Get ready for more new homes!
Regardless of the reasons or politics, new home builders are optimistic... more than they have been in a decade!
The good news comes from a recently issued press release by the National Association of Home Builders. The association surveys several hundred home builders each month and asks them how they feel about a couple of things. Simple, emotional gut reactions.
One of the "how do you feel" questions is:
Do you expect sales of new homes, over the next six months, to be good, fair or poor?"
Sounds simple. It is. With that and a few other questions, the association issues a monthly report about how builders feel about the future. They assign it a number, and that number becomes the Housing Market Index (HMI).
The number went up 3 points in October, to 64. That's the highest it's been in 10 years.
Builders are optimistic- so what?
It's a big so what!
When new home builders read the tea leaves... they see more folks buying new homes over the next six months. So they start building now to make sure they've got homes on the market for these new buyers.
New home construction means more materials purchased. That means someone has to make and sell those materials. Jobs are created. Someone then has to build those homes. More jobs created.
New home sales are only a tenth of the housing market- but they pack a punch.
The economy just LOVES new homes!
Is it time to buy a new home?
We can't answer that for you. But considering that the Federal Reserve recently refused to raise interest rates (that was a bit of a shock), interest rates are still at all time lows. No one knows how long the builder optimism will stay high and the rates stay low, but it's a perfect combination for builders and buyers alike.
It could all change in next month's report.
But for now...the economy just got a shot of adrenaline. And that's good news.
Homeowners insurance: St. Clair Insurance: (951) 284-0400.