Housing Markets Continue Slow But Steady Ascent Into Stable Range

In the latest Freddie Mac Multi-Indicator Market Index (MiMi), which measures the stability of the U.S. housing market, three additional metro areas entered the "stable" range in May while the overall index value pushed its way up to slightly below stable at 79.2.

The three markets that improved to stable range in the May MiMi were Stockton, California; Madison, Wisconsin; and Miami, Florida, according to Freddie Mac.

The 79.2 value for the latest MiMi, which was released Wednesday, indicated a weak overall housing market but improved by 0.71 percentage points from April to May and by more than 2 percentage points over the three-month period from the beginning of March to the end of May. The MiMi value improved by more than 4 percentage points year-over-year in May, according to Freddie Mac.

The all-time high for the national MiMi is 121.7, set in April 2006 prior to the recession. The all-time low for the national MiMi was 57.2, set in October 2010 at the height of the foreclosure crisis. The housing market has rebounded by 34 percent since hitting that all-time low nearly five years ago.

"MiMi continues to deliver good news on the housing front as more markets continue improving," Freddie Mac Deputy Chief Economist Len Kiefer said. "Likewise, it's becoming clearer every month that after several years of local trends largely reflecting national trends, we are getting back to more normal times where local housing markets develop based on their own unique economies. For example, housing markets in the West and Southwest continue to be the bright spot of the recovery and spring homebuying season with strong purchase activity fueled by an improving local economy and job picture. Yet, even within these regions, MiMi shows noticeable differences. Meanwhile, markets throughout Florida showed significant improvement this month not because of robust home buying activity, but because more borrowers became current on their mortgages, with just a few showing better purchase activity. Florida markets, much like those in Nevada or Arizona, while improving rapidly, still have significant work to do to get back to their benchmark stable ranges."

In May, 26 states plus the District of Columbia reported MiMi values in the stable range, led by the District of Columbia (100.5) and North Dakota (96.4). Meanwhile, 38 of the top 100 metro areas nationwide had stable MiMi values in May, led by Fresno (95.8) and Honolulu (93.1). According to Freddie Mac, 43 out of 50 states and 95 of the top 100 metros showed an improving three-month trend in May, compared to 42 states plus the District of Columbia and 95 of 100 metros in May 2014.

Click here to see the complete May 2015 MiMi from Freddie Mac.