Tuesday, December 17, 2013

NAHB: Builder Confidence increases to 58 in December

by Calculated Risk on 12/17/2013 10:00:00 AM

The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 58 in December, up from 54 in November. Any number above 50 indicates that more builders view sales conditions as good than poor.

From the NAHB: Builder Confidence Rises Four Points in December

Builder confidence in the market for newly built, single-family homes improved four points to a 58 reading on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for December, released today. This gain reflected improvement in all three index components – current sales conditions, sales expectations and traffic of prospective buyers.
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All three HMI components posted gains in December. The index gauging current sales conditions jumped six points to 64, while the index gauging expectations for future sales rose two points to 62. The index gauging traffic of prospective buyers gained three points to 44.

Looking at the three-month moving averages for regional HMI scores, the South edged one point higher to 57 while the Northeast, Midwest and West each fell a single point to 38, 59 and 59, respectively.
emphasis added
HMI and Starts Correlation Click on graph for larger image.

This graph show the NAHB index since Jan 1985.
“This is definitely an encouraging sign as we move into 2014,” said National Association of Home Builders (NAHB) Chairman Rick Judson, a home builder from Charlotte, N.C. “The HMI is up 11 points since December of 2012 and has been above 50 for the past seven months. This indicates that an increasing number of builders have a positive view on where the industry is going.”