According to NAHB’s latest 55+ Housing Market Index (HMI) survey, builder confidence in the 55+ housing market for single-family homes increased significantly in the first quarter of 2012 compared to the same period a year ago. The 55+ single-family HMI increased 10 points to 27, and although 27 is relatively low for an index that lies on a scale of 0 to 100, it is nevertheless the highest reading since the inception of the index in 2008.
The 55+ single-family HMI measures builder sentiment based on a survey that asks if current sales, buyer traffic and anticipated sales for that market are good, fair or poor (high, average or low for traffic). An index number below 50 indicates that more builders view conditions as poor than good.
The overall 55+ single-family HMI is a weighted average of the current sales, traffic and anticipated sales components. In the first quarter of 2012, all three components remained well below 50, but increased considerably from a year ago, each reaching an all-time high: present sales rose 12 points to 27, expected sales for the next six months increased eight points to 32 and traffic of prospective buyers rose nine points to 26. The survey results are not yet seasonally adjusted, so numbers should only be compared year-over-year.
The 55+ HMI survey also shows multifamily rental holding its place as the strongest segment of the overall 55+ housing market. The index for current production of 55+ rental apartments climbed 11 points to 31, while the index measuring current demand for existing 55+ rental apartments rose three points to 42. Expectations for future production and demand were up year-over-year also.
For complete history of all indices derived from NAHB’s 55+ HMI survey, see www.nahb.org/55HMI