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Markets in 56 out of the approximately 350 metro areas nationwide returned to or exceeded their last normal levels of economic and housing activity, according to the National Association of Home Builders/First American Leading Markets Index (LMI). This represents a net gain of two from the previous month. The index's nationwide score of 0.86 indicates that, based on current permits, prices and employment data, the nationwide average is running at 86% of normal economic and housing activity.
“More markets are slowly returning to normal levels, and we expect this upward trend to continue as an improving economy and pent-up demand bring more home buyers back into the marketplace,” said Rick Judson, NAHB chairman and a home builder from Charlotte, N.C. “Policymakers must be careful to avoid actions that would harm consumer confidence and impede the ongoing recovery.”
“Forty-five percent of metro areas are recovering at a faster pace than the nation as a whole, with smaller markets leading the way,” said David Crowe, chief economist for the NAHB. “Of the 56 markets that are at or above normal levels, 48 of them have populations that are less than 500,000, and many of these local metros are fueled by a strong energy sector, which is producing solid job and economic growth.”
Baton Rouge, La., tops the list of major metros on the LMI, with a score of 1.42, or 42% better than its last normal market level. Other major metros at the top of the list include Honolulu; Oklahoma City; Austin and Houston, Texas; and Harrisburg and Pittsburgh, Pa. LMI scores for each of these major metros indicate that their market activity now exceeds previous norms.
Looking at smaller metros, both Odessa and Midland, Texas, had LMI scores of 2.0 or better, meaning that their markets are now at double their strength prior to the recession. Also at the top of the list of smaller metros are Casper, Wyo.; Bismarck, N.D.; and Grand Forks, N.D.
For more information, visit www.nahb.org/lmi.