Offline“Boom time is back,” is a statement in an article this week that is really a bit strong. However, there are a number of indicators that real estate is entering an improvement trend, and many analysts believe that it’s going to be this way for some time to come. The recently released S&P Case-Shiller Home Price Index report for the first quarter of 2013 showed the index soared by 10.17 year-over-year percent in the quarter.
This was the biggest single quarter increase year-over-year since 2006. The quarter-to-quarter increase was 3.94%. The Index tracks 20 major cities, and in the quarter all 20 posted price gains. Phoenix recorded the greatest increase of 22.4%. It was closely followed by:
• San Francisco - 22.2%
• Las Vegas - 20.6%
• Atlanta - 19.1%
• Detroit - 18.6%
The other popular home price index, the FHFA (Federal Housing Finance Agency), was also showing encouraging gains. This index rose by 6.73 percent year-over-year for the first quarter. This was also the largest gain since 2006 for this index as well. Construction activity was also on the rise, with 2012 figures showing:
• Authorized house building permits soared by 32.9% to 829,700 units.
• Housing unit starts rose by 28.2% to 780,600 units.
• The total number of housing units under construction rose by 27.5% to 532,500 units.
Demand is rising due to buyers returning to the market. Many are thought to be trying to beat anticipated mortgage rate increases, though the jump in the last three weeks put a chill on buying desire.
Thank you for this important information
The market turn is awesome news for re investors! It sparks buying and provides more opportunities for wholesalers to make money. Now is the time to dial in your game and really qualify your Investors so you can help them find the deals out there! We have the edge on the market - the MLS is only 1 way to find deals. Dean keeps the dgfamily at the forefront of paving new ways to find deals that nobody else can find!
Enjoy the upswing and take advantage of the rising market!
Happy Investing!
Karen
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Rising mortgage rates slowed September sales of existing homes
Americans bought fewer existing homes in September, a sign that some prospective home buyers have finally started to feel the pinch of higher mortgage rates.
Sales of existing homes fell nearly 2 percent in September from the previous month but are still nearly 11 percent higher than a year ago, according to data released Monday by the National Association of Realtors. The number of homes sold was at a seasonally adjusted annual rate of 5.3 million, down from 5.4 million in August.
September’s drop was largely in line with expectations by analysts, who say that sales will probably slow down for the rest of the year as rising mortgage rates make homes less affordable for some. The average 30-year fixed-rate mortgage reached 4.28 percent last week, according to mortgage-financing company Freddie Mac.
There was a temporary sales spike in August, as buyers rushed to lock in low mortgage rates, pushing sales to a six-year high. But that is unlikely to continue, analysts said.
“We anticipate further declines in the coming months as affordability is getting hit,” said Lawrence Yun, the Realtor group’s chief economist. Affordability fell to a five-year low because income growth hasn’t kept pace with home prices, he said.
Another factor weighing on the housing market, at least temporarily, is the government shutdown, analysts said. Monday’s data release reflects September sales, so the effects of the shutdown will not be clear until next month. Many home buyers faced delays in getting approval for home loans or mortgage applications because federal agencies were closed.
The economic uncertainty created by the shutdown and Washington’s debt-ceiling battles could spook some buyers into postponing big purchases, analysts said, adding that others might shrug off the events as political bickering.
“It’s definitely a cloud hanging over everyone’s head,” said Brad Doremus, senior analyst at Reis, a New York-based real estate research firm.
Consumer sentiment fell to a nine-month low after the shutdown, according to the University of Michigan index released this month. The homebuilders’ confidence index also dropped in October.
Tight inventory remains a key obstacle for home buyers, said Patrick Newport, chief economist at IHS Global Insight. The supply of homes for sale in September was unchanged at 2.2 million homes. It would take five months to run through the inventory, better than August’s rate of 4.9 months. Six months of inventory is generally considered healthy for the housing market. Unsold inventory is 1.8 percent higher than a year ago, the report said.
“We’re still not building enough homes,” Newport said.
Sales in the South, which include the Washington area, fell 1.4 percent from the previous month, to an annual level of 2.1 million homes. The median home price was $171,600, nearly 14 percent higher than a year ago. The national median home price was $199,200, nearly 12 percent higher than last year.Washington Post