HMI Archives

Builders Expect Stronger New Home Market

The new home market is particularly important to the health of the overall housing market. That’s because any improvement in the number of new homes being built helps inventory levels, which also helps moderate prices and balance supply and demand. Currently, buyer demand is high and the number of homes available for sale is low. So now is a good time to keep an eye on what’s happening in the market for newly built homes. One good indicator of where the market stands is the National Association of Home Builders Housing Market Index. The survey asks builders for their perspective on current sales levels, buyer traffic, and the outlook for the next six months. The results are scored so that any number above 50 indicates more builders view conditions as good than poor. In June, the index rose two points to 60 – the highest reading since January. Robert Dietz, NAHB’s chief economist, says there are a number of indications that the housing market will improve during the second half of this year. “Rising home sales, an improving economy, and the fact that the HMI gauge measuring future sales expectations is running at an eight-month high are all positive factors indicating that the housing market should continue to move forward in the second half of 2016,” Dietz said. More here.

Baby Boomer Buyers Are On The Move

There’s been plenty of talk about the fact that there are fewer young Americans buying homes over the past few years. On the flip side, however, the market for new homes among buyers 55 and older has remained strong and continues to improve. In fact, the National Association of Home Builders 55+ Housing Market Index – which measures builders’ perceptions of the market among older buyers – has now seen seven consecutive quarters of positive readings. David Crowe, NAHB’s chief economist, says those gains will likely continue. “This quarter’s 55+ HMI is in line with our forecast for the overall housing market, which shows a gradual, steady recovery,” Crowe said. “In addition, the 55+ housing market is benefitting from growing home equity on the balance sheets of 55+ households, an improving economic outlook, historically low mortgage rates and a growing population as baby boomers age.” In other words, there are an increasing number of baby boomer households that have seen their current home’s value rise and are looking to capitalize on the equity they’ve gained by shopping for a new house that fits better with their needs and lifestyle. With affordability conditions still favorable across much of the country, builders expect to see many older buyers active in the market in the coming months. More here.

Builder Confidence Steady To Start The Year

The National Association of Home Builders’ Housing Market Index is a measure of how confident builders are in the market for newly built single-family homes. Conducted for the past 30 years, the survey is an important indicator for residential real estate due to the fact that more new homes being built is good – not only for the broader economy – but also for the entire housing market, as it helps moderate home-price increases in markets where for-sale inventory is low. According to the most recent results, builder confidence held steady in January from the month before, registering a reading of 60. The index is scored so that any number above 50 indicates more builders view conditions as good than poor. David Crowe, NAHB’s chief economist, said the results are in line with the group’s forecast for the year. “January’s HMI reading is right in line with our forecast of modest growth for housing,” Crowe said. “The economic outlook remains promising, as consumers regain confidence and home values increase, which will help the housing market move forward.” Also in the release, the gauge measuring current sales conditions led all index components, rising two points to 67. More here.

Builders Confident In New Home Market

The National Association of Home Builders’ Housing Market Index is a gauge of how builders see the current market for newly built single-family homes. The index is scored so that any number above 50 indicates more builders view conditions as good than poor. In October, the HMI rose three points to 64, which matches levels last seen at the end of the housing boom in 2005. David Crowe, NAHB’s chief economist, says the improvement is further proof that the housing market is strengthening. “With October’s three-point uptick, builder confidence has been holding steady or increasing for five straight months,” Crowe said. “This upward momentum shows that our industry is strengthening at a gradual but consistent pace. With firm job creation, economic growth, and the release of pent-up demand, we expect housing to keep moving forward as we start to close out 2015.” In fact, builders are particularly optimistic about the market going forward. Among the three individual index components measuring sales expectations for the next six months, current condition, and buyer traffic, expectations for future sales saw the biggest increase, moving up seven points to 75. The component measuring current sales conditions jumped three points to 70, while buyer traffic was unchanged from the month before at 47. More here.