Builder confidence in the single-family 55+ housing market remains in positive territory in the second quarter with a reading of 57, up one point from the previous quarter, according to the National Association of Home Builders' (NAHB) 55+ Housing Market Index (HMI) released today. This is the ninth consecutive quarter with a reading above 50.
“Builders and developers for the 55+ housing sector continue to report steady demand,” says Jim Chapman, chairman of NAHB's 55+ Housing Industry Council and president of Jim Chapman Homes LLC in Atlanta. “However, there are many places around the country facing labor and lot shortages, which are hindering production.”
There are separate 55+ HMIs for two segments of the 55+ housing market: single-family homes and multifamily 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 (high, average or low for traffic). An index number above 50 indicates that more builders view conditions as good than poor.
One of the three index components of the 55+ single-family HMI posted an increase from the previous quarter: traffic of prospective buyers increased four points to 42. Present sales held steady at 61 while expected sales for the next six months dropped two points to 69.
The 55+ multifamily condo HMI dipped one point to 47. The index component for expected sales for the next six months rose three points to 54, while present sales remained even at 49 and traffic of prospective buyers fell seven points to 38.
Three of the four indices tracking production and demand of 55+ multifamily rentals decreased in the fourth quarter. Present production fell nine points to 51—from a record-high reading in the previous quarter—while current and future demand for existing units both dipped one point to 68 and 67, respectively, and expected future production rose three points to 56.
“Much like the overall housing market, this quarter’s 55+ HMI results show that this segment continues its gradual, steady recovery,” says NAHB Chief Economist Robert Dietz. “A solid labor market, combined with historically low mortgage rates, are enabling 55+ consumers to be able to sell their homes at a favorable price and buy or rent a home in a 55+ community.”
For the full 55+ HMI tables, visit www.nahb.org/55hmi.