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Real Estate News

New home sales surge 18.6% – fastest pace in 6 years

June 24, 2014

FLORIDA REALTORS

WASHINGTON (AP) – June 24, 2014 – Sales of new U.S. homes rose in May to the highest level in six years, providing the strongest signal yet that housing is recovering from a recent slowdown.

New home sales jumped 18.6 percent last month following a 3.7 percent increase in April, the Commerce Department reported Tuesday. The gains followed declines in February and March that were blamed in part on harsh winter weather.

The big May increase pushed the seasonally adjusted annual sales rate to 504,000, the highest level since May 2008.

"This is the strongest level since the end of the recession and is an encouraging sign that housing activity improved in the second quarter," Cooper Howes, an economist at Barclays Research, said in an analyst note.

Home sales peaked last year at an annual rate of 459,000 in June, but then lost altitude. The decline reflected an increase in mortgage rates that occurred after the Federal Reserve began discussing pulling back on its monthly bond purchases that were keeping long-term interest rates low.

The inventory of unsold new homes was unchanged at 189,000 homes at the end of May, the same as April. That inventory level would be depleted in 4.5 months at the May sales pace, an extremely low level that underscored the fact that the supply of new homes remains well below historic averages.

Sales were up in all regions of the country in May, led by a 54.5 percent surge in sales in the Northeast. New home sales rose 34 percent in the West and 14.2 percent in the South. The Midwest had the smallest month-over-month sales gain of just 1.4 percent.

Even with the big overall gain, sales of new homes are still running at just about half the pace of a healthy real estate market.

But there have been some encouraging signs of a spring rebound in housing.

The National Association of Realtors reported Monday that sales of previously owned homes jumped 4.9 percent in May, the biggest one-month gain in nearly three years. That increase pushed the sales rate to 4.89 million homes, the strongest showing since last October.

While economists were encouraged by the second straight monthly gain in existing home sales, they noted that the sales rate is still below the recent peak of 5.38 million sales hit last July.

Higher mortgage rates and the bad weather weighed on sales of both existing and new homes in late 2013 and early 2014. But sales seem to be staging a rebound, helped by solid job growth and growing inventories of homes for sale, a development that has helped to hold down price increases.

Economists say there is significant pent-up demand for homes as many potential buyers put off purchases over the past few years because of concerns about the economy.

Citizens wants to lower property insurance rates

June 24, 2014

FLORIDA REALTORS

ALLAHASSEE, Fla. – June 24, 2014 – Nearly seven out of 10 Citizens Property Insurance Corporation personal-lines policyholders would see rate reductions in 2015 under a slate of rate recommendations being considered today by the Board of Governors in Orlando.

Under the rates proposed by Citizens, policyholders with homeowners policies would see an average decrease of 3.2 percent, while mobile-home owners would see an average 3.9 percent.

The 2015 recommended rates will be submitted to the Florida Office of Insurance Regulation, which must establish rates for Citizens before they take effect.

The lower rates come as a surprise to some observers since Citizens has been trying to raise rates to become actuarially sound, but has been hamstrung by a law that allows it to raise rates no more than 10 percent per year.

"While rates for many policy types and areas have been inadequate in the past, the gradual phasing in of sound rates beginning in 2010 has helped Citizens to attain actuarial soundness in many areas," Citizens says in its 2015 Rate Kit. "Pockets of inadequacy persist, mostly near the coast and for older homes, condos and mobile homes, but the majority of Citizens policyholders will see an actuarially sound rate that is similar to last year's indications or even a bit lower."

Citizens posted a PDF of frequently asked questions on its website. It offers additional information about the proposed rate decrease.

RealtyTrac: Home prices up 13% due to high-end sales

June 24, 2014

FLORIDA REALTORS

IRVINE, Calif. – June 24, 2014 – In RealtyTrac's May 2014 Residential & Foreclosure Sales Report, U.S. residential properties – single family homes, condominiums and townhomes – sold at roughly the same rate as they did one month earlier and less than 1 percent higher year-to-year.

However, total sales include a lot more "normal" sales than in recent months, causing, in part, a median sales price ($180,000) rise of 6 percent month-to-month and 13 percent year-to-year.

May's year-over-year increase was the second consecutive month with a double-digit annual increase in U.S. home prices, and the biggest annual increase since U.S. home prices bottomed out in March 2012.

