confidence in September hit a new high for 2016, in fact it’s at its
highest since October last year, according to the most recent Housing Market
Index (HMI) released by the National Association of Home Builders (NAHB) and
Wells Fargo. The HMI increased six points to 65 in September,
up from August’s downward-revised 59.
from a monthly survey that NAHB has been conducting for 30 years, the
NAHB/Wells Fargo HMI categorizes builder perceptions of current single-family
home sales and sales expectations for the next six months as good, fair or
survey also asks builders to rate traffic of prospective buyers as high to very
high, average or low to very low. Scores for each component are then used to
calculate a seasonally adjusted index where any number over 50 indicates that
more builders view conditions as good than poor.
market continues to make gradual gains and they expect this upward momentum
will build throughout the remainder of the year and into 2017 the report states.
to new data from the U.S. Census Bureau, household income
posted its first significant increase in eight years.
the inventory of new and existing homes remaining tight, builders are confident
that if they can build more homes they can sell them. Though solid job creation
and low interest rates are also fueling demand, builders continue to be
hampered by supply-side constraints that include shortages of labor and lots.
three HMI components moved higher in September. The component that measures
current sales expectations rose six points to 71 while the component measuring
sales expectations in the next six months increase five points to 71. The index
measuring traffic of prospective buyers also increased by four points to 48.
HMI did not decrease in any region of the U.S. The Northeast and South
increased one point each to 42 and 64 respectively, and the West increased four
points to 73. The Midwest remained unchanged at 55.
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