For the first time since April 2006, more home builders view the market for new single-family houses as good rather than poor.
That’s according to the Housing Market Index compiled by the National Association of Home Builders and Wells Fargo. The HMI jumped eight points in June to 52 — the biggest one-month increase since September 2002. In the index a score of 50 is the diving line between a good market and a poor one.
Increased demand for new homes was cited as the major reason of big jump in the index.
"With the low inventory of existing homes, an increasing number of buyers are gravitating toward new homes," said NAHB Chairman Rick Judson, owner of Evergreen Development in Charlotte, N.C.
NAHB Chief Economist David Crowepredicts housing starts will top 1 million this year for the first time since 2007.
The HMI, which is based on a survey of home builders, is composed of three components: Current sales conditions increased eight points to 56; expectations for future sales jumped nine points to 61; and traffic of prospective buyers rose seen points to 40.
Kent Hoover Washington Bureau Chief