Homebuilder Confidence Best Since May 2010

[Purveyor]

Confidence among U.S. homebuilders unexpectedly climbed in November to the highest level since May 2010, a sign the outlook for construction may be stabilizing.

The National Association of Home Builders/Wells Fargo index of builder confidence rose to 20 from a revised 17 in October that was a point lower than first reported, the Washington-based group said today. Economists projected an index of 18, according to the median forecast in a Bloomberg News survey. Readings below 50 mean more respondents said conditions were poor.

Borrowing costs near a record low and efforts by the Federal Reserve to spur demand may be starting to bear fruit. At the same time, the prospect of more foreclosed properties returning to the market and competing with new construction means a sustained rebound in housing may be years away.

“The trends are pretty flat but not getting worse, so builders may be less depressed,” Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida, said before the report. “We expect there will be some marginal improvement at best, helped by lower mortgage rates.”

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http://www.bloomberg.com/news/2011-11-16/homebuilder-confidence-best-since-may-2010.html