Builders Expect New Home Sales Increase

The National Association of Home Builders Housing Market Index measures builder confidence in the market for newly built, single-family homes. Because builders have an insiders’ perspective on the market, the index has become an important measure of new New Homeshome sales, buyer traffic, and expectations for future sales. In May, the index dropped a point, continuing a recent stretch in which builder confidence has remained relatively steady. Kevin Kelly, NAHB’s chairman, said builder sentiment has shown little fluctuation over the past four months and is becoming more in line with the reality of a continuing but modest recovery. Still, despite the fact that overall optimism has been hovering just below 50 – on a scale where any number above 50 indicates more builders view conditions as good than poor – the individual component measuring expectations for sales over the next six months rose to 57 in May. The component measuring buyer traffic also rose, climbing two points to 33. David Crowe, NAHB’s chief economist, said consumers will return to the market in larger numbers as job growth becomes more consistent. More here

Michael Rosenbaum


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