Homebuilder confidence drops for first time since April

Index tracking sentiment is still up year-over-year

National /
Dec.December 16, 2020 12:15 PM
(iStock)

(iStock)

Homebuilders are reining in their expectations for the housing market, according to a new report.

The National Association of Home Builders/Wells Fargo Housing Market Index for this month dropped to 86, seasonally adjusted, after reporting its highest reading in history in November. It marks the first time since April that the index’s reading has seen a month-over-month decline.

December’s reading is still a record, however. It marks the second-highest reading in the index’s 35-year history.

The index tracks homebuilder confidence in current and future single-family home sales and traffic of potential homebuyers on a monthly basis. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook.

Mirroring the overall index’s step back, homebuilder sentiment was also lower when it came to single-family sales, with a reading of 92. The outlook for home sales in six months time dropped to 85, the same reading reported in September, while the outlook for buyer traffic fell to 73, just below September and October’s reading of 74.

Regional sentiment once again followed in national’s footsteps, with regional index readings all below those recorded in November.

But despite December’s lower figures, all components and regions tracked by the indices were up significantly year-over-year.

The housing market has had a record run this year, but with a rise in Covid-19 infection rates and homebuyer demand wavering as access to credit tightens, some economists question how much longer the gains can be sustained.






    Related Articles

    arrow_forward_ios
    Berkshire Hathaway HomeServices CEO Christy Budnick (Berkshire)
    Berkshire Hathaway HomeServices names new CEO
    Berkshire Hathaway HomeServices names new CEO
    Hammerson CEO Rita-Rose Gagne and Brookfield's Bruce Flatt. (Hammerson, Brookfield, Getty)
    Brookfield’s US malls are struggling. Now it’s buying some in Europe
    Brookfield’s US malls are struggling. Now it’s buying some in Europe
    (iStock)
    Hot, hot, hot: Resi market sets new price records in March
    Hot, hot, hot: Resi market sets new price records in March
    (iStock)
    Homebuilder sentiment ticks up in April
    Homebuilder sentiment ticks up in April
    Andrew Florance, CEO of CoStar Group (CoStar, Homes.com)
    CoStar to buy Homes.com for $156M
    CoStar to buy Homes.com for $156M
    (iStock)
    Mortgage requests, refinancings continue to drop
    Mortgage requests, refinancings continue to drop
    Howard Hanna CEO Helen Hanna Casey and Compass CEO Robert Reffkin (Howard Hanna Casey, Getty)
    Howard Hanna accuses Compass of poaching agents, stealing trade secrets
    Howard Hanna accuses Compass of poaching agents, stealing trade secrets
    The effective rate was 1.1 percent, on average, in 2020, down from 1.14 percent in 2019. (iStock)
    Homeowners’ property taxes grew twice as fast last year
    Homeowners’ property taxes grew twice as fast last year
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...