Many housing markets remain weak overall, but those with stronger economies and favorable demographics are improving at a much stronger pace, according to Freddie Mac’s latest Multi-Indicator Market Index. The so-called MiMi monitors the stability of the nation’s single-family housing market by looking at home purchase applications, payment-to-income ratios, on-time mortgage payments, and the local employment picture.
Learn more about why Freddie introduced the MiMi and what it says about market stability.
Overall, the index indicates a weak housing market (at 73.7) in June, the latest month measured, with only slight improvement month-over-month. Since reaching its lowest value of 59.8 in September 2011, the housing market has made a 23.3 percent rebound.
“As we see the economy slowly normalizing we’re starting to see its effects in the housing market as well, albeit very slowly,” says Frank Nothaft, Freddie Mac’s chief economist. “The good news is the big housing markets, of which some were also the hardest hit, continue to improve.”
For example, compared to the same time last year, California is up 12 percent and every market the MiMi tracks in the state is improving, Nothaft notes. Also, Florida is up nearly 15 percent, and Illinois is up nearly 13 percent over the past year.
“Likewise, the stalwarts of the recovery continue to be those states in the North Central section of the country, places like North Dakota, Montana, Wyoming, and then south to Texas and Louisiana,” Nothaft says. “In these areas not only are markets producing jobs, but better paying jobs that translate into workers taking out applications to purchase a home and income growth that keeps homebuyer affordability strong.”
Some of the most stable metro housing markets are San Antonio, Austin, New Orleans, Salt Lake City, and Houston, according to the latest MiMi reading.
Many housing markets are showing improvement, although fewer than last year. In June, 21 of the 50 states and 25 of the 50 metros tracked by Freddie Mac’s MiMi showed an improving three-month trend. Last year, every state and metro tracked was showing a three-month improving trend.
The states that have improved most year-over-year as of June are:
- South Carolina
On a metro level, the following metros saw the most improvement year-over-year:
- Las Vegas
- Riverside, Calif.
- Orlando, Fla.
Source: Freddie Mac