The NAHB released the monthly Housing Market Index (HMI) for July last week with a national reading of 53. This marks the first time since January that builder confidence has been above 50, which indicates more than half of builders report good sales conditions. Regionally, preliminary numbers for July increased most significantly in the West from 53 to 59, and in the Midwest from 47 to 53. Who is the typical 2014 home buyer facilitating the positive change in builder confidence? Via Metrostudy data collected for new-home closings year-to-date, here is deeper look at average home buyers, price of purchased homes, and the leading builder in each U.S. Census region.
The New England and Mid-Atlantic saw a positive increase in HMI, up 3 from June and the highest since January, but the region is struggling most to bounce back from a low winter selling season. Of a total 222,177 closings recorded year-to-date in 2014, 7,977 are new-home sales. The average Northeast buyer has paid a median new-home closing price of $343,777.78 and $164.40 per square foot. Sixty-four percent of new-home buyers are married, and the average household age is 46 with 1.4—one to two—children. The leading builder in the Northeast in the first two quarters is NVR with a reported 843 closings so far this year; 10.6 percent of the regional market share by closings.
High demand, high prices in top markets, and a better winter selling season overall put the West ahead of every other region in builder confidence with a preliminary July HMI of 59. In 2014, the western U.S. reported 569,900 closings and 39,693 new-home closings. The median closing price year-to-date is $316,007.69 and $176.08 per square foot. Sixty-three percent of new-home buyers are married and have an average household age of 42.6. The West ties with the Midwest for highest average number of children per new-home household, approaching two with an average of 1.7. DR Horton, who is the year-to-date leading builder by closings nationally, is the top builder in the West with 2,984 reported closings so far in 2014. It holds 6.5 percent of the regional market share by closings.
The Midwest and South tie with a regional HMI of 53 for July, and affordability reigns in both regions with the lowest median closing prices and prices per square foot in 2014. In the Midwest, 15,134 new homes have been sold with a total of 421,745 closings this year. The median closing price is the lowest of the four U.S. regions at $272,190.91 and $144.09 per square foot. The average household age for current buyers is 42.2 with an average 1.7 children. The majority of new-home buyers in the Midwest are married—67 percent year-to-date. Pulte-Del Webb-Centex leads builders in the region with 543 reported closings, making up 3.6 percent of the market share.
The South leads the U.S. in closings with a total of 963,189, 87,833 of which were new homes. The year-to-date median new-home closing price is $275,035.29 and $143.47 per square foot. New-home buyers are youngest in the South this year at an average household age of 40.2. The average number of children in the region ranges from one to two with a 1.5 average. Only 56 percent of new-home buyers are married, the lowest in the country. DR Horton also currently leads the South in new-home closings with 8,054 reported so far this year, which accounts for slightly less than 1 percent of the overall market share by closings.