US Builder Confidence Moves Higher for Third Consecutive Month in November

On Monday, the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) reported that builder sentiment in the market for newly built single-family homes in November posted a reading of 46, up 3 points from October. This marks the third consecutive increase.

NAHB points out that 31% of builders cut home prices in November—essentially unchanged since July, hovering between 31% and 33%. Meanwhile, the average price reduction was 5%, slightly below the 6% rate in October. The use of sales incentives was 60%, slightly down from 62% in October.

All three HMI sub-indices were up in November:

• The index charting current sales conditions rose 2 points to 49.
• The component measuring sales expectations in the next six months increased 7 points to 64.
• The gauge charting traffic of prospective buyers posted a 3-point gain to 32.

The regional breakdown was as follows (three-month moving average):

• The Northeast increased 4 points to 55.
• The Midwest moved 3 points higher to 44.
• The South edged up 1 point to 42.
• The West held steady at 41.