In May U.S. distressed sales and short sales combined accounted for 14.3 percent of all residential sales – a drop from 15.6 percent of sales in April and down 15.9 percent in May 2013.

"Distressed sales continue to represent a smaller share of the overall sales pie nationwide, helping to boost median home prices higher given that distressed sales tend to be in lower price ranges," says Daren Blomquist, vice president at RealtyTrac.

"When broken down by average price range, U.S. sales are clearly shifting away from the lower end," he says. "Properties selling below $200,000 represented 50 percent of all sales in May, but that was down from a 55 percent share a year ago. Meanwhile, the share of homes selling above $200,000 increased from a 45 percent a year ago to a 50 percent in May 2014."

Florida ranked fifth nationwide for a sales decline year-to-year (3 percent), though top-ranked California saw a 15 percent drop. Only one Florida city, Orlando, ranked in the top five for metro areas with declining sales, coming in at No. 3 with an 18% drop. No. 1 ranked Boston sale a 23 percent sales decline.

Luxury home sales increase

Home sales in the higher price ranges represent growing share of market, according to RealtyTrac, which created price ranges and then calculated the number of home sales in those ranges compared to all sales.

The share of home sales in the $200,000 to $300,000 price range increased 2 percent from the previous month and 6 percent from a year ago; but the share of home sales in all price ranges above $750,000 was up more than 20 percent from a year ago.

Meanwhile the share of home sales decreased from a year ago in all price ranges below $200,000, with bigger decreases corresponding to lower price ranges.

The share of homes priced between $100,000 and $200,000 decreased 5 percent from a year ago, while the share of homes between $50,000 and $100,000 decreased 13 percent. The share of homes priced below $50,000 – often highly distressed homes – decreased 22 percent.

Home sales in the $100,000 to $200,000 price range accounted for one-third of all home sales in May – the largest percentage of any price range – but homes priced between $200,000 and $400,000 were close, accounting for nearly 32 percent of all sales for the month.

Sales of homes priced in the $200,000 to $400,000 range were at their highest percentage of U.S. home sales since September 2008 – a 68-month high.

Distressed sales

Metro areas with the highest share of combined short sales and distressed sales were Las Vegas (36.6 percent), Lakeland, Fla., (33.3 percent), Modesto, Calif., (31.9 percent), Jacksonville, Fla., (31.7 percent), and Riverside-San Bernardino-Ontario in Southern California (29.3 percent).

Short sales accounted for 4.5 percent of all national sales in May, down from 5.4 percent in April and down from 5.8 percent in May 2013. However, the top five metros with the highest percentages of short sales were all in Florida: Lakeland (17.7 percent), Orlando (14.9 percent), Tampa-St. Petersburg-Clearwater (13.4 percent), Palm Bay-Melbourne-Titusville (12.9 percent), and Sarasota(11.6 percent).

Sales of bank-owned (REO) properties nationwide accounted for 8.6 percent of all sales in May, down from 9.1 percent of all sales in April and 9.3 percent of all sales in May 2013. Four of the top five areas were in California while Las Vegas ranked third.

Best distressed discounts vary by state

RealtyTrac identified the five best real estate deals for distressed property buyers and one is inFlorida: Homes scheduled for foreclosure auction that have negative equity, are vacant and were built between 1950 and 1990 sold at a 29 percent discount.

Other national bargains include:

″ California: Homes scheduled for foreclosure auction with positive equity (17 percent discount)

″ Ohio: Homes in default with negative equity, vacant and built between 1950 and 1990 (34 percent discount)

″ Michigan: Homes in default and vacant (34 percent discount)

″ New York: Homes scheduled for foreclosure auction with negative equity and vacant (38 percent discount)

Consumer confidence up for second month

June 24, 2014

Florida Realtor

EW YORK – June 24, 2014 – The Conference Board Consumer Confidence Index, which had increased in May, improved again in June.

The Index now stands at 85.2 (1985=100), up from 82.2 in May. The Present Situation Index increased to 85.1 from 80.3, while the Expectations Index, which gauges attitudes about the economy over the next six months, rose to 85.2 from 83.5 in May.

"Consumer confidence continues to advance, and the index is now at its highest level since January 2008 (87.3)," says Lynn Franco, Director of Economic Indicators at The Conference Board.

