Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses GDP and mortgage purchase applications.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses consumer confidence and Case-Shiller home price data.
Economic activity remained positive in the fourth quarter of 2011, driven by increased consumer and business spending. With employment showing signs of improvement, the outlook for commercial real estate points to a positive year.
Realtor® comments and replies this month to the January 2012 survey for the REALTORS® Confidence Index indicate favorable market developments but also continued concern with issues related to lending and appraisals: http://www.realtor.org/research/research/reps.
- REALTOR® confidence in the outlook for the housing markets over the next 6 months has increased significantly.
- Higher prices expected in the next year by 67 percent of Realtors®
- A number of respondents commented on the upswing in buyer activity, multiple bids in a number of transactions, lower inventories of available homes, and substantially increased buyer activity in lower priced properties.
Realtors® continued to report, however, that a number of problems continue to present major challenges:
- Problems with the appraisal process were prominent among the complaints, with concerns over the selection of comps, lack of appraiser qualifications in many cases, and length of time to complete an appraisal.
- Problems confronting potential buyers in obtaining a mortgage included unrealistically tight underwriting processes, a lack of customer service and responsiveness by banks, excessive documentation required in the lending process, and in some cases generally bad attitudes by banking personnel.
- Concern over the ability to finance condos focused on obtaining FHA approvals, given mortgage and homeowner association delinquencies.
- Bargain hunters and low-ball offers continue, but to a lesser degree than previously.
- A number of respondents noted that the overall jobs and economic situation continues to have a major, negative impact on the residential markets.
In conclusion, the results from this month’s survey are positive: confidence in the outlook is up. However, the recovery is slow, and the Appraisal and Lending issues—although evincing some improvement—are still a major concern.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses new home sales.
- The government price index put out by FHFA that uses Fannie and Freddie loan data on home purchases showed that prices were roughly steady from the 3rd to 4th quarters nationally, slipping only 0.1 percent. From the 4th quarter of 2010, prices were down 2.4 percent.
- Monthly data from the same source showed that prices were up 0.7 percent in December.
- The map above shows price changes by state from the 4th quarter of 2010 to the 4th quarter of 2011. Twelve states plus DC had price growth in this period. The map shows that many of these states were concentrated in the central plains.
- The metro area with the greatest year over year price growth was Bismarck, ND. Other metro areas in the top 20 were spread across the country from Wyoming to Pennsylvania.
- One other notable observation, the FHFA house price index does NOT exclude distressed properties from evaluation. Other research has shown that distressed properties typically sell at a discount, and data series that attempt to exclude distressed sales tend to show better price performance.
- Identifiably distressed properties are an estimated 7 to 13 percent of the FHFA sample. Thus, non-distressed properties may see even stronger price performance than reported by the FHFA index.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses jobless claims.
According to NAR’s recently released quarterly Commercial Market Survey, the level of rent concessions has been steadily declining as we leave the economic debris of the Great Recession.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses existing home sales numbers and mortgage purchase applications.
Seasonal Patterns in Home Sales Data
It comes as no surprise to those in the real estate industry that there is a seasonal pattern to home sales data. This concept is also easily understood by those outside of the industry who can picture families with school-age children preferring to purchase homes and move in the summer flooding the market during those months so as to avoid disruption to education. It is also easy to picture singles, young couples, or empty nesters remaining in the market regardless of the season. While there are undoubtedly other potential explanations behind the seasonal pattern in home sales, one does not need to understand all of the possible drivers of a seasonal pattern to understand that it exists.
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