A:HousingEconomics.com is a subscription service providing in-depth housing and economic data and forecasts for those who want greater detail than they can find at NAHB's Economics section. It is the online economics information source for America’s housing industry, published by the National Association of Home Builders (NAHB). HousingEconomics.com provides the latest housing forecasts, market trends, in-depth economic analysis, and archival data relating to the housing industry from NAHB’s Economics Group.
Q: What do you get with a subscription to HousingEconomics.com?
A: Once you become a subscriber, you will have access for a full year to all the data and reports described at the samples page.
A: No, reports or data are not sold separately. All of the HousingEconomics reports will be accessible for a year once you subscribe online. You will also receive several forecast updates throughout the year.
Q: How do you produce the state and metro housing starts forecasts? (NOTE: As of July 2019, the metro forecast data is no longer produced by NAHB)
A: The Census Bureau does not estimate starts data for states or metros. NAHB Economics uses Moody’s Ecomomy.Com estimates of historical housing starts for the states, the District of Columbia, and 100 metros based on Census Bureau permits data. These “historical” series serve as a starting point for our state and metro forecasts of housing starts.
NAHB has developed forecast models for state and metro housing starts. Key drivers in the model include employment, population, vacancy rates, and housing prices. Our economists also monitor state and local developments that might not be captured in the models but affect residential construction for a particular area.
Q: Can a subscription be shared with other department members or coworkers?
A: NAHB discourages subscribers from sharing their HousingEconomics subscription within their company. Anytime that usernames and passwords are shared, there is the potential that private information about the subscriber, such as payment method, can be discovered. Also, our system allows only one user at a time per user ID.
A: NAHB is a Washington, D.C.-based trade association whose mission is to enhance the climate for housing and the building industry. Chief among NAHB’s goals is providing and expanding opportunities for all consumers to have safe, decent and affordable housing. As “the voice of America’s housing industry,” NAHB helps promote policies that will keep housing a national priority. Since 1942, NAHB has been serving its members, the housing industry, and the public at large.
The Economics and Housing Policy Groups provide information, statistics, and analysis to NAHB members, subscribers, and the general public. Subscription information and product samples can be found at HousingEconomics.com.
Q: Why during the 3rd quarter of 2020 did NAHB replace the Census Bureau’s quarterly residential improvement data with the Bureau of Economic Analysis (BEA)’s quarterly residential improvement classifier and use it as the NAHB benchmark data to analyze and forecast the remodeling market?
A: Beginning with the September remodeling forecast, the Bureau of Economic Analysis (BEA)’s quarterly residential improvement classifier, as published in the National Income and Product Accounts (NIPA), will replace the Census Bureau’s quarterly residential improvement data as the NAHB benchmark data to analyze and forecast the remodeling market.
Prior to September 2020, the Census Bureau’s quarterly residential improvement data was used by NAHB as the benchmark remodeling indicator and forecast variable. However, this source has proved to be volatile and subject to large monthly and annual revisions. As a result, NAHB is moving to a more stable measure that better reflects the current state of the size of the remodeling market.
According to the NIPA handbook, BEA's quarterly estimate uses a composite indicator that is derived from the Census Bureau's monthly retail sales for building material and garden equipment and supplies dealers and the Bureau of Labor Statistics (BLS) aggregate weekly payrolls of production and nonsupervisory employees for residential remodelers. Furthermore, the BEA estimate was already used in the NAHB macroeconomic forecast to determine aggregate residential fixed investment.
According to the NIPA definition:
Improvements to residential structures…consist of additions, alterations, and major replacements to structures subsequent to their completion. They include construction of additional housing units in existing residential structures, finishing of basements and attics, remodeling of kitchens and bathrooms, and the addition of swimming pools and garages. They include major replacements—such as new roofs, water heaters, furnaces, and central air conditioners—that prolong the expected life of the structure or add to its value; routine maintenance and repair work is not included. For residential fixed investment, own-account construction (“do-it-yourself” projects) consists of the value of the materials supplied only and does not include the value of the labor supplied by the property owner.
