Southeast Housing Update: The Recovery Continues
Southeastern housing contacts reported that home sales remained ahead of the year-earlier level in February. More than three-fourths of brokers and more than two-thirds of home builders that participated in the Atlanta Fed’s monthly real estate poll indicated that sales were ahead of the year-earlier level (see the chart). Reports from brokers were more positive than builder reports and indicated strong sales gains.
Home shortages persisted across much of the region. Brokers continued to note that low listing inventories were restraining sales, and many said that they were receiving multiple offers for properties, particularly at the low end of the market. Investors remained active across the region. Several Florida brokers in particular noted that first-time home buyers were being squeezed out by investors who were buying with cash.
More brokers and builders indicated better access to mortgage finance compared with those surveyed last November (see the chart). The share indicating that available credit was equal to or greater than demand improved slightly from November.
Improving demand for both new and existing homes, along with low home inventories across much of the Southeast, continued to move home prices up in February (see the chart). Most contacts indicated that home prices rose modestly compared with a year earlier. Appreciation was strongest among Florida contacts.
Once again, Southeast builders indicated that construction activity was slightly ahead of the year-earlier level.
Builders did indicated some improvement in accessing construction finance compared with those polled last November (see the chart). However, the majority continued to report that available credit was short of demand.
The outlook for sales among brokers and builders over the next several months remained positive (see the chart). More brokers anticipate stronger sales gains than was reported a year earlier.
Southeast builders reported that it remained challenging to access construction development financing, but their outlook for new home construction activity remained positive, as did their outlook for new home sales this spring (see the chart). They indicated that will be slightly ahead of the year-earlier levels.
Note: February poll results are based on responses from 65 residential brokers and 28 homebuilders and were collected March 4-13, 2013. The housing poll's diffusion indexes are calculated as the percentage of total respondents reporting increases minus the percentage reporting declines. Positive values in the index indicate increased activity while negative values indicate decreased activity.
By Whitney Mancuso, senior economic research analyst in the Atlanta Fed’s research department
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