Builder confidence in the market for newly build single-family homes rose four points to a level of 58 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).
“Growing confidence among consumers is what’s fueling this optimism among builders,” said NAHB Chairman Kevin Kelly, a home builder and developer from Wilmington, Del. “Members in many areas of the country continue to see increasing buyer traffic and signed contracts.”
“Low interest rates, affordable home prices and solid job creation are contributing to a steady housing recovery,” NAHB Chief Economist David Crowe said. “After a slow start to the year, the HMI has remained above the 50-point benchmark for five consecutive months, and we expect the momentum to continue into 2015.”
The NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of perspective buyers as “high to very high,” “average” or “low to very low.” Scores from each component then are used to calculate a seasonally adjusted index, where any number over 50 indicates that more builders view conditions as good than poor.
All three HMI components increased in November. Current sales conditions rose five points, while the index measuring expectations for future sales moved up two points and the index gauging traffic of prospective buyers increased four points.