The newly released report from the National Association of Home Builders says builder confidence in the market for  single-family homes has leveled out and is holding steady after a slight uptick in December. Real estate investors are watching the new build-to-rent trend that is starting to pop up around the country.

“Following an unexpected jump last month, builder confidence has essentially leveled out and is holding at a solid level,” said NAHB Chairman Rick Judson, a home builder from Charlotte, N.C., said in a release from the National Association of Home Builders.  “Many markets continue to improve and this bodes well for future home sales.”

Derived from a monthly survey that NAHB has been conducting for 25 years, the NAHB/Wells Fargo Housing Market Index 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 prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then 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 declined in January. The index gauging current sales conditions edged one point lower to 62, while the index gauging expectations for future sales fell two points to 60. The index gauging traffic of prospective buyers fell three points to 40.

Looking at the three-month moving averages for regional HMI scores, the Northeast and West each rose four points to 42 and 63, respectively, while the South held steady at 56. The Midwest fell a single point to 58.

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