The lack of certainty over the budget impasse affected homebuilders across the country. The recent government shutdown in October caused homebuilders in the U.S. to lose confidence in the housing market overall and forced some homebuilders in Arizona to take a step back to evaluate their next step. According to the National Association of Home Builders, the builder sentiment index dropped by two points to 55 in October thus far. This followed a slightly higher reading in September of 58. This index measures the current sales conditions for different areas across the country. Nationally, the outlook for the six months to come was slightly lower than the September reading.
However, Phoenix has experienced a strong recovery in all areas of the housing market and builders in the area do not believe there will be a significant drop in both homebuilding as well as home purchases in the Phoenix area.
The partial government shutdown is viewed as the reason behind the decrease in confidence in October. Homebuyers and sellers have expressed apprehension that this shutdown could decrease the recovery process in Phoenix home sales. Without access to verification sources, some buyers have been forced to wait a longer period of time for mortgage approval. Thankfully, the recent termination of the government shutdown should allay fears for consumers in the housing market.
Builders remain optimistic that the housing recovery on the Phoenix market will continue to increase. Any reading of the builders index above 50 is seen as a good rather than poor in the current conditions.