An update yesterday from Trulia on the progress to date for the US housing recovery:
Each month, Trulia’s Housing Barometer charts how quickly the housing market is moving back to “normal.” We summarize three key housing market indicators: construction starts (Census), existing home sales (NAR), and the delinquency-plus-foreclosure rate (LPS First Look). For each indicator, we compare this month’s data to (1) how bad the numbers got at their worst and (2) their pre-bubble “normal” levels.
As of last month the housing market is now 52% of the way back to normal, compared with 27% in December 2011. In just the past three months, Trulia’s Housing Barometer has jumped 11 points, from 41% in September 2012 to 52% in December 2012.
Why is this news? Don’t we expect to see a bit of a recovery following a huge contraction, particularly when FHA is guaranteeing loans to anyone who is willing to buy a home and when the Fed is injecting massive amounts of liquidity into the system?
Normal? Is the most expanded state of the housing bubble “normal”? Existing home sales in March of 1982 were 2 million units,
in Sept. of 2005 7.25 million, dropping to 3.3 million in July of 2010. Monthly sales were above 5.5 million only from January 2002 until March of 2007. So what’s “normal”?
http://www.mortgagenewsdaily.com/data/home-sales-existing.aspx?showCompleteHistory=true
i do not think that is what they are doing.
the bubble peaked at around 7 million in home sales. 5.5 seems like a reasonable “normal” figure to me.
There is no such thing as “normal” when it comes to real estate transactions, spending, and/or construction. Housing is a standard of living choice not an investment. The rebound is due to government interference that is unsustainable. The greater fools theory in full effect.
Interesting inforgraphic, that’s for sure.
It looks like that Delinquency & Foreclosure Rate is really thing thing holding housing back.
“It looks like that Delinquency & Foreclosure Rate is really thing thing holding housing back“…
But not the CRA?
http://www.calculatedriskblog.com/2013/01/new-home-sales-and-distressing-gap.html
the one metric that is not showing this sort of recovery seems to be new home sales.
they have maybe recovered 11 or 12% of the drop from a “normal” level which seems to be about 900k.
i suspect this has do do with the build vs buy trade off.
if existing homes are too much cheaper than new ones, no one builds.
i suspect there may be an inflection point where this flips back over, but i have no idea just where that point is.
Well m if the St. Louis Fed knows what its talking about there doesn’t seem to be that much of an improvement but some is better than none I guess…
ummm.. why is zerohedge.com saying the exact opposite of this site…
http://www.zerohedge.com/news/2013-01-25/new-home-sales-miss-expectations-post-biggest-drop-february-2011