Southeast Housing Update: Sales Growth Slows
In an effort to stay on top of changing housing market conditions, the Atlanta Fed conducts a monthly poll of home builder and residential broker business contacts. The poll dates back to December 2005. It opens on the first Monday of each month, closes a week and a half later, and reflects activity from the previous month. Since the most current housing data often come with several months’ lag, we like to keep a close eye on this poll for any early signals that the housing landscape is changing.
According to the latest poll results, the majority of builders and brokers reported that sales on a year-over-year basis continued to be flat to slightly up. On a month-over-month basis, contacts indicated that sales continued to be flat to slightly down (see the chart).
Nearly half the brokers indicated that buyer traffic was down on a year-over-year basis. More builders have also started to indicate that buyer traffic is declining (see the chart). Many of the comments we received from contacts suggested that seasonal factors are driving the decline in buyer traffic.
The majority of brokers and builders continued to report that home inventory levels were down from a year earlier (see the chart). Several contacts commented that they expect to see slight increases in inventory levels over the next few months as more homeowners regain equity in their homes.
The majority of builders and brokers continued to indicate home price appreciation in November (see the chart).
Over the past two months, more builders have begun to indicate that they are having a difficult time filling positions compared with a year earlier (see the chart).
When asked how labor costs compare with a year ago, more than 30 percent of builders indicated that they are experiencing increases of 3 percent or more (compared with 20 percent of builders one year earlier and 10 percent of builders two years earlier; see the chart).
More broker and builder contacts expect to see home sales growth over the next few months relative to last month’s report, although expectations for home sales growth are slightly weaker than a year earlier (see the charts).
Fewer builders expect construction activity to increase over the next three months compared with a year ago, although expectations for activity have increased from recent reports (see the chart).
Note: November poll results are based on responses from 43 residential brokers and 21 homebuilders and were collected December 2–11, 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, and negative values indicate decreased activity.
If you are a real estate broker or homebuilder and would like to participate in this poll, please let us know by sending a note to RealEstateCenter@atl.frb.org.
By Jessica Dill, senior economic research analyst in the Atlanta Fed's research department
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