by Bill McBride on 7/18/2016 10:18:00 AM
Monday, July 18, 2016
The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 59 in July, down from 60 in June. Any number above 50 indicates that more builders view sales conditions as good than poor.
From the NAHB: Builder Confidence Holds Firm in July
Builder confidence in the market for newly built, single-family homes in July fell one point to 59 from a June reading of 60 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released today.Click on graph for larger image.
“For the past six months, builder confidence has remained in a relatively narrow positive range that is consistent with the ongoing gradual housing recovery that is underway,” said NAHB Chairman Ed Brady, a home builder and developer from Bloomington, Ill. “However, we are still hearing reports from our members of scattered softness in some markets, due largely to regulatory constraints and shortages of lots and labor.”
“The economic fundamentals are in place for continued slow, steady growth in the housing market,” said NAHB Chief Economist Robert Dietz. “Job creation is solid, mortgage rates are at historic lows and household formations are rising. These factors should help to bring more buyers into the market as the year progresses.”
All three HMI components edged lower in July. The components measuring current sales expectations and buyer traffic each fell one point to 63 and 45, respectively. The index measuring sales expectations in the next six months posted a three-point decline to 66.
The three-month moving averages for regional HMI scores held remarkably steady. The Northeast, Midwest and South were unchanged at 39, 57 and 61, respectively. The West edged one point higher to 69.
This graph show the NAHB index since Jan 1985.
This was below the consensus forecast of 61, however this is still a solid reading.