Housing Market Index Unchanged

Demand for new homes is solid but lack of available lots and shortages in construction labor are holding back growth. The housing market index came in unchanged in March at a 58 level which however remains well above breakeven 50. Present sales, unchanged at a strong 65, lead the March report followed by future sales which are down 3 points to 61. A plus, however, is a 4 point gain to 43 for buyer traffic which has been weak this whole cycle.

The gain in traffic hints at the drawing power of low mortgage rates and speaks to the strength of the labor market. But there hasn't been much acceleration in housing nor is any expected in tomorrow's permits data. The housing sector, which was billed as a strength for 2016, has yet to build any momentum this year.

Recent History Of This Indicator:
The housing market index has been losing steam but is nevertheless signaling that confidence among the nation's home builders is strong. The Econoday consensus is calling for a 1 point rebound in March to 59.0 following February's 3-point dip. The traffic component of this report, reflecting lack of first-time buyers, has been lagging badly.