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Economy in Brief

U.S. Home Builders Index Recovers To Expansion High
by Tom Moeller  December 17, 2013

The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo jumped four points to 58 this month and landed at the highest level since the economic expansion began. This latest figure was stronger than expectations for 55. The index of single-family home sales jumped to 64, a new high for the expansion. The index of sales during the next six months notched up to 62 and recovered two months of decline. Realtors reported that their traffic index of prospective buyers also improved after two months of decline.

Activity was mixed around the country. In the South, the index rose sharply to a new recovery high. The figure for the Midwest also recovered its November decline while activity in the West rose moderately. The NAHB figures are seasonally adjusted. The index for the Northeast declined to 40 after a sharp November increase.

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 expectations figure is available in Haver's MMSAMER database.

National Association of Home Builders Dec Nov Oct Dec'12 2013 2012 2011
Composite Housing Market Index, SA (All Good=100) 58 54 54 47 51 34 16
 Single-Family Sales: Present 64 58 58 51 55 36 16
 Single-Family Sales: Next Six Months 62 60 61 50 58 41 22
 Traffic of Prospective Buyers 44 41 43 36 39 27 13
Northeast 40 44 30 41 38 29 17
Midwest 62 54 62 51 54 36 14
South 61 55 54 47 51 34 18
West 60 58 59 45 56 38 15
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