Is it welcome news to the many slowly recovering housing markets? Real estate is waiting on a marked recovery from the recession, and some of the latest regional housing start figures seem to show it could be happening.
According to the U.S. Commerce Department, "Housing starts increased 1.7 percent, consistent with privatesector expectations of a 2.0 percent increase."
"Today's data show that new housing activity appears to be stabilizing in the wake of the expiration of the home buyer tax credit," Commerce Secretary Gary Locke said. "However, a healthy economy requires not only a robust housing sector but strong employment and incomes, and President Obama remains committed to developing policies that encourage job creation and broad economic growth."
"Builders are very reluctant to build more homes in view of the current state of the economy and weak buyer demand," noted Bob Jones, chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich.
What does a recovering housing start market, in general, mean for homeowners? As your own local market begins to sprout up new homes, this in turn can increase jobs for the area. It also could indicate builders are confident enough in the local market to even start building. And if builders are confident, then you, as a homeowner could start to see your home value increase, as well as renewed buyers interest.
"Right now the housing market is essentially in a holding pattern," acknowledged NAHB Chief Economist David Crowe. "As our latest member surveys have indicated, builders are seeing greater hesitancy among potential home buyers who are uncertain about what's in store for the economy and jobs going forward. That said, favorable home buying conditions including historically low mortgage rates and low house prices should help spur additional demand as the job market gradually improves later this year."
The two regions with improving housing starts were the Northeast and Midwest, each posting dramatic gains. The Northeast saw an incredible 30.5 percent increase in July, while the Midwest saw an equally impressive 10.7 percent rise.
The Western region of the U.S. saw no change in housing starts, while the South, noted by the NAHB as "the country's largest housing market," posted a 6.3 percent decline in July.
But these figures may be deceiving, as the NAHB reports that in reality, "single-family housing production declined 4.2 percent to a seasonally adjusted annual rate of 432,000 units, its lowest mark since May of 2009." Why are the figures indicating a rise then? This rise in housing production could easily be due to a rise on the multi-family side of housing.
Either way, a rise is a rise, and that is a welcome sign in an ailing economy.