Realty Times - Real Estate Outlook: Improving Markets Index

Markets all across the nation are beating the odds and posting at least six consecutive months of gains in housing permits, employment, and house prices.

According to the latest National Association of Home Builders/First American Improving Markets Index (IMI), a total of 103 housing markets now make the list.

"While 11 new housing markets were designated as improving in October, 92 metros retained their spots on the IMI and just seven slipped from the list," noted Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. "This is an encouraging sign that the housing recovery is proceeding at a steady pace as firming prices and employment help spur new building activity, which in turn generates new jobs and more home sales."

Builders are showing their confidence in the market. Mortgage applications analysis in the multifamily sector for 2011 indicate that "the $110 billion of borrowing and lending backed by multifamily apartment buildings in 2011 was more than double the amount of just two years earlier," said Jamie Woodwell, a Mortgage Banking Association Vice President of Commercial Real Estate Research. "The growth is a testament to the improvements in both the underlying multifamily property markets and the broader capital markets."

"The fact that most markets are maintaining their spots on the improving list from month to month is an important indication that the recovery trend is solidifying," agreed NAHB Chief Economist David Crowe.

"At the same time," he said, "overly tight credit conditions are certainly constraining consumers' ability to purchase homes as well as builders' ability to construct them."

Is your area on the list of improving markets? It's must-know information for buyers and sellers today. Visit http://nahb.org/imi for the full list.

Mortgage refinance applications had been on a steady decline in the past few months, but now the MBAA reports that they make up 83 percent of the market. "Refinance application volume jumped to the highest level in more than three years last week as each of the five mortgage rates in MBA's survey dropped to new record lows in the survey," said Mike Fratantoni, MBA's Vice President of Research and Economics.

He continued that "financial markets continue to adjust to QE3, as the ongoing presence of the Federal Reserve as a significant buyer of mortgage-backed securities applies downward pressure on rates.? Although there was a slight decline in the HARP share of refinance activity, the level of HARP volume remains steady." Total mortgage applications were up 16.6 percent last week.

Realtor Magazine is reporting this week that the housing recovery continues to expand. They reported in their daily news that the recovery has now risen above just sales and price increases. Home builder stocks are beginning to rebound, with such companies as Pulte Group posting double gains in the last year.

"It does appear we've turned the corner and a housing recovery is under way," says Bradley B. Thomas, an analyst at KeyBanc Capital Markets. "We continue to expect recovery over the next three to five years, if not five to 10 years."

Published: October 15, 2012

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Source: http://realtytimes.com/rtpages/20121015_realestateoutlook.htm

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