US homebuilders' confidence rose to a three-month high in February indicating returning stabilization in the troubled sector, National Association of Home Builders/Wells Fargo index of builder confidence indicated on Tuesday.

The index grew to 17 as compared to 15 in the previous month. Though the index beat expectations, it's still much below a level that can be called not poor. A reading below 50 is considered poor.

Despite the expectations that the builders have to deal with rising foreclosures and high unemployment rate dampening their spirit, extension of a homebuyer credit by the government is certainly something that gave a boost to homebuilders' confidence.

The survey for the index asks builders to categorize their sales at present into three groups, good, fair and poor. Respondents also are asked to evaluate their outlook for a period of six months.

Meanwhile, a report by Realty Trac Inc. suggested that the country would see repossession of nearly three million houses by lenders in the current year as joblessness continue to make house owners default in repayment of their charges and low values restrict them from selling the properties off.