Builders’ confidence in the market for new single-family homes was higher as the National Association of Home Builders' housing market index rose to 64 in September from 61 in September.
Thomson Reuters' poll of economists predicted the index would be 62.
“This month’s reading is a return to HMI levels seen at the end of the housing boom in late 2005,” according to a press release from NAHB.
“The fact that builder confidence has held in the 60s since June is proof that the single-family housing market is making lasting gains as more serious buyers come forward,”,” NAHB Chairman Tom Woods said. “However, our members continue to tell us there are still pockets of softness in some markets across the nation, and that they face challenges regarding the availability of lots and labor.”
“With October’s three-point uptick, builder confidence has been holding steady or increasing for five straight months. This upward momentum shows that our industry is strengthening at a gradual but consistent pace,” according to NAHB Chief Economist David Crowe. “With October’s three-point uptick, builder confidence has been holding steady or increasing for five straight months. This upward momentum shows that our industry is strengthening at a gradual but consistent pace.”
Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales 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 then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
The current single-family home sales index increased to 70 from 67, the sales expectations index for the next six months surged to 75 from 68; and the traffic of prospective buyers index remained at 47.
