The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo jumped to 59 during September from an unrevised from 55 in August. The latest figure was the highest since November 2005 and beat expectations for 56 in the Informa Global Markets Survey.

Prospective home buyers were out in force. Realtors reported that their traffic index improved to 47, the highest level since October 2005.

The index of single-family home sales increased to 63, the highest level in nine months. The index of expected sales during the next six months gained to 67, the highest level since August of last year. The NAHB figures are seasonally adjusted.

Housing market activity was firm around the country. The index reading for the South jumped by nearly one-quarter m/m (8.6% y/y). The index for the West rose 8.9% m/m (-3.2% y/y) and the reading for the Northeast gained 4.8% m/m, unchanged y/y. To the downside was the index for the Midwest which fell 4.7% m/m and was down 3.2% y/y.

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.

Multifamily Housing: The New American Dream? from the Federal Reserve of Atlanta can be found here.