It is clear that the widespread boom in the U.S. housing market that began around 1991 came to an end over the last few years. By many measures — house prices, housing permits, and housing starts among them — this nationwide housing cycle has been mirrored to a greater or lesser extent in the residential real estate industries of the Third District states.

However, the Third District did not experience as large a housing boom as the rest of the nation during the rising phase of this cycle. Pennsylvania, in particular, saw slower growth in housing starts and housing prices than did the country as a whole. By contrast, New Jersey and Delaware cycled more or less in line with the nation.

The nationwide downturn in the housing cycle lagged the corresponding downturns in Delaware and New Jersey and led that of Pennsylvania, but almost all of the most recent data indicate downward trends in the Third District. House price inflation over the past decade has been about the same as in the U.S. as a whole but lower than in some metropolitan areas in the West and South. Deceleration in house prices has followed a path similar to that of the nation. Mortgage delinquencies are now higher than they have averaged over the past three years, but in general, they are not at historic peaks in the Third District.

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