Improving housing markets list grows

by Shea Homes on February 13, 2013

 

In the past month, there has been a significant expansion in the list of improving housing markets.

The recently released Improving Markets Index from the National Association of Home Builders/First American, shows that the housing market is continuing to make significant progress. The number of improving housing markets grew from 242 in January to 259 in February, adding Rome, Georgia; Fort Wayne, Indiana; Myrtle Beach, South Carolina; Albuquerque, New Mexico; and Racine, Wisconsin.

The IMI was formulated to track housing markets around the country that are showing signs of improvement by measuring three sets of independent monthly data. The three factors considered are employment growth from the Bureau of Labor Statistics, single-family housing permit growth from the U.S. Census Bureau and house price appreciation from Freddie Mac.

According to Rick Judson, the 2013 NAHB chairman and a homebuilder from Charlotte, North Carolina, with every one of the 50 states having a metropolitan area included on the list, it proves that the housing market has significant momentum going into 2013 and is continuing expansion from one market to the next.

Judson added that there is still room for improvement in metropolitan areas, which could be remedied with less strict mortgage standards that are preventing qualified buyers from investing in the housing market.

“Just over 70 percent of the 361 metros covered by the IMI are listed as improving this month,” said NAHB Chief Economist David Crowe. “That’s a far cry from when we initiated this index with just 12 improving metros in September of 2011 for the purpose of highlighting places that didn’t fit the mold of the national headlines. Today, the story is about how widespread the recovery has become as conditions steadily improve in markets nationwide.”

Housing sentiment improves with employment security
Americans who are considering buying a new home might see the current state of the market as being favorable enough to secure the home of their choice. With jobs being added across the country, more Americans might be able to afford the prices of homes, which are still near historic lows.

“The continued expansion of improving housing markets in February should help convince those who have been considering a home purchase that now is the time to go forward with those plans,” said Kurt Pfotenhauer, vice chairman of First American Title Insurance Company.

Fannie Mae’s January 2013 National Housing Survey showed that there has been increased confidence in home sales and an improved sense of job security for the upcoming months. The number of Americans who think now is a good time to sell a home increased to 23 percent during January, jumping from the 11 percent that was reported in the same month in the year prior.

“The housing market continues to firm, with consumer home price expectations for both rental and ownership properties near the strongest levels that we’ve seen in the survey’s two-and-a-half-year history,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Concerns about job loss are waning as payrolls are growing – a trend that may give potential homebuyers more confidence that they can meet the financial obligation of homeownership. The upward trend over the past year and a half in the share of consumers who say it’s a good time to sell may reflect two related events.”

The two events Duncan referred to is that homeowners are seeing home prices improving and the number of homeowners who are underwater is decreasing, which reduces a barrier for those owners who would like to sell their home or purchase a new one.

 

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