Following three consecutive months of decline, the National Association of Home Builders' (NAHB) Composite Housing Market Index gained back in October all of the September drop with a 3.1% increase. Nevertheless the index remained 6.9% below the June peak.

During the last twenty years, year to year changes in the annual composite index had an 85% correlation with the change in single family housing starts.

The m/m increase reflected strong gain throughout the country except in the Northeast.

The October index for sales of single family homes in six months gained back one third of the prior month's 9.1% drop (-8.9% y/y) while the index for current sales reversed all of a modest September fall (-3.9% y/y).

The NAHB index is a diffusion index based on a survey of builders. Readings above 50 signal that more builders view conditions as good than poor.

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