Today, the National Association of Home Builders (NAHB) released its latest Housing Market Index (HMI). It showed that assessments of housing activity declined in April, with the composite HMI index falling to 42 and the "buyer traffic" index declining to 30. It's important to note that April continued to show a generally weakening trend, a development that is worth noting as the new-home market moves through it's most active months at the start of the year (see Bob Tolls' explanation for January -- early spring is the new-home markets' most active period annually).
While all indicators have made truly spectacular improvements this year, it's important to note that conditions still remain fairly distressed by historic standards. Although, looking at the data, it is fairly clear that the last few months of results indicate a major change in builder sentiment. That's likely coming as a result of improvements in confidence given the notable rise in buyer traffic, reduced inventory, and a more balanced monthly supply.