89% of leading markets saw economic and housing activity increase during the quarter, according to an index from the National Association of Home Builders and First American
Almost 300 markets across the US saw gains in economic and housing activity during the second quarter, an indication that the housing sector continues to gain momentum, according to the Leading Markets Index (LMI) released by the National Association of Home Builders (NAHB) and First American Title Insurance.
On average, nationwide markets are now seeing housing and economic activity at 102% of normal activity. The index plots a market’s economic health based on data on home prices, permits, and employment. For the second quarter, the index components showed different stages of recovery. While home prices are at 152% of normal levels and employment at 98%, single-family permit activity is only at 54% of normal.
“This report shows that the housing and economic recovery is widespread across the nation and that housing has made significant gains since the Great Recession,” said NAHB Chairman Granger MacDonald. “However, the lagging single-family permit indicator shows that housing still has a ways to go to get back to full strength.”
“The overall index is running above 100% of normal largely due to healthy home-price appreciation,” said NAHB Chief Economist Robert Dietz. “At the same time, the reason why single-family permits are barely halfway above normal is because builders continue to face persistent supply-side headwinds, including rising material prices and a shortage of buildable lots and skilled labor.”
During the quarter, the index saw more markets return to or exceed their last normal economic and housing activity levels. Of the 337 metro areas covered by the index, 196 saw economic and housing activity meet or surpass normal levels, a net gain of 68 markets from the year-ago period.
“With 89% of all metro areas posting a quarterly increase in their LMI score, this is a strong signal that the overall housing market continues to make broad-based gains,” said Kurt Pfotenhauer, vice chairman of First American.
Among major metros on the index, Baton Rouge, La., continued to see the highest activity increase compared to normal levels, while Odessa, Texas, performed best among smaller metros as its market strength doubled from pre-recession levels.
Related stories:
Skilled labor shortage, higher development costs drive inventory slump
Low supply drives decline in June existing-home sales
On average, nationwide markets are now seeing housing and economic activity at 102% of normal activity. The index plots a market’s economic health based on data on home prices, permits, and employment. For the second quarter, the index components showed different stages of recovery. While home prices are at 152% of normal levels and employment at 98%, single-family permit activity is only at 54% of normal.
“This report shows that the housing and economic recovery is widespread across the nation and that housing has made significant gains since the Great Recession,” said NAHB Chairman Granger MacDonald. “However, the lagging single-family permit indicator shows that housing still has a ways to go to get back to full strength.”
“The overall index is running above 100% of normal largely due to healthy home-price appreciation,” said NAHB Chief Economist Robert Dietz. “At the same time, the reason why single-family permits are barely halfway above normal is because builders continue to face persistent supply-side headwinds, including rising material prices and a shortage of buildable lots and skilled labor.”
During the quarter, the index saw more markets return to or exceed their last normal economic and housing activity levels. Of the 337 metro areas covered by the index, 196 saw economic and housing activity meet or surpass normal levels, a net gain of 68 markets from the year-ago period.
“With 89% of all metro areas posting a quarterly increase in their LMI score, this is a strong signal that the overall housing market continues to make broad-based gains,” said Kurt Pfotenhauer, vice chairman of First American.
Among major metros on the index, Baton Rouge, La., continued to see the highest activity increase compared to normal levels, while Odessa, Texas, performed best among smaller metros as its market strength doubled from pre-recession levels.
Related stories:
Skilled labor shortage, higher development costs drive inventory slump
Low supply drives decline in June existing-home sales
