US housebuilder sentiment steady in January

Sentiment among US housebuilders remained steady in January, but analysts still expected the sector to pick in coming months.

The National Association of Home Builders/Wells Fargo housing market index was unchanged at 60 from a downwardly-revised December reading.

This was a touch below economists’ expectations for a reading of 61 but still comfortably above the 50 threshold that indicates improvement.

“After eight months hovering in the low 60s, builder sentiment is reflecting that many markets continue to show a gradual improvement, which should bode well for future home sales in the year ahead,” said NAHB chairman Tom Woods, a home builder from Blue Springs, Missouri.

“With job creation, economic growth and growing household formations, we anticipate the housing market to continue to pick up traction as we head into 2016.”

The component gauging current sales conditions rose two points to 67 in January, but the index measuring sales expectations in the next six months fell three points to 63 and the component charting buyer traffic slipped two to 44.

Pantheon Macroeconomics said: “We are surprised to see a 2-point dip in the buyer traffic component, given the much milder-than-usual weather across much of the country over the past month.”

Nevertheless, the research shop added: "The relationship between the current sales number in the survey and the official new home sales data is very weak month-to-month, but the recent run of NAHB readings does point to clear upside risk, with the official numbers undershooting substantially since late summer."