The NAHB/Wells Fargo Housing Market index passed the tipping point of 50 in June to top out at 52, the highest level since April 2006 and the largest monthly increase since 2002. The renewed confidence was spread across all three components, with the expectation for the next 6 months rising to 61, the highest in seven years.

 
The index compares the share of builders who believe the market is better with those who believe it is poor. The index flipping over 50 means builders seeing a better market outnumber those judging it as poor. In the 29 years of the HMI, it has been at 50 or more 58 percent of the time but for never longer than three years until this most recent seven year run below 50.

 
The causes are several. Builders are seeing more serious buyers, some coming from the existing home market because that…