The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) rose five points to 72 in October to its highest level this year, according to a National Association of Home Builders (NAHB) report released this week. Analysts credited robust buyer demand brought on by improving economic conditions, low mortgage rates, and strong house-price performance for the five point jump in October, compared with the previous month.
Home builders are asked to rate current sales of single-family homes, and prospects for sales activity in the next six months, as "good," "fair," or "poor," where any number over 50 indicates that more builders view sales conditions as good than poor.
"Another factor that's undeniably contributing to builder optimism is the large turnout of prospective buyers at model homes and sales offices," said NAHB Chief Economist David Seiders. "The HMI component gauging traffic of prospective buyers has remained above 50 since May, which is a strong run for that index and a positive sign for potential sales activity."
Each of the HMI's component indexes rose in October, with the largest gains registered for current sales activity (up five points to 78) and expected sales in the next six months (up a remarkable nine points to 84). The component gauging traffic of prospective buyers rose two points to 54.
Posted by gandlwoods at October 21, 2004 07:27 AM