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Economy in Brief

U.S. Home Builders Index Falls to Six-Month Low
by Tom Moeller  April 15, 2013

The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo declined to 42 this month following an unrevised March reading of 44. Expectations were for an index reading of 45 in April. The latest was the lowest since November. Nevertheless, the index level remained up by three quarters versus one year ago. The index of single-family home sales fell to 45 while the index of sales during the next six months improved to 53. Also down m/m was the home builders index of traffic of prospective home buyers. It fell sharply m/m to 30, its lowest level since July.

Weakness spread throughout the country this month. The index for the Midwest dropped significantly to its lowest level in six months. The index for the Northeast also fell sharply to its lowest level since November. In addition, the indexes for the West and the South reversed the gains logged earlier this year. The NAHB figures are 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 Apr Mar Feb Apr'12 2012 2011 2010
Composite Housing Market Index, SA (All Good=100) 42 44 46 24 34 16 16
 Single-Family Sales 45 47 51 25 36 16 16
 Single-Family Sales: Next Six Months 53 50 50 31 41 22 23
 Traffic of Prospective Buyers 30 34 32 18 27 13 12
Northeast 34 39 41 26 29 17 20
Midwest 41 49 45 22 36 14 14
South 40 42 44 23 34 18 17
West 52 55 59 31 38 15 13
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