The housing market continued to make progress in August, showing the third straight month of improvement and hitting its highest level since the recovery began.
With construction starts remaining steady, existing home sales hitting their highest level in two years and foreclosures dropping, the housing sector is 42 percent of the way back to normal, up from 34 percent in July, according to Trulia’s monthly housing barometer, released Monday.
"Remember, the past year has shown that most steps forward in the housing recovery are followed by some steps back, so the recovery from here on out won’t be fast or smooth," said Jed Kolko, chief economist for Trulia.
Construction starts were at a 750,000 annual rate in August, up 2.3 percent over July and 29.1 percent higher over the same period a year ago.
Activity reached its second-highest level since October 2008 but is only 27 percent of the way back to a normal level of 1.5 million.
Existing home sales, which jumped 7.8 percent to their highest level in more than two years, are showing the greatest improvement and are 61 percent back to normal levels. Sales in August were 4.82 million, a 9.3 percent increase from one year ago, and still below the 5.5 million that is considered healthy.
In the West region, sales were flat compared with last year's levels because of sharp drops in inventory.
The combined delinquency and foreclosure rate hit a post-recession low last month, falling to 10.91 percent of mortgages — the lowest level since March 2009 and 38 percent of the way back to the 5.25 percent that is considered normal. That was down from 11.11 percent in July.