Today, the National Association of Home Builders (NAHB) and Wells Fargo Housing released the September Housing Market Index (HMI). The HMI is based on a monthly survey that measures builder perceptions on currently single-family home sales and gets their outlook for the next six months using the ranking of “good,” fair” or poor. Any number over 50 indicates that more builders view conditions as good than poor.
According to the HMI, September was the first time in three months that builder sentiment for newly-built single-family homes increased, inching up one point to 76.
"Builder sentiment has been gradually cooling since the HMI hit an all-time high reading of 90 last November," said NAHB Chairman Chuck Fowke, a custom home builder from Tampa, Florida. "The September data show stability as some building material cost challenges ease, particularly for softwood lumber. "However, delivery times remain extended and the chronic construction labor shortage is expected to persist as the overall labor market recovers."
"The single-family building market has moved off the unsustainably hot pace of construction of last fall and has reached a still hot but more stable level of activity, as reflected in the September HMI," said NAHB Chief Economist Robert Dietz. "While building material challenges persist, the rate of cost growth has eased for some products, but the job openings rate in construction is trending higher."
Other HMI Stats:
- The HMI index gauging current sales conditions rose one point to 82;
- The component measuring traffic of prospective buyers posted a two-point gain to 61;
- The gauge charting sales expectations in the next six months held steady at 81;
- Looking at the three-month moving averages for regional HMI scores:
- The Northeast fell two points to 72;
- The South dropped two points to 80;
- The West registered a two-point decline to 83;
- The Midwest remained unchanged at 68.
To read the full NAHB "Eye on Housing" blog click here.