Builder confidence in the single-family 55-plus housing market was at an all-time high in the third quarter, jumping 18 points to 83, according to the National Association of Home Builders’ (NAHB) 55-plus Housing Market Index (HMI).
The 55-plus HMI measures two segments of the 55-plus housing market: single-family homes and multifamily condominiums. Each segment of the 55-plus 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).
“We saw 55-plus buyers come out in force in the third quarter of this year, driving strong growth in sales at 55+ communities,” said Harry Miller III, chairman of NAHB’s 55-plus Housing Industry Council and president of Regal Builders LLC in Dover, Del. “However, shortages of key building materials are contributing to affordability concerns and delayed construction schedules, although recent declines in lumber prices offer good news.”
All three index components of the 55-plus single-family HMI posted gains in the third quarter and were all-time highs: present sales increased 16 points to 88, expected sales for the next six months rose 20 points to 90 and traffic of prospective buyers jumped 23 points to 69.
The 55-plus multifamily condo HMI increased 20 points to 67—a record level. All three index components also posted increases from the previous quarter: present sales rose 20 points to 70, expected sales for the next six months increased 15 points to 67 and traffic of prospective buyers jumped 24 points to 63.
All four components of the 55-plus multifamily rental market went up in the third quarter: present production increased six points to 62, expected future production rose seven points to 61, present demand for existing units increased 15 points to 76 and future expected demand rose seven points to 71.
“Like the broader housing market, low interest rates and the importance of home are helping to lift market sentiment,” said NAHB Chief Economist Robert Dietz. “The rebound in the stock market has also contributed to demand for the 55-plus housing market.”