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Economy in Brief
U.S. Current Account Deficit Deepens to Record in Q1'22
The U.S. current account deficit deepened to $291.4 billion during Q1'22...
Kansas City Fed Manufacturing Index Declines Further in June But Remains Positive
The Kansas City Fed reported that its manufacturing sector business activity index fell to 12 in June...
U.S. Unemployment Claims Edged Down
Initial claims for unemployment insurance filed in the week ended June 18 declined by 2,000 to 229,000...
U.S. Energy Prices Reverse Earlier Gains
Retail gasoline prices surged to $5.01 per gallon (63.1% y/y)...
S&P Global Flash PMIs Weaken -Except for Japan
The S&P Global PMI indexes weakened across the board in June...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller December 16, 2019
The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo strengthened during December. The index rose to 76, up 7.0% m/m and by roughly one-third y/y. The index was the highest level for the economic expansion. A reading of 70 had been expected in the INFORMA Global Markets survey. The NAHB figures are seasonally adjusted. Over the past 15 years, there has been a 70% correlation between the y/y change in the home builders index and the y/y change in new plus existing home sales.
The index of present sales conditions rose 9.1% to 84 (37.7% y/y) after easing to 77 in November. The index of expected conditions in the next six months increased 1.3% (29.5% y/y) to 79, up for the third straight month. The index measuring traffic of prospective buyers rose 7.4% to 58 (34.9% y/y) and equaled the expansion high.
Regional readings were mixed this month. They indicated a 25.9% increase (40.4% y/y) in the Midwest to 73, which was just shy of the expansion high two years ago. In the South, the index gained 2.7% (26.2% y/y) to 77, a new high. Offsetting these increases was a 9.4% decline (+61.1% y/y) to 58 in the Northeast. The index for the West also fell 2.4% (+27.7% y/y) and reversed its November rise.
The NAHB has compiled the Housing Market Index since 1985. It reflects survey questions which ask builders to rate sales and sales expectations as "good," "fair" or "poor" and traffic as "very high," "average" or "very low." The figures are diffusion indexes with values over 50 indicating a predominance of "good"/"very high" readings. In constructing the composite index, the weights assigned to the individual index components are: 0.5920 for single-family detached sales, present time, 0.1358 for single-family detached sales, next six months, and 0.2722 for traffic of prospective buyers. These data are included in Haver's SURVEYS database.
National Association of Home Builders | Dec | Nov | Oct | Dec Y/Y | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
Composite Housing Market Index, SA (All Good=100) | 76 | 71 | 71 | 35.7% | 66 | 67 | 68 |
Single-Family Sales: Present | 84 | 77 | 78 | 37.7 | 72 | 73 | 74 |
Single-Family Sales: Next Six Months | 79 | 78 | 76 | 29.5 | 72 | 74 | 76 |
Traffic of Prospective Buyers | 58 | 54 | 54 | 34.9 | 49 | 50 | 50 |