55+ Housing Market Ends 2017 on Record High in U.S.
According to the National Association of Home Builders' 55+ Housing Market Index
, released this past week, U.S. builder confidence in the single-family 55+ housing market remained strong in the fourth quarter of 2017 with a reading of 71, up 12 points from the previous quarter. This is the highest reading since the inception of the index in 2008.
"Builders and developers in the 55+ housing market are reporting strong demand across the country," said Chuck Ellison, chairman of NAHB's 55+ Housing Industry Council and Vice President-Land of Miller & Smith in McLean, Va. "However, regulations in some parts of the country can make it challenging to meet the demand."
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).
All three index components of the 55+ single-family HMI posted increases from the previous quarter: Present sales posted a record high, increasing 14 points to 79, while expected sales for the next six months jumped 10 points to 73 and traffic of prospective buyers rose seven points to 51.
The 55+ multifamily condo HMI posted a gain of three points to 54. The index component for present sales increased four points to 59, expected sales for the next six months rose five points to 60 and traffic of prospective buyers remained even at 40.
Two of the four components of the 55+ multifamily rental market went up from the third quarter: present production increased three points to 62 and expected future production rose four points to 61, while present demand for existing units fell four points to 71 and future expected demand dropped nine points to 67.
"The strong performance of the 55+ HMI at the end of 2017 is consistent with recent increases in broader measures of the housing market, including the NAHB/Wells Fargo HMI," said NAHB Chief Economist Robert Dietz. "We expect continued growth in the market for new 55+ housing in 2018 due to favorable demographics, rising home owner wealth and the current tight supply of existing homes on the market."