Builder confidence has gone down in the 55+ housing market for single-family homes, falling three points to 12 compared to the same period last year, according to the lastest National Association of Home Builders’ (NAHB) 55+ Housing Market Index.
“The current state of the economy continues to affect buyers in the 55+ housing market,” said NAHB Chairman Bob Nielsen in a statement. “The market remains weak given the many uncertainties people face in this economy. While potential buyers exist, they are hesitant to commit to buying a new home as they are concerned about selling their existing home at a fair price, due to low appraisals, an abundance of foreclosures and tighter mortgage lending criteria.”
The declining sentiment is based on current sales, prospective buyer traffic and anticipated six-month sales for the 55+ single-family market, says the NAHB; a number greater than 50 indicates that more builders view conditions as good than poor.
Index components included present sales dropping four points to 11; expected sales (six months into the future) dropping nine points to 15; and traffic of prospective buyers rising two points, to 11.
Although 55+ single-family homes are getting lessening votes of confidence, 55+ multifamily rentals remain the strongest segment of the 55+ housing market, says NAHB, with the index measuring present demand rising 12 points to 40, and the index measuring future demand up 10 points to 42. Plus, current and future production indices for 55+ multifamily rental units also jumped 11 points in the third quarter to 25, and from 10 points to 26, respectively, compared to last year.
“Multifamily rental units continue to be the bright spot in the 55+ housing market,” said NAHB Chief Economist David Crowe. “However, with demand currently running ahead of production, as it has been for several quarters now, the risk of a shortage of rental units in select markets in the future looms larger as builders continue to have trouble obtaining credit to finance new construction.”
Go here for the full 55+ HMI tables.
Written by Alyssa Gerace