While recent recovery in the housing market and national economy has been marred by constant starts and stops, a recent indicator from lending giant Freddie Mac is pointing out that some states are rebounding quicker than others. As the market steadies as a whole, certain areas of the country are pulling away from the pack in terms of economic and housing recovery, with Southern California’s Riverside being one of those fast-moving communities.
Using its monthly-calibrated Multi Indicator Market Index (MiMi), Freddie Mac gauges the health of the national real estate market by looking at data sets from all 50 states in addition to the top 50 metropolitan areas. The MiMi analyzes factors such as home purchase applications, payment-to-income ratios, proportion of current mortgage payments in each market and the local employment situation.
The June data sets reveal that the housing market has stalled at 73.7 points. Despite showing slight increases in all increments of change over time, including a monthly increase of 0.4 percent, a three-month increase of 0.16 percent and an annual increase of 7.67 percent, the June MiMi still indicated a weak showing for all markets across the board. In order to get into normal range, the MiMi needs to climb just a few more points to over 80, while anything in the elevated range would be over 120.
Riverside Home Market Makes Improvements
Of the 50 metropolitan markets that the MiMi tracks, 25 showed improvements in their local housing markets with the Southern California community of Riverside being among the communities with the most marked improvements. Other markets to fall in this category are Las Vegas, Miami, Orlando and Chicago.
California also ranked as one of the states that showed the most growth in the past three months, with Nevada, Florida, Illinois and South Carolina ranking high as well. With the exception of maybe California, all of these states and metropolitan areas were hit particularly hard by the recession making their noted mega-recoveries not only welcome, but expected given how far their markets had fallen at the lowest of lows.
“As we see the economy slowly normalizing we’re starting to see its effects in the housing market as well, albeit very slowly,” said Frank Nothaft, Freddie Mac’s chief economist, said in a statement. “The good news is the big housing markets, of which some were also the hardest hit, continue to improve.”
One of the most marked indicators of improvement has been the increase of inventory that local real estate markets have been looking for in order to spur more sales and to regulate rapid price increases that had characterized many markets for the first half of the year. In Riverside, rapid home price increases have been halted slightly as more homes have come to the market as indicated by data from Altos Research, a California-based real estate analytics company. As of August 29, there are about 956 properties on the market in Riverside.
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