For the second month in a row, confidence among American home builders was stronger — rising to the second-highest level in more than a decade. The Northeast drove the improvement.
At 70 for November, the seasonally adjusted Housing Market Index was the highest it’s been since March, when it was determined to be 71, and the second-highest level since July 2005.
An index that exceeds 50 is an indication that there are more U.S. home builders
who view conditions in the new home market than those who view them as poor.
The index was jointly reported Thursday by the
National Association of Home Builders and Wells Fargo.
Last month’s index was elevated by two points from September, while it has ascended seven points compared to October 2016.
“November’s builder confidence reading is close to a post-recession high — a strong indicator that the housing market continues to grow steadily,” NAHB Chairman Granger MacDonald said in the report. “However, our members still face supply-side constraints, such as lot and labor shortages and ongoing building material price increases.”
There are three components that make up the national HMI. The first, which measures buyer traffic, rose two points from a month earlier to 50. The component
gauging current sales conditions was also up two points to 77. The third component, sales expectations for the next six months, dipped a point to 77.
By region, the three-month moving average was 54 in the Northeast, soaring from September 2017 by five points — the most of any region. A one-point gain in the South put that index at 69.
No change left the average at
77 in the West and 63 in the Midwest.