Q: What is a housing start? What is a building permit? What is the relationship between building permits, housing starts, and housing completions?
A: Not all the houses with building permits get started (built), and not all started units get completed, although most do. A start is defined as excavation (ground breaking) for the footings or foundation of a residential structure. For a multifamily structure, all units are counted as started when the structure is started. Get a full description of the relationship between building permits, housing starts, and housing completions.
A: Housing starts data are produced by the Census Bureau. Census releases starts data for the nation and the four census regions (Northeast, South, Midwest and West), which are available on our website. National housing starts data are reported as single-family (one unit), multifamily (the total of the separately reported 2 to 4 units and 5 or more units), and total starts (single-family plus multifamily starts).
You can also look at monthly permits (annual permits history back 20 years available to subscribers) for the nation, the four census regions, the nine census divisions, the 50 states plus the District of Columbia, and 200 metros.
Q: Where can I get information on building permits?
A: Building permits for the nation, the four census regions, the nine census divisions, the 50 states plus the District of Columbia, and 200 metros can be found in NAHB's construction statistics section. Additional detail for building permits can be found at the Census Bureau’s New Residential Construction.
Q: I would like to know the number of new housing permits in my state/metro. Where can I find this information?
A: The Census Bureau collects these data. NAHB makes the most recent year-to-date data available to the public for the states, the District of Columbia, and 200 metropolitan statistical areas in the Construction Statistics section of NAHB.org. Executive Level subscribers can find a link to a table showing annual permits history for all the states and 200 metros. Additional detail for building permits (such as metros not listed in our tables and county permit data) can be found at the Census Bureau’s New Residential Construction.
Q: Besides new housing permits, what other information is available from the Census Bureau?
A: Building permits for the nation, the four census regions, the nine census divisions, the 50 states plus the District of Columbia, and 200 metros can be found on our website. Additional detail for building permits can be found at the Census Bureau’s New Residential Construction.
The U.S. Census Bureau collects, tabulates, and publishes monthly statistics on Housing Starts, New One-Family Houses Sold, Housing Completions, Manufactured Home Placements, and Dollar Value of Construction Put in Place. In addition they also produce quarterly estimates of the Residential Construction in Selected Metropolitan Areas, Price Index of New One-Family Houses Sold, and Dollars Spent on Residential Improvements and Repairs.
Q: The U.S. Census Bureau's website is very large. Where can I find residential construction statistics?
A: The Census Bureau has several logical starting points depending upon the kind of statistics you are looking for. For residential construction we suggest you bookmark this page as your starting point with the Census Bureau.
Q: Why are new home sales consistently lower than single-family housing starts? Does this mean a huge inventory of unsold homes is building up?
A: No. Houses built for rent, houses built by a general contractor on the owner's land, and owner-built homes are not included in new home sales. Therefore the number of new home sales is consistently lower than total single-family starts or completions. Roughly 20 years ago or so, this represented 40 percent of starts, today the number is closer to 20 percent of starts.
A: There are numerous measures of housing prices. One of the most widely cited house price indexes measuring changes in existing home prices is produced by the Federal Housing Finance Agency (FHFA). The Census Bureau provides a number of housing price indexes. See also the Census Bureau’s American Community Survey. Enter the local area you are interested in for detailed housing and demographic data.
Q: How long is a typical new house on the market before it is sold?
A: Most new houses are under contract before completion with title transferred shortly after completion. In fact, a majority of new houses have signed contracts before construction begins. For homes that are still unsold at completion, Census Bureau publishes median months for sale since completion (go to the “New Houses Sold and For Sale, by Stage of Construction).
Q: What is Seasonally Adjusted Annual Rate (SAAR)?
A: Seasonal adjustment is the process of estimating and removing seasonal effects from series such as housing starts or sales to allow examination of underlying trends and business cycles. Annual rates indicate the annual total that could be expected if the month or quarter had its typical share of the year.
Seasonal adjustment does not account for abnormal weather conditions, only for “normal” seasonal variation occurring because of typical weather conditions, relationship to the school year, number of days in the month, etc...
