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55+ Housing Market Demand Figures
According to the National Association of Home Builders, confidence in the single-family 55+ housing market remained in positive territory in the first quarter of 2016. The 55+ single-family HMI dropped five points to 56, but is still above the breakeven point of 50, which indicates that more builders view conditions as good than poor. The 55+ single-family HMI has been above 50 for eight consecutive quarters.
There are separate 55+ HMIs that measure builder confidence in two market segments: single-family and multifamily condominiums. Each 55+ HMI is 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).
Two of the three subcomponents of the 55+ single-family HMI decreased from the previous quarter: present sales decreased four points to 61 and traffic of prospective buyers dropped 14 points to 38. However, expected sales for the next six months rose eight points to 71, which is the highest reading since the inception of the index in 2008.
The 55+ multifamily condo HMI increased six points to 48 in the first quarter. All three of its subcomponents increased: presents sales rose five points to 49, expected sales for the next six months increased five points to 51 and traffic of prospective buyers jumped 8 points to 45.
In addition to the 55+ multifamily condo and single family markets, the survey also tracks conditions in the 55+ multifamily rental market. In this market segment, the present economic indicators increased: present production rose four points to 60 and current demand for existing units increased three points to 69. On the other hand, the future economic indicators declined: expected future production fell eight points to 53 and future demand dipped three points to 68.
Although conditions in the 55+ housing markets are positive overall, builders are still facing challenges such as labor shortages and lot availability.
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