LOS ANGELES (AP) — Confidence among U.S. homebuilders rose this month to its highest level in six and a half years, driven by strong demand for newly built homes and growing optimism that the housing recovery will strengthen next year.

The National Association of Home Builders/Wells Fargo builder sentiment index increased to 46, up from 41 in October. That's the highest reading since May 2006, just before the housing bubble burst.

Readings below 50 suggest negative sentiment about the housing market. The index last reached that level in April 2006. Still it has been trending higher since October 2011, when it stood at 17.

A measure of current sales conditions rose this month by 8 points to 49, the highest level since May 2006.

The survey is based on responses from 417 builders.