US builder outlook for home buying has been stuck at dismal level for 6 of the past 7 months
Derek Kravitz, AP Real Estate Writer, On Monday May 16, 2011, 10:21 am
WASHINGTON (AP) -- U.S. homebuilders are concerned that the struggling housing market won't recover this year and some feel it may be getting worse. Builders' outlook for the industry in May was unchanged at 16, the National Association of Home Builders said Monday. It has been at that level for six of the past seven months. Any reading below 50 indicates negative sentiment about the market.
The index hasn't been above that level since April 2006. When asked about where they see sales of single-family home heading over the next six months, the builders offered their most pessimistic outlook since September. Last year was the worst in more than a decade for sales of previously owned homes and the worst for new-home sales in nearly a half-century. Fewer homes mean fewer jobs. Each new home built creates an average of three jobs for a year and generates about $90,000 in taxes, according to the builders' trade group.
The trade group cited a handful of factors weighing on the housing market. Some were familiar -- tighter lending standards, high unemployment and an increase in the number of homes sold at foreclosure. But the builders' group also noted that higher gas prices were creating "consumer anxiety and reluctance to go forward with a home purchase," said the group's chairman, Reno, Nev., home builder Bob Nielsen.
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