Of 351 metropolitan areas surveyed in the National Association of Home Builders/First American Leading Markets Index, 300 have seen year-over-year economic gains, according to the NAHB. Fifty-nine of those metro areas have met or exceeded their last normal levels of economic and housing activity.
The national economic score crept up to 0.88 from a revised April reading of 0.87. That means that based on current permit, price and employment data, the national average is currently running at 88% of normal economic and housing activity, according to the NAHB. Last year at this time, the index showed a national reading of 0.82.
“We have always said this recovery would be a slow but steady one, and I think this index continues to prove this,” said NAHB Chief Economist David Crowe. “The year started a bit slower than anyone could have anticipated but we still expect housing to play a greater role in aiding the overall economic recovery this year. The job market continues to mend and that should spur a steady release of pent up demand among home buyers.”
“Our builder members tell us they are starting to see more optimism in the field,” said NAHB Chairman Kevin Kelly. “Mortgage rates are low, home prices are affordable and with the harsh winter behind us our latest surveys show builders are feeling more bullish about future sales conditions.”
Baton Rouge, La., had the best index reading among major metro areas with a score of 1.41 – meaning economic and housing conditions there are currently 41% better than its last normal market level. Other major metro areas now exceeding previous norms include Honolulu, Oklahoma City, Austin and Houston, Texas, Los Angeles and San Jose, Calif., and Harrisburg, Pa.
Economic and housing activity is slowly returning to normal, according to data released Tuesday.