WASHINGTON – Nov. 19, 2013 – Builders remain confident in the new single-family home market. The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) was unchanged in November from a downwardly revised level of 54 last month.
Any HMI number over 50 represents more optimism than pessimism, and the score has topped 50 for the sixth consecutive month.
“Given the current interest rate and pricing environment, consumers continue to show interest in purchasing new homes,” says NAHB Chairman Rick Judson. However, he says some potential homebuyers continue to hold back “because Congress keeps pushing critical decisions on budget, tax and government spending issues down the road. Meanwhile, builders continue to face challenges related to rising construction costs and low appraisals.”
“Policy and economic uncertainty is undermining consumer confidence,” says NAHB Chief Economist David Crowe. “The fact that builder confidence remains above 50 is an encouraging sign, considering the (fact that) unresolved debt and federal budget issues cause builders and consumers to remain on the sideline.”
The HMI index gauging current sales conditions in November held steady at 58. The component measuring expectations for future sales fell one point to 60, and the component gauging traffic of prospective buyers dropped one point to 42.
The HMI three-month moving average was mixed in the four regions. No movement was recorded in the South or West, which held unchanged at 56 and 60, respectively. The Northeast recorded a one-point gain to 39 and the Midwest fell three points to 60.
The NAHB/Wells Fargo Housing Market Index conducts a monthly survey to gauge builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores from 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.
© 2013 Florida Realtors®