Home builders are shooting higher this morning after the National Association of Home Builders said that its gauge of sentiment among builders rose 4 points to 25 in January, the highest level since 2007. It’s still well below “normal” levels (a 50 reading is considered breakeven), but high enough to give a jolt to stocks in the industry. Hovnanian (HOV), for instance, was recently up 9.8%.
�Builder confidence has now risen four months in a row, with the latest uptick being universally represented across every index component and region,� noted Bob Nielsen, chairman of the NAHB and a home builder from Reno, Nevada. �This good news comes on the heels of several months of gains in single-family housing starts and sales, and is yet another indication of the gradual but steady improvement that is beginning to take hold in an increasing number of housing markets nationwide — and that has been shown by our Improving Markets Index. Policymakers must now take every precaution to avoid derailing this nascent recovery.�
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