The first quarter of 2009 showed a continuation of dismal housing market conditions, according to the latest quarterly review of housing markets released by HUD. According to the May 2009 U.S. Housing Market Conditions report, declining trends were evident within all areas of the industry—from production and marketing to inventory and investment. This report provides an easy reference for those looking for a recent selection of housing statistics.
As has been widely reported, new home sales and their median prices showed a reduction in numbers during the first quarter of 2009. In fact, new home sales have been on the decline for the past 14 quarters. Sales of new single-family homes went down 38% between the first quarter of 2008 and the first quarter of 2009. The median price of these new homes was $205,600— 12% lower than the median price at this time last year.
Affordability—defined as the ratio of median family income to the income needed to purchase the median priced home— is mentioned as one of the indicators that may be seen to be improving. However, this perceived improvement was due to a 6% decrease in the median price ($168,933) of existing singlefamily homes sold and an 87-basis-point decrease in mortgage insurance rates. (A basis point is one hundredth of a percentage point, or 0.01%.) These decreases are offset by the 2.3% decline in family income since the first quarter of 2008.
The decline in multifamily housing (in buildings with five or more units) indicates that the downturn is market-wide. Building permits issued to build multifamily units were down 20% from the fourth quarter of 2008 and down 49% from the first quarter of 2008. Building starts and completions showed similar declines. The rental vacancy rate has remained steady, however, at 10.1% for both the fourth quarter of 2008 and the first quarter of 2009, while asking rents continued to inch up.
Along with providing a statistical summary of U.S. housing conditions, each U.S. Housing Market Conditions report also contains a more in-depth article analyzing or describing recent data or developments. This article gives readers an overview of the newly released data on Low Income Housing Tax Credit (LIHTC) projects placed in service through 2006. On average per year between 1995 and 2006 (the period with the most complete data available) nearly 1,400 projects and 103,000 units were placed into service. These LIHTC projects contained an average of 74 units, with the average size of the properties and the average number of units increasing over the period. More than 95% of the total units placed in service between 1995 and 2006 were qualifying units—reserved for low income use, with restricted rents, and for which low income tax credits could be claimed. Twenty-three percent of the LIHTC units had three or more bedrooms, which is much higher than the national average of 16% between 1995 and 2006. Roughly two-thirds of the projects placed in service were defined as new construction. Nearly a third of the LIHTC projects between 1995 and 2006 were sponsored by a nonprofit. On average, $8,321 of low income housing tax credits were allocated per low income unit.
The U.S. Housing Market Conditions 1st quarter 2009 report can be found at: http://www.huduser.org/periodicals/ushmc/spring09/USHMCQ109.pdf