Category Archives: Market Trends

Home Sales Post Strongest Year Since 2006

hendersonville real estateIn 2006 – the final year of the housing bubble – 6.48 million homes were sold. Last year, sales of previously owned homes reached 5.09 million. It was the strongest year of sales since the bubble burst and a 9.1 percent improvement on 2012’s totals, according to new data released by the National Association of Realtors. Lawrence Yun, NAR’s chief economist, said housing has experienced a healthy recovery over the past two years. Existing-home sales have risen nearly 20 percent since 2011, with job growth, record low mortgage interest rates, and a large pent-up demand driving the market, Yun said. Though housing lost some momentum in the fall, sales were up 1.0 percent in December and ended the year near normal, despite limited inventory and disappointing job growth. Total housing inventory at the end of December was down 9.3 percent to 1.86 million homes available for sale, which represents a 4.6-month supply at the current sales pace. Also in the report, the median existing-home price for all housing types was up 9.9 percent from December 2012 at $198,000. Morehere.

Housing Headed In The Right Direction

this wayFreddie Mac’s U.S. Economic and Housing Market Outlook for January finds four of the key housing indicators moving in the right direction to begin the year. The unemployment rate, though still high at 6.7 percent, is vastly improved and should continue its gradual path to a more consistent and historically normal level. Mortgage delinquencies have also shown great improvement, having been nearly cut in half since their peak. Finally, both affordability levels and home sales continue to trend in the right direction, with the average mortgage payment remaining very affordable in most markets – suggesting there’s still room for more recovery in home prices. Frank Nothaft, Freddie Mac’s chief economist, said the housing recovery continues on a steady pace. According to Nothaft, home prices should rise about 5 percent this year, while home sales – along with other key indicators – will continue to trend in the right direction. More here.

Job Growth To Drive Housing Market In 2014

hendersonville real estateIndustry experts and market analysts expect housing to continue to build on last year’s gains in 2014. Home prices – which rose 11 percent last year – will continue to rise, though at a slower rate. And those price increases will lead to fewer underwater homeowners and, as more homes are put up for sale, improved inventory levels. In addition to rising home values, analysts expect higher mortgage rates in the new year, though they believe it’ll have little effect on buyer demand, which is expected to remain at a healthy level. Celia Chen, an economist at Moody’s Analytics, predicts job growth will spur a surge in new residential construction this year. Chen believes the economy will add about 200,000 jobs a month, leading to greater housing demand and increased homebuilding activity. The spike in new residential construction will lead to even more jobs and support a stronger, growing economy in 2014, according to Chen. More here.

Housing Barometer Tracks Market Recovery

hendersonville housing recoveryTrulia’s Housing Barometer has been tracking the housing market’s recovery since February 2012. The Barometer measures how quickly the market has been returning to normal by comparing existing-home sales, prices, delinquency and foreclosure rates, new home starts, and the employment rate for 25-34 year-olds against their pre-bubble normal and their lowest reading during the housing crisis. The most recent release shows that three of the five indicators have improved significantly over the past year and are now close to normal. Existing-home sales, for example, are 79 percent back to normal, up from 51 percent a year earlier. Prices also have recovered dramatically from a year ago and are now 71 percent back to normal. Among the other indicators, foreclosure and delinquency rates have recovered 59 percent, while new home starts and employment levels still have a ways to go. Overall, the recovery has been uneven but, at the current pace, non-distressed sales and home prices could reach normal levels this year, with the other indicators taking a bit longer to fully recover. More here.

Market Momentum Carries Over Into 2014

asheville real estate marketConsumer confidence has rebounded since October’s government shutdown and should continue to strengthen in 2014 as fiscal and monetary policy issues begin to clear. According to Fannie Mae’s Economic & Strategic Research Group, the improvement should lead to gains in consumer spending, manufacturing activity, and economic growth – all of which will contribute to the housing market’s continued recovery. Doug Duncan, Fannie Mae’s chief economist, said housing will continue on a modest upward trend toward more normal levels in 2014, with additional home price increases tempered by declining investor activity in the market. Duncan said housing indicators met the group’s expectations for 2013 and should continue their gradual march toward normal in the new year. More here.

