Major cities making housing, economic recovery

Major cities continued making economic strides in June as growth and hiring accelerates after a harsh winter.

Of about 350 metro markets, 56 returned to or exceeded their last normal levels of economic and housing activity, a gain of nine metro areas over last year, the National Association of Home Builders/First American Leading Markets Index said on Thursday.

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The index's score of .88 held steady from the previous month, which means that based on current permit, price and employment data, the average is running at 88 percent of normal economic and housing activity.

Meanwhile, 30 percent of metro areas saw their scores rise this month and 83 percent have shown an improvement over the past year.

"When we see more sustainable levels of job growth, this will unleash pent-up demand and bring more buyers into the marketplace," said NAHB Chairman Kevin Kelly, a homebuilder and developer from Wilmington, Del.

Baton Rouge, La., continues to top the list of major metros, with a score of 1.4, or 40 percent better than its last normal market level.

Other major metros at the top of the list include Honolulu; Oklahoma City; Austin, Texas, and Houston.

Of the index's three components, the lagging one is single-family housing permits, which is only 43 percent of the way back to normal.

Meanwhile, home prices are 26 percent above their last normal level and employment is at 95 percent of its previous norm, according to David Crowe, NAHB's chief economist.

In the 22 metro areas where permits are at or above normal, the overall index indicates that these markets have fully recovered.

"Well over one-third of all markets are operating at a level of at least 90 percent of previous norms, and this bodes well for a continuing housing recovery in the year ahead," said Kurt Pfotenhauer, vice chairman of First American Title Insurance Co.

Smaller metros such as Odessa and Midland, Texas, boast scores of 2.0 or better, meaning their markets are now at double their strength prior to the recession.

Also at the top of the list of smaller metros are Bismarck, N.D.; Casper, Wyo.; and Grand Forks, N.D.

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