Thursday, July 10, 2014

Survey: Buyers, Sellers 'Not on the Same Page'

DAILY REAL ESTATE NEWS | THURSDAY, JULY 10, 2014
Home buyers and sellers are “not on the same page” when it comes to the state of the housing market, according to a new Redfin survey of 707 of its agents and partner agents across 35 U.S. markets. Buyers and sellers are taking a more aggressive stance in the market, with some sellers overpricing their homes and more buyers refusing to get in bidding wars, the survey found.
In This Guide:
“In May, 40 percent of sellers surveyed by Redfin said that they planned to list their homes above market value, even though home sales had dropped by 9 percent since the year before,” says Nela Richardson, Redfin’s chief economist. “Typically, it takes sellers six to nine months to adjust to a price change, but this latest shift is longer. Prices have moved down and then up so much over the past five years that it’s even more difficult for sellers to have a realistic baseline for what their homes are worth in the current market.”
Fifty-eight percent of Redfin agents say that sellers are holding unrealistic expectations about the value of their homes, up from 49 percent in the previous quarter. Meanwhile, buyers are showing less willingness to chase after a home, as they face affordability and financing hurdles, the survey found.
“Buyers who have been searching for a long time may still try to win deals with aggressive offers,” Richardson says. “However, new buyers in the market are much less willing to chase an escalating sale price to compete with multiple bids. The demand side of real estate is moving from ‘please take my offer’ to ‘take it or leave it as you please.’ Home buyers’ willingness to walk away from a deal that’s a bad fit is good for them and is ultimately healthier for the housing market.”
So is it a seller’s market or a buyer’s market? It depends on who you ask. Twenty-four percent of Redfin agents surveyed say that “sellers have all the power,” a drop from 35 percent three months ago.
Rising inventories have been beneficial for buyers who are less willing to participate in a bidding war, but they are facing other challenges, such as access to credit and affordability, the survey finds. The top challenges Redfin agents identified as growing problems for buyers are: lack of affordability; qualifying for a mortgage; saving enough for a down payment; and worries about the economy.
Source: Redfin



www.RebeccaSellsAZ.com
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Wednesday, July 9, 2014

Mortgage Applications Post Solid Jump

DAILY REAL ESTATE NEWS | WEDNESDAY, JULY 09, 2014
Mortgage applications reversed course last week after several weeks of softening demand, as both applications for home purchases and refinances showed an increase in activity, the Mortgage Bankers Association reported Wednesday. The MBA’s overall index of mortgage application activity showed demand rose by 1.9 percent for the week ending July 4.
Recent MBA Mortgage Reports
Separated out, mortgage applications for home purchases, viewed as a leading gauge of future home sales, jumped 3.7 percent, while refinancing applications rose 0.4 percent last week.
The 30-year fixed-rate mortgage rose last week by 4 basis points, averaging 4.32 percent for the week from 4.28 percent the week prior, the MBA reports. The MBA’s survey reflects more than 75 percent of the U.S. residential mortgage application market.
Source: “Mortgage Applications Rose in Latest Week: MBA,” Reuters (July 9, 2014)



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Builders Say Labor Shortages Grow More Widespread

DAILY REAL ESTATE NEWS | WEDNESDAY, JULY 09, 2014
The real estate industry has called for homebuilders to ramp up construction to meet inventory shortages. But homebuilders increasingly are facing significant labor shortages that is making it more difficult to complete projects, a new study shows.
A June 2014 survey from the National Association of Home Builders shows that the industry is facing shortages of labor and subcontractors that have become “substantially more widespread since 2013.” Shortages are particularly notable for basic skills like carpentry and framing, the NAHB notes.
The Homebuilding Shortage Continues
Forty-six percent of builders reported a shortage of labor in 2014, the highest shortage reported since 2000 and slightly higher than at the peak of the housing boom in 2004 and 2005, when the United States was averaging about 2 million housing starts a year, the NAHB notes in its report.
Today, annual housing starts remain mostly under 1 million. New-home construction has only about partially recovered from its 2008 downturn and labor shortages are persisting despite relative slowdown in activity compared to previous years, the NAHB notes.
Builders say a shortage of subcontractors is raising their costs. On average, builders said their direct labor costs on the same house rose by 2.9 percent, while subcontractor costs grew by 3.8 percent.
Three out of five builders say the labor shortages have caused them to pay higher wages or subcontractor bids (65%); raise home prices (62%); and created difficulty in completing projects on time (60%). Thirty-six percent of builders said the labor shortages were making some projects unprofitable, and 18 percent of builders reported having to even turn down some projects.
Source: “Builders See Shortages of Labor And – Especially – Subcontractors,” National Association of Home Builders Eye on Housing Blog (July 8, 2014)




