The
National Association of Homebuilders (NAHB) announced on Monday its housing
market index (HMI) came in at 80 in October, up from 76 in September. This
marked the largest monthly increase since November 2020.
Economists had forecast the HMI to remain at 76.
A
reading over 50 indicates more builders view conditions as good than poor.
All three of the major HMI indices recorded advances in
early October. The indicator gauging current sales conditions surged 5 points
to 87, while the component measuring traffic of prospective buyers increased 4
points to 65 and the measure charting sales expectations in the next six rose 3
points to 84.
NAHB
Chairman Chuck Fowke noted: “Although demand and home sales remain strong,
builders continue to grapple with ongoing supply chain disruptions and labor
shortages that are delaying completion times and putting upward pressure on
building material and home prices.”
Meanwhile,
NAHB Chief Economist Robert Dietz said: “Builders are getting increasingly
concerned about affordability hurdles ahead for most buyers. Building material
price increases and bottlenecks persist and interest rates are expected to rise
in coming months as the Fed begins to taper its purchase of U.S. Treasuries and
mortgage-backed debt. Policymakers must focus on fixing the broken supply
chain. This will spur more construction and help ease upward pressure on home
prices.”