NAHB weighs in on housing-starts jump
Responding to the Commerce Department’s September housing starts data — up 15% from August — the National Association of Home Builders (NAHB) said tight lending conditions continue to depress the market.
Nationwide housing starts rose 15% to a seasonally adjusted annual rate of 658,000 units in September, the strongest pace of residential construction since April 2010.
"Today’s numbers are very welcome evidence that builders are putting some crews back to work on single-family homes in select markets where economic conditions are improving, and on multi-family homes in places where demand for rentals is on the rise," said Bob Nielsen, chairman of the NAHB and a home builder from Reno, Nev. "That said, extremely tight lending conditions for both building and buying new homes, along with stubbornly high foreclosures that are putting downward pressure on home prices, continue to weigh down new construction and corresponding job growth."
The gain was largely attributed to a sharp increase on the multi-family side, which has been trending upward due to increased demand for rental apartments.
"The big gain in multi-family housing production for September was in the wake of a below-trend number in August and in keeping with characteristic volatility in that sector," said NAHB chief economist David Crowe. "However, there’s no doubt that demand for apartments is rising, as restrictive mortgage lending policies and concerns about future employment push consumers to pursue rental options."
Builder confidence rises in October
Builder confidence in the market for newly built, single-family homes edged slightly higher for a sixth consecutive month in October, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The one-point gain brings the index to 41, its strongest level since June 2006.
“Many builders are reporting increases in the number of serious buyers visiting their sales offices, and the overall confidence measure is much higher than it was at this time last year,” said NAHB Chairman Barry Rutenberg, a home builder from Gainesville, Fla. “The concern is that, even though demand for new homes is rising, overly tight credit conditions are still constraining new building and new purchases at a time when that kind of economic activity and the job growth it generates are greatly needed.”
The NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores from each component are then used to calculate a seasonally adjusted index where any number higher than 50 indicates that more builders view sales conditions as good than poor.
Following increases in the previous month, the HMI components measuring current sales conditions and sales prospects for the next six months remained unchanged in October at 42 and 51, respectively. The component measuring traffic of prospective buyers increased 5 points to 35, its highest level since April 2006.
Builder confidence continued to improve in three out of four regions in October. The HMI gained two points in the Midwest and West to 42 and 44, respectively, and three points in the South to 39. A three-month moving average for the Northeast’s HMI was unchanged at 29.
PulteGroup appoints president, Houston division
PulteGroup has named Kevin Meuth as the new division president for its Houston operations, where he will oversee the 27 communities and about 100 employees throughout the Greater Houston area.
Meuth has 22 years of diversified home-building experience, all in the Houston market. Previously, he served as division president at Meritage Homes for the past five years.
"Kevin has developed strong relationships with land developers and trade partners across the Houston market, while building extensive expertise in the purchasing, construction and home-building operations disciplines," said Harmon Smith, Gulf Coast Area president of PulteGroup. "With his extensive experience in home building, Kevin understands how to deliver profitable results during these challenging times. We are confident that he will continue to build upon the success of the Pulte Homes, Centex and Del Webb brands in Houston."