Builder Confidence Is Up, But Home Construction Numbers Are Down

The NAHB home builder confidence index is at its highest level in 11 years, but home construction plunged 19 percent last month.

CNBC found that the results are not mutually exclusive. Builders say that they have kept a positive mindset since the recession, and that the NAHB survey is skewed toward smaller builders and accounts for expected sales, not actual sales.

Bottom line, there is high demand for housing and very low supply of homes for sale. That makes builders confident. … So why aren't builders building more houses? Basic stuff: They are hamstrung by new regulations which are costing them up to a quarter of the price of a new home. They are facing a huge labor shortage and have been for a while.

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