Out of 350 metros across the country, 52 have returned to or exceeded their pre-recession levels, according to a new index debuted by the National Association of Home Builders and First American.
The newly released Leading Markets Index factors in housing permits, home prices, and employment data in the past year to gauge how close the housing market is running at normal activity. The index uses the 2000-2003 time period as the most recent “normal period” for comparison in reviewing housing permits and home prices.
The index's first reading scored the nation at 0.85, which indicates the national housing market is running at 85 percent of normal activity.
The metros performing the best on the index are:
- Baton Rouge, La.
- Oklahoma City
- Austin, Texas
- Harrisburg, Pa.
For smaller markets, Odessa and Midland in Texas are now at double their strength prior to the recession, according to the index. Other smaller markets with a strong performance are Casper, Wyo.; Bismarck, N.D.; and Florence, Ala.
"Smaller metros are leading the way to a housing recovery, accounting for 43 of the top 50 markets on the current LMI," says David Crowe, NAHB chief economist. "This is an indication of the extent to which local economic conditions dictate the strength of individual housing markets."
The new index replaces NAHB and First American’s Improving Markets Index, which was a monthly gauge of where the recovery was beginning to take hold in individual markets. The new index broadens that view by determining how close the markets are to returning to their normal levels.
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