"June's increase was driven primarily by improving current conditions, particularly consumers' assessment of business conditions," Franco says. "Expectations regarding the short-term outlook for the economy and jobs were moderately more favorable, while income expectations were a bit mixed. Still, the momentum going forward remains quite positive."

Consumers claiming business conditions are currently "good" increased to 23 percent from 21.1 percent, while those stating business conditions are "bad" decreased to 22.8 percent from 24.6 percent. Consumers' assessment of the job market was also more favorable. Those stating jobs are "plentiful" edged up to 14.7 percent from 14.2 percent, while those claiming jobs are "hard to get" declined to 31.8 percent from 32.2 percent.

The percentage of consumers expecting business conditions to improve over the next six months increased to 18.8 percent from 17.7 percent. However, those expecting business conditions to worsen increased to 11.4 percent from 10.7 percent.

Consumers were more positive about the outlook for the labor market. Those anticipating more jobs in the months ahead increased to 16.3 percent from 15.2 percent, while those anticipating fewer jobs edged down to 18.7 percent from 18.9 percent.

Fewer consumers expect their incomes to grow, 15.9 percent versus 18 percent, but those expecting a drop in their incomes also declined, to 12.1 percent from 14.5 percent.

The monthly Consumer Confidence Survey is based on a probability-design random sample and conducted for The Conference Board by Nielsen, a global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was June 13.

© 2014 Florida Realtors®

Realtor.com and Bankrate launch mobile mortgage app

June 24, 2014

Florida Realtors

SAN JOSE, Calif. – June 24, 2014 – Realtor.com app users have a new tool to help them figure out if they can afford the home they're looking at.

Thanks to a partnership with Bankrate.com – a publisher, aggregator and distributor of personal finance content on the Internet – buyers can play with mortgage basics, such as the amount of the downpayment or mortgage points to determine if they can afford a property. If they can, the app also helps them find a lender that offers the best mortgage package.

Realtor.com is operated by Move Inc. on behalf of the National Association of Realtors® (NAR).

To start the homebuying process, the realtor.com app has an affordability tool and monthly payment calculator to help potential buyers find their target price range. They can then do a search of only those listings that match those calculations.

The affordability estimate takes into account interest rates and personal mortgage insurance, and it works with local tax and insurance rates so potential homebuyers know upfront approximately what they can spend on a home.

"Consumers want access to accurate information on the spot," says Move's chief executive officer, Steve Berkowitz. "Nearly 60 percent of the traffic on realtor.com now comes from consumers using mobile devices. This application reflects our efforts to optimize and develop technology based on putting the most important information at the consumer's fingertips."

"Housing inventory in many areas can move fast and consumers need the answers to their questions to be accurate and quick," adds Bankrate.com's chief executive officer, Don Ross.

According to Move, the realtor.com mortgage application:

″ Taps into real-time local, personalized mortgage rate loan options from different lenders

″ Allows users to change details with custom sliders to see how the package changes if they make a bigger downpayment, for example, or pay additional points

″ Sorts mortgage rate comparisons according to user preferences – by lowest APR, interest rate, fees or monthly payment.

″ Empowers users to see only those homes in their price range or based on the calculated monthly payment.

The application is available on iPhone and Android devices.

© 2014 Florida Realtors®

Keep an all-seeing eye on your stuff

June 24, 2014

Florida Realtors

NEW YORK – June 24, 2014 – Ben Nader's tech brainstorm came courtesy of a thief. Make that several thieves.

After a succession of apartment break-ins, each resulting in the disappearance of his prized bicycles, Nader, 30, an engineer, installed a home security system.

"I'm the tech-savvy guy who worked with camera chips and sensors, and it still took me three days to set it up, drilling holes, running wire and fiddling with router settings. I thought, 'There has to be a better way.'"

Nader's better way is called Butterfleye, a year-old start-up now taking online pre-orders for its wireless, high-quality optics camera that aims to do far more than just keep an eye on your home. It wants to be your personal videographer, too.

The $250 device features what Nader calls Active Eye Intelligence. This face-detection algorithm marks when faces are logged into the sharp 1980p by 1080p video stream, making it easier to scroll back and look for prized moments. Nader and his team of five hope to soon make that feature face-recognizing, meaning faces in your contacts lists will be tagged by name.

