Home builders grew even more bullish on new-home sales in September, raising the National Association of Home Builders' Housing Market Index to its highest level this year.

The seasonally adjusted index, which measures the strength of the single-family housing market, rose to 59, from 58 in August.

The index is based on a nationwide survey of builders. The association asks builders to rate single-family home sales and sales expected for the next six months. On both questions, builders gave higher scores in September than in August.

The survey also asks whether traffic of prospective buyers has risen or fallen. This indicator of future sales fell in September. It rose, however, in one region-the West, where California is benefiting from resurging home sales.

This has been a surprisingly strong year for sales of new and existing homes, coming on the heels of last year's hot housing market.

The home builders group projected 1.44 million housing starts this year, down only slightly from last year's 1.48 million. It projected 1.38 million housing starts next year and 1.4 million in 1999.

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