In its June issue, BUILDER magazine named the top five single-family markets in the United States of 1998, and then, in an interesting study, compared them to their respective conditions 20 years ago in 1978. The findings painted a remarkable portrait of just how far these regions have come throughout the years.

In 1978, four of 1998's top five markets -- Phoenix, Dallas-Fort Worth, Chicago, and Washington, D.C. -- also were ranked in the top five. Atlanta, the other market on today's top-five list, was still a work in progress back in '78.

Here's a closer look at the 20-year progressions of these markets

Sources: U.S. Housing Markets, U.S. Census Bureau:

1. ATLANTA

In 1978, Atlanta was a very competitive market comprised of many small builders in fierce competition. David Chatham, president of Chatham Holdings Group in Roswell, Ga., says that the city's market in 1998 is better prepared than it was 20 years ago to absorb a housing slowdown because of the city's more diverse job market -- and the fact that the 1970s recession taught Atlanta builders the hard way about the consquences of overbuilding.

2. PHOENIX

In 1978, Phoenix found itself in its best year ever in terms of permit activity. Things have only gotten better since then: In 1997, Phoenix broke its 1978 record by 477 permits.

3. DALLAS-FORT WORTH

Dallas - Fort Worth outpaced Houston in 1978, a year that began slowly due to the occurrence of five snowstorms -- uncharacteristic of the Lone Star state. Nineteen years later, in 1997, housing demand surpassed the lot supply, and small builders found themselves wedged into an increasingly smaller portion of the market.

Bob Cresswell, president of Cresswell Custom Builders in Dallas, told BUILDER: "There were only two or three large-volume builders in Dallas in 1978. Today, there are still a lot of small custom builders, but there are close to 30 production builders, which increases the competition tremendously."

4. WASHINGTON, D.C.

Inside the Beltway 20 years ago, lot supplies were tight, according to Ken Thompson, presdient of Ken Thompson & Associates in Woodbridge, Va. That's still the case in 1998; builders continue to seek out more infill projects. Thompson adds that back in 1978, small-volume builders used "skipped-over" land or unsewered land located in the suburbs. At that time, prices were so strong that cancellations would resell at 10 percent above original asking prices.

"Local government control of overgrowth was the same in 1978 as it is now, but the tools were different. In 1978, there were zoning ordinances to restrict growth. Today, there are impact fees and public facility ordinances," Thompson told BUILDER.

5. CHICAGO

Chicago wasn't a fun place to be 20 years ago. The city was experiencing one of its worst winters on record -- the worst of any major housing market. Because sales were so low, lenders dropped their rates to less than money market certificate rates, .5 percent below other Midwest markets. Lenders in 1998, according to Daniel McLean, president of MCL Construction in Chicago, are keeping a tight leash on the local market.

"In 1978, 1 percent of the market was in the city; everything was happening in the suburbs," McLean told BUILDER. "But today's back to the city movement has brought 10 percent of the market into Chicago".

Note: *The "hotness" index, defined by BUILDER, measures new single-family housing permits and total housing permits issued in both 1978 and 1997, per 1,000 population.

Published: July 9, 1998

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