Global| Oct 16 2013U.S. Home Builders Index Works Its Way Lower
by:Tom Moeller
|in:Economy in Brief
Summary
The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo fell 2 points to 55 this month after a 1 point decline in September, last month reported as no change. This latest reading disappointed [...]
The Composite Housing Market Index from the National Association of Home Builders-Wells Fargo fell 2 points to 55 this month after a 1 point decline in September, last month reported as no change. This latest reading disappointed expectations for stability at 58. The index of single-family home sales fell to 58, the lowest reading since June. The index of sales during the next six months declined to 62, also its lowest level since June. Realtors also saw the traffic index of prospective buyers fall to its lowest level in four months.
Activity was mixed around the country. It fell out of bed in the Northeast where the index dropped to 31, its lowest level in six months. The figure for the West followed with a 5 point decline to 58. In the South, the index dropped to 54, its lowest since July, from 58. The figure for the Midwest gained to 65 from 63, a new high for the recovery. The index for traffic of prospective buyers fell to 44, its lowest level since June. 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 expectations figure is available in Haver's MMSAMER database.
The Parts Are More Than the Whole: Separating Goods and Services to Predict Core Inflation from the Federal Reserve Bank of New York is available here.
| National Association of Home Builders | Oct | Sep | Aug | Oct'12 | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|---|---|
| Composite Housing Market Index, SA (All Good=100) | 55 | 57 | 58 | 41 | 34 | 16 | 16 |
| Single-Family Sales: Present | 58 | 60 | 62 | 41 | 36 | 16 | 16 |
| Single-Family Sales: Next Six Months | 62 | 64 | 68 | 51 | 41 | 22 | 23 |
| Traffic of Prospective Buyers | 44 | 46 | 46 | 35 | 27 | 13 | 12 |
| Northeast | 31 | 44 | 39 | 32 | 29 | 17 | 20 |
| Midwest | 65 | 63 | 64 | 40 | 36 | 14 | 14 |
| South | 54 | 58 | 56 | 42 | 34 | 18 | 17 |
| West | 58 | 63 | 59 | 48 | 38 | 15 | 13 |
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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