The Double Dip in Builder Confidence is Here

The NAHB reported its December housing market index, which came in at 15, missing expectations of a rebound from November's reading of 16, and is now at the low levels last seen in June. The double dip, at least in perceptions of what is happening to the housing market is here, and follows the recent housing starts inflection point.

Additionally, builder confidence for current sales also slipped by a point to 15, even as optimism for sales in the next 6 months held at 26. Lastly, the measure of traffic from prospective buyers declined one point to 12, the lowest level since the market bottom in March 2009.

NAHB Chief Economist David Crowe tried to bring some glimmer of hope to the most recent downward inflection point:

Home buying conditions have rarely been as good as they are right now, but consumers are still waiting to see significant positive signs of improvement in employment and confidence, and this is slowing buyers' return to the market.

A way to visualize hope is the ratio of future expectations by the present.

As a reminder: from the NAHB, any reading below 50 demonstrates that more builders view sales conditions as poor... They should just wait until the Fed ends the MBS portion of QE and mortgage rates start their inevitable track higher.