"Cameras are dumb; they're just streaming video to the cloud. Can you make your camera intelligent? The answer is yes," he says. "It should know when it's you at home, and know not to record you unless you tell it to. Or if it's your pet wandering through the house, you shouldn't get an alert about that." That camera-with-a-brain twist tweaks Butterfleye from passive security guard to smart assistant.

"This is just the beginning of us being part of the smart and connected home," he says. "Maybe (Butterfleye's) initial appeal is as an easy-to-use security camera, or perhaps as a personal videographer. But as image recognition improves, the possibilities are endless. The window is open? It will alert you. The coffee pot is still on, but it knows you left the house and pings you."

Nader admits that all-seeing eyes come with built-in privacy concerns. While he can't control every aspect of Butterfleye's eventual use, the product does have a feature that asks authorized users currently in a home – via a smartphone alert – if an authorized user outside can monitor the action. "I don't want to encourage the negative side … 'Oh, I want to check what my wife is doing,' " he says. "But I suppose ultimately, people will use this in different ways."

The good news for Nader is he's diving into a hot market segment, as evidenced by Google's smart-home buying spree (learning-thermostat company Nest, security camera firm Dropcam), as well as Apple's recent announcement of its HomeKit API, which lets developers working on smart-home products integrate them with Apple's iOS operating system. But that's also the bad news, as a growing number of big players – ranging from AT&T to Honeywell – race into this inevitably lucrative space, says Avi Greengart, market analyst with Current Analysis.

"The Dropcam and Nests of the world are already disrupting the big players with simple-to-install products, so the whole area is ripe for new ideas and consolidation," says Greengart. "There are lots of companies entering the time-lapse camera market."

Butterfleye investor Peter Relan thinks Nader has what it takes to crack the code. "At every turn, he's listened to suggestions and pivoted when needed, and that's rare; an engineer who really can think beyond that and into the marketing," says Relan, chief mentor at incubator Studio9Plus. Relan told Nader, "'Butterfleye needs to be the first smartphone of security cameras. If you focus on making your camera intelligent, then I'm interested.'"

Nader is polite and gregarious, but one detects an unrelenting drive beneath that calm exterior. Credit some of that to a tumultuous youth. He was born in Tehran, where he found a passion "for tinkering with any toy that had motors and parts and lights." After Nader's father passed away, his mother immigrated to Portland, Ore., with her two sons.

"I was in 10th grade and didn't speak much English, and you know how cliquish high school can be if you're not exactly from around town," he says. "But it was all good. I learned a lot. I deep-dived into things, from English to math and science. I immediately got a sense you could really pursue your dreams in America."

Specifically, Nader became fixated on applying his math aptitude toward building products that could improve lives. "In my mind was always this sense that technology for technology's sake isn't good enough," he says. "The question is: Can you build something that is useful to someone?"

Copyright 2014 USA TODAY, Marco della Cava; Martin E. Klimek, USA TODAY

 

Florida Realtors May sales report finds stability

June 23, 2014

Florida Realtors

ORLANDO, Fla. – June 23, 2014 – Florida's housing market reported more new listings, increased median prices and an uptick in inventory in May, according to the latest housing data released by Florida Realtors®. Closed sales of single-family homes statewide totaled 23,013 last month, up 3.6 percent over the May 2013 figure.

"Inventory levels continue to improve in Florida, and the months' supply of homes for sale remains stable – all good signs for the housing market," said 2014 Florida Realtors President Sherri Meadows, CEO and team leader, Keller Williams, with market centers in Gainesville, Ocala and The Villages. "Right now, the market offers a great opportunity for sellers, who are seeing nearly 93 percent of their asking price at the closing table. And mortgage rates, though rising, remain historically low – giving consumers more buying power."

New listings for single-family existing homes in May rose 13.1 percent year-over-year, while new listings for townhouse-condos rose 3.9 percent over the previous year.

The statewide median sales price for single-family existing homes last month was $180,000, up 4.3 percent from the previous year, according to data from Florida Realtors Industry Data and Analysis (IDA) department in partnership with local Realtor boards/associations. The statewide median price for townhouse-condo properties in May was $145,000, up 13.7 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors (NAR), the national median sales price for existing single-family homes in April 2014 was $201,100, up 4.7 percent from the previous year; the national median existing condo price was $205,500. In California, the statewide median sales price for single-family existing homes in April was $449,360; in Massachusetts, it was $320,000; in Maryland, it was $256,608; and in New York, it was $215,000.