Trends Point To Healthy Housing Market In 2014

asheville nc healthy housingIn 2013, home prices and buyer demand both spiked as the housing recovery took hold in markets across the country. Double-digit increases in home values brought prices to a level last seen in 2004. But, according to Zillow’s November Real Estate Market Report, annual and monthly price trends indicate the robust recovery seen throughout 2013 is beginning to slow to more sustainable levels. The slowing price growth is partly driven by decreasing negative equity rates. As homeowners recoup value lost during the recent recession, more of those homes are put up for sale which increases inventory levels and normalizes price gains. And in addition to an increasing supply of previously owned homes, new home construction is expected to ramp up over the next year, adding further relief to constrained inventory levels across the country. If these trends continue, 2014 will likely see improved for-sale inventory levels, slower price increases, and more potential buyers entering the market to purchase homes. More here.

Cash Is King For November Home Sales

All-cash buyers accounted for a whopping 42 percent of the nearly 500,000 U.S. home purchases in November, according to the latest housing report from RealtyTrac. That figure is the highest seen since RealtyTrac began tracking all-cash purchases in 2011.

Institutional investors accounted for nearly 40 percent of home buys in November , the RealtyTrac data show, also close to the all-time high of just above 40 percent seen at the end of 2012.

The numbers showcase the rising confidence in the housing market, according to Time, but also mean that first-time home buyers may have a hard time pulling off a purchase in the face of stiff competition from these cash-rich investors.

Existing Home Sales Fall 4.3% In November

hendersonville nc homes for saleSales of previously owned homes fell 4.3 percent in November, according to estimates from the National Association of Realtors. The drop slowed sales to a pace 1.2 percent below last year’s rate, marking the first time in more than two years that sales were below year-ago levels. Lawrence Yun, NAR’s chief economist, said the market is being squeezed by constrained inventory. According to Yun, there is pent-up demand for owner-occupied housing and, though household formation will inevitably burst out, limited supply is slowing the sales pace. It’s also driving price increases. The national median existing-home price for all housing types was $196,300 in November, up 9.4 percent from last year. Median prices are highest in the West, where the median sales price was $284,400. The Midwest had the lowest median price at $151,100. More here.

Builders Optimistic About New Home Sales

asheville nc buildersAll three components of the National Association of Home Builders Housing Market Index improved in December. The three index components, which measure current sales conditions, sales expectations, and traffic of prospective buyers, are scored on a scale where any number above 50 indicates more builders view conditions as good than poor. According to the most recent release, the current-sales component jumped six points to 64, while the index measuring expectations for future sales rose two points to 62 and traffic of prospective buyers increased three points to 44. David Crowe, NAHB’s chief economist, said the recent spike in mortgage rates has not deterred consumers, as rates are still near historically low levels. Crowe believes this month’s gain is due, in part, to the release of pent-up demand caused by the uncertainty surrounding October’s government shutdown. Overall, builder confidence in the market for newly built, single-family homes improved four points to a reading of 58. More here.

Confidence In Economy Slowly Returning

brevard nc mls searchFollowing the government shutdown in October, Americans’ confidence in the economy tumbled. But ever since that plunge, confidence has been slowly returning. And according to Gallup’s most recent Economic Confidence Index, Americans’ assessment of current economic conditions has almost completely rebounded to levels last seen in mid-September. On the other hand, the index component measuring future outlook, which took a heavier hit during the shutdown, remains 11 points below mid-September levels – though it has recovered 24 points since its post-shutdown low. Gallup’s report says economic confidence should be more positive than negative next year, as long as home and stock prices keep rising and the job market continues to improve. More here.