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Economy in Brief

U.S. Home Builders Index Slips M/M And Traffic Declines
by Tom Moeller  February 19, 2013

The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo dipped to 46 this month following two months at 47. Expectations were for a slight increase. Nevertheless, the index level remained up by roughly two-thirds from one year ago. The index of single-family home sales slipped to 51 but was near the highest level since 2006. The index of sales during the next six months notched up to 50 and recovered the prior month's slip. Offsetting these gains was news that the home builders' index of traffic fell to 32, its lowest level since September.

By region, the index for the Northeast jumped to 41 and more than doubled year-to-year. The latest was its highest level since February of 2007. The index for the West notched higher m/m (39.5% y/y) while the index for the Midwest was unchanged m/m (33.3% y/y). The index for the South fell moderately m/m but remained up by three-quarters y/y. Each of these NAHB figures is seasonally adjusted.

The NAHB has compiled the Housing Market Index since 1985. It reflects 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 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 are included in Haver's SURVEYS database. The expectation figure is available in Haver's MMSAMER database.


National Association of Home Builders Feb Jan Dec Feb'12 2012 2011 2010
Composite Housing Market Index, SA (All Good=100) 46 47 47 28 34 16 16
 Single-Family Sales 51 52 51 30 36 16 16
 Single-Family Sales: Next Six Months 50 49 50 34 41 22 23
 Traffic of Prospective Buyers 32 36 36 22 27 13 12
Northeast 41 36 41 20 29 17 20
Midwest 46 46 52 30 36 14 14
South 44 51 47 25 34 18 17
West 60 59 45 43 38 15 13
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