The number of improving housing markets continued to expand for a third consecutive month in November, rising from 23 to 30 on the latest National Association of Home Builders/First American Improving Markets Index (IMI). The list dropped two metros and added nine new ones–Cheyenne, Wyo.; Corpus Christi, Texas; Davenport, Iowa; Fort Collins, Colo.; Hinesville, Ga.; Lima, Ohio; Monroe, La.; Tyler, Texas and Williamsport, Pa. The index identifies metropolitan areas that have shown improvement for at least six months in housing permits, employment and housing prices.
The following metros were listed in November:
►Corpus Christi, Texas
►Fort Collins, Colo.
►New Orleans, La.
►Pine Bluff, Ark.
"Texas continues to dominate the list of improving housing markets in November, increasing its net number of entries to eight and continuing a trend in which energy-producing metros seem to be doing better than the average," said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. "Meanwhile, the geographic diversity of metros also continued to expand this month, with the states of Colorado, Georgia and Ohio all represented for the first time. This is further evidence that all housing markets are uniquely dependent upon local conditions, and some are leading the way toward an eventual, broader recovery."
The two metros that dropped off of the improving markets list in November were Iowa City and Wichita Falls. These metros experienced declines in their employment and permit data, respectively.
"The November IMI remains heavily weighted by smaller cities, with Pittsburgh and New Orleans as the only major metros represented," said NAHB Chief Economist David Crowe. "This is indicative of the tough conditions that continue to prevail across much of the country, particularly in larger markets that have been hit hardest by job losses and foreclosures during the recession and that will take more time to heal. However, momentum is building in pockets of the country where energy and agriculture are the dominant industries and where consistent, measurable improvements in economic conditions are now becoming apparent."
The IMI is designed to track housing markets throughout the country that are showing signs of improving economic health. The index measures three sets of independent monthly data to get a mark on the top improving Metropolitan Statistical Areas (MSAs). The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics (BLS), house price appreciation from Freddie Mac, and single-family housing permit growth from the U.S. Census Bureau. NAHB uses the latest available data from these sources to generate a list of improving markets. A metro area must see improvement in all three areas for at least six months following their respective troughs before being included on the improving markets list.