Builder confidence in the market for newly-built single-family homes edged one point lower to 75 in January, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The last two monthly readings mark the highest sentiment levels since July of 1999. Low interest rates and a healthy labor market combined with a need for additional inventory is setting the stage for further home building gains in 2020.
The HMI index charting traffic of prospective buyers increased one point to 58, the highest level since December 2017. The gauge measuring current sales conditions fell three points to 81 and the component measuring sales expectations in the next six months held steady at 79.
Looking at the three-month moving averages for regional HMI scores, the Northeast rose one point to 62, the Midwest increased three points to 66 and the West moved one point higher to 84. The South remained unchanged at 76.
The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 75, down from 76 in December. Any number above 50 indicates that more builders view sales conditions as good than poor.