Today, the National Association of Home Builders (NAHB) released their Housing Market Index (HMI) showing continued evidence that the new home market is experiencing a prolonged recession.The release came along with some guarded outlook from Chief Economist David Seiders who is now suggests that more action on the part of legislators is needed to help bring recovery to the market.
“Some potential buyers who have been sitting on the sidelines are starting to at least research a new home purchase given improving affordability factors and the large selection of units on the market, … That said, builders know there’s a difference between people looking and people buying, and their current outlook remains quite subdued. Additional stimulative measures on the legislative and policy side are definitely needed to bolster consumer confidence and help bring about a housing and economic recovery.”
As with last month, the NAHB has apparently discontinued publishing the individual builder respondent rating (“good”, “fair” and “poor”) data series that are the components of the overall composite HMI series, so I have reworked my charts to simply show the four main composites; the HMI index, the “present conditions” index, the “future conditions” index and the “buyer traffic” index.
It’s important to understand that each component of the NAHB housing market index is now sitting at or near the worst levels ever seen in the over 20 years the data has been being compiled.
This suggests that the current severe contraction has surpassed all other events seen in the last 22 years and is now firmly in uncharted territory.
