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Fourth Quarter 2012 Housing Market Conditions

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March 07, 2013  

Fourth Quarter 2012 Housing Market Conditions

HUD’s Office of Policy Development and Research has released the U.S. Housing Market Conditions Report for the fourth quarter of 2012, which contains updates on production, marketing, multifamily housing performance, homeownership, and affordability statistics for the year, as well as for the fourth quarter of 2012.

The annual analysis indicates that during 2012, building permits and starts in single-family and multifamily housing increased significantly from 2011. Single-family and multifamily completions also increased from 2011. Shipments of manufactured homes increased 6.4 percent. In the marketing sector, indicators were positive, with an increase in the number and median price of both new and existing homes sold. Builders also had positive views on 2012’s housing market activity, shown through an increase in the NAHB/Wells Fargo Composite Housing Market Index. The homeownership rate, however, decreased slightly for White, African American, and Hispanic households from 2011.


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The report also includes comparisons with the previous quarter and the fourth quarter of 2011, profiles of economic and housing market activity in each of HUD’s 10 regions, and updates of historical trends in national and regional housing markets. The title of the issue’s feature article is “Transforming U.S. Housing Market Conditions for the Digital Age.”

Key Findings

  • Builders took out permits for 892,000 new housing units during the last quarter of 2012, 7% above the previous quarter and 29% more than one year earlier.
  • Single-family building permits were up 8% from the previous quarter and 23% from a year earlier; multifamily permits increased by 14% from the second quarter and 56% from one year earlier.
  • Single-family housing construction starts increased from the previous quarter, as well as 25% from one year earlier. Multifamily starts were 33% higher than the previous quarter and 55% higher than the previous year.
  • New single-family housing completions were up 7% from the third quarter of 2012 and 16% from last year. Multifamily unit completions were down 4% from the third quarter of 2011, but up 29% from 1 year ago.
  • Manufactured housing shipments increased slightly from the previous quarter but were down 11% from the previous year.
  • New single-family home sales were up 2% from the last quarter and 15% from a year earlier. Existing home sales were 5% higher than the previous quarter and were up by 12% from 12 months earlier.
  • Sales to first-time homebuyers decreased slightly from the previous year to 30% of all home sales.
  • Home affordability, measured by the NAR Housing Affordability Index, increased in the third quarter of 2012. This increase is attributed to a 20-basis-point decrease in mortgage interest rates, which offset a 1.7% increase in the median sales price of existing single-family homes.
  • The homeownership rate decreased to 65.4% in the last quarter of 2012. The homeownership rate was 65.5% in the previous quarter and 66.0% 12 months earlier.
  • FHA foreclosure starts and FHA loans in foreclosures both decreased in the third quarter of 2012.

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