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Builders Upbeat on Buyer Traffic, but 6-Month Outlook Dims
Tuesday, March 15, 2016
After dropping three points in February to 58, the Housing Market Index, a measure of builder confidence in the single-family home market, remained unchanged in March. Analysts surveyed by Econoday had predicted a one-point gain. The level the past two months is the lowest for the index since May 2015.
The index is produced by the National Association of Home Builders (NAHB) and Wells Fargo Bank from responses to a survey NAHB conducts monthly among its new home builder members. They are asked to gauge the current market for new homes as "good," "fair" or "poor" and to do the same regarding their expectations over the next six months. They are also asked to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.
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