RealEstateEconomyWatch.com Insight and Intelligence on Residential Real Estate
(September 16, 2009 Release)
Highlights
• The housing market index rose by 1 point in September to 19 from a 18 registered in August.
• The September index of 19 is 2 points above the 17 registered in September of 2008.
• The buyer traffic index rose slightly to 17 in September from 16 in August.
• Homebuilder expectations over the next 6 months fell 1 point to 29 compared to a August index of 30.
| NAHB Housing Market Index | ||||
| Sept 09 | Aug 09 | 3 mo Avg | 6 mo Avg | |
| Housing Market Index | 19 | 18 | 18.0 | 16.5 |
| Northeast | 24 | 22 | 20.7 | 19.2 |
| Midwest | 19 | 16 | 16.3 | 15.2 |
| South | 19 | 17 | 18.3 | 17.5 |
| West | 18 | 17 | 16.3 | 14.0 |
| Single Family Sales | ||||
| Present | 18 | 16 | 16.7 | 15.0 |
| Next 6 months | 29 | 30 | 28.3 | 27.0 |
| Buyer Traffic | 17 | 16 | 15.3 | 14.2 |
Source: National Association of Home Builders
Analysis
The housing market index is a leading indicator of future new home sales. The September numbers reflect a slight upward trend in the homebuilding industry. The September index of 19 is now 11 points above the cyclical bottom of 8 set in January. However, the September index remains at a relatively low level and a downside still remains due to the economic recession, mounting job losses, tight credit conditions and mounting foreclosures. An excess inventory of homes and the frightful prospect of a sizeable amount of option ARM and interest only resets over the next two years are keeping builder optimism at bay. We continue to believe that the homebuilding recovery will be a slow and painful one.