Looking at Florida's townhome-condo market, statewide closed sales totaled 10,558 last month, down 7.0 percent compared to May 2013. The closed sales data reflected fewer short sales last month compared to the previous year: Short sales for condo-townhome properties declined 61.2 percent while short sales for single-family homes dropped 54.3 percent. Closed sales typically occur 30 to 90 days after sales contracts are written.

Florida Realtors Chief Economist Dr. John Tuccillo said, "Ordinarily, a market that is flattening out after a rise can be of concern. But this market has been in recovery mode and is now catching its breath after a long run-up. We are still seeing improvement in sales and prices, and are continuing to see drops in days on the market, cash sales and short sales. All of these are signs of a market that has stabilized.

"Going forward, we're concerned about affordability. In particular, the difficulty of first-time buyers to access mortgage financing and the lag in providing a much-needed supply of new homes may hold back Florida's housing market."

Inventory was at a 5.7-months' supply last month for single-family homes and at a 6-months' supply for townhouse-condo properties – the same level as the previous two months, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.19 percent in May 2014, up from the 3.54 percent average recorded during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Media Center and look under Latest Releases, or download the May 2014 data report PDFs under Market Data.

Dr. Tuccillo also offers an overview of the May market in an online video.

© 2014 Florida Realtors®

John R. Wood Properties opens new full-service office on Marco Island

June 15, 2014

Naples News

John R. Wood Properties announced the opening of its new office on Marco Island at 1000 N. Collier Boulevard. While the firm has a presence on Marco Island, the new 4,000-square-foot office will offer full-service, including 30-plus Realtors on staff and a Cyber Café to serve the company’s mobile agents and transactions.

“Obviously, we are excited to expand in this market in a bold way,” said Phil Wood, President. We have already been contacted by many agents and clients alike who are delighted to have the increased presence of a company known for its high sales volume and reputation on Marco Island.”

In addition to its reputation for high-level client services and sales volume, John R. Wood Properties is also a member of Luxury Portfolio International (LPI), the largest global network of the world’s most powerful independent luxury brokerages.

As a member, John R. Wood Properties has access to a worldwide network of luxury homes and is able to promote its listed properties with LPI’s online portal, attracting 1.2 million high-net-worth global visitors per year. In conjunction with LPI, the firm also has its own proprietary and unique targeted local marketing program.

John R. Wood Properties is the oldest real estate company in Southwest Florida with 55 years of experience in the market. The firm has 12 offices serving Marco Island to Sanibel/Captiva Islands, and employs 300 agents and staff. Visit the newly-redesigned user-friendly website, www.JohnRWood.com.

Fla.’s housing market shows strength in 1Q 2014

May 12, 2014

© 2014 Florida Realtors®

ORLANDO, Fla. – May 12, 2014 – Florida's housing market reported higher median prices, more new listings, fewer days on the market and a slight uptick in inventory during the first quarter of 2014, according to the latest housing data released by Florida Realtors®.

Closed sales of single-family homes statewide totaled 50,251 in 1Q 2014, up 2.3 percent over the 1Q 2013 figure.

"The first three months of 2014 show a strong housing market in Florida, with diminishing distressed property sales," says 2014 Florida Realtors President Sherri Meadows, CEO and team leader, Keller Williams, with market centers in Gainesville, Ocala and The Villages. "More jobs are being created, putting more Florida residents back to work, and our population continues to increase. All of these factors are bolstering the state's economy and providing a solid foundation for a strong housing market.

"Statewide, new listings for single-family homes over the three-month-period rose 12 percent year-over-year, while new townhouse-condo listings rose 8.2 percent. Home sellers, whether in the single-family home market or the townhouse-condo market, received more than 92 percent, on average, of their original listing price during the first quarter of this year."

The statewide median sales price for single-family existing homes in 1Q 2014 was $168,000, up 9.1 percent from the same time a year ago, according to data from Florida Realtors Industry Data and Analysis department in partnership with local Realtor boards/associations. The statewide median price for townhouse-condo properties during the quarter was $135,000, up 16.9 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

Looking at Florida's townhome-condo market, statewide closed sales totaled 24,860 during 1Q 2014, down 0.8 percent compared to 1Q 2013. The closed sales data reflected fewer short sales last month: Short sales for condo-townhome properties declined 55.8 percent while short sales for single-family homes dropped 52 percent. Closed sales typically occur 30 to 90 days after sales contracts are written.

