NAHB housing market index dips in March but still strong

Sentiment among US housebuilders remained strong in March, according to data released on Thursday.

The National Association of Home Builders/Wells Fargo housing market index dipped to 70 from a downwardly-revised 71 in March, coming in below expectations for a reading of 72. Although the index has fallen for three consecutive months, it is still at a very high level by historical standards.

The index measuring future sales expectations dropped two points to 78 and the index gauging buyer traffic slipped three points to 51.

By region, the index for the Midwest was up one point at 57, while the index for the South fell one point to 73 and the gauge for the Midwest fell by four points to 68.

NAHB Chairman Randy Noel said: "Builders’ optimism continues to be fulled by growing consumer demand for housing and confidence in the market. However, builders are reporting challenges in finding buildable lots, which could limit their ability to meet this demand."

NAHB Chief Economist Robert Dietz said: "A strong labour market, rising incomes and a growing economy are boosting demand for homeownership even as interest rates rise. With these economic fundamentals in place, the single-family sector should continue to make gains at a gradual pace in the months ahead."