There appears to be good reason that home builders’ confidence in the single-family, new-home market rose in August for the fourth consecutive month and is at its highest level since February 2007. A variety of indicators all point to better times ahead.

Among them was July’s housing starts rate, which at 746,000 is 21.5% above where it was a year earlier. Building permit numbers also are up, and sales of homes in July were at a two-year high.

Meanwhile, business conditions—especially home values—finally seem to be stabilizing, so some larger companies are expanding. Among them was last month’s announcement by D.R. Horton, America’s biggest home builder, to acquire Huntsville, Ala.-based Breland Homes, the No. 38 biggest builder according to the Builder 100.

A survey of home builders by Ernst & Young found nearly 85% anticipating that their companies will either break even or do better this year. That’s compared with 71% who said the same last year and 52% who made the same prediction in 2010. Nearly 95% made the hopeful prediction for 2013.

The expectations for boosted balance sheets come largely from forecasts for price improvements: 58% of respondents predicted that new-home prices will rise over the coming 24 months, and nearly 16% anticipated the gains would exceed 3%.

Recent earnings reports buttress that optimism. Beacon Roofing Supply said net income for its fiscal third quarter ended June 30 rose 5% from the year-earlier quarter. Net sales grew 4% to $560.5 million, a third-quarter record at the company. Income from operations increased 19% to $51.3 million.

Among manufacturers, Advanced Environmental Recycling Technologies of Springdale, Ark., swung to a $1.2 million net gain in the second quarter from a $308,000 loss a year ago, on a 33% jump in sales. Likewise, American Woodmark moved back into the black, posting a first-quarter gain of $1 million to recover from a $2.7 million loss a year ago.

Masonite fell deeper into the red last quarter despite a 14% jump in sales, but Ply Gem doubled its bottom line from a year ago to post a $5.2 million gain in the second quarter as sales rose 4.3% to $307 million for the same period.