Weather may not be to blame for slow housing market
Posted on Wednesday, February 19, 2014 at 9:23:50 AM
Each year, it appears that the housing market slows during the colder months, then picks back up as the temperatures start to rise. This is typically attributed to buyers' desires to wait on residential financing for times other than during the holidays, and the winter storms that inspire people to stay inside rather than attend open houses.
However, Jed Kolko, chief economist at Trulia, explained that this year's seasonal slowdown may not be totally the fault of snow and cold. Instead, he explained that January's weather didn't have that big of an impact on home sales. Trulia looked at more than a decade of data, including construction starts and new home sales.
The results indicated that weather only had a minimal effect on the housing market. Other traditional factors are more persuasive, and the overall recovery won't stumble because of a little cold.
In addition, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development announced that new residential construction decreased in January. Building permits dropped 5.4 percent month-over-month, while housing starts fell 16 percent from December. Even so, single-family homes were completed at a rate of 580,000 for January, slightly higher over that time span.