The National
Association of Homebuilders (NAHB) announced on Thursday its housing market
index (HMI) jumped to 43 in October
from an unrevised September reading of
41. This was the highest reading since June (43).
Economists had forecast the HMI to rise to 42.
A reading over
50 indicates more builders view conditions as good than poor.
All three major
HMI components posted advances in early October. The
component charting sales expectations in the next six months surged 4 points to
57, while the component measuring traffic of prospective buyers climbed by 2 points to 29, and the component tracking current sales conditions also jumped 2
points to 47.
Commenting on
the latest report, NAHB Chairman Carl Harris said that while housing
affordability remains low, builders are feeling more optimistic about 2025
market conditions. "The wild card for the outlook remains the election, and
with housing policy a top-tier issue for candidates, policymakers should be
focused on supply-side solutions to the housing crisis," he added.
Meanwhile, NAHB Chief Economist Robert Dietz noted that
despite the beginning of the Fed’s easing cycle, many prospective home buyers
remain on the sideline waiting for lower interest rates. He also unveiled that
they are forecasting "uneven declines for mortgage interest rates in the coming
quarters, which will improve housing demand but place stress on building lot
supplies due to tight lending conditions for development and construction loans."