BuildFax Housing Health Index reveals continued challenges
A measure of trends in the US housing market has revealed a slight increase in single-family housing authorizations.
But the gain revealed in the BuildFax Housing Health Index in May belies the trailing 3-month view which decreased 4.76% to mark six months of steady decreases. A year earlier the 3-month outlook was up 7.78%.
The index shows that single-family housing authorizations decreased by 3.50% year-over-year, while existing housing maintenance volume decreased by 1.01% year-over-year and existing housing remodel volume decreased by 3.94% year-over-year.
“The combination of declining mortgage rates, moderating home prices and peak home-buying season should help to buoy the housing market, but so far this hasn’t happened,” said BuildFax COO Jonathan Kanarek. “Continued declines in year over year maintenance and single-family housing authorizations further reinforce the ongoing housing slowdown. As we near six months of declining activity, the question remains, how long will this slump persist?”
5 metros show increased modeling activity
Despite the nationwide decrease, five metros saw a rise in remodeling activity led by Philadelphia (15.2%) and Chicago (5.06%).
“After several years of above-average growth, the residential remodeling market may be reaching a turning point. Nationwide slowdowns in house price gains, home sales activity, and building material sales are lowering our expectations for further increases in home improvement and repair spending in 2019,” said Abbe Will, Remodeling Futures Associate Project Director at the Harvard Joint Center For Housing Studies. “However, metro housing markets that have yet to fully recover from the 2009 economic downturn provide untapped potential for further growth, despite the broader deceleration we’re seeing nationally.”
