The National Association of Home Builders (NAHB) (NYSEARCA:XHB) Housing Market Index (HMI) is a gauge of builder opinion on the relative level of current and future single-family home sales.
It is a diffusion index, which means that a reading above 50 indicates a favorable outlook on home sales; below 50 indicates a negative outlook.
The latest reading of 72 is up 14 from last month’s 58.
Here’s an introduction from this morning’s blog update:
In a strong signal that the housing market is ready to lead a post-COVID economic recovery, builder confidence in the market for newly-built single-family homes jumped 14 points to 72 in July, according to the latest NAHB/Wells Fargo Housing Market Index (HMI) released today. The HMI now stands at the solid pre-pandemic reading in March before the outbreak affected much of the nation.
Here is the historical series, which dates from 1985.
The HMI correlates fairly closely with broad measures of consumer confidence. Here is a pair of overlays with the Michigan Consumer Sentiment Index (through the previous month) and the Conference Board’s Consumer Confidence Index (through the current month).