Housing market recovery spreads to new markets
The housing recovery spread to more markets in February, according to industry data, indicating that more parts of the country are showing signs of improving economic health.
A total of 259 metropolitan areas were listed as improving, according to an index produced by the National Assn. of Home Builders. That was an increase from 242 markets listed as improving in January.
“Today, the story is about how widespread the recovery has become as conditions steadily improve in markets nationwide,” David Crowe, chief economist for the builders group, said in a news release.
The index tracks employment growth, home price appreciation and single-family housing permit growth.
It was the sixth consecutive month of improvement in the index. All 50 states now have at least one improving metro area. Newly added areas include Rome, Ga.; Fort Wayne, Ind.; Myrtle Beach, S.C.; Albuquerque, N.M.; and Racine, Wis.
The housing recovery began in earnest last year. The rebound came as foreclosures declined, housing inventory plummeted, mortgage interest rates hit record lows and demand from investors surged last year.
In addition, the overhang of the last housing bust resulted in some unexpected benefits.
For instance, the high number of underwater borrowers actually served as a boost to the market rather than being a drag, as people kept their homes off the market, decreasing inventory.
California buyers should expect a tight market for months to come.