U.S. Homebuilder Confidence Unexpectedly Edges Lower In February

Homebuilder confidence in the U.S. has unexpectedly edged lower in the month of February, according to a report released by the National Association of Home Builders on Wednesday.

The report showed the NAHB/Wells Fargo Housing Market Index slipped to 82 in February from 83 in January, while economists had expected the index to come in unchanged.

The NAHB said the unexpected dip in homebuilder confidence came as ongoing building material production bottlenecks are raising construction costs and delaying projects.

“Production disruptions are so severe that many builders are waiting months to receive cabinets, garage doors, countertops and appliances,” said NAHB Chairman Jerry Konter.

“These delivery delays are raising construction costs and pricing prospective buyers out of the market,” he added. “Policymakers must make it a priority to address supply chain issues that are harming housing affordability.”

The unexpected drop by the headline index came as the component charting traffic of prospective buyers tumbled to 65 in February from 69 in January.

The gauge measuring sales expectations in the next six months also fell to 80 in February from 82 in January, while the index gauging current sales conditions inched up to 90 from 89.

On Thursday, the Commerce Department is scheduled to release a separate report on new residential construction in the month of January.

Housing starts are expected to edge down by 0.1 percent to an annual rate of 1.70 million, while building permits are expected to plunge 6.6 percent to an annual rate of 1.76 million.

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