"The first quarter statistics reflect the fact that Florida, in part a derivative market, has felt the sting of the northern winter.said Florida Realtors Chief Economist Dr. John Tuccillo. "Yet, the market is showing some positive movement. Sales are up, particularly for non-distressed properties. Other data indicate that this is a market that is settling down and returning to more stabilized conditions."

In 1Q 2014, the median days on market (the midpoint of the number of days it took for a property to sell during that time) was 58 days for single-family homes and 56 days for townhouse-condo properties.

Inventory was at a 5.7-months' supply in the first quarter for single-family homes and at a 6-months' supply for townhouse-condo properties, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.36 percent for 1Q 2014, up from the 3.50 percent average recorded during the same quarter a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Media Center and look under Latest Releases, or download the 1Q 2014 data report PDFs under Market Data.

© 2014 Florida Realtors®

Analysts still bank on 7% home appreciation

May 1, 2014

Florida Realtors

NEW YORK – April 30, 2014 – Despite a weak quarter in existing-home and new-home sales, Wall Street analysts say they still expect home prices to increase by 7 percent this year.

"We continue to expect home-price appreciation to moderate from the torrid pace of mid-2012 to 2013, supported by improving employment and growth prospects," according to analysts from Morgan Stanley. Analysts from Barclays echoed that, saying they are keeping their projection for home prices unchanged at 7 percent.

Barclays analysts are most upbeat about home-price appreciation in four "sand states": Arizona (projection of 8.2 percent), California (9.4 percent), Florida (8.3 percent), and Nevada (11 percent).

Morgan Stanley acknowledged the sluggish spring start to the home-selling season.

"In our view, the rationale for the weakness comes from a combination of three factors: severe winter weather; a transition away from investors reliant on distressed and cash purchases to mortgage credit-dependent buyers; and affordability challenges for first-time homebuyers," says Morgan Stanley's analysts, adding that nearly 20 percent of home owners remain underwater on their mortgage, which prevents many from moving.

Nevertheless, Morgan Stanley analysts say they're still upbeat about the prospects for an ongoing housing recovery.

Source: "Wall Street Home Price Appreciation Still Expected to Hit 7 percent," HousingWire (April 28, 2014)

© Copyright 2014 INFORMATION, INC. Bethesda, MD (301) 215-4688

NAR: Pending Home Sales Increase in March

April 28, 2014

WASHINGTON – April 28, 2014 – After months of stagnant activity, pending home sales rose in March, marking the first gain in the past nine months, according to the National Association of Realtors®The Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, rose 3.4 percent to 97.4 from an upwardly revised 94.2 in February. However, year-to-year, it's down 7.9 percent below its 105.7 in March 2013.

 

"After a dismal winter, more buyers got an opportunity to look at homes last month and are beginning to make contract offers," says Lawrence Yun, NAR chief economist, who calls the uptick inevitable. "Sales activity is expected to steadily pick up as more inventory reaches the market, and from ongoing job creation in the economy."

The PHSI in the Northeast increased 1.4 percent to 78.8 in March but is 5.9 percent below a year ago. In the Midwest, the index slipped 0.8 percent to 94.5 in March and its 10.1 percent below March 2013.

Pending home sales in the South rose 5.6 percent to an index of 112.7 in March but below 5.3 percent below a year ago. The index in the West increased 5.7 percent in March to 91.0, but it's 11.1 percent below March 2013.

"The March increase … comes as a relief," says BMO Capital Markets economist Jennifer Lee. She says the recovery "is still on track."

Although home sales are expected to trend up over the course of the year and into 2015, the year began on a weak note and total sales are unlikely to match the 2013 level, NAR says.

Existing-home sales are expected to total just over 4.9 million this year, below the nearly 5.1 million in 2013. However, with ongoing inventory shortages in much of the U.S., the national median existing-home price is expected to grow between 6 and 7 percent in 2014.

© 2014 Florida Realtors®

Why is Listing Inventory So Low? Five Reasons

April 28, 2014

LOS ANGELES – April 28, 2014 – Low inventories plague housing markets across the country. It's giving buyers limited options and sparking more bidding wars, though with sale prices rising, inventory seems to be growing a bit.

