Housing has now returned or exceeded its pre-recession levels of activity in 52 housing markets nationwide, according to the National Association of Home Builders (NAHB).
The nationwide housing market is running at 85% or normal activity, according to NAHB’s First American Lending Markets Index (LMI), which indicated a score of 0.85.
The LMI takes into account current building permits, prices and employment data from the Bureau of Labor Statistics, home price appreciation data from Freddie Mac and single-housing permit growth from the U.S. Census Bureau.
In doing such, the NAHB finds that Baton Rouge, Louisiana, tops the list of major metros on the LMI, ranking 41% better than its normal market level.
“This index helps illustrate how far the U.S. housing recovery has come, and also how much further it has to go as we continue to face some significant headwinds in terms of credit availability, rising costs for lots and labor, and uncertainties regarding Washington policymaking,” said NAHB Chairman Rick Judson, a home builder from Charlotte, North Carolina.
Other metros such as Honolulu, Oklahoma City, Austin and Houston, Texas, as well as Harrisburg, Pennsylvania, also indicated that their housing markets have now exceeded previous norms.
Looking at smaller metros, both Odessa and Midland, Texas, boasted LMI scores of 2.0 or better, meaning that their housing markets are now at double their strength prior to the recession.
These smaller metros are leading the way to a housing recovery, as they account for 43 of the top 50 markets on the current LMI, says NAHB Chief Economist David Crowe.
“This is very much in keeping with the results of our previous index for improving markets, and is an indication of the extent to which local economic conditions dictate the strength of individual housing markets,” Crowe said.
Written by Jason Oliva