After a sharp decline that began in early 2006, the housing market showed signs of recovery during the fourth quarter of 2009—possibly pointing to stabilization of the housing market. This is the conclusion of the February issue of U.S. Housing Market Conditions, a quarterly publication from HUD’s Office of Policy Development and Research that provides and summarizes statistical data and written reports on national and regional trends in housing.
Overall improvements were found in the production sector, specifically in the area of housing permits and completions. The fourth quarter also saw an increase in existing home sales, most likely because of lower home prices, record-low mortgage interest rates, and more people taking advantage of tax incentives.
On the rental side, the absorption rate for new rental units rose and the rental vacancy rate for multifamily units declined in the fourth quarter of 2009. The median asking rent for new units, $1,156, was statistically unchanged from the previous quarter but significantly higher than the same quarter a year before.
The number of single family housing permits and completions rose in the fourth quarter, a solid indicator of an improving production sector. An analysis of the report shows that builders took out permits for new housing at a pace 4 % higher than in the third quarter of 2009. Moreover, builders completed more housing units in the fourth quarter of 2009 compared to the third quarter of 2009. The HUD reports single-family permits have increased in the last two quarters, after having declined for 14 quarters before that. Multifamily permits also showed some signs of recovery, up from the third quarter of 2009, but still down significantly from 2008.
Along with national and regional data, U.S. Housing Market Conditions provides economic and housing trends for 10 geographical regions, profiles of selected housing markets, and a summary of historical data. Each issue of the periodical also contains a topical article, which for this quarter is on newly implemented reforms to the Real Estate Settlement Procedures Act (RESPA). RESPA governs what information must be provided to customers at a house settlement, and the reforms were geared toward making clearer information about the costs of the loan and the transaction clearer. The article reports that consumers will see an estimated net savings as a result of the new procedures.
The HUD report and additional information can be found at: http://www.huduser.org/portal/periodicals/ushmc/winter09/ index.html