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Saturday, September 24, 2011

NAHB Releases New Economic Index That Tracks Improving Housing Markets

The National Association of Home Builders has launched a new monthly economic indicator—the NAHB/First American Improving Markets Index, which tracks housing markets throughout the country that are showing signs of improving economic health.

The new economic index reveals metropolitan areas that have shown improvement for at least six months in three key economic areas—housing permits, employment and housing prices.

"Housing conditions are local, and do not always reflect the national picture. NAHB created this new index to shine a light on those housing markets across the country that have stabilized and have begun to show signs of recovery," the organization said.

"By examining key indicators of home prices, employment and housing permits data, we are using a comprehensive, but conservative method in determining which markets are improving," said NAHB Chief Economist David Crowe. "Last year at this time, there was not a single market that showed improvement using these criteria, and now we can point to 12 examples of growth."

The IMI is designed to track housing markets throughout the country that are showing signs of improving economic health. The index measures three sets of independent monthly data to get a mark on the top improving Metropolitan Statistical Areas. The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics, house price appreciation from Freddie Mac, and single-family housing permit growth from the U.S. Census Bureau. A metro area must see improvement in all three areas for at least six months following their respective troughs before being included on the improving markets list. NAHB uses the latest available data from these sources to generate the list of improving markets.

Visit www.nahb.org/imi for additional data and tables.

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