Since we have muddled our way out of the housing depression of 2008-2011, its time to take a look at where national new home sales are now from their lows. Queue chart please (courtesy of CalculatedRisk):
As you can see, sales have increase over 25% from their lows in 2011. However, current sales are still 71% below their historic peaks. Even more interesting is that today's national sales are at parity with lows during six of the past seven economic recessions.
Yet, it may no longer feel like a recession to many home builders who survived the slaughter of the market downturn. With most of their competition now gone, those left are able to meet the much lower demand levels of the market and still do so at a profit.
Nevertheless, Utah's demand for new housing appears to be fairing better than the national market. Queue the next chart please (Courtesy St. Louis Federal Reserve Economic Data):
While we are still lower than the peak, we have stabilized and appear to be averaging around the same period as 1992 and trending upward. While we are still about 55% below the historic market peak our sales have kept pace with growth in the national market. Utah's decline was severe, but not nearly as much as was seen nationwide.
It appears at this point that most of the excesses of previous years have been purged from the system and new construction is growing organically again based on solid fundamentals like population increase. The Utah market isn't immune to a recession, but any downturn in housing should not be nearly as traumatic as we have experienced in years past.
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