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News Sept. 23, 2020

Homebuilder sentiment jumps to record high

Builder sentiment increased five points in September to a record high of 83, according to cnbc.com. Any reading above 50 indicates a positive market; the National Association of Home Builders/Wells Fargo Housing Market Index had plunged to 30 in April.

Of the homebuilder index’s three components, current sales conditions rose four points to 88; sales expectations in the next six months increased six points to 84; and buyer traffic rose nine points to 73.

“The suburban shift for home building is keeping builders busy, supported on the demand side by low interest rates,” said NAHB Chief Economist Robert Dietz. “In another sign of this growing trend, builders in other parts of the country have reported receiving calls from customers in high-density markets asking about relocating.”

Although housing demand is strong, builders continue to be affected by a lack of skilled labor. The fast-rising prices for lumber resulting from the COVID-19 crisis and the wildfires in the West have added another challenge.

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