Homebuilder's Index Remains Solid

Builder confidence remains solid, at 57 for the December housing market index. Though slightly below November's 58 and on the low side of expectations, this is still the 6th reading in row that the index is above breakeven 50.

December's strength is centered in expectations for future sales, at 65 vs November's 66, followed by current sales which are at 61 vs 62. Continuing to trail in the distance is the traffic component, unchanged at 45 in a reading that underscores the lack of first-time buyers in the housing market.

Regional data show a big surge in the West, up 14 points to a composite confidence score of 74 in what is especially good news for builders in the region. The South is down 4 points this month to 58 followed by the Midwest, at 54 vs 56, and the Northeast, at 46 for a 5 point decline.

This report isn't scorching hot but is a positive indication for the housing sector which, on trend, has been no better than flat going into year end. Tomorrow's housing starts data are expected to show a bounce higher for starts but, in a reminder that housing has been up and down, are also expected to show a decline for permits. The Dow is moving off opening highs following today's report.

Recent History Of This Indicator:
Ther NAHB housing market index for November was up 4 points to 58 which, outside of September's 59, is the best reading of the year and of the recovery. Gains appear through the three components led by a 5 point gain in current sales to 62 which points to strength for November new home sales. Future sales were up 2 points to 66 with the traffic component, which continues to lag, up 4 points to 45. Regional data show wide gains led this month by the Northeast which is now in positive ground at 51 (readings over 50 indicate month-to-month growth). Housing remains comparatively flat to other sectors of the economy though the latest report does hint at increasing strength.