RISMEDIA, June 8, 2009-Builders of single-family housing for the mature home buyer market reported an increase in traffic of prospective buyers during the first quarter of this year, according to the 55+ Housing Market Index (55+ HMI) released today by the National Association of Home Builders (NAHB). The component measuring traffic rose to 14, up from nine in the last quarter. The reported sales component, however, dropped five index points to 12 from the previous quarter’s 17. The drop in the reported sales component pushed the overall 55+ HMI down from 16 to 14.
“A strong and growing number of retirees and empty-nest households are interested in either downsizing or moving to a more user-friendly home – especially if it’s near their existing community,” said David Crowe, NAHB’s chief economist. “But the current market still presents significant obstacles to homeowners who need to sell an existing home before buying a more appropriate one. That situation is holding many mature consumers back from moving.”
The 55+ HMI is a diffusion index, derived from quarterly surveys of builders and developers designed to study builder sentiment on single-family housing and both multifamily condo and rental conditions. The survey asks builders to rank their perceptions of the current sales conditions, prospective buyer traffic, and market expectations for the next six months as “good,” “fair,” or “poor.” The responses are used to create a scale of 0 to 100, with a rating of 50 generally indicating that the number of positive responses is about the same as the number of negative responses.
Despite difficult market conditions, builders who specialize in this sector are seeing more prospective buyers coming through their doors according to the survey. Builders exhibited guarded optimism as they look forward six months, with the six-month expectation index number rising from 24 to 26 for single-family sales, and the condo sales index number rising from 17 to 20. Expectations for multifamily rental starts fell from 37 to 35.
“With the return of a more stable, healthier housing market, the pent-up demand for housing with the features and amenities that appeal to Baby Boomers will keep builders in this sector busy for years to come,” noted Crowe.
For more information, visit www.nahb.org.