For Mark Roberts’ Use: As we all know, the collapse of the housing market was one of the major contributors to the worst recession seen in the U.S. since the Great Depression. Now, as the economy has begun to grow and recover, the housing sector has continued to lag behind.
Luckily, that might be changing. Statistics for the second quarter of 2013 are in, and new single-family home sales were up 4.7% over the previous quarter. Even more exciting, these sales showed a whopping 30% increase over the second quarter of 2012 – a dramatic improvement in just one year.
Homes aren’t just selling; prices are rising as well. In the second quarter of this year, the median new home price rose 2.3% over the previous quarter, while the median price for existing homes rose an impressive 15.4%. These figures for new and existing home prices were up 10.8% and 12.2%, respectively, over the same quarter of 2012.
When many homeowners found themselves “under water” on their mortgages, making it difficult for them to sell their homes, inventory of available homes for sale shrank considerably. But as the economy has recovered, demand for housing has grown, and that has served to push prices upward. As prices increase, some homeowners may find themselves no longer under water with their mortgages.
Due to increased confidence in the housing market, the construction industry has been waking up from what seemed like a long hibernation. In fact, statistics for the second quarter of 2013 show that there are 20.5% more new homes currently under construction than there were during the same quarter of 2012. Applications for single-family dwelling permits are up 25.3% over last year. These promising gains may indeed represent the beginning of a housing market recovery, with even more room for growth if the trend continues. As the construction industry continues to revive, it’s reasonable to expect more jobs will be created.
For now, most analysts are advising a cautious outlook. The numbers from 2013 so far do indeed look promising, but gains for the rest of the year remain to be seen. If the upward trend continues, this could be the year that marks the return of the housing market, and the overall economy could greatly benefit as a result.
US Dept of Housing and Urban Development