Housing Market Expands
The latest data from the National Association of Home Builders (NAHB) gives every indication that the national housing market continues a steady improvement. According to the NAHB Improving Market Index (IMI) the positive market trend has now risen for the fifth straight month.
NAHB Chairman Barry Rutenberg, says that the Improving Market Index was created in September 2011 as a means of tracking metropolitan housing markets that were “on the mend” in spite of the contrary market news and environment.
Statistics from the index reveal that as of January there are 242 markets that are improving according to the index criteria, this number is up from 201 markets listed as improving in December. There are 361 metro areas on the list representing almost every state, in addition there were 47 new metro areas listed for January while six were dropped.
The identifying criteria for the IMI measures market improvement in housing permits, employment and housing prices for at least six consecutive months. The IMI data for housing permits in drawn from single-family housing permit growth given by the U.S. Census Bureau. Employment data comes from the Bureau of Labor Statistics, while housing stats are housing price appreciation figures from Freddie Mac.
Some of the newly added metro areas seen as improving include: Los Angeles, Calif.; Auburn, Ala.; Des Moines, Iowa; Nashville, Tenn.; Richmond, Va.; and Cleveland, Ohio.
In assessing the overall market, NAHB Chief Economist David Crowe states that, “The story is no longer about exceptions to the rule, but about the growing breadth of the housing recovery even as overly strict mortgage requirements hold back the pace of improvement.”
Crowe goes on to say that the number of metro areas listed on the Improving market Index has almost doubled in the past two months. He does caution that the IMI may see some reductions in the months to come, due more to the slower winter months for the market than any net change in the overall market environment.