Housing Market Index Rises Two Points In March
March 21, 2002
Indicating strong and stable builder confidence in the market for new single-family home sales, the National Association of Home Builders' Housing Market Index (HMI) rose two points to 60 in March.
"Low interest rates, resilient home values and a stabilizing economy have helped home buyers put whatever fears they might have had following Sept. 11 behind them, which in turn has produced renewed builder optimism," said Gary Garczynski, NAHB president and a builder/developer from Woodbridge, Va.
After falling nine points to a more than six-year low of 47 in the weeks following the Sept. 11 attacks on America, the index gauging builder sentiment rebounded strongly in November, December and January before dropping back two points to 58 in February. "March's two-point gain in the HMI, which brings the index back up to where it was at the peak of the rebound in January and to the same level as in August, is a testament to the resilience of the American home buyer and of the housing industry," Garczynski said.
The HMI is derived from a monthly survey of builders that NAHB has been conducting for nearly two decades. Home builders are asked to rate current sales of single-family homes and sales expectations for the next six months as "good," "fair" or "poor." They are also asked to rate traffic of prospective buyers as either "high to very high," "average" or "low to very low." Scores for responses to each component are used to calculate a seasonally adjusted index, where any number over 50 indicates that more builders view sales conditions as good than poor.
Two out of three of the HMI's component indexes rose in March. The index gauging current sales of single-family homes rose three points to 65 while the index gauging sales expectations in the next six months rose two points to 69. Meanwhile, the index gauging traffic of prospective buyers fell two points to 44, the same level at which it stood prior to Sept. 11.
Copyright: National Association of Home Builders