US Builder Sentiment Up for Fourth Consecutive Month in April

On Monday, April 17th, 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 increased 1 point in April to a reading of 45—the fourth consecutive month of gains. However, any reading below 50 indicates that more builders view conditions as poor rather than good.

Two out of the three HMI components posted gains and one was unchanged in April. The HMI current sales conditions index increased 2 points to a reading of 51. The component charting sales expectations in the next six months increased by 3 points to a reading of 50. The NAHB notes that this is first time since June 2022 that these two components returned to a 50+ reading. The gauge that measures traffic of prospective buyers was unchanged at a reading of 31. This is the first time the traffic component failed to improve in 2023.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose four points to a reading of 46, the Midwest was up two points to a reading of 37, the South increased four points to a reading of 49, and the West posted a four-point gain to a reading of 38.