Home Builder Confidence Hits All-Time Record

Dated: September 23 2020

Views: 10

Home Builder Confidence Hits All-Time Record

Last week, the National Association of Home Builders (NAHB) reported their Housing Market Index (HMI) hit an all-time high in the 35-year history of the series with a score of 83. The index gauges builder perceptions of current single-family home sales and sale expectations for the next six months, as well as the traffic of prospective buyers of new homes.

As the following chart shows, confidence dropped dramatically when stay-in-place orders were originally mandated earlier this year. Since then, it has soared back.Home Builder Confidence Hits All-Time Record | Keeping Current MattersLooking at the three-month moving averages for HMI scores, confidence increased in every region of the country:

  • The Northeast increased 11 points to 76
  • The Midwest jumped 9 points to 72
  • The South rose 8 points to 79
  • The West increased 7 points to 85

Confidence Is Validated by the Numbers

This confidence is definitely warranted. According to a recent NAHB report, single-family housing starts increased 4.1% to a 1.02 million annual rate, and single-family permits increased 6% to a 1.04 million unit rate, meaning newly constructed homes are on the rise.

A separate report from the Mortgage Bankers Association (MBA) shows mortgage applications for new home purchases increased by 33.3% compared to a year ago. Joel Kan, Associate Vice President of Economic and Industry Forecasting at MBA, commented on the numbers:

“The housing market continued to exceed expectations in August, as housing demand for new homes stayed strong and the job market continued to recover…The new home market has maintained its path of recovery throughout the summer, and record-low mortgage rates and households seeking more space will likely continue to drive demand into the fall.”

Bottom Line

If you’re thinking about putting your house on the market but are afraid you may not find a home to buy, speak with your local real estate professional about new construction opportunities in your area.

Latest Blog Posts

The Financial Benefits of Home Ownership

Homeownership Is Full of Financial BenefitsA Fannie Mae survey recently revealed some of the most highly-rated benefits of homeownership, which continue to be key drivers in today

Read More

Top 4 Reasons to Own a Home

Owning a home can have an incredible impact on your quality of life. Let's connect if you're ready to make your dream of homeownership a.

Read More

Don’t Sell on Your Own Just Because It’s a Sellers’ Market

In a sellers’ market, some homeowners might be tempted to try to sell their house on their own (known as For Sale By Owner, or FSBO) instead of working with a trusted real estate professional.

Read More

What It Means To Be In A Sellers' Market

For Sellers, Housing Market Updates, PricingWhat It Means To Be in a Sellers’ MarketIf you’ve given even a casual thought to selling your house in the near future,

Read More
Fair Housing Icon NY Fair Housing Notice