The National Association of Home Builders/Wells Fargo reported that its Composite Housing Market Index rose this month to 29 from a revised 28 in May, initially reported as 29. The latest figure was the highest since 2007. The index of single-family home sales rose two points to 32, also the highest since 2007 but still down from levels near 70 in 2004. The index of sales during the next six months held constant at 34. Finally, the home builders' index of traffic of prospective buyers remained at its high of 23. By region, the Midwest index returned to its high of 31 while the index for the West recovered slightly following three months of decline. The index for the South retraced half of its May gain and the Northeast's index also fell slightly.

The index of prospective new home buyer traffic held at its recent high of 23. Each of these NAHB figures is seasonally adjusted. The Home Builders' Housing Opportunity Index, which is the share of homes sold that could be considered affordable to a family earning the median income, improved slightly in Q1'12 to a record 77.5%, buoyed by lower home prices, lower interest rates and higher income. (There is a break in the series from 2002 to 2003.)

The Home Builders index is compiled from survey questions asking builders to rate market conditions as "good," "fair," "poor" or "very high" to "very low." The figure is thus a diffusion index with numerical results over 50 indicating a predominance of "good" readings.

The NAHB has compiled the Housing Market Index since 1985. The weights assigned to the individual index components are .5920 for single family detached sales, present-time, .1358 for single family detached sales, next six months; and .2722 for traffic of prospective buyers. The results, along with other housing and remodeling indexes from NAHB Economics, are included in Haver's SURVEYS database. The expectation figure is available in Haver's MMSAMER database.

Economic Rebounds in U.S. and Euro Zone: Deceivingly Similar, Strikingly Different from the Federal Reserve Bank of Dallas is available here.