Home builder confidence was up four points to an index reading of 58 in the December National Association of Home Builders/Wells Fargo Housing Market Index (HMI).
All three index components improved in December:
• the index gauging current sales conditions jumped six points to 64
• the index gauging expectations for future sales rose two points to 62
• the index gauging traffic of prospective buyers gained three points to 44
"This is definitely an encouraging sign as we move into 2014,” said National Association of Home Builders (NAHB) Chairman Rick Judson, a home builder from Charlotte, NC. “The HMI is up 11 points since December of 2012 and has been above 50 for the past seven months. This indicates that an increasing number of builders have a positive view on where the industry is going.”
“The recent spike in mortgage interest rates has not deterred consumers as rates are still near historically low levels,” said NAHB Chief Economist David Crowe. “Following a two-month pause in the index, this uptick is due in part to release of the pent-up demand caused by the uncertainty generated by the October government shutdown. We continue to look for a gradual improvement in the housing recovery in the year ahead.”
The three-month moving averages for regional HMI scores:
• the South was up one point to 57
• the Northeast fell one point to 38
• the Midwest fell a point to 59
• the West fell a point to 59
An index reading over 50 indicates that more builders view conditions as good than poor.
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