The construction industry continues to show signs of an economic recovery. Builder confidence in the market for new single-family homes declined only slightly this month, according to the National Association of Home Builders’ (NAHB) Housing Market Index (HMI). The index declined one point to 62, its second-highest reading all year.

The HMI is derived from a monthly survey of builders conducted by NAHB. Home builders are asked to rate current sales of single-family homes and sales expectations for the next six months as “good,” fair,” or “poor.” They are also asked to rate traffic of prospective buyers as either “high to very high,” “average,” or “low to very low.” Scores for responses to each component are used to arrive at a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.

“On the strength of continuing low mortgage rates and sound house-price performance, builders still have a very good outlook on the current marketplace,” says Gary Garczynski, NAHB president. “Buyer demand remains strong at the present time, though builders are moderating their expectations for future sales and noting slower traffic of prospective buyers.”