US Housing Markets 'Back to Normal'

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Housing market activity in 52 of approximately 350 metro areas in the U.S. has returned to or exceeded pre-recessionary levels, according to the latest National Association of Home Builders/First American Leading Markets Index (LMI).

The index's nationwide score of .85 indicates that the U.S. housing market is running at 85 percent of normal activity.

"This index helps illustrate how far the U.S. housing recovery has come, and also how much further it has to go as we continue to face some significant headwinds in terms of credit availability, rising costs for lots and labor, and uncertainties regarding Washington policymaking," NAHB chairman Rick Judson said in the report. 

Topping the list of major metros, Baton Rouge, La, had a score of 1.41 -- or 41 percent better than its last normal market level. Other major metros reporting exceeding housing markets include Honolulu, Oklahoma City, Austin and Houston, Texas, as well as Harrisburg, Pa. 

Across the country, smaller metros are showing a better improvement. 

"Smaller metros are leading the way to a housing recovery, accounting for 43 of the top 50 markets on the current LMI," NAHB chief economist David Crowe said in the report. "This is very much in keeping with the results of our previous index for improving markets, and is an indication of the extent to which local economic conditions dictate the strength of individual housing markets."

Top-performing smaller metros include Odessa and Midland, Texas, with scores of 2.0 or better, indicating that their housing markets are now at double their strength prior to the recession, NAHB reports. Other smaller metros at the top include Casper, Wyo.; Bismarck, N.D.; and Florence, Ala.