Builders Confident Despite Slow February

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Because builders have an unique perspective on the market for newly built single-family homes, their outlook is a valued measure of the housing market’s health. For example, the National Association of Home Builders Housing Market Index is a widely followed survey of home builders that scores their responses on a scale where any number above 50 means more builders view conditions as good than poor. In February, the index fell two points to 55. Despite the month-over-month dip, however, the index has remained in the mid-to-high 50s for eight consecutive months. David Crowe, the NAHB’s chief economist, says that’s consistent with a modest but ongoing recovery. “Solid job growth, affordable home prices, and historically low mortgage rates should help unleash growing pent-up demand and keep the housing market moving forward in the year ahead,” Crowe said. Of the components measuring current buyer traffic, sales conditions, and outlook for the next six months, two of the three experienced losses in February. Buyer traffic posted the largest decline, posting a five point slide likely caused by harsh winter weather in much of the country. On the other hand, both current sales conditions and outlook for the next six months were relatively flat and remain above 60. More here.

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