Examiner confidence in the health of real estate markets nationwide has rebounded this spring, the Federal Deposit Insurance Corp. reported Friday.
The agency's newest survey of market trends, done in late April, produced a composite score of 69, up eight points from January. This was the largest quarterly gain reported in more than six years.
Yet the FDIC noted that the latest score falls far short of the record high of 79 reached in April 1998.
The FDIC contacted 292 senior examiners and asset managers from the federal banking and thrift agencies, as it does every three months, to gauge the performance of real estate markets. It then translates the results onto a 100-point scale. Any score over 50 indicates that most examiners believe market conditions are improving.
Optimism soared for residential real estate in particular.
Nearly half the examiners said housing markets are headed in a "better" direction than in the previous three months; only 29% said this in the January survey.
Excess supplies of residential property shrank, home sales and sale prices shot up, and construction held steady, they said. As a result, the survey's residential score jumped 10 points, to 72.
Examiners were upbeat about commercial real estate markets, boosting that score five points, to 65.
Though more examiners saw surpluses of commercial space in their locales, a record 69% said supply and demand were in balance. Other reasons for the rosier assessment were above-average sales and rising sales prices.
Dividing the country into four sections, the April survey found improved conditions in all regions. But the West and Northeast improved the most. Growth in the composite score in the West was tops, up 15 points from the January survey, to 77. The Northeast was right behind, with a 12-point leap, to 76.
An upswing in California drove the strong results in the West. Commercial prices and sales rose in the Golden State, and 78% of the examiners there reported better residential real estate conditions.
Residential real estate was also the highlight in the Northeast, where 63% of examiners said housing markets were better, up from 30% three months earlier.
