Tuesday, February 17, 2015

NAHB: Builder Confidence decreased to 55 in February

by Bill McBride on 2/17/2015 10:05:00 AM

The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 55 in February, down from 57 in January. Any number above 50 indicates that more builders view sales conditions as good than poor.

From Reuters: Builder Confidence Slightly Lower in February on Harsh Weather Conditions

Builder confidence in the market for newly built, single-family homes in February fell two points to a level of 55 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released today.

Overall, builder sentiment remains fairly solid, with this slight downturn largely attributable to the unusually high snow levels across much of the nation,” said NAHB Chairman Tom Woods, a home builder from Blue Springs, Mo.

“For the past eight months, confidence levels have held in the mid- to upper 50s range, which is consistent with a modest, ongoing recovery,” said NAHB Chief Economist David Crowe. “Solid job growth, affordable home prices and historically low mortgage rates should help unleash growing pent-up demand and keep the housing market moving forward in the year ahead.”

Two of the three HMI components posted losses in February. The component gauging current sales conditions edged one point lower to 61 while the component measuring buyer traffic fell five points to 39. The gauge charting sales expectations in the next six months held steady at 60.
emphasis added
HMI and Starts Correlation Click on graph for larger image.

This graph show the NAHB index since Jan 1985.

This was below the consensus forecast of 58.