|Housing Indicators Continue to be Positive|
Recently published data concerning housing and the broader economy reveal good news for the home building industry.
The NAHB/Wells Fargo Housing Market Index, a measure of builder confidence, reached 29 in February. This was the fifth consecutive monthly increase and the highest level for the index since April 2007.
Housing starts in January were up 1.5% from the previous month, reaching a 690,000 annualized pace. New single-family home sales were also up in January, which at a 321,000 seasonally-adjusted annualized rate, neared levels last seen in April 2010 at the end of the home buyer tax credit program. Existing home sales were also up (4.3%) in January.
These positive trends are the result of a healing national economy and improving conditions for housing markets. For example, the NAHB/Wells Fargo Housing Opportunity Index reached the highest level in its 20-year history in January.
These improving conditions were also reflected in the February National Association of Realtors Pending Home Sales Index, which was up 8% from a year ago. And house prices are finding stable ground, with the Federal Housing Finance Agency national house price index up nearly 2% from its lowest level in March 2011 and most Census regions showing gains.
The Case-Shiller national home price index fell somewhat, but there is considerable local variation among the metropolitan areas in that measure.
Data from the Mortgage Bankers Association shows a slowing starts rate for foreclosures, although some of that slowing may be due to judicial and administrative delays for distressed homes in late 2011.
And more broadly, consumers are gaining confidence with respect to their own economic status and their views of the labor market.
Despite these positives, a few dark clouds remain: lending for home building remains overly restrictive, and some producer prices, including gypsum, appear to be on the rise.
Other analysis appearing on NAHB’s Eye on Housing economics blog this month included:
- Profiles of Lincoln, Neb. and Cincinnati, Ohio, cities appearing on the NAHB/First American Improving Market Index, which now includes 98 metropolitan areas.
- A look at the average builders’ finances in 2010, including revenue and costs.
- Analysis of trends in newly constructed homes in 2011, including home size and other characteristics.
Read more in the following posts from Eye on Housing.