NAHB Housing Index Slumps to 14 in July

Confidence among home builders fell back to its lowest level in more than a year, as the National Association of Home Builders’ housing market index — a monthly gauge of builder sentiment — dropped to 14 in July, the group announced Monday.

Thomson Reuters’ poll of economists predicted a decrease to 16 for July. The June confidence level was revised down to 16 after earlier being reported as 17.

Derived from a monthly survey, the NAHB/Wells Fargo HMI gauges builder perceptions of the current market for sales of new single-family home and their expectations for the next six months as either “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as either “high to very high,” “average” or “low to very low.” Scores for each component are used to calculate a seasonally adjusted index in which numbers over 50 indicate that more builders view sales conditions as good than poor.

All three component indexes fell in July. The current single-family home sales index slumped to 15 from 17 and the sales expectations index for the next six months dropped to 21 from 22. The traffic of prospective buyers index slid to 10 from 13.

For reprint and licensing requests for this article, click here.
MORE FROM BOND BUYER