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NAHB logo National Association of Home Builders
June 24, 2011
David Crowe
NAHB Chief Economist
Eye on the Economy
Housing Remains Sluggish, But Positive Signs Are Emerging

Housing and the economy remained sluggish and most economic data released during the past few weeks have been disappointing.

Existing home sales were down again in May, and the NAHB Housing Market Index fell in June to a nine-month low. Inflation, as measured by the producer and consumer prices indexes, also continued to rise.

But some bright spots are beginning to emerge. House prices ended a 10-month slide as the Federal Housing Finance Agency House Price Index ticked up in April. And while housing starts continue to “bounce along the bottom,” they rose in May, recovering half of the previous month’s decline. In addition, oil prices, which peaked in April, have settled back down by almost 15%, relieving some inflationary pressure.

Though some have suggested that housing has fallen out of favor with the American public and Washington is targeting housing on a number of fronts — the expiration of the GSE and FHA loan limits, scaling back the mortgage interest deduction, etc. — a new poll commissioned by NAHB suggests otherwise. The results indicate that homeownership remains a priority for most Americans.

Latest Postings
House Prices Finally Turn the Corner, Rising 0.8% in April

House prices turned the corner in April, after 10 consecutive months of decline. We do not anticipate any further significant declines in house prices. Posted: June 22

New Survey Shows Housing Remains a National Priority

Homeownership and housing should remain national priorities, according to national poll recently commissioned by NAHB to gauge likely voters’ attitudes toward housing and housing policy issues. Posted: June 22 

Poor May Existing Home Sales Reflect Soft Economy and Falling House Prices

Existing home sales fell again in May, a casualty of the soft economy and falling house prices. Posted: June 21

NAHB Chief Economist on the HMI Dropping Three Points

A video link to NAHB Chief Economist David Crowe explaining the factors responsible for the latest fall in the HMI. Posted: June 15 

HMI Down Three Points

The June NAHB/Wells Fargo Housing Market Index fell to a nine-month low of 13 — with the expectation index down four points, which tied the record low recorded in March 2009. Posted: June 15 

Consumer Price Index Up Again in May, but Energy Prices No Longer Rising

The Consumer Price Index (CPI) was up in May —0.2% for the month and 3.6% year-over-year. The energy price index ended its 10-month streak, but increases in food, clothing and vehicles pushed the CPI higher. Posted: June 15 

Growth in the Producer Price Index Slows in May

Growth in the Producer Price Index (PPI) has finally begun to show signs of slowing — with growth in energy prices moderating but still rising. While the composite index of inputs into residential construction rose slightly because of energy prices, the trend in the main building products was mixed. Posted: June 14 

Why Independent Contractors Are Important for the Construction Sector

The construction sector is experiencing high rates of worker turnover, according to Bureau of Labor Statistics  Job Opening and Labor Turnover Survey. This workforce flexibility enables builder to link demand for workers with available supply. Posted: June 14

Household Deleveraging Slows, But Savings Rate Continues to Decline

Deleveraging — households and businesses paying down their debts to restore net worth — restrains consumption and investment and is a major factor impeding any potentially robust economic recovery. Posted: June 10

Households Continue to Deleverage, Mostly

Total consumer credit outstanding increased for the seventh consecutive month, reaching its highest level since February 2010. It appears households might have a little more balance sheet repair work to perform before they can access credit lines and ramp up spending. Posted: June 10

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For in-depth analysis of the latest housing statistics and research from the federal government, NAHB and other sources, Eye on the Economy readers are encouraged to visit Eye on Housing at http://eyeonhousing.wordpress.com.

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