The main factors behind builders' hopeful outlook on the single-family housing market are the improving job market, affordable home prices and low interest rates.
Chicago, IL (PRWEB) November 20, 2014
The Federal Savings Bank was pleased with the the National Association of Home Builders' latest Home Builders/Wells Fargo Housing Market Index has shown builder confidence hit 58 points in November, an increase of four points.
The HMI measures builders' perceptions of the state of the single-family home market. There are three separate measures regarding how builders see the rate of traffic of prospective buyers, sales and sale expectations. Builders rate the first factor as "high to very high," "average" or "low to very low" and the latter measures as "good," "fair" or "poor." Index readings higher than 50 points are viewed as positive.
From October to November, all three parts improved, according to the NAHB release. The sales measure rose five points to hit 62, future sales expectations bumped up two points to reach 66 and traffic increased four points to 45.
Regionally, all four areas of the U.S. saw HMI improvements from October to November. The Midwest had a three-point gain to reach 56, the West rose seven points to 60, the South saw a small two-point rise to 62 and the Northwest leaped 12 points to hit 51. This is the first time the Northwest has been above 50 points since April 2006, according to The Wall Street Journal on November 18th.
The past three months
The three-month moving averages for the HMI increased in three of the four U.S. regions, indicating the strong builder optimism over the past few months. Only the Midwest saw a drop of two points to 57. The West had the smallest increase of one point to hit 58, followed by the Northeast, rising three points to reach 44 and the South, which had a four-point boost to hit 62.
Optimism sign of strong market
The main factors behind builders' hopeful outlook on the single-family housing market are the improving job market, affordable home prices and low interest rates. The Federal Savings Bank has experienced a rise in purchase mortgage activity due to these current market conditions. As these three factors continue going strong, more sellers understand it is worth it to put their homes on the market, and buyers realize this is the time to find a great deal.
"Growing confidence among consumers is what's fueling this optimism among builders," said NAHB Chairman Kevin Kelly. "Members in many areas of the country continue to see increasing buyer traffic and signed contracts."
First-time home buyers interested in delving into the single-family housing market should contact The Federal Savings Bank, a veteran owned bank, to learn about the historically low interest rates available.