by Bill McBride on 4/17/2017 10:05:00 AM
Monday, April 17, 2017
The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 68 in April, down from 71 in March. Any number above 50 indicates that more builders view sales conditions as good than poor.
From NAHB: Builder Confidence Holds Firm in April
Builder confidence in the market for newly-built single-family homes remained solid in April, falling three points to a level of 68 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) after an unusually high March reading.Click on graph for larger image.
“Even with this month’s modest drop, builder confidence is on very firm ground, and builders are reporting strong interest among potential home buyers,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas.
“The fact that the HMI measure of current sales conditions has been over 70 for five consecutive months shows that there is continued demand for new construction,” said NAHB Chief Economist Robert Dietz. “However, builders are facing several challenges, such as hefty regulatory costs and ongoing increases in building material prices."
All three HMI components posted losses in April but remain at healthy levels. The components gauging current sales conditions fell three points to 74 while the index charting sales expectations in the next six months dropped three points to 75. Meanwhile, the component measuring buyer traffic edged one point down to 52.
Looking at the three-month moving averages for regional HMI scores, the West and Midwest both rose one point to 77 and 68, respectively. The South held steady at 68, and the Northeast fell two points to 46.
This graph show the NAHB index since Jan 1985.
This was slightly below the consensus forecast but still a solid reading.