The State of the Nation's Housing 2012
Housing markets are showing signs of reviving, concludes The State of the Nation’s Housing report released last week by the Joint Center for Housing Studies of Harvard University. “While still in the early innings of a housing recovery, rental markets have turned the corner, home sales are strengthening, and a floor is beginning to form under home prices,” says Eric S. Belsky, Managing Director of the Joint Center for Housing Studies. “With new home inventories at record lows, unless the broader economy goes into a tailspin, stronger sales should further stabilize prices and pave the way for a pickup in single-family housing construction over the course of 2012.”
Some key facts found in the homeowner market are as follows:
- By the first quarter of 2012, existing home sales (single family and condos) were 5.2% above year-earlier levels, with single family sales up 6.3%.
- After hitting a record low of just 306,000 units in 2011, sales of newly constructed homes in the first quarter of 2012 stood 16.7% above year-earlier levels.
- Inventories of new single-family homes for sale fell 20% in 2011, sinking to just 143,000 units in March 2012—the lowest level in nearly five decades of recordkeeping.
- The inventory of existing homes for sale shrank by some 23% in 2011, reducing the supply in the first quarter of 2012 to its lowest level since 2006.
- The number of new homes added in 2002–11 was lower than in any other ten-year period since the early 1970s.
- With the uptick in sales, single-family starts picked up significantly in the second half of 2011 and stand fully 16.6% above year-earlier levels in the first quarter of 2012. They were down 8.6% in 2010-11.
- Single-family permitting, a leading indicator of starts, was also up 16.9% in the first quarter of 2012.
- Multifamily starts surged 54% in 2010-11, and in 2012:1 were up 36.1% from year-earlier levels.
- With an increase in residential construction in late 2011 and early 2012, Residential Fixed Investment (RFI) posted two consecutive quarters of solid growth and provided its first significant boost to GDP since the end of the Great Recession.
- According to the Freddie Mac Primary Mortgage Market Survey, interest rates on a 30-year fixed mortgage slid below 4.0% in early 2012— its lowest level since recordkeeping began in 1971.
To download the full report, which covers the rental market, foreclosure rates, and overall homeownership numbers, click here.
You can also watch a video of Eric Belsky discussing the state of the nation’s housing below.
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