Builder confidence is high despite slight weakening in a morale index maintained monthly by the National Association of Home Builders (NAHB).

The Home Builders/Wells Fargo Housing Market Index, or HMI, dipped just a bit after revision in May from a numerical rating of 69 to a rating of 67. But the NAHB insists the revised figure still reflects a strengthening market and overall great confidence among builders.

“Builder confidence levels have remained consistently sound this year, reflecting the ongoing gradual recovery of the housing market,” said NAHB Chairman Granger MacDonald, a Texas home builder and developer.

Builder confidence is high despite slight weakening in a morale index maintained monthly by the National Association of Home Builders (NAHB)

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The confidence rating – and overall indications of a housing marketing continuing to strengthen – are also reflected in reports issued just last week of overall rising wages in managerial positions is the housing industry.

“As the housing market strengthens and more buyers enter the market, builders continue to express their frustration over an ongoing shortage of skilled labor and buildable lots that is impeding stronger growth in the single-family sector,” said NAHB Chief Economist Robert Dietz.

The NAHB has conducted its monthly surveys for three decades. It gauges builder perceptions of single-family home sales and sales expectations for the upcoming six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor. The current rating of 67 is clearly well above the 50 mark.

But the NAHB also issued a cautionary note.

“All three HMI components posted losses in June but remain at healthy levels,” it said. “The components gauging current sales conditions fell two points to 73 while the index charting sales expectations in the next six months dropped two points to 76. Meanwhile, the component measuring buyer traffic also moved down two points to 49.”

The NAHB collects and publishes a wide range of housing and market statistics and references at its Housing Economics site.