The recession is over.

It's been over for years.

And in the Newer Economy's strongest sector, it's as if the recession never existed.

"Housing continues to do the heavy lifting in an otherwise sluggish economy," said Kent Conine, president of the National Association of Home Builders (NAHB).

The official keeper of data that defines recessions, the Business Cycle Dating Committee of the National Bureau of Economic Research recently made it official -- following the nation's longest economic expansion on record, the last recession began in March 2001 and ended in November 2001.

The recession lasted 8 months, which is slightly less than average for recessions since World War II, according to the committee.

The committee defines a recession as "a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales."

The recession's end is an economic trough that marks the end of a shrinking economy and the beginning of economic growth -- which can remain below normal well into the expansion, the committee said.

The committee delayed so long in making the announcement on July 17 to be confident that any additional downturn was not a continuation of the recession that began March 2001. The most recent data indicate that the broadest measure of economic activity -- gross domestic product in constant dollars -- has risen 4.0 percent from its low in the third quarter of 2001, and is 3.3 percent above its pre-recession peak in the fourth quarter of 2000.

Refinancing mortgages alone was credited with 20 percent of the growth in the nation's raw gross domestic product (GDP, a measure of the output of goods and services produced by labor and property in the U.S.) during 2001 and 2002, according to "The Economic Contribution of the Refinancing Boom," research by West Chester, PA-based Economy.com, an international economic researcher.

Economy.com said even without considering equity borrowing, refinancing alone amounts to one-fifth of the national economy's GDP growth of just over 1 percent per annum since late 2000. The report was commissioned by the Homeownership Alliance, a coalition of organizations supporting the nation's housing system.

A slight home sales dip during the recession can be attributed in part to the seasonal nature of the home sales market, but home price increases continued unabated through the recession.

The National Association of Realtors reported the annual rate of existing home sales in March, 2001 at the beginning of the recession was 5.46 million per year. That dipped to 5.31 million by the end of the recession, November, 2001. The latest figures show the annual rate of home sales was back up to 5.83 million for June this year, according to NAR.

"The strong number of existing-home sales is consistent with high levels of mortgage applications, new home sales and housing starts," said David Lereah, NAR's chief economist.

The National Association of Home Builders reported the annual rate of new home sales at 939,000 in March 2001, dropping to 924,000 by the end of the recession. Its latest figures show the annual rate has since jumped to a record 1.16 million in June.

"Don't forget that every new-home purchase helps stimulate the economy even further. At this point, it's nearly certain that we'll set another record for new-home sales in 2003," said NAHB's president Conine.

Price movement during the recession best reveals the strength of the housing market.

The national median prices for existing homes moved from $143,400 at the onset of the recession to $147,100 when the recession ended, according to NAR. For new homes, the price moved from $166,300 to $168,100 during the recession, NAHB reported.

In June of this year, the national median for existing homes was $176,500, up 7.7 percent from June of 2002, NAR said.

For new homes, the national median price was $187,000, down from $190,600 a year ago, NAHB said.

"Keep in mind that due to a seasonal nature in buying patterns, the most valid comparisons for median prices are with the same period a year earlier. For example, each year since record keeping began in 1968, the median price had dropped in the fall because most families with children -- purchasing more expensive homes -- time their purchases based on school year considerations.  As a result, there is a higher ratio of singles and childless couples purchasing more moderately priced homes in the fall, so the median transaction price (not value) drops," said Walter Molony, NAR spokesman.

Published: July 31, 2003

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Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.