Housing Market Index Buckles Lower

This is no misprint. The housing market index has suddenly buckled lower, falling 8 points to 60 in November for the lowest score since August 2016. Rising mortgage rates are a major factor behind the unexpected plunge. The last reading even close to November's result was August last year at 64.

Among components, future sales show the largest drop, down 10 points to 65 for the weakest showing since May 2016 with current sales down 7 points to 67 which is the weakest since August 2016. And another low since August 2016 is traffic, down 8 points to 45.

By region, the South and West are both sharply lower at 65 with the Midwest at 54 and Northeast at 52, with both of these regions also sharply lower.

This an odd result and should the housing sector, which has been weakening the last six months, suddenly break lower going into year end, we can look back at today's report as the first harbinger. These results will not lift expectations for tomorrow's report on housing starts and permits for October where expectations are mixed.