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Dip in Foreclosures Only Temporary?

DAILY REAL ESTATE NEWS | TUESDAY, JULY 08, 2014
In May, there were 47,000 completed foreclosures nationwide, down 9.4 percent year-over-year, according to CoreLogic’s May National Foreclosure Report. Every state posted double-digit year-over-year declines in completed foreclosures, but some housing analysts say the drop could be temporary.
“There is still much more hard work to do to clear the backlog of foreclosed properties,” says Anand Nallathambi, president and CEO of CoreLogic. “Although difficult, we need to continue to aggressively clear distressed homes to ensure the return of a healthy housing market.”
On the Foreclosure Beat
About 660,000 homes were in some stage of foreclosure in May, marking a 37 percent year-over-year decrease. That represents 1.7 percent of all homes with a mortgage, down from 2.6 percent in May 2013.
“Significant gains have been made in the last year to reduce the foreclosure stock,” says Mark Fleming, chief economist for CoreLogic. “Yet, these improvements are occurring disproportionately in non-judicial states. The foreclosure inventory in judicial states is averaging 2.1 percent, which is more than twice the 0.9 percent average that is occurring in non-judicial states.”

States With Biggest Declines in Foreclosure Inventory

Thirty-eight states posted year-over-year declines in its foreclosure inventory of greater than 30 percent. But the following states had the largest year-over-year declines, at more than 50 percent:
  • Arizona
  • Utah
  • Nebraska
  • Minnesota

States With Highest Number of Completed Foreclosures

The following states had the highest number of completed foreclosures (for the 12 months ending in May) and accounted for nearly half of all completed foreclosures nationally, according to CoreLogic’s report:
  • Florida: 122,000
  • Michigan: 44,000
  • Texas: 39,000
  • California: 34,000
  • Georgia: 32,000
Source: CoreLogic



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Tuesday, July 8, 2014

Recovery Broadens as More Markets See Price Increases

DAILY REAL ESTATE NEWS | MONDAY, JULY 07, 2014
Home prices were on the rise again last month, but in a stark contrast to last year, price increases were more generalized and less concentrated to just a few metro pockets, according to realtor.com’s May 2014 National Housing Trend Report.
In May, the median list price of homes was $214,900 nationwide, an 8 percent increase year-over-year. All but eight of the 146 markets that realtor.com tracks reported year-over-year price increases in May. “This broad increase in price suggests a more evenly distributed recovery and a healthier national housing market,” reads a realtor.com statement on the findings.
Home inventories in May were down 5.8 percent compared to year ago levels. A limited number of homes for-sale across the country is credited with lifting home prices.
“Home prices are as high as they are because of low inventory spread across the nation,” says Steve Berkowitz, CEO of Move Inc., which operates realtor.com. “But we are not seeing the runaway pricing of last year. Nor is the situation exclusive to the hotbed markets of recent years.”
The following 10 metro areas saw the greatest increases in median list prices year-over-year, according to realtor.com’s May report:
  1. Stockton-Lodi, Calif.
    • Median list price: $285,000
    • Year-over-year increase: 42.7%
  2. Las Vegas
    • Median list price: $186,085
    • Year-over-year increase: 24.1%
  3. Houston
    • Median list price: $245,000
    • Year-over-year increase: 23.1%
  4. Reno, Nev.
    • Median list price: $289,900
    • Year-over-year increase: 22.9%
  5. Denver, Colo.
    • Median list price: $349,900
    • Year-over-year increase: 20.7%
  6. Riverside-San Bernardino, Calif.
    • Median list price: $309,900
    • Year-over-year increase: 19.7%
  7. West-AZ-RSA
    • Median list price: $328,950
    • Year-over-year increase: 19.6%
  8. Sacramento, Calif.
    • Median list price: $340,000
    • Year-over-year increase: 19.3%
  9. Boulder-Longmont, Colo.
    • Median list price: $465,000
    • Year-over-year increase: 19.3%
  10. San Diego
    • Median list price: $500,250
    • Year-over-year increase: 17.7%
Source: realtor.com



