Housing markets in the U.S. overall continue to progress, supporting the best year in home sales in a decade, as indicated by Freddie Mac’s Multi-Indicator Market Index® (MiMi®) value, which stands at 86—a market on the “outer edge of its historic benchmark range of housing activity.” The MiMi value, which has climbed back up 45 percent since its all-time low in 2010, is still trailing its high of 121.7.
“The National MiMi stands at 86, a 5.6 percent year-over-year increase, but still below its historic benchmark normalized to 100,” says Len Kiefer, Freddie Mac deputy chief economist. “The purchase applications indicator is up nearly 19 percent from last year, indicating strong housing demand and a market that’s poised to close out the best year in home sales in a decade.
“National home prices have surpassed their pre-recession nominal peak with about half of states still below their pre-recession peak,” Kiefer continues. “Factoring in low mortgage rates and modest income gains, house prices still have some room to run, as indicated by the MiMi payment-to-income indicator which is nearly 33 percent below its historic benchmark.”
Forty-one of the 50 states, plus the District of Columbia, have MiMi values within range of their benchmark averages, with Utah (100.4), Colorado (97.8), Hawaii (97), Idaho (96.7) and North Dakota and Oregon at (95.8) ranking in the top five. Seventy-six of the 100 metro areas have MiMi values within range of their benchmark averages, with Honolulu, Hawaii (99.8), Nashville, Tenn. (100.2), Ogden, Utah (99.3), Dallas, Texas (99.2) and Provo, Utah (101), ranking in the top five.
The most improving states month-over-month were Nevada (+2.59 percent), Arizona (+1.54 percent), Massachusetts (+1.53 percent), South Carolina (+1.34 percent) and Colorado (+1.24 percent). On a year-over-year basis, the most improving states were Nevada (+11.74 percent), Florida (+11.58 percent), Massachusetts (+11.35 percent), Mississippi (+9.76 percent) and New Jersey (+9.61 percent).
The most improving metro areas month-over-month were Las Vegas, Nev. (+2.57 percent), Charleston, S.C. (+2.00 percent), Seattle, Wash. (+1.76 percent), Worcester, Mass. (+1.74 percent) and Springfield, Mass. (+1.52 percent). On a year-over-year basis, the most improving metro areas were Orlando, Fla. (+17.85 percent), Worcester, Mass. (+14.49 percent) Tampa, Fla. (+14.36 percent), Chattanooga, Tenn. (+14.20 percent), and Dallas, Texas (+13.89 percent).
“The recent jump in mortgage rates will drive down homebuyer affordability and likely dampen demand for home sales next year,” Kiefer adds. “Though we’ve come far, as indicated in the national statistics, housing still has significant room for improvement in many markets across the country as indicated by the fact that 24 out of the top 100 metros are still more than 20 percent below their historic benchmark, as measured by MiMi.”
For more information, please visit www.freddiemac.com/mimi.
For the latest real estate news and trends, bookmark RISMedia.com.