The Number of Improving Housing Markets in the U.S. Rises to 99
The number of improving housing markets across the country rose to 99 in September, according to the National Association of Home Builders/First American Improving Markets Index (IMI). This is up from 80 metros that were listed as improving in August and includes representatives from 33 states as well as the District of Columbia. The IMI identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months. Markets added to the list in September include such geographically diverse locations as Tucson, Ariz.; Jacksonville, Fla.; Springfield, Ill.; Greenville, N.C.; and Bend, Ore. "The number of improving housing markets grew by 19 in September as 68 metros retained their spots, 31 new metros were added and just 12 dropped off the list," said Barry Rutenberg, chairman of the NAHB and a home builder from Gainesville, Fla. "This solid growth is an encouraging sign that housing continues on a slow but steady recovery path that is gradually advancing from one local market to the next." 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. "More metros across the country are experiencing a sustained uptick in house prices, employment and new building activity as rising consumer confidence in local market conditions pushes more people to consider a new-home purchase," said NAHB Chief Economist David Crowe. "That said, overly tight lending conditions for builders and buyers continue to slow this process considerably." The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics, 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 metropolitan area must see improvement in all three measures for at least six months following those measures' respective troughs before being included on the improving markets list. "Combined with recent positive reports on builder confidence, housing starts and new-home sales, the September IMI adds to the growing consensus that housing is finally moving in the right direction, which in turn is spurring more potential buyers to get off the fence," said Kurt Pfotenhauer, vice chairman at First American Title Insurance Company.