 

However, many current homeowners can't or won't sell, with some estimates suggesting that more than half of all existing homes are unlikely to be put on the market anytime soon. An analysis by Redfin looked at transactions across 29 metro areas for single-family homes, condos, and townhomes, as well as mortgages and refinances, since 1999.

Researchers identified a number of event keeping homes from going on the market:

1. Low equity: An estimated 19 percent of homeowners owe more than 80 percent of the value on the home. Many of these low-equity homes were purchased or refinanced during the housing bubble between 2004 and 2009, though the analysts estimate that nearly all will be in the black over the next five years.

2. Low mortgage rate: An estimated 16 percent of homeowners won't sell quickly because they purchased or refinanced with an extraordinarily low mortgage interest rate – and they won't get that kind of deal again if they move. (In Redfin's analysis, a low mortgage interest rate was considered below 4.25 percent.)

3. Purchased or refinanced in the past seven years: Homes owned less than seven years tend not to sell, according to the analysts, because short-term ownership raises a red flag in the eyes of many buyers, as they wonder why the owner wants to move on so quickly.

4. Company or investor owned: A company or investors owns about 3 percent of homes, defined as an entity that bought five or more homes in a metro area during the past 10 years. "These investors are likely holding on to their investment for the capital appreciation and rental income," the Redfin study says.

5. Ex-owner ownership: Fewer buyers actually sell their old home – many hold onto it as a rental investment property. A Redfin survey of 1,900 prospective homebuyers found that 39 percent said they would rent out the old residence. The percentage was even higher in such markets that have recently seen strong price appreciation.

Source: "Why Aren't There More Homes for Sale?" Redfin (April 22, 2014), Los Angeles Times (04/05/14) Logan, Tim

© Copyright 2014 INFORMATION, INC. Bethesda, MD (301) 215-4688

 

Florida's Housing Market Shows Rising Prices in March

April 21, 2014

Fla.’s housing market shows rising prices in March

NAR: Existing-home sales remain soft in March

ORLANDO, Fla. – April 21, 2014 – Florida's housing market reported higher median prices, more new listings and a stable level of inventory in March, according to the latest housing data released by Florida Realtors®. Closed sales of single-family homes statewide totaled 20,081 last month, up 2.8 percent over the March 2013 figure.

"March marked the 28th month in a row that statewide median sales prices rose year-over-year for both single-family homes and townhome-condo properties," said 2014 Florida Realtors President Sherri Meadows, CEO and team leader, Keller Williams, with market centers in Gainesville, Ocala and The Villages. "Realtors across Florida are reporting fewer short sales of distressed properties and more interest from potential home sellers as they observe the return of more traditional market conditions. Statewide, new listings for single-family homes in March rose 16.5 percent year-over-year, while new townhouse-condo listings rose 10.3 percent."

The statewide median sales price for single-family existing homes last month was $173,000, up 7.1 percent from the previous year, according to data from Florida Realtors Industry Data and Analysis department in partnership with local Realtor boards/associations. The statewide median price for townhouse-condo properties in March was $140,000, up 16.7 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less 

According to the National Association of Realtors®(NAR), thenational median sales price for existing single-family homes in February 2014 was $189,200, up 9 percent from the previous yearthenational median existing condo price was $187,900.In California, the statewide median sales price for single-family existing homes in February was $404,250; in Massachusetts, it was $294,950; Maryland, it was $241,097; and in New York, it was $232,000.

Looking at Florida's townhome-condo market, statewide closed sales totaled 9,580 last month, down 5.2 percent compared to March 2013. The closed sales data reflected fewer short sales last month compared to the previous year: Short sales for condo-townhome properties declined 62.8 percent while short sales for single-family homes dropped 55.3 percent. Closed sales typically occur 30 to 90 days after sales contracts are written.

"What we're seeing is a market we can live with," said Florida Realtors Chief Economist Dr. John Tuccillo. "Sales are up, inventories are increasing moderately and days on the market are shrinking slightly. What's of particular interest this month is how market activity has moved up the price ladder. We are seeing greater sales gains and inventory increases, and strong percentage decreases in days on the market, for homes priced above $250,000. This is a break from the trends we were seeing last year and bears watching for the future.

"A trend that is continuing is the rapid decline in short sales, as increasing prices reduce the incentive for homeowners to seek short sales."

