Search

Builder Confidence Loses Steam after Four Months of Gains

by devteam October 16th, 2014 | Share

The National Association of HomernBuilders (NAHB) said on Thursday that sentiment among its new home builderrnmembers reversed course in October, with few of those responding to its monthlyrnsurvey viewing the current market for new homes as a good one.  The NAHB/Wells Fargo Housing Market Indexrn(HMI) declined four points from September, falling to a score of 54.  The change came after four straight months ofrnimprovement during which the HMI passed the milestone 50 level for the firstrntime since January.</p

“While there was a dip this month,rnbuilders are still positive about the housing market,” David Crowe, NAHB ChiefrnEconomist said.  “After the HMI posted arnnine-year high in September, it’s not surprising to see the number drop inrnOctober.  However, historically lowrnmortgage interest rates, steady job gains, and significant pent up demand allrnpoint to continued growth of the housing market.” </p

NAHB Chairman Kevin Kelly called thernreturn to the mid-50s level established earlier in the summer “In line with the<bgradual pace of the housing recovery.” </p

NAHB’s survey asks builders for theirrnperceptions of current single family home sales and sales expectations for thernnext six months as “good,” “fair” or “poor.” The survey also asks builders tornrate traffic of prospective buyers as “high to very high,” “average” or “low tornvery low.” Scores from each component are then used to calculate a seasonallyrnadjusted index where any number over 50 indicates that more builders viewrnconditions as good than poor. </p

All three components derived from thernsurvey showed decreased expectations compared to September.  The index gauging current sales conditionsrnfell six points to 57, the index measuring future expectations fell from 67 torn64 and the index measuring perceptions of current buyer traffic was down to 41rnfrom 47.  The last index has not crossedrnthe 50 mark since October 2005.</p

NAHB has conducted its survey sincern1985.  The HMI hit an all-time high of 77rnin June 1999 and dipped to 8 in January 2009.<br /<br /Looking at the three-month moving averages for regional HMI scores, thernNortheast and Midwest remained flat at 41 and 59, respectively. The South roserntwo points to 58 and the West registered a one-point loss to 57.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.

About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

See all blogs
Share

Comments

Leave a Comment

Leave a Reply

Latest Articles

Real Estate Investors Skip Paying Loans While Raising Billions

By John Gittelsohn August 24, 2020, 4:00 AM PDT Some of the largest real estate investors are walking away from Read More...

Late-Stage Delinquencies are Surging

Aug 21 2020, 11:59AM Like the report from Black Knight earlier today, the second quarter National Delinquency Survey from the Read More...

Published by the Federal Reserve Bank of San Francisco

It was recently published by the Federal Reserve Bank of San Francisco, which is about as official as you can Read More...