Final data for 2011 confirms that single-family home sales marked their worst year on record, totaling 302,000 for the year. Total private residential construction spending, including home improvement expenditures, was down more than 1% compared to 2010.

Despite these year-end statistics, other key economic indicators suggest growth for housing and home building in 2012.

For the economy as a whole, fourth-quarter GDP growth was estimated at 2.8%, up from the weak rate of 1.8% in the third quarter of 2011. In January, total payroll employment increased by 243,000, causing the unemployment rate to decline to 8.3%.

Construction firms saw increased business activity in their futures, with 2011 the first year since 2006 when total hires exceeded total job separations for the industry. And NAHB’s Remodeling Market Index achieved a level of 46.6 in the fourth quarter of 2011, the highest mark since 2006.

As the new year began, NAHB published research and analysis on several topics of interest to home builders and remodelers.

• NAHB economists updated the “priced out” model, which estimates the number of households that are unable to purchase a new home when prices increase due to regulatory costs and other burdens.
• Economists also examined the distribution of new home prices across metropolitan areas.  
• A quarterly survey of remodelers found windows to be the most popular energy-efficient property installed with respect to home improvement projects.
•  And finally, NAHB analysis noted the aging of the owner-occupied housing stock, with the average age of owned homes standing at 34 years old in 2009, a full 11 years older than the measure taken in 1985.

Read more in the following posts from Eye on Housing.

A new research paper from NAHB Economics shows that nationally a $1,000 increase in a home’s price leads to pricing out about 232,447 households. The updated model can be used to evaluate the effects of pending regulations on housing affordability in those markets where regulatory actions are expected to raise home prices. 

http://www.bls.govThe February release (December 2011 data) of the Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics (BLS) confirms that 2011 was the first year for the construction sector in which total hires exceeded total job separations since 2006.

The U.S. Census Bureau regularly tracks new home prices for the United States, Census Regions and Divisions. However, there is no systematic measurement of new home prices by states or metropolitan areas. To fill the void, NAHB Economics periodically estimates median new home prices for metropolitan areas.

According to the Census Bureau, total spending on private residential construction projects increased 0.8% during December. Overall, private residential construction activity was on a modest upward trend during the second half of 2011 as spending increased in four of the final five months of the year. For the calendar year 2011, spending fell 1.1% versus 2010, which marks the smallest rate of decline in construction spending for a calendar year since the housing market downturn began.

The S&P Case-Shiller Home Price Index was released with data through November, and the press release announced declines in the 10-city and 20-city composites, as well as most of the cities covered by the composites, on a monthly and annual basis. But a better perspective on the current conditions in these markets comes from examining the full history of the indexes.

The American owner-occupied housing stock is growing older, and this fact may signal future increased demand for both remodeling and new home construction over the long term. Data from the Department of Housing and Urban Development American Housing Survey (AHS) reveal that the median age of an owner-occupied home in the United States was 34 years as of the 2009 survey. This is 11 years older than the median age reported by the 1985 AHS (23 years).

The Bureau of Economic Analysis (BEA) released the advance estimate of real Gross Domestic Product growth for the fourth quarter of 2011. Real GDP grew at a seasonally adjusted annual rate of 2.8%, up from 1.8% in the third quarter. Growth in residential fixed investment (RFI) strengthened to 10.9%, adding to its string of modest but positive contributions to GDP growth, based on some momentum in single-family housing starts in the final quarter.

A detailed look at the information released following the January Federal Open Market Committee (FOMC) meeting indicates that monetary policy will remain highly accommodative for the better part of the next two years, based on expectations of a long, slow economic recovery with inflation subdued and a slowly declining unemployment rate.

Sales of new homes fell 2.2% in December from an elevated November level. The fourth quarter average seasonally-adjusted rate was 309,000, up 4.4% from the third quarter. For 2011, new sales did hit an all-time low of 302,000, which is 6.5% below than the next worst year, 2010.

A profile of one of the metropolitan areas on the NAHB/First American Improving Markets Index.

NAHB’s quarterly survey of remodelers recently included a special question concerning commonly used products. According to the data, the top four all involved windows or insulation. At the top of the list, almost 80% of NAHB’s remodelers said they commonly use low-E windows.

The Federal Housing Finance Agency (FHFA) released monthly home price indexes for the United States and the nine Census divisions for November. Home prices for the U.S. overall increased by 1$ on a seasonally adjusted basis, while eight of the nine Census divisions had increases, ranging from 0.2% to 2%. Home prices in the Middle Atlantic division declined by 0.2%.

Nationally, home prices have rebounded from a peak to trough decline of 20%, and are currently 1.6% higher than the trough in March 2011.

NAHB’s Remodeling Market Index (RMI) for the fourth quarter of 2011 increased to 46.6 from 41.7 in the third quarter. At 46.6, the overall RMI is now as close to the break-even point of 50 as it has been since 2006. An RMI above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it is lower.