Confidence among home builders ended a four month slide this month as falling mortgage rates led to a rise in buyer traffic and an overall improvement in builder sentiment. The National Association of Home Builders (NAHB) Housing Market Index rose three points to 37, and while this is still in contraction territory below the key breakeven level of 50, the reversal marks a positive sign heading into next year. 

In terms of the index components, current sales conditions held steady at 40, while future sales expectations increased six points to 45 and buyer traffic rose three points to 24.    

What’s the bottom line? NAHB Chief Economist Robert Dietz noted that, “The housing market appears to have passed peak mortgage rates for this cycle.” Plus, there was additional good news for buyers, as more builders (36%) reported cutting prices, matching November’s level for the highest percentage in a year.