Freddie Mac's Multi-Indicator Market Index (MiMi) fell back nearly half a percentage point to 73.4 in its latest reading, the company reported earlier this week. According to the company, the decline "appear[ed] to be broad-based, and not concentrated in a handful of state or metro markets."
The index, which debuted over the summer, measures the stability of state and local trends as well as the national market in terms of home purchase applications, payment-to-income ratios, proportion of on-time mortgage payments, and employment strength. Those figures are set against each market's long-term stable range, with index values between 80 and 120 reflecting stability.
As of the latest reading, Freddie Mac says the index is up 22.7 percent from its all-time low in 2011.
"We will continue to see 'two steps forward and one step backward' movement in our housing stability index until the broader economy sees better growth, labor markets tighten further and household formations pick-up to bring more first-time and move-up buyers into the market," said Frank Nothaft, chief economist at Freddie Mac.
Thirteen states and the District of Columbia showed up in their stable ranges in July's MiMi, with North Dakota (95.9), D.C. (94.4), Wyoming (91.3), Montana (89.5), and Alaska (88.4) making up the top five.
Of the top 50 metro areas nationwide, only six are in a stable range, including San Antonio (91.3), Austin (87.5), New Orleans (83.9), Salt Lake City (83.6), and Houston (83.5).
"We didn't notice a large decline in any one market this month, but more of a softening across the board. Even the MiMi top ranked state and metro markets all saw a slight decline except for Austin," Deputy Chief Economist Len Kiefer said.
The biggest drag at the moment comes from the lack of purchase application activity, Kiefer said.
"Even the hot housing markets in the northwest which are back in their stable range of housing activity are seeing their purchase application activity slow," he said. "The one area where momentum hasn't slowed is among the hardest hit markets. Places like Las Vegas, Miami, Chicago and Riverside, among others, are still showing double-digit yearly improvements, but that's largely a reflection of significant gains in the local employment picture as well as a real improvement in borrowers making timely mortgage payments."