Increased sales expectations among home builders offset diminished confidence about current sales conditions. The Northeast was the only region with deterioration.
This month’s Housing Market Index has been calculated at 72. An index in excess of 50 is an indication that more builders view conditions as good than poor.
No change was noted for the index compared to one month previous. The index reached an 18-year high of 74 in December 2017.
One year ago, the index stood at just 65.
The report was jointly produced by Wells Fargo and the National Association of Home Builders, which called the level of confidence “healthy.”
“Builders are excited about the pro-business political climate that will strengthen the housing market and support overall economic growth,” NAHB Chairman Randy Noel said in the report. “However, they need to manage supply-side construction hurdles, such as shortages of labor and lots and building material price increases.”
NAHB Chief Economist Robert Dietz called the latest reading an indication of growing consumer demand.
As was the case for the overall index, the component that measures buyer traffic was unchanged at 54.
At 78, the index for current sales expectations was off a point from a month earlier.
The index that charts builders’ expectations for new home sales over the next six months was 80, two points higher than in December.
In the Northeast, builders were least optimistic of any region, with a three-month moving average for the HMI of 56, falling two points from last month.
No change in the West left the index there at 81 — the most optimistic of any region.
A one-point increase in the South put the index there at 74, and a two-point jump in the Midwest had the HMI there at 72.
