UPTREND IN BUILDER CONFIDENCE CONTINUES

Buoyed by improved buyer demand, the confidence level of the nation's home builders continued its slow but steady climb in January, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).

The seasonally adjusted HMI stands at 35 this month, up two points from December and at its highest level since July 2006. An HMI below 50 indicates more builders view sales conditions as poor versus good."The same factors that were evident at the end of 2006 continue to hold true in today's housing market â€" improving affordability measures, strengthening consumer assessments of home buying conditions and an upswing in applications for mortgages to buy homes," said NAHB Chief Economist David Seiders.

"Builders are starting to see that the worst is behind them and that buying conditions have improved to the point that greater optimism is warranted."Two of the three HMI components increased this month.

The components measuring current sales of single-family homes and buyer traffic each gained three points to 36 and 26, respectively, while the component gauging sales expectations remained unchanged at 49. Builder confidence improved or remained unchanged across the country in January, according to the report.

**Taken from the California Association of Realtors Bulletin, dated January 17th, 2007.