The National Association of Home Builders/Wells Fargo builder sentiment index released Monday was unchanged at 58. It hasn’t budged in three months.
Readings above 50 indicate more builders view sales conditions as good, rather than poor. The index had been in the low 60s for eight months until February.
Builders’ outlook for sales over the next six months and a measure of traffic by prospective buyers edged higher. But builders’ view of current sales conditions fell.
Still, builders remain cautiously optimistic about home construction growth this year, said Robert Dietz, the NAHB’s chief economist.
“Solid job creation and low mortgage interest rates will sustain continued gains in the single-family housing market in the months ahead,” he said.
The latest readings come amid the annual spring buying season, which typically sets the pattern for residential hiring and construction for much of the rest of the year.
So far, the U.S. housing market looks more tempered after strong growth in 2015, with sales in the first two months of 2016 running below last year’s pace. A limited supply of houses have pushed up prices and curbed sales.
New-home sales rose 2 percent in February to a seasonally adjusted annual rate of 512,000 after slumping 9.2 percent in January. March sales data are due out next week.
Home construction has been uneven this year. It declined in January but rebounded in February to a seasonally adjusted annual rate of 1.18 million units, the highest level in five months. Still, applications for new construction were weak for a third month in a row.
This month’s builder index was based on 320 respondents.
Builders’ view of sales over the next six months rose one point to 62, while their gauge of traffic by prospective buyers rose one point to 44. A measure of current sales conditions for single-family homes fell two points to 63.
Though new homes represent only a fraction of the housing market, they have an outsized impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to NAHB data.