The National Association of Home Builders conducts a monthly survey of builders to gauge their confidence in the current market and their expectations for the future. The index is a closely watched housing market metric because a builder's business depends on being able to accurately read what home buyers want, and when. In January, the index saw its first improvement after 12 consecutive months of declines. It could signal a turning point for the market.
Robert Dietz, NAHB's chief economist, thinks so. “While NAHB is forecasting a decline for single-family starts this year compared to 2022, it appears a turning point for housing lies ahead,” Dietz said. “In the coming quarters, single-family home building will rise off of cycle lows as mortgage rates are expected to trend lower and boost housing affordability.” Naturally, home builders are focused on the new home market, but rising inventory, lower rates, and improved affordability will benefit buyers of both new and existing homes.