WASHINGTON, D.C. – (RealEstateRama) — Builder confidence in the single-family 55+ housing market remains in positive territory for the first quarter of 2015, according to the National Association of Home Builders’ (NAHB) 55+ Housing Market Index (HMI) released today. Compared to the previous quarter, the single-family index edged down slightly by one point to 58, which is the fourth consecutive quarter above 50.
Two of the three components of the 55+ single-family HMI posted increases from the previous quarter: present sales increased one point to 64 and expected sales for the next six months rose three points to 67, while traffic of prospective buyers dropped eight points to 40.
“Builders in many parts of the country were affected by a particularly severe winter, but builders and developers in the 55+ sector continue to be positive as we move forward in 2015,” said Timothy McCarthy, chairman of NAHB’s 50+ Housing Council and managing partner of Traditions of America in Radnor, Pa. “The weather had an effect on traffic, and moderated and delayed settlement schedules. Nonetheless, 55+ builders’ confidence remains bullish on the outlook for the balance of the year.”
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 below 50 indicates that more builders view conditions as poor than good.
The 55+ multifamily condo HMI dipped four points to 38, and all components of the index dropped in the first quarter as well: present sales dropped three points to 41, expected sales for the next six months fell five points to 39 and traffic of prospective buyers increased dipped one point to 33.
Three out of the four indices tracking production and demand of 55+ multifamily rentals posted increases for the first quarter. Present production jumped eight points to 58, expected future production increased one point to 52 and current demand for existing units rose three points to 68, while future demand dipped two points to 64.
“The strong eight-point surge in the 55+ HMI survey’s index for multifamily rental production is a positive sign, and a contrast to the relatively low attitudes builders are currently expressing towards 55+ multifamily condos,” said NAHB Chief Economist David Crowe. “This suggests that there is a significant number of 55+ households who desire to live in dense multifamily settings but not to own, at least not right away.”
For the full 55+ HMI tables, please visit nahb.org/55hmi.