The National Association of Home Builders/Wells Fargo Housing Market Index of confidence index rose to 84 in December from 83 in November. December marks the highest level of the year, along with February.
December marks the fourth consecutive month of increase, on the back of strong consumer demand, tight inventory and increasing home prices.
The U.S. inventory of active home listings fell -26% in the 12 months through November, over last year, according to Realtor.com.
“Building has increased, but the industry faces constraints, namely cost/availability of materials, labor and lots,” NAHB Chief Economist Robert Dietz said.