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Economy in Brief

U.S. NAHB Housing Market Index Down A Bit Further
by Tom Moeller June 16, 2008

The National Association of Home Builders' (NAHB) indicated that its Composite Housing Market Index in June fell slightly to 18 from 19 in May. So far this year, the series has shown some signs of stability, averaging 18, 20 and 18 during the last three quarters. Nevertheless, the levels are more than two-thirds lower than the highs of 2004.

During the last twenty years there has been a 76% correlation between the y/y change in the Composite Index and the change in single family housing starts.

The index for single family detached homes in June was stable month-to-month but the 2Q average level still was near the series' 20-year low. Builders saw modest improvement in single family home sales during the next six months, up from the lows of the prior two quarters.

Despite modest improvement in the builders' index in most of the country's regions, continued decline was registered in the Northeast.

Traffic of prospective home buyers remained quite low.

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

Visit the National Association of Home Builders.

Nat'l Association of Home Builders June May   June '07 2007 2006 2005
Composite Housing Market Index 18 19 28 27 42 67
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