What is NAHB Market Index

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What is it?

• NAHB/Wells Fargo Housing Market Index (HMI) is based on a monthly survey of home builders.
• The HMI is based on a survey that has been mailed to a panel of NAHB builder members every month since January 1985.
• Builders, with their experience and close contact with local market conditions, provide timely information about current housing market conditions as well as how home sales are likely to behave in the future
• They are asked to rate current sales of single-family homes and sales expectations for the next six months and to rate the traffic of prospective buyers. Scores for responses to each component are used to calculate a seasonally adjusted overall index, where a number over 50 indicates more builders view sales conditions as good than poor.
• About 400 responses are obtained each month.

How it is Calculated?

The NAHB/Wells Fargo HMI is a weighted average of three separate component indices:

• Present Single-Family Sales(scale of “good,” “fair” or “poor”)
• Single-Family Sales for the Next Six Months(scale of “good,” “fair” or “poor”)
• The traffic of Prospective Buyers. (scale of “high to very high,” “average” or “low to very low”)