Signs of Housing Industry Recovery Are Encouraging

There are signs, although guarded that the housing market as well as the economy in general is recovering. The NAHB (National Association of Home Builders) reports single and multi-family housing starts were up 3.4% in 2011 over 2010. NAHB is forecasting a bold 17% increase in single and multi-family housing starts this year.

Existing Home sales have recently shown a pattern of recovery. The overall improvement of the jobs market has allowed people who have been sitting on the sidelines to purchase one of the many bargain priced homes still on the market. Overall existing home sales rose 1.7% in 2011.

Sales of appliances were at best flat to down .5% for the year as well as cabinet and vanity sales that were down 3% for the year. These two trends make sense when you factor in the difficulty people have had saving for their down payment and closing costs, which along with job uncertainty remain the biggest  barriers to purchasing a home. The slow but gradual up trend in home building and buying will hopefully fuel the remodeling industry later this year.

I believe the best indicator of our improving economy is the credit card delinquency rates. For consumer credit cards, the delinquency rate fell for the 10th consecutive quarter to 3.27% during the October-December period last year, dropping to the lowest level since a 3.24% reading in the third quarter of 1994, more than 17 years ago. This says consumers are managing their credit effectively and have available funds to pay their credit cards.

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One Response to “Signs of Housing Industry Recovery Are Encouraging”

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