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| 2Q11 Indicates Signs of Economic Recovery for Central California |
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MetroStury Report - (Roseville, CA– August 1, 2011) The Central California housing market continues to show signs of slight economic recovery in 2Q11, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market. “It’s been more than three years since we have seen job growth in any of the Central Valley markets, and in June we have had growth in seven of the 13 sectors we track,” said Greg Gross, director of Metrostudy’s Central California Region. The Central California economy continues to struggle, but now the indicators continue to suggest a cautious improvement through 2011. However, the improving job market has yet to positively impact the new home market. Annual Housing starts are down 32% to 3,225 from 2Q10 in the Central Valley, while closings are off by 37% to 3,976. This has brought inventory levels closer to equilibrium. It appears we have reached the bottom of the market as paces are stabilizing and both quarterly starts and closings increased during 2Q11. Additionally, our average “offer to build” base price for new Single Family detached homes has increased 1% to $262K since 2Q10. Finished inventory of homes has retreated impressively from the highs reached in 4Q06. With 1,167 Finished Vacant homes this quarter, the market has about 3.5 months of supply. Finished Vacant Units have steadily declined over the past 8 quarters as lot production has all but ceased. “Metrostudy expects the Central Valley housing market to remain weak for 2011 and will begin to show stronger signs of improvement by end of year,” said Greg Gross. “The next year will likely be as challenging for us as the market has grasped the idea of having ‘bottoming out’. The new normal will be steady absorptions, difficult lending standards and increased construction costs.” For information contact: greg gross @ 916.873.7840 This e-mail address is being protected from spambots. You need JavaScript enabled to view it |
