New Home Housing Market Index Drops two Points

The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) reports builder confidence dropped two points to 55 in October due in part to continuing challenges in the marketplace coupled with rising interest rates and uncertainty in Washington. However, any score above 50 indicates builders see the market as “good” as opposed to “poor”. The score is based on builders perceptions of current single-family home sales, traffic of prospective buyers, and sales expectations for the next six months. Says NAHB Chief Economist David Crowe, “ A spike in mortgage interest rates along with the paralysis in Washington that led to the government shutdown and uncertainty regarding the nation’s debt limit have caused builders and consumers to take pause. However, interest rates remain near historic lows and we don’t expect the level of rates to have a major impact on sales and starts going forward. Once this government impasse is resolved, we expect builder and consumer optimism will bounce back.” Regionally, as MHProNews has learned, the South was unchanged at 56, the Midwest gained a point to 64, while the Northeast fell three points and the West fell one point to 60.The partial shutdown has prevented the U. S. Census Bureau from releasing September’s statistics on housing starts, but NAHB’s own figures estimate 900,000 starts in Sept., with 620,000 to 630,000 as single-family homes.

(Photo credit: housingwire)

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