In the first quarter of 2013, the National Association of Home Builders’ (NAHB) 55+ single-family Housing Market Index (HMI) increased 19 points on a year-over-year basis to 46. This is the highest first-quarter number recorded since the inception of the index in 2008 and sixth consecutive quarter of year-over-year improvements.
“Builders and developers for the 55+ housing sector continue to report increased optimism in the market,” said Robert Karen, chairman of NAHB’s 50+ Housing Council and managing member of the Symphony Development Group. “We are seeing an increase in consumer demand for homes and communities that are designed to address the specific needs of the mature homebuyer.”
There are separate 55+ HMIs for two segments of the 55+ housing market: single-family homes and multi-family condominiums. Each 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor. An index number below 50 indicates that more builders view conditions as poor than good.
All of the components of the 55+ single-family HMI showed growth from a year ago: present sales climbed 19 points to 46, expected sales for the next six months increased 21 points to 53, and traffic of prospective buyers rose 15 points to 41.
“The strong year-over-year increase in confidence reported by builders for the 55+ market is consistent with year over year increases in other segments of the home building industry,” said NAHB chief economist David Crowe. “While demand for new 55+ housing has improved due to a reduced inventory of homes on the market and low interest rates, builders’ ability to respond to the demand is being limited by a shortage of labor with basic construction skills and rising prices for some building materials.”