Global| Feb 16 2010U.S. Home Builders’ Index Improves Slightly
by:Tom Moeller
|in:Economy in Brief
Summary
Low interest rates and improved affordability have yet to generate strong improvement in the housing market. The National Association of Home Builders' index of housing market activity improved this month to 17 from 15 in January, but [...]
Low
interest rates and improved affordability have yet to generate strong
improvement in the housing market. The National Association of Home
Builders' index of housing market activity improved this month to 17
from 15 in January, but that was only back to the 4Q average.
Nevertheless, the index remained double the low of 8 hit last January.
The index is compiled from 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 present sales index improved m/m to 17 and equaled the 4Q and 3Q averages. The sub-index of sales during the next six months also improved modestly versus January. The Home Builders' Association also reported that the traffic of prospective buyers languished at a reading of 12 which was below the averages from 2Q to 4Q of last year.
The regional housing market indexes showed improvement versus last year throughout the country but there has been modest backpedaling in the Northeast & the Midwest and relative stability in the South & the West.
The Home Builders' Housing Opportunity Index, which is the share of homes sold that could be considered affordable to a family earning the median income, fell in 3Q '09 (the latest available figure) to 70.1%. It had jumped earlier to a record high of 72.5% buoyed by lower home prices, lower interest rates and higher income. (There is a break in the series from 2002 to 2003.).
The NAHB has compiled the Housing Market Index since 1985. 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, along with other housing and remodeling indexes from NAHB Economics, are included in Haver’s SURVEYS database.
IMF Explores Contours of Future Macroeconomic Policy from the International Monetary Fund can be found here.
| Nat'l Association of Home Builders | February | January | December | February '09 | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Composite Housing Market Index (All Good=100) | 17 | 15 | 16 | 9 | 15 | 16 | 27 |
| Single-Family Sales | 17 | 15 | 16 | 7 | 13 | 16 | 27 |
| Single-Family Sales: Next Six Months | 27 | 26 | 26 | 15 | 24 | 25 | 37 |
| Traffic of Prospective Buyers | 12 | 12 | 13 | 11 | 13 | 14 | 21 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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