Boston, MA 08/19/2014 (wallstreetpr) – Homebuilder Confidence figure in the US rose to seven-month high in the month of August. What does it indicate for Standard Pacific Corp. (NYSE:SPF) and the other builders? The homebuilder confidence came at 55 from 53 in July. It came above the analyst’s estimates of 53. The readings above 50 indicate that the conditions in the home market are improving. The industry is growing compared to the earlier weakness at the start of this year.
The low mortgage rates and the higher rate of employment are adding up to the purchasing power of consumers. They can go for home purchases. The improvement in the wage gains will lead to higher growth in the industry. Initially, the industry was finding it tough to attract the customers as they were not ready to comply with the tough credit conditions. But the change in the job market can force them to accept the stringent conditions and move ahead with their home purchases. The US economy added almost 200,000 jobs in the month of July. It was the sixth consecutive month of jobs growth.
Builders are continuously facing the challenges posed by tight credit conditions for home buyers. There is also the shortage of labor. The builder confidence came higher in the Midwest at 65. It was a 13-point jump and the biggest gain since record started in 2004. Confidence sentiment improved in the Northeast too. However, it saw a decline in the other two regions including the South and West.
Scott Stowell, President and the CEO at Standard Pacific Corp. (NYSE:SPF) said that the housing data is a mix of good and bad. Still, the demographic and economic fundamentals remain strong. The fundamentals are expected to stay strong in the near future. The housing recovery is not fast and even, but still it is real. The outlook for the industry remains cautious to positive. The moderate price appreciation and the enhanced capacity to buy is the positive sign for Standard Pacific and the industry.