It’s All About the Numbers – Baton Rouge Still On Top
Even though Louisiana is located at the “bottom” of the states in the U.S., we still have something to brag about – Baton Rouge is leading the nation’s cities in its recovery and higher than normal levels of real estate building and buying activity. According to the National Association of Home Builders/First American Leading Markets Index (LMI), Baton Rouge scored a 1.42 on the index, the highest overall number nationwide. What this number means is that Baton Rouge is showing a 42% increase over normal market activity when the housing market is at normal operating levels. This is not the first time that this Southeastern Louisiana city has made this score. Baton Rouge has been leading the housing market recovery “charge” in Louisiana since it drifted out of the Recession.
It is admitted by many people here in Louisiana, especially in St. Tammany Parish, that Southeast Louisiana did not experience the drastic losses that other states experienced when the housing market crashed. However, to have an index number close to 50% above normal activity levels says a lot about the pent up demand for new homes and existing homes for sale in this region. Overall, the report from the LMI was also very positive with 11 new metro cities joining the list of cities in recovery. Also, the nation isn’t doing too badly – it’s running about 88% of what the normal housing market would be doing. Meanwhile, 28 percent of metro areas saw their score rise this month and 83 percent have shown an improvement over the past year.
Other cities which posted above the norm increases in activity and sales were as follows: Honolulu, Oklahoma City, Austin Houston, San Jose, CA and Harrisburg, PA. One of the major forces driving the statistics that are collected by the LMI was employment. Builders nationwide have been reporting a shortage in labor in getting their homes built. Contractors and sub-contractors who used to be in the housing industry had to find work elsewhere when the real estate market sagged. Therefore, builders are holding signed contracts on homes ready to build, but they are short the labor force needed to actually do the work. Employment in construction has gone up even in the past few months, as well as other industries including communications and IT, and unemployment has been creeping down by tenths each quarter. Many analysts and economists expect to see a continuation of improvement in the housing markets in the 350 metros scored by the LMI.
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