Housing: Leading Recovery?

by FOR


“Housing Isn’t a Horror Show Anymore” announces a July 27 Wall Street Journal headline, summarizing several weeks of surprisingly firm housing data, including a slight (but broad-based) tick up in home prices, a strong June resurgence in homebuilding (“highest level in nearly four years”), falling inventories of unsold homes “in every market,” and the “biggest monthly jump in nearly a decade of home builder confidence” (an index compiled and tracked by the National Association of Homebuilders).  On July 18, the Federal Reserve Board’s “Beige Book” also affirmed “all District housing-market reports were largely positive as sales and construction levels increased and home inventories declined”—pointing to those factors as bright spots in a generally “tepid” report on the broader economy.



Over the past few years, analysts have tended to attribute the stubborn unemployment figures to the depressed housing sector.  If housing really is experiencing more than a “bounce,” the next few months may test the extent of that influence.