U.S. Housing Market Index Jumps To Nine-Month High In June

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Homebuilder confidence has seen a significant improvement in the month of June, according to a report released by the National Association of Home Builders on Monday.

The report said the NAHB/Wells Fargo Housing Market Index jumped to 59 in June from 54 in May. The index has been expected to show a more modest increase to a reading of 56.

With the bigger than expected increase, the housing market index reached its highest level since a matching reading in September of 2014.

NAHB Chairman Tom Woods said, "Builders are reporting more serious and committed buyers at their job sites and this is reflected in recent government data showing that new-home sales and single-family construction are gaining momentum."

The sharp increase by the housing market index came as all three components of the index posted healthy gains during the month.

The component gauging current sales conditions surged up to 65 in June from 58 in May, the index charting sales expectations in the next six months jumped to 69 from 63 and the component measuring buyer traffic rose to 44 from 39.

"The HMI indices measuring current and future sales expectations are at their highest levels since the last quarter of 2005, indicating a growing optimism among builders that housing will continue to strengthen in the months ahead," said NAHB Chief Economist David Crowe.

Tuesday morning, the Commerce Department is scheduled to release a separate report on housing starts in the month of May.

Economists expect housing starts to drop to an annual rate of 1.090 million in May from a rate of 1.135 million in April.

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