New home construction is an important part of maintaining a healthy housing market. Without a steady supply of new homes, the total number of homes for sale will stall and prices will climb. That’s why the National Association of Home Builders tracks builder confidence with their monthly Housing Market Index. The index surveys builders about current conditions and their expectations for the next six months. Answers are scored on a scale where any number above 50 indicates more builders feel conditions are good than poor. In December, the index reached 74 – the highest recorded score since July 1999. Robert Dietz, NAHB’s chief economist, says housing demand is on the rise. “The HMI measure of home buyer traffic rose eight points, showing that demand for housing is on the rise,” Dietz said. “With low unemployment rates, favorable demographics, and a tight supply of existing home inventory, we can expect continued upward movement of the single-family construction sector next year.” More here.