Senior housing demand strong but builders face high lumber prices
The 55+ housing market showed continued strength in the first quarter on healthier economic conditions, but high lumber prices are causing hurdles for homebuilders trying to keep up with consumer demand, according to the National Association of Home Builders.
NAHB's 55+ Housing Market Index, which measures single-family homes and multifamily condominiums in the sector, remained in positive territory in the second quarter, increasing one point to 67. The HMI is measured on a scale from 0-100, with a reading over 50 representing more builders reporting positive than negative conditions.
"Strong economic growth and rising homeowner wealth are allowing consumers to sell their current homes and buy or rent homes in 55+ communities. However, builders need to manage rising building material costs, especially for lumber, in order to continue providing housing at competitive prices," Robert Dietz, chief economist at NAHB, said in a press release.
The single-family components of the 55+ HMI showed present sales grew three points to 73 and anticipated sales in the next six months falling three points to 77. Traffic of prospective homebuyers slipped into negative territory, dropping four points to 47.
The 55+ multifamily condo HMI fell to 57, marking a seven-point decline. Despite the decrease, this is still the second highest this measure has been since NAHB began tracking this data back in 2008. In contrast, all the components of the 55+ multifamily rental market went up in the second quarter, with expected production over the next six months shooting up 11 points to 44.