Builders’ confidence in the market for new single-family homes increased as the National Association of Home Builders' housing market index climbed to 70 in November from an unrevised 68 in October.
IFR's poll of economists predicted the index would be 68.
“November’s builder confidence reading is close to a post-recession high — a strong indicator that the housing market continues to grow steadily,” NAHB Chairman Granger MacDonald said. “However, our members still face supply-side constraints, such as lot and labor shortages and ongoing building material price increases.”
“Demand for housing is increasing at a consistent pace, driven by job and economic growth, rising homeownership rates and limited housing inventory,” according to NAHB Chief Economist Robert Dietz. “With these economic fundamentals in place, we should see continued upward movement of the single-family housing market as we close out 2017.”
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 grew to 77 from 75, the sales expectations index for the next six months dipped to 77 from 78; and the traffic of prospective buyers index crept to 50 from 48.