Home builders saw little change in the housing market between October and November, according to the NAHB/Wells Fargo Housing Market Index (HMI) released Tuesday.
The monthly index, which measures builders’ assessment of buyer traffic as well as current and future sales, remained unchanged in November with a reading of 17.
Two components of the index—current sales and buyer traffic—also held steady this month, with current sales registering a reading of 17 and buyer traffic staying at 13.
The third component—sales expectations for the next six months—showed a small two-point uptick to 28, which may or may not reflect builders' reaction to Congress' extension and expansion of the housing tax credit, depending on when they completed the survey and how likely they thought the extension was to happen.
"When the HMI survey was conducted at the beginning of this month, home builders were facing the imminent expiration of the $8,000 first-time home buyer tax credit at the end of November, with no guarantee that this valuable buyer incentive would be extended," said Joe Robson, the NAHB chairman and a builder in Oklahoma."Now that Congress has done its job by both extending the tax credit into next year and expanding eligibility for it among potential buyers, we are very hopeful that this will have the intended stimulative effect on sales activity going forward."
Appraisals remain a concern for builders; one-third of those surveyed said too-low appraisals have resulted in lost sales, which is a jump from July, when one-fourth of builders said they had encountered that problem, according to the NAHB.
Alison Rice is senior editor, online, at BUILDER magazine.