The nation’s low-interest-rate environment and strong job market propelled homebuilder confidence to 71 points in October, the National Association of Home Builders and Wells Fargo said in this month’s Housing Market Index.
According to the index, October’s level now marks the highest reading since February of last year.
“The housing rebound that began in the spring continues, supported by low mortgage rates, solid job growth and a reduction in new home inventory,” NAHB Chairman Greg Ugalde said.
In October, the index measuring current sales conditions rose to 78 points, while buyer traffic increased to 54 points and sales expectations over the next six months jumped to 76.
“The second half of 2019 has seen steady gains in single-family construction, and this is mirrored by the gradual uptick in builder sentiment over the past few months,” NAHB Chief Economist Robert Dietz said. “However, builders continue to remain cautious due to ongoing supply-side constraints and concerns about a slowing economy.”
Despite these concerns, the three-month moving averages for regional HMI scores show the Northeast grew to 60 points, the South rose to 73 points, the West climbed to 78 points and the Midwest inched forward to 58 points.
NOTE: The NAHB/Wells Fargo Housing Market Index gauges builder opinions of single-family home sales and expectations, asking for a rating of good, fair or poor. Builders are also asked to rate prospective buyer traffic from very low to very high. The scores are used to calculate a seasonally adjusted index with a rating of 50 or over indicating positive sentiment.
