Freddie Mac has released its inaugural Freddie Mac Multi-Indicator Market Index (MiMi), a publicly-accessible tool that monitors and measures the stability of the nation's housing market, as well as the housing markets of all 50 states, the District of Columbia, and the top 50 metro markets.
MiMi combines proprietary Freddie Mac data with current local market data to calculate a range of equilibrium for each single-family housing market covered. Monthly, MiMi uses this data to show, at a glance, where each market stands relative to its own stable range. MiMi also indicates how each market is trending—whether it is moving closer to, or further away from, its stable range. A market can fall outside its stable range by being too weak to generate enough demand for a well-balanced housing market or by overheating to an unsustainable level of activity.
"MiMi is the right housing index at the right time as we once again transition to a purchase-dominated housing market," said Freddie Mac Chief Economist Frank Nothaft. "With recent history demonstrating that housing activity differs substantially from market to market, MiMi offers a fresh perspective on housing at the local level just as we are entering this new purchase market landscape. MiMi helps to pinpoint each market's 'sweet spot' by focusing on local housing differences while also tracking the fundamentals necessary for a stable market. MiMi draws from multiple data sources -- including Freddie Mac proprietary data generated through our daily business with more than 2,000 mortgage lenders across the country -- to create current insights into how the housing market at the national, state, and local level is trending."
In this first release of MiMi, several key findings emerged that highlight the current state of the nation's housing market as of January 2014:
►The national MiMi value stands at -3.08 points indicating a weak housing market overall. From December to January the national MiMi improved by 0.03 points and by 0.81 points from one year ago. The nation's housing market is improving based on its 3-month trend of +0.17 points and moving closer to its stable and in range status. The nation's all-time MiMi low of -4.49 was in November 2010 when the housing market was at its weakest.
►Eleven of the 50 states plus the District of Columbia are stable and in range with North Dakota, the District of Columbia, Wyoming, Alaska, and Louisiana ranking in the top five.
►Four of the 50 metros are stable and in range, San Antonio, Houston, Austin and New Orleans.
►The five most improving states from December to January were Florida (+0.11), Tennessee (+0.11), Michigan (+0.09), Louisiana (+0.07), Nevada (+0.07), and Texas (+0.07). From one year ago the most improving states were Florida (+2.12), Nevada (+1.84), California (+1.26), Texas (+1.06) and D.C. (+1.05).
►The five most improving metros were Miami (+0.11), Detroit (+0.10), Orlando (+0.09), San Antonio (+0.09), and Chicago (+0.08). From one year ago the most improving metros were Miami (+2.54), Orlando (+2.08), Riverside (+1.87), Las Vegas (+1.81), and Tampa (+1.77).
►Overall, in January of 2014, 25 of the 50 states plus the District of Columbia are improving based on their three-month trend and 35 of the 50 metros are improving.