The National Association of Home Builders/Wells Fargo Housing Market Index increased to 78 in August, its highest reading in the 35-year history of the series, up six points from the July reading of 72.
NAHB Chairman Chuck Fowke noted that low interest rates and a focus on the importance of housing has led to an all-time high in buyer traffic. Chairman Fowke also stated that the quick recovery in housing has produced an increase in lumber prices which could damper momentum in the fall.
“Housing has clearly been a bright spot during the pandemic and the sharp rebound in builder confidence over the summer has led NAHB to upgrade its forecast for single-family starts, which are now projected to show only a slight decline for 2020,” said NAHB Chief Economist Robert Dietz. “Single-family construction is benefiting from low interest rates and a noticeable suburban shift in housing demand to suburbs, exurbs and rural markets as renters and buyers seek out more affordable, lower density markets.”
The HMI component measuring buyer traffic increased eight points to 65, its highest reading on record. The component measuring current sales conditions increased six points to 84, and the component measuring sales expectations in the next six months rose three points to 78.
The three-month moving averages for regional HMI scores, the Northeast gained twenty points to 65, the Midwest increased thirteen points to 63, and the West moved fifteen points higher to 78. The South jumped twelve points to 71.
Read the NAHB release.