National Housing Market Conditions, 3rd Quarter 2016

January 31, 2017  

National Housing Market Conditions, 3rd Quarter 2016

HUD’s Office of Policy Development and Research has released its analysis of the national housing market with third quarter statistics for 2016. The report contains updates on production, marketing, housing performance, homeownership, and affordability; provides comparisons with the previous quarter; and places the data in historical context. The analysis indicates that during the third quarter of 2016, the housing market continued to improve.

Key Findings

• Construction starts on single-family homes were up 1 percent from the second quarter and 2 percent from one year before. As of the third quarter, the pace of single-family housing starts was more than half the annual rate of 1.36 million units in 2002, before the housing bubble began. Multifamily housing starts dropped 5 percent from the second quarter and 7 percent from one year earlier.
• Purchases of new single-family homes were up 4 percent from the second quarter and up 21 percent from one year earlier. Sales of existing homes were down 2 percent from the second quarter but were virtually the same as one year before. The NAR Composite Housing Affordability index, at 163.9 in the third quarter, remains well above its historic norm of 129.
• The rate of seriously delinquent loans fell to 2.96 percent in the third quarter, the lowest rate since the third quarter of 2007.
• After falling for two consecutive quarters, the U.S. homeownership rate increased to 63.5 percent from 62.9 percent in the second quarter, but was still down from 63.7 one year before.
• HUD’s Rental Affordability Index shows that the affordability of renting a home increased 1 percent from the second quarter and 4 percent from one year earlier, as the median monthly price of renting a home fell while median renter household income increased in the third quarter.

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