The National Association of Home Builders (NAHB)/Wells Fargo builder sentiment index was released on November 16th and remained unchanged at 63. The index is two points below September’s reading, which was the highest in nearly a year. Readings above 50 indicate that builders view sales conditions as good rather than poor.
“Ongoing job creation, rising incomes and attractive mortgage rates are supporting demand in the single-family housing sector,” said Robert Dietz, the NAHB’s chief economist. “This will help keep housing on a steady, upward glide path in the months ahead.”
Builders’ view of current sales held steady from last month, while a gauge of traffic by prospective buyers edged higher. But their outlook for sales over the next six months declined slightly.
Even so, builders remain optimistic overall about new home sales, which are running ahead of last year’s pace.
The index shows that sales of new U.S. homes hit a seasonally adjusted annual rate of 593,000 units as of September, which is up nearly 30 per cent from a year ago. Sales of new homes were up 13 per cent through the first nine months of this year compared to the same period in 2015.
A healthy job market and low interest rates have bolstered demand for new homes and fueled construction of single-family homes this year. Still, builders complain new construction is being hampered by a shortage of skilled labor and rising costs for ready-to-build land parcels in many markets. That reality, and other factors, have been cited by MHProNews as reasons why factory-home building could be poised to gain market share, given the right steps by industry companies and leaders.
This month’s NAHB builder index was based on 325 respondents.
Though new homes represent only a fraction of the housing market, they have an outsized impact on the economy. Each house conventionally built creates an average of three jobs for a year and generates about $90,000 in tax revenue, per NAHB data. By comparision, each manufactured home built ads about one job to the economy, because of greater efficency. ##
(Image credits are as shown above.)
Submitted by RC Williams to the Daily Business News for MHProNews.