National Association of Home Builders Housing Market Index

December 6, 2010  -  Housing Struggles Even As Economy Advances — Tough Lending Standards To Blame?

The economy continues to advance, albeit slowly, as housing continues to struggle.

Overall construction spending increased, primarily because of a surge in the dollar amount spent on improvements, which overshadowed a slip in single-family construction spending. At this point, house prices seem to be essentially flat with minor monthly and quarterly fluctuations.

Some minor solace can be found in the decline in the third quarter mortgage delinquency rate and the percentage and number of mortgages in foreclosure at the end of the quarter, but tight credit for home builders remains a major impediment to a stronger housing recovery.

Two proposals addressing federal deficit reduction can have significant adverse effects on residential real estate. Given the fragility of the housing market, these impacts must be avoided.  David Crowe, NAHB Chief Economist