Housing Market Index Shows Strength

Rising traffic headlines a very strong housing market index, at 59 this month vs August's already strong 50-plus reading of 55. The traffic component, which has been lagging badly, is up 5 points to a near-50 reading of 47 (readings above 50 indicate monthly growth).

The present sales component is also up 5 points, to 63 in what points specifically to September gains for new home sales. The future sales component is at 67 for a 2 point gain.

By region, strength is led by the South, at 63, which is by far the largest region for new homes. The Midwest and West are right behind at 61 while lagging badly at 44 is the Northeast which is by far the smallest region for new homes.

The gain for this report's traffic component marks an important moment for housing data. Traffic in housing has been held down by a lack of first-time buyers who, perhaps bolstered by rising job prospects and rising spirits, now may be coming back to the market.

But new home sales and housing starts have yet to show the same kind of general strength as the housing market index has the last several months. Housing starts for August will be posted Thursday morning at 8:30 a.m. ET.