Homebuilder confidence in the new, single-family construction market is going strong, despite dialing back in the latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The Index reading for January was 72, just two points under a spike in December. An above-50 reading indicates more builders have a positive outlook than a negative one.
“Builders are confident that changes to the tax code will promote the small business sector and boost broader economic growth,” said Randy Noel, chairman of the NAHB, in a statement. “Our members are excited about the year ahead, even as they continue to face building material price increases and shortages of labor and lots.”
Home builders’ expectations regarding present and expected single-family home sales both dipped in January, down one point to 79 and one point to 78, in order, while expected homebuyer traffic was down four points to 54.
However, “the HMI gauge of future sales expectations has remained in the 70s, a sign that housing demand should continue to grow in 2018,” said Robert Dietz, chief economist of the NAHB, in the statement. “As the overall economy strengthens, owner-occupied household formation increases and the supply of existing-home inventory tightens, we can expect the single-family housing market to make further gains this year.”