U.S. home builders in August were at their most optimistic since January 2000 as consumers looked to buy homes before mortgage rates rose even further, a report said Monday.
The National Association of Home Builders' housing market index, a measure of builder sentiment about sales and buyer traffic, rose to 71 in August from an upwardly revised 65 in July.
"Buyers appear to be motivated to make a purchase now, while [interest] rates remain near historic lows," NAHB President Kent Conine said in a statement.
Strong demand has come even as the rate on the most popular home loan in the United States, the 30-year mortgage, has risen to 6.24 percent from 5.21 percent in mid-June, according to Freddie Mac.
Mark Vitner, a senior economist at Wachovia Securities in Charlotte, N.C., says that rising rates will have little impact on home sales and economists say the signs of economic improvement that are pushing rates higher are also helping stoke demand for housing.
Housing sales should stay strong for at least the next several months because applications for mortgages to buy homes still are close to record levels, according to data from the Mortgage Bankers Association of America.
Source: Reuters