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Builder Confidence Rises to 44 Builder Confidence rose seven points to 44 in January after rising to 37 in December, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Builders were cheered by falling mortgage rates and recent economic data. All three of the major HMI indices posted gains in January. The HMI index charting current sales conditions increased seven points to 48, the component measuring sales expectations in the next six months jumped 12 points to 57 and the component gauging traffic of prospective buyers rose five points to 29. Regional confidence numbers were mixed. Any number over 50 indicates that more builders view the component as good than view it as poor. Building Permits Rise 1.9% Overall building permits rose 1.9% in December to 1.50 million units in December after falling to 1.46 million annual units in November. Single-family permits rose 1.7% to 994,000 annual units after rising to 976,000 annual units in November and were up 32.9% from December 2022. Multifamily permits increased 2.2% to 501,000 units after falling to 484,000 units in November. Permits were down year over year in all regions. Housing Starts Fall 4.3% Housing starts fell 4.3% in December to a seasonally adjusted annual rate of 1.46 million units after jumping to 1.56 million units in November. Single-family starts fell 8.6% to a seasonally adjusted annual rate of 1.03 million units after rising to 1.14 million units in November. Single family starts were down 7.2% year to date. There are currently 669,000 single-family homes under construction, down almost 15% from a year ago. In contrast, there are more than one million apartments under construction, near the highest total since 1973. Multifamily starts rose 6.3% to an annualized pace of 402,000 units after rising to 395,000 units in September. New Home Sales Rise 8.0% New home sales rose 8.0% in December to a seasonally adjusted annual rate of 664,000 homes after falling to 590,000 homes in November, according to the National Association of Home Builders (NAHB). Sales were up 4.4% from December 2022. Falling interest rates and a chronic lack of existing homes helped pull buyers off the sidelines. On an annual basis, new home sales were up 4.2% to 668,000 new homes. New single-family home inventory in December remained elevated at a level of 453,000, up 0.4% compared to a year earlier, an 8.2 months’ supply at the current building pace. A 6 months’ supply is considered balanced. Completed, ready-to-occupy inventory was up 22.2% from December 2022 to 88,000 homes but still accounts for just 19% of total inventory. The median new home sale price fell 3.0% in December to $413,200 and was down 13.8% year over year. Sales year to date were up in all regions. Sales of new homes are tabulated when contracts are signed and are considered a more timely barometer of the housing market than purchases of previously-owned homes, which are calculated when a contract closes. Existing Home Sales Fall 1.0% Existing home sales fell 1.0% in December to a seasonally adjusted annual rate of 3.78 million homes after rising to 3.82 million homes in November, according to the National Association of Realtors. Sales were down 6.2% from December 2022. The median existing-home sales price rose 4.4% year over year to $382,600, leaving year-over-year prices below $400,000 for the fourth consecutive month. The inventory of unsold existing homes fell 11.5% to 1 million homes at the end of December, a 3.2-months’ supply at the current sales pace, down from 3.5 months in November. A chronic shortage of existing inventory is spurring new home construction and sales despite continuing high prices. Year-over-year prices were up in all regions. Regional Housing Data  Mortgage Rates Steady at 6.7% 
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