Builders' confidence in the market for new single-family homes grew as the National Association of Home Builders' housing market index — a monthly gauge of builder sentiment — climbed to 58 in November from 54 in October.
Thomson Reuters' poll of economists predicted the index would be 55.
"Growing confidence among consumers is what's fueling this optimism among builders," NAHB Chairman Kevin Kelly said. "Members in many areas of the country continue to see increasing buyer traffic and signed contracts."
"Low interest rates, affordable home prices and solid job creation are contributing to a steady housing recovery," according to NAHB Chief Economist David Crowe. "After a slow start to the year, the HMI has remained above the 50-point benchmark for five consecutive months, and we expect the momentum to continue into 2015."
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 gained to 62 from 57, the sales expectations index for the next six months climbed to 66 from 64; and the traffic of prospective buyers index rose to 45 from 41.
