Builder Confidence Remains Solid in October
Builder confidence in the market remained on firm ground in October 2016.
Builder confidence in the market for newly constructed single-family homes remained on firm ground in October 2016, down two points to a level of 63 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).
“Even with this month’s drop, builder confidence stands at its second-highest level in 2016, a sign that the housing recovery continues to make solid progress,” said Ed Brady, NAHB chairman. “However, builders in many markets continue to express concerns about shortages of lots and labor.”
“The October reading represents a mild pullback from a jump in September, and indicates that the housing market continues to make slow and steady gains,” said Robert Dietz, NAHB chief economist. “Moreover, mortgage rates remain low, and the HMI index measuring future sales expectations has been over 70 for the past two months. These factors will sustain continued growth in the single-family market in the months ahead.”
Two of the three HMI components posted losses in October. The component gauging current sales conditions dropped two points to 69, and the index charting buyer traffic fell one point to 46. Meanwhile, the index measuring sales expectations in the next six months rose one point to 72.
Looking at the three-month moving averages for regional HMI scores, the West increased two points to 75 while the Northeast, Midwest and South each posted one-point gains to 43, 56 and 65, respectively.
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