In this newsletter, we use a graph to show home price indexes, map building permits for new single-family homes across states and over time, share some tips for playing FREDcast, and quiz you on housing markets.

Focus on Home Price Indexes

This assignment provides instructions on building the graph below and includes writing prompts for out-of-class assignments.

Using GeoFRED® to Compare Growth Rates of Building Permits

This assignment provides instructions on creating the maps of growth rates of building permits for new single-family homes below and suggests prompts for in-class discussion. See how you do on our sample discussion questions below.

Growth Rate of Building Permits for New Single-family Homes by State

Click on the map above to view an interactive version

Question: Name one State where building permits for new single-family homes increased by double digits between 2018 and 2019 .

Again, click on the map above to view an interactive version

Question: Compare this map with the map above. How are they different? Briefly describe the impact of the economic recession of 2007-2009 on the growth rate of building permits for new single-family homes between 2007 and 2008 .

Learning about Housing Markets to Forecast Changes in Gross Domestic Product

Changes in Gross Domestic Product depend on many factors. In the fourth quarter of 2019, residential private investment, or homebuilding, increased. Read on for more details and a list of resources to become a better FREDcast forecaster.

BLS Headline:

According to the Bureau of Economic Analysis, “Real gross domestic product (GDP) increased at an annual rate of 2.1 percent in the fourth quarter of 2019.”

Release Highlight:

“The increase in real GDP in the fourth quarter reflected positive contributions from residential fixed investment.”

https://www.bea.gov/news/2020/gross-domestic-product-fourth-quarter-and-year-2019-advance-estimate

Resources to become a better FREDcaster

• FRED® Blog: “Is the housing price-rent ratio a leading indicator?“
• Economic Synopses: “Construction Permits and Future Housing Supply: Implications for 2020“
• Economic Synopses: “Are U.S. Housing Markets Hot, Hot, Hot?“

Quiz Yourself on Different Aspects of Housing Markets

Q1. In the fourth quarter of 2019, which racial or ethnic group had the highest rate of home ownership in the U.S.?

Q2. In the fourth quarter of 2019, which racial or ethnic group had the lowest rate of home ownership in the U.S.?

Q1. Compare the shares of real estate held by different wealth percentiles. As of the last available observation, which wealth percentile holds the largest share of real estate?

Q2. Compare the shares of real estate held by different wealth percentiles. As of the last available observation, which wealth percentile holds the smallest share of real estate?

Q1. Compare the 30-year and the 15-year fixed rate mortgage average in the U.S. Which one is higher?

Q2. Between the fourth quarter of 2007 and the fourth quarter of 2019, when were the 30-year and the 15-year fixed rate mortgage averages in the U.S. almost the same?

Now that you’ve aced this quiz, give it to your students using this dashboard. To customize this dashboard, just click the “Save to My Account” button at the top of the dashboard.