March 31, 2015
Nationwide Unveils Broad Measure of U.S. Housing Landscape That Signals Healthiest Outlook Since 2001
Quarterly report combines job, mortgage market, home price and demographic data for the U.S. and 373 metropolitan statistical areas
Columbus, Ohio - A new and forward-looking index of the U.S. housing market is at its healthiest level since 2001. Nationwide, a leading insurance and financial services organization, unveiled its new housing market barometer today, which evaluates the housing health outlook for the U.S. and 373 metropolitan areas.
Nationwide’s Health of Housing Markets Report (The HoHM Report), which will be issued quarterly, includes a national leading indicator score as well as regional readings and breakdowns – such as lists of the top and bottom 10 rankings of the metropolitan statistical areas, or MSAs, and the Top 40 rankings by size. Nationwide’s team of economists will offer contextual analysis and commentary to help explain underlying trends and meaning behind the data.
Specifically, the inaugural HoHM Report finds that the current leading indicator score is 109.8, a modest increase from the 108.7 score for the fourth quarter of 2014 and the highest level since 2001 (earliest date for which data is available). An index value over 100 suggests the national housing market is healthy, with lower chances of a housing downturn over the next year as the index moves increasingly above the 100 breakeven value.
In addition, the report indicates that:
- The housing markets in the vast majority of MSAs are healthy, signaling that few regional housing markets are vulnerable to a housing downturn in the next year.
- The healthiest housing markets in the nation are Pittsburgh, Cleveland and Philadelphia, with none of the largest 40 MSAs in negative territory and only six of them are at neutral.
- The least healthy markets are Bismarck, N.D., and Atlantic City, N.J., and even these markets received just slightly negative performance rankings.
- While almost all local housing markets are healthy, about 25 percent worsened over the past year. Still, slightly more improved than worsened.
Fourth quarter 2014 data was used to determine the index level, capturing statistics for employment, the mortgage market and house price growth components. In the latest period, household formations rose at a faster pace, but a continued tight mortgage-lending environment persists as an impediment to even stronger national housing activity.
“Unlike most other housing indices or surveys, the HoHM Report provides a look into the future instead of the rearview mirror,” said David Berson, Nationwide’s chief economist and senior vice president. “The quarterly report should serve as a resource to gauge how healthy housing markets are today but, perhaps more important, what to expect in the future and why.”
The Top 10 MSAs in the initial index are, in order: Pittsburgh; Cleveland-Elyria; Philadelphia; Rockford, IL; Burlington, N.C.; Scranton-Wilkes-Barre, PA; Fayetteville-Springdale, AK-MO; Idaho Falls, ID, Tulsa and Kennewick-Richland, WA.
The Bottom 10 MSAs, in order, are: Bismarck, N.D., Atlantic City-Hammonton, N.J.; New Orleans-Metairie; Lafayette, LA; Casper, WY; Ocean City, N.J.; Austin-Round Rock; Monroe, LA; Dallas-Plano-Irving; and Houston.
Showing the most improvement in the past year were, in order: Elmira, N.Y.; Ithaca, N.Y., Erie, PA; Decatur, IL; Johnstown, PA; Danville, IL; Bowling Green, KY; Flint, Mich.; Clarkston, TN; and Anniston-Oxford, AL.
Weakening the most in the past year, in order, were: Bismarck, N.D.; Bellingham, WA; Roanoke, VA; Bloomington, IN; Atlantic City-Hammonton, N.J.; Rapid City, S.D.; Wheeling, W.V.; Gainesville, FL; Waterloo-Cedar Falls, IA; and Ocean City, N.J.
More information about the HoHM Report, including the methodology used, can be found at www.inthenation.com/housing. The HoHM Report will be released on a quarterly basis online and in print.
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the U.S. and is rated A+ by both A.M. Best and Standard & Poor’s. The company provides a full range of insurance and financial services, including auto, commercial, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; banking and mortgages; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com.