Home Builder sentiment weaker than expected

The National Association of Home Builders' housing market index was weaker than expected, falling to 13 in August from 14 in July. The current single-family new home sales index declined to 14 from 15, while the six-month sales outlook index fell to 18 from 21. Prospective buyer traffic was unchanged at 10 in August.

BOTTOM LINE

The survey noted that weaker homebuilder confidence reflected concerns about the overall economy and the labor market along with problems related to "inaccurate appraisals, competition from the large number of distressed properties on the market [87 percent of respondents reported that their market has been negatively impacted by foreclosures], and tight consumer lending conditions."  In our opinion, it will take ten years to cure the slack to the point where there is large scale home building again

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