If you're buying or selling a house, the new home market should matter to you. Why? Well, new home construction is the best way to increase the overall number of homes available for sale. And, as that number rises, the gap between supply and demand shrinks and home price increases begin to moderate.
Whether you want to see home price increases begin to slow depends, of course, on whether or not you're buying or selling but, either way, it's likely something that is of interest to you. So what's happening in the new home market these days? For one, housing starts – which measure the number of new homes that began construction during the month – were up 25.5 percent in October, according to new numbers released by the U.S. Census Bureau and the Department of Housing and Urban Development. That number includes multi-family residences but single-family home construction also increased, jumping 10.7 percent over the month before.
That was a better than expected result and is an indication that builders are feeling confident in the economy. Another is the fact that the National Association of Home Builders Housing Market Index, which gauges builders' perception of the market for new homes, scored a 63 in November.
The Index measures home builder confidence on a scale where any number above 50 indicates more builders view conditions as good than poor. In other words, according to recent news, the new home market is looking steady and poised for further improvement.