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Wednesday, July 2, 2014

More Home Owners Getting Bit by Selling Bug?

DAILY REAL ESTATE NEWS | WEDNESDAY, JULY 02, 2014
Reports of rising home prices are making selling more attractive to the largest share of home owners in eight years, according to a gauge from the University of Michigan and Thomson Reuters. Few of the home owners surveyed said they expected to lose money if they decided to sell their home now.
The findings could signal the beginnings of a major shift for the housing market, which has been haunted by the low number of homes for sale across the country.
Inventory Issues Improve
Home price increases over the past two years may give more families confidence to sell their homes, alleviating low inventories and giving home buyers who were sitting on the sidelines because of fewer housing choice more incentive to make a move too, The Wall Street Journal reports.
Rising confidence among consumers could also translate into more sales in new homes. Last week, a report by the U.S. Census Bureau showed that new-home sales surged nearly 19 percent last month, reaching the highest rate since May 2008. 
Two home-building giants reported a steady turnaround in new orders and price rises too in the second quarter. Lennar reported that new orders were up 8 percent, with average sales prices of its homes blooming 14 percent year over year. KB Homes, meanwhile, reported that orders increased 5 percent and its average selling price increased 10 percent in the past year.
Source: “More Would-be Home Sellers Say Prices Are Attractive,” The Wall Street Journal (June 27, 2014)


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Pending Home Sales Surge 6.1%

DAILY REAL ESTATE NEWS | TUESDAY, JULY 01, 2014
Pending home sales posted a sharp 6.1 percent rise in May, as lower mortgage rates and rising inventories helped propel the market into the summer season, according to the National Association of REALTORS®’ Pending Home Sales Index, a forward-looking indicator based on contract signings. It was the largest month-over-month gain on the index since April 2010, when first-time home buyers were rushing to sign purchase contracts before a popular tax credit program ended.
Guess what? Existing-home sales are getting a lift, too.
All four regions across the country posted increases in pending home sales in May, led by the Northeast and West.
“The flourishing stock market the last few years has propelled sales in the higher price brackets, while sales for homes under $250,000 are 10 percent behind last year’s pace,” says Lawrence Yun, NAR’s chief economist. “Meanwhile, apartment rents are expected to rise 8 percent cumulatively over the next two years because of tight availability. Solid income growth and a slight easing in underwriting standards are needed to encourage first-time buyer participation, especially as renting becomes less affordable.” 
Yun says home sales will likely rise the second half of the year but “won’t be enough to compensate for the sluggish first quarter and will likely fall below last year’s total.”
Despite the rise in May, pending home sales remained 5.2 percent below their levels a year ago.

By Region

The following is a breakdown by region of the latest Pending Home Sales Index reading:
  • Northeast: contracts rose 8.8 percent month-over-month in May and are 0.2 percent above year-ago levels.
  • Midwest: contracts rose 6.3 percent month-over-month in May but remain 6.6 percent below May 2013 levels.
  • South: contracts increased 4.4 percent month-over-month in May but are 2.9 percent below year-ago levels.
  • West: contracts increased 7.6 percent month-over-month in May but remain 11.1 percent below May 2013 levels.




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