Builder confidence in the market for newly built, single-family homes rose one point to 47 in April from a downwardly revised March reading of 46 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).

"Builder confidence has been in a holding pattern the past three months," said Kevin Kelly, NAHB chairman , a home builder and developer from Wilmington, Del. "Looking ahead, as the spring home buying season gets into full swing and demand increases, builders are expecting sales prospects to improve in the months ahead." 

"Job growth is proceeding at a solid pace, mortgage interest rates remain historically low and home prices are affordable," said David Crowe, NAHB chief economist . "While these factors point to a gradual improvement in housing demand, headwinds that are holding up a more robust recovery include ongoing tight credit conditions for home buyers and  the fact that builders in many markets are facing a limited availability of lots and labor." 

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores from each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

The HMI index gauging current sales conditions in April held steady at 51 while the component gauging traffic of prospective buyers was also unchanged at 32. The component measuring expectations for future sales rose four points to 57.

The HMI three-month moving average was down in all four regions. The West fell nine points to 51 and the Midwest posted a four-point decline to 49 while the Northeast and South each dropped two points to 33 and 47, respectively.

HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.