A recent report by the National Association of Home Builders (NAHB) revealed that the number of improving housing markets in the U.S. remained unchanged in April.
NAHB's "The First American Improving Markets Index (IMI)", tracks various metro areas of the country on the basis of construction employment, housing permits and home prices for the previous six months in the region.
Apparently, the number of expanding housing markets gained for seven consecutive months before stalling in April 2013. Very minute changes were recorded, with one market falling out of the "improving" list and the others remaining unchanged. However, around 75 percent of the housing markets displayed commendable improvements.
Experts believe that the stalling is a good sign and an indication of steady growth. They assert that the improvements point toward a brighter outlook for the country's economy.
"After a strong run-up through late 2012 and early 2013, the number of improving markets is holding steady at a high level. We can expect to see more gradual gains going forward as challenges related to increased demand kick in - including everything from tightened supplies of developable lots and labor to the rising cost of building materials," David Crowe, Chief Economist at NAHB said in the report.
On March 21, the NAHB stated that the list of improving real estate markets of the U.S. included 274 metropolitan areas. The March report said, since February, the list welcomed 15 new entrants from various states of America and the District of Columbia. Thirty four new metropolitan markets witnessed sharp housing trends while 19 existing markets were dropped from the list.
However, growth in many recovering markets is being decelerated by credit availability issues and building lot and material shortages. Construction material costs soared in February and are expected to be high for the rest of the year. Moreover, construction on new homes also declined to drop to 7 percent in the same month.
"In some markets, the main thing that's holding back a recovery is a relatively thin inventory of homes for sale, which could be resolved if builders had easier access to credit for building homes and putting people back to work," Rick Judson, Chairman of NAHB added in the report.