Except for the data on existing home sales, the seasonally-adjusted construction data include an adjustment for the days of the week that occur in the month. Thus, if there are 5 Saturdays in a month, and Saturday is typically a day when more activity (such as new home sales) occurs, then the annual rate is adjusted downward.
The seasonal adjustment factors are based on moving averages over about five years, so that a trend towards more (or less) activity in a particular month of the year will gradually be reflected in the seasonal factor for that month.
The average of the monthly or quarterly seasonally-adjusted annual rates for a year will not precisely match the annual total.
The complex program that calculates seasonal factors automatically gives reduced weight to extreme values in the recent past.
Q: In the NAHB Economic and Housing Forecast, what does the “% Change AR” mean?
A: The term “% Change AR” means “percentage change at an annual rate”. It answers the question, “If the percentage change for total housing starts between two consecutive quarters were to persist for an entire year, what would the annual percentage rate of change be?” This is roughly equivalent to taking the quarterly rate of change and multiplying by 4. For example, assume total housing starts were 1,965 in fourth quarter 2004 and 2,069 thousand in first quarter of 2005 (rounded to the nearest thousand). The quarterly percentage change for these numbers is 5.29%. Multiplying by 4 gives you 21.17%. However, to be completely accurate, quarterly compounding must be taken into account (and is the method used to calculate the numbers reported in our tables). Thus, in this case, the annualized rate of change is 22.91% rather than 21.17%. For this example we rounded housing starts to the nearest thousand. When we do the calculation, we use unrounded numbers. Hence, the reported compounded percentage rate of change for the first quarter of 2005 is 22.7%, not the 22.9% just calculated. Note that you cannot average the various quarterly percentage changes at an annual rate for the year to get the annual percentage rate of change. The 2005 annual percentage rate of change is 6.3%, NOT the 5.4% derived from averaging 2005 quarterly percentage changes at an annual rate (22.7%, -1.0%, 7.4%, and -7.6%).
Q: What is the NAHB-Wells Fargo Housing Market Index (HMI)?
A: The HMI is based on a monthly survey of NAHB members designed to take the pulse of the housing industry, especially the single-family industry. The survey asks respondents to rate general economic and housing market conditions. For more details, visit nahb.org/HMI.
Q: What is the NAHB-Wells Fargo Housing Opportunity Index (HOI)?
A: The HOI for a given area is defined as the share of homes sold in that area that would have been affordable to a family earning the local median income based on standard mortgage underwriting criteria. Therefore, there are really two major components: income and housing cost. For more details, visit nahb.org/HOI.
A: In general, about half of the selling price of a home is the onsite cost of labor and materials. Of that, about 2/3 of the "hard" costs (i.e., 1/3 of the selling price) is the cost of materials, and 1/3 of the hard costs (1/6 of the selling price) is onsite construction labor, most of which is employed by subs rather than the builder. There is also additional non-construction labor such as sales workers, office staff, etc...
Q: Where can we find data on the current sale prices of existing homes?
A: The National Association of REALTORS® has a research section on its website. The reports include economic and housing data, national and local forecasting, and existing home sales. NAHB provides NAR national existing home prices and HousingEconomics subscribers have access to additional price data.
Q: Where else can we find statistics on new construction activity? We are especially interested in shipments of newmanufactured homes.
A: The U.S. Department of Housing and Urban Development maintains a research website called HUD-User with access to pertinent information, such as research reports and periodicals covering housing in the United States. To find information on shipments of new manufactured homes, view HUD's quarterly periodical U.S. Housing Market Conditions. This periodical also contains data on housing permits, starts, completions, and homeownership rates.
Q: We are a mid-sized custom home builder and want to know the salary range for superintendents. Where can we find wageinformation for construction professionals?
A: NAHB publishes a book The Cost of Doing Business Study that contains business statistics such as financial ratios, profit margins, and salary ranges for officers, managers and superintendents for builders of various sizes including the mid-sized custom homebuilder. This book is based upon surveys conducted with builders across the United States and can be found on in the Business Management section of BuilderBooks.com. For additional information about this book and other financial books for builders visit the NAHB's online bookstore, BuilderBooks.com.