Inventory was at a 5.7-months' supply last month for single-family homes and at a 6-months' supply for townhouse-condo properties, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.34 percent in March 2014, up from the 3.57 percent average recorded during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Media Center and look under Latest Releases, or download the March 2014 data report PDFs under Market Data.

Number of Homes Seriously Underwater at Two-Year Low

April 17, 2014

Florida Realtors

Number of homes seriously underwater at two-year low

IRVINE, Calif. – April 17, 2014 – RealtyTrac released its U.S. Home Equity & Underwater Report for the first quarter of 2014, and it finds that 9.1 million U.S. residential properties were "seriously underwater," where the combined loan amount secured by the property is at least 25 percent higher than the property's estimated market value.

The number represents 17 percent of all properties with a mortgage in the first quarter.

However, the number of underwater homeowners is at its lowest level since RealtyTrac began reporting negative equity in the first quarter of 2012. In the previous quarter, 9.3 million residential properties (19 percent of those with a mortgage) were seriously underwater. One year earlier, 10.9 million residential properties (26 percent) were seriously underwater.

The universe of equity-rich properties – those with at least 50 percent equity – grew to 9.9 million (19 percent of all properties with a mortgage) in the first quarter, up from 9.1 million (18 percent) in fourth quarter 2013.

Another 8.5 million properties (16 percent of all properties with a mortgage) were on the verge of resurfacing in the first quarter, with between 10 percent negative equity and 10 percent positive equity. It was 17 percent one quarter earlier.

Fewer properties in the foreclosure process also had negative equity. Nationwide, 45 percent were seriously underwater, down from 48 percent quarter-to-quarter and 58 percent year-to-year. Conversely, the share of foreclosures with positive equity increased to 35 percent in the first quarter, up from 31 percent in the fourth quarter and up from 24 percent in the third quarter of 2013.

"The relatively high percentage of foreclosures with equity is surprising to many because it would seem homeowners with equity could easily avoid foreclosure by leveraging that equity by refinancing or with an equity sale of the home," says Daren Blomquist, vice president at RealtyTrac. "But many distressed homeowners with equity may not realize they have equity and in some cases have vacated the property already, assuming that foreclosure is inevitable."

Florida

Florida continues to rank high in the percentage of seriously underwater homeowners with a mortgage – 31 percent. It ranks second nationwide to first-place Nevada (34 percent), and it's followed by Illinois (30 percent), Michigan (29 percent) and Ohio (27 percent).

Two Florida cities also make the top-six list for underwater homeowners with a mortgage. Las Vegas tops the list (37 percent) followed by Lakeland, Fla., (36 percent), Palm Bay-Melbourne-Titusville, Fla., (35 percent), Cleveland (35 percent), Akron, Ohio (34 percent), and Detroit (33 percent).

Of Florida homeowners in the foreclosure process, 26 percent have equity, while 59 percent are seriously underwater. The remaining 15 percent are close to the break-even point.

© 2014 Florida Realtors®

Builders Continue to See Market Improvements

April 16, 2014

NAHB

Builder Sentiment Steady

The March NAHB/Wells Fargo Housing Market Index rose one point from a one-point downwardly revised February to 47. This is the third consecutive month with the index below 50, the point where more builders see the market improving rather than getting poorer. Two of the three components of the index remained unchanged; the current sales index was at 51, the same as the one-point downwardly revised February index and the traffic index was 32, which is the same as the one-point downwardly revised February component. The heaviest weighted sub-index is the expectations for the next six months, which was up four points to 57.

The essentially unchanged index is the result of builders waiting on expected spring demand while holding any further optimism until actual sales occur. Many of the individual comments mentioned stronger traffic or more serious buyers but the interest has yet turned into contract signings. Builders continue to meet some supply constraints as buildable lot supply either is not available or is priced beyond what the builder feels can be recaptured in a sale.

Access to credit continues to be a concern across all parts of the country as builders search for credit to buy land and build homes and consumers apply for mortgages. A recent NAHB survey of builders found some improvement in builders’ access to capital and FDIC quarterly reports finally show some increase in bank holdings of AD&C residential credit. Lot supply will take longer to solve but access to credit is a critical first step. The housing recovery is likely to be hindered by these limitations just as demand begins to resurge.

NAHB expects 1.1 million housing starts in 2014 primarily driven by the pent up demand of existing home owners. The first-time home buyer will return more gradually as mortgage credit standards become more rational and young adults’ incomes stabilize and grow.