{"id":29870,"date":"2016-02-16T16:16:12","date_gmt":"2016-02-16T22:16:12","guid":{"rendered":"http:\/\/news.medill.northwestern.edu\/chicago\/?p=29870"},"modified":"2016-02-17T09:17:03","modified_gmt":"2016-02-17T15:17:03","slug":"u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs","status":"publish","type":"post","link":"https:\/\/news.medill.northwestern.edu\/chicago\/u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs\/","title":{"rendered":"U.S. home-builder confidence buckles under pressure of high labor costs"},"content":{"rendered":"

By Siri Bulusu <\/strong><\/p>\n

Confidence among U.S. home-builders reached a nine-month low in February, said a U.S. trade group Tuesday, after a series of lukewarm index figures fell shy of expectations in recent months.<\/p>\n

The report stated the Housing Market Index, compiled by the\u00a0National Association of Home Builders and Wells Fargo, dropped 3 points to 58 in February from a revised 61 in January. The reading fell well short of the consensus estimate of 61 by analysts surveyed by Bloomberg.<\/p>\n

<\/p>\n

\u201cBuilders are reflecting consumers\u2019 concerns about recent negative economic trends,\u201d said David Crowe, chief economist for the NAHB.<\/p>\n

NAHB chairman Ed Brady stated in a press release that the dip in confidence can be attributed to high costs and low availability of construction labor.<\/p>\n

Brady said that\u00a0despite the dip in confidence this month, builders are still \u201coptimistic\u201d that home sales will grow in coming months.<\/p>\n

J.P. Morgan analyst Daniel Silver agreed, writing, \u201cWe still believe that the housing market will continue to recover over time, although the tone of the near-term housing indicators has been mixed in recent months.”<\/p>\n

Housing Market Index (Feb.15-Feb.16)<\/h2>\n

[field name=”chart”]<\/p>\n

The Housing Market Index began to slow in December 2015,\u00a0due in part\u00a0to the tightening construction-labor market. (Siri Bulusu\/ MEDILL)(Source: Bloomberg)<\/div>\n

The HMI number peaked in November 2015 at 65 and then fell short of consensus expectations in the following December and January, reaching 62 and 60 respectively, hinting at a lukewarm outlook for the housing market in 2016.<\/p>\n

\u201cThe latest figure was not much weaker than the readings from the past few months and still a solid level in a broader historical context,\u201d Silver stated.<\/p>\n

Index readings over 50 suggest most builders feel confident about market conditions for single-family homes.<\/p>\n

Analysts at Trading Economics estimate the HMI\u00a0will fall to 57.32 in March 2016 and\u00a0hold\u00a0around 57 through April and May.<\/p>\n

Nearly four years after the housing crisis, the housing market began to see sustained growth in 2012, aided by historically low mortgage rates and decreased foreclosures.<\/p>\n

The HMI steadily increased since the extremely low reading of 25 in January 2012, and continued to rise until the index peaked in November 2015 at 65.<\/p>\n

The U.S. Housing Market Index fell under pressure from high labor costs for construction workers. (Scott Lewis\/ FLICKR)<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

By Siri Bulusu Confidence among U.S. home-builders reached a nine-month low in February, said a U.S. trade group Tuesday, after a series of lukewarm index figures fell shy of expectations in recent months. The report stated the Housing Market Index, compiled by the\u00a0National Association of Home Builders and Wells Fargo, dropped 3 points to 58 […]<\/p>\n","protected":false},"author":220,"featured_media":29876,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27,585],"tags":[1419,931],"class_list":["post-29870","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-winter-2016","tag-home-builders","tag-housing-sector"],"yoast_head":"\nU.S. home-builder confidence buckles under pressure of high labor costs - Medill Reports Chicago<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/news.medill.northwestern.edu\/chicago\/u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"U.S. home-builder confidence buckles under pressure of high labor costs - Medill Reports Chicago\" \/>\n<meta property=\"og:description\" content=\"By Siri Bulusu Confidence among U.S. home-builders reached a nine-month low in February, said a U.S. trade group Tuesday, after a series of lukewarm index figures fell shy of expectations in recent months. The report stated the Housing Market Index, compiled by the\u00a0National Association of Home Builders and Wells Fargo, dropped 3 points to 58 […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/news.medill.northwestern.edu\/chicago\/u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs\/\" \/>\n<meta property=\"og:site_name\" content=\"Medill Reports Chicago\" \/>\n<meta property=\"article:published_time\" content=\"2016-02-16T22:16:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2016-02-17T15:17:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/s3.amazonaws.com\/medill.wordpress.offload\/WP%20Media%20Folder%20-%20medill-reports-chicago\/wp-content\/uploads\/sites\/3\/2016\/02\/15971792021_9c63d0bfe5_o.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"531\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"siribulusu\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"siribulusu\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/news.medill.northwestern.edu\/chicago\/u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs\/\",\"url\":\"https:\/\/news.medill.northwestern.edu\/chicago\/u-s-home-builder-confidence-buckles-under-pressure-of-high-labor-costs\/\",\"name\":\"U.S. home-builder confidence buckles under pressure of high labor costs - 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