Freddie Mac housing index shows recovery continues

 Real Estate Market  Comments Off on Freddie Mac housing index shows recovery continues
Aug 052015
 

For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.

by G. Steven Bray

Freddie Mac’s MiMi index, or Multi Indicator Market Index, continues to point to a recovering housing market. The latest index covers the spring buying season, and shows the nationwide index increased to 79.2. While this value still indicates a borderline weak housing market, it is a sizable improvement from last year and from the previous month. By comparison, the index high was 121.16 in 2006.

More than half the states have MiMi values in the stable range of 80 to 120. Texas ranks 7th nationwide with a MiMi value of 87.6. This represents a 5% improvement over last year.

Of Texas metros, Austin leads the pack and remains in the top 5 nationally with a value of 92.8. Values for other TX metros include DFW at 83.9, El Paso at 84.9, Houston at 86.7, The Valley at 89.1, and San Antonio at 86.5.

The biggest drag on MiMi values for TX metros is the number of purchase applications. This probably is more indicative of tight supply than market weakness. Thus, I think it’s safe to say the housing markets may be stronger than indicated by their MiMi scores.

Healthiest housing market since 2001

 Real Estate Market  Comments Off on Healthiest housing market since 2001
Apr 072015
 

For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.

by G. Steven Bray

I read an interesting report from Nationwide Insurance’s economics group this past week that claimed the housing market is the healthiest it’s been since 2001. Let’s take a look at how they came to this conclusion.

The report’s authors calculate a value they call the Leading Index of Healthy Housing Markets (LIHHM) using employment, demographic, mortgage, and home price data for the national and individual housing markets. They claim a market’s score, which ranges from 75 to 125, indicates the relative health of that market. A score of 100 is neutral, and scores above 100 indicates a healthy market.

The current value for the national market is 109.8, which the authors conclude indicates a housing market unlikely to enter another downturn soon. Further, they find that only two of 373 metro areas have negative scores at this time. Positive contributors to the index included employment gains and higher home prices. In addition, they cite a pick-up in household formation.

Interestingly, these results are a bit at odds with Freddie Mac’s Multi-Indictor Market Index (MIMI). The national MIMI score in Jan was 74.6, a level Freddie says indicates a weak housing market.

Regardless of which report you believe, what may be more interesting is the trend, and both indices show year-over-year improvement.

Click here for the Nationwide Insurance report.

Click here for the Freddie Mac report.