Builder confidence rises in March

To Estimated risk per 15.03.2023 10:13:00

The National Association of Home Builders (NAHB) reported a Housing Market Index (HMI) of 44, up from 42 last month. Any number below 50 indicates that more builders are finding the terms of the sale worse than good.

From NAHB: Builder confidence rises in March, but future outlook uncertain

While high construction costs and rising interest rates continue to hinder housing affordability, builders were cautiously optimistic in March as a shortage of existing inventory is shifting demand to the new housing market.

Builders’ confidence in the new home market rose two points to 44 in March., according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). This is the third month in a row that builders’ sentiment levels have risen.
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The HMI index, which measures current selling conditions in March, rose two points to 49, while the indicator that measures potential buyer traffic rose three points to 31, the highest traffic reading since September last year. The component reflecting sales expectations for the next six months fell one point to 47.

Looking at the three-month moving averages for HMI’s regional estimates, the Northeast is up five points to 42, the Midwest is up one point to 34, the South is up five points to 45 and the West is up four points to 34.

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Click on the graph to enlarge the image.

This chart shows the NAHB index since January 1985.

This was above the consensus forecast.

“Traffic of potential buyers” is still well below the break-even point at 31 (below 50).