Home builder confidence can’t shake its range, according to the National Association of Home Builders. The group’s monthly Housing Market Index put May’s builder confidence reading at a level of 16.
The Housing Market Index is scored on a scale of 1-100. A reading above 50 suggests favorable conditions for the new home housing market, as reported by home builders. A reading below 50 suggests unfavorable conditions.
May marks the sixth time in 7 months that the HMI posted a 16, the longest such plateau in the index’s history.
Those are national numbers, locally I’m definately seeing a pickup in new home purchases and clients asking about construction loans. What I’m hearing is that existing construction is picked over and a lot of what’s out there is crap.
I think this creates two opportunities for buyers.
First, new construction buyers can often buy below appraised value today and have a brand new home just the way they want it. Lots and cost to build have come WAY down.
Second, if clients are willing to remodel, the FHA 203k or Energy Efficient Mortgage can offer up to $43k in renovation money to make that bank owned beater like new.
Both are good plays and offer great opportunities for buyers. Let’s not forget that interest rates just ticked down to their lowest levels of the year. Conforming mortgage rates in Utah have fallen 5 weeks in a row!
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