The housing recovery is gaining strength in regions beyond just the booming energy states, according to the National Association of Home Builders/First American Leading Markets Index.
“It’s a promising sign to see areas like Los Angeles and San Jose joining the top ten largest [metros] showing a recovery,” says NAHB Chief Economist David Crowe. “We still expect 2014 to be a strong year for housing and to aid in the overall economic recovery. The job market continues to mend and, with that, we will see a steady release of pent-up demand of buyers.”
The index shows that 59 of the 350 metro markets tracked by the index have returned to or exceeded their last normal levels of economic and housing activity.
The index examines current housing permit, price, and employment data to see how close markets are performing at their historical normal levels.
Also, 28 percent of metro areas tracked had their score rise this month. Eighty-three percent have shown an improvement over the past year as well.
Topping the list on the index, Baton Rouge, La., continues its streak on the index, performing at 42 percent better than its last normal market level. Additional major markets that are exceeding their previous norms are: Honolulu; Oklahoma City; Austin and Houston, Texas; San Jose, Calif.; and Harrisburg, Pa.
Smaller metros showing the strongest recovery continue to mostly be centered in states experiencing the energy boom. For example, Odessa and Midland, Texas, have markets that are performing at double their strength prior to the recession. Other top-performing smaller metros include Bismarck, N.D.; Casper, Wyo.; and Grand Forks, N.D.
“Things are getting slowly better overall,” says NAHB Chairman Kevin Kelly. “And with the housing market now entering the spring buying season, the fact that the nation’s economy is headed in the right direction is a very promising sign.”