The housing market is on its way back to normal, but is struggling through its awkward phase, according to a new report
The housing market made it to 61% “back to normal” in May, according to the latest housing barometer from Trulia.
May’s percentage is the first time the recovery has passed 60% since the crash. April’s barometer was 54% and a year ago, the barometer was at only 35%.
“The recovery has reached full-fledged teenager status, with awkward, sudden growth spurts and parents—the Fed—who now threaten to take away its allowance by winding down measures that pushed mortgage rates down to historic lows,” said Jed Kolko, chief economist at Trulia.
“Before long, the recovery should make it into adulthood, but it will face some grown-up challenges in the next couple of years: still-tight mortgage credit for many borrowers, a slow jobs recovery for young adults, and unaffordable housing in large coastal markets.”
The monthly report measures three key housing market indicators—construction starts, existing home sales, and the delinquency-plus-foreclosure rate—to track how quickly the market is recovering to its normal, pre-bubble state. All three metrics improved in May, with starts and sales rising and the delinquency/foreclosure rate falling.