In the 38 years NAHB has been creating and tracking this index there has never been another year even close to 2021 with an average of 81. The 38 year average is 53. To give readers an idea what a terrible housing market looks like, the average for the four years 2008-2011 was 16 with a five month low of under 9. Now that was a problematic market.
This housing market will likely tend to be trending flat to down until the Fed stops raising rates later this summer. The wild card is of course, energy.
One other important note. The average number of active single family home listings in the US averaged ~1.3MM from 2017 until the start of the pandemic in January 2020. When talking heads tell us that home listings are burgeoning because of high interest rates they're only giving us half the story. The other half is seasonality. There are always a lot more homes for sale in the summer than the winter. Also June inventory was 619K or less than half the average inventory over the 2017-2019 period.
Like the stock market the housing market is cooling off after a huge run-up. I don't expect housing prices to fall for the rest of the decade. There is just too much pent-up demand for home formation in the US.
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