Housing Market Almost Back to ‘Normal,’ Economist Says
July 10th, 2013 | by Update Metro
The signs have been building for about a year now, and this month, a prominent real estate economist reports that the housing market nearly has returned to normal - that is, pre-housing bubble.
In Dallas-Fort Worth, the trend has been long evident. As of July 1, Briggs Freeman Sotheby’s International Realty reported 48 contract closings for the week prior, totaling more than $45 million, plus 62 properties under contract, representing more than $38 million.
Here’s an excerpt from the Trulia chief economist Jed Kolko’s blog:
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 (National Association of Realtors), 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.
In May 2013, all three measures improved: construction starts and existing home sales rose, while the delinquency-plus-foreclosure rate notched downward:
- Construction starts did a half-rebound. Starts were at a 914,000 seasonally adjusted annualized rate – up 7 percent from April but still below February and March levels. Building permits remained strong, pointing to bigger increases in construction starts in coming months. For now, construction starts are 43 percent of the way back to their normal level of 1.5 million.
- Existing home sales climb as inventory begins to expand.Sales rose 4 percent in May to a seasonally adjusted annualized rate of 5.18 million – that’s up 13 percent year-over-year. Excluding foreclosures and short sales, conventional home sales were up 23 percent year-over-year in May. Tight inventory isn’t holding back sales as much: for the fourth straight month, inventory expanded even after taking seasonality into account. It now looks like inventory might have bottomed in January. Overall, existing home sales are 82 percent back to normal.
- The delinquency plus foreclosure rate continued its retreat. The share of mortgages in delinquency or foreclosure dropped to 9.13 percent in May, a big drop from 11.08 percent a year ago. As the economy recovers, fewer people are falling behind on their mortgage payments. Also, with prices rising, people have more to lose if they default. The combined delinquency plus foreclosure rate is 57 percent back to normal.
Click here to read the full article from Trulia.
Click here to read more news about real estate and the economy in Dallas-Fort Worth.
Briggs Freeman Sotheby’s International Realty is Dallas’ luxury real estate leader, with more than 190 agents in five offices located throughout the Metroplex and access to the global Sotheby’s network, including more than 11,000 agents in 600 offices worldwide. For more information on escapes and second homes, ranch and land, and luxury homes in the Dallas-Fort Worth region and beyond, go to briggsfreeman.com.
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