Housing Can Be 'Key Engine of Job Growth'

Copyright National Association of REALTORS®. Reprinted with permission.

Existing-Home Sales Rise in Most States in First Quarter; Metro Area Prices Mixed

Washington, DC, May 10, 2011

Existing-home sales continued to recover in the first quarter with gains recorded in 49 states and the District of Columbia, while 22 percent of the available metropolitan areas saw prices rise from a year ago, according to the latest survey by the National Association of Realtors®.

Total state existing-home sales, including single-family and condo, rose 8.3 percent to a seasonally adjusted annual rate¹ of 5.14 million in the first quarter from 4.75 million in the fourth quarter, and are only 0.8 percent below a 5.18 million pace during the same period in 2010.

Also in the first quarter, the median existing single-family home price rose in 34 out of 153 metropolitan statistical areas² (MSAs) from the first quarter of 2010, including four with double-digit increases; one was unchanged and 118 areas showed price declines.

Lawrence Yun, NAR chief economist, said home prices are all over the map. "The reading of quarterly price data can be volatile because they are based on the types of homes that are sold during the quarter. When buyers principally purchase distressed properties in a given market, the recorded prices will be very low, which is what we're seeing now in much of the country," he said. "Annual price data provides a better guide about the direction of the market in those areas."

The national median existing single-family home price was $158,700 in the first quarter, down 4.6 percent from $166,400 in the first quarter of 2010. The median is where half sold for more and half sold for less. Distressed homes,³ typically sold at a discount of about 20 percent, accounted for 39 percent of first quarter sales, up from 36 percent a year earlier.

To clarify, Yun said lower priced homes have seen the best sales performance. "The biggest sales increase has been in the lower price ranges, which are popular with investors and cash buyers," he said. "The preponderance of sales activity at the lower end is bringing down the median price, so what we're seeing is the result of a change in the composition of home sales."

Although sales are slightly below a year ago, the volume of homes sold for $100,000 or less in the first quarter was 8.9 percent higher than the first quarter of 2010, creating a downward skew on the overall median price. The share of all-cash home purchases rose to 33 percent in the first quarter from 27 percent in the first quarter of 2010.

Investors accounted for 21 percent of first quarter transactions, up from 18 percent a year ago, while first-time buyers purchased 32 percent of homes, down from 42 percent in the first quarter of 2010 when a tax credit was in place. Repeat buyers accounted for a 47 percent market share in the first quarter, up from 40 percent a year earlier.

"The rising sales trend in nearly all states is a part of the healing process to clear off inventory. Sales need to rise before prices can firm up," Yun added.

NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said strong sales of distressed homes are exactly what the market needs. "The good news is foreclosures, which account for two-thirds of all distressed homes sold, are selling very quickly," he said. "Short sales still take far too long to get lender approval, but it appears the inventory of distressed property is peaking and will be gradually declining next year. This means the market should slowly return to balance. We are encouraged that recent home buyers are having exceptionally low default rates."

According to Freddie Mac, the national commitment rate on a 30-year conventional fixed-rate mortgage averaged 4.85 percent in the first quarter, up from a record low 4.41 percent in the fourth quarter, but below the 5.00 percent average in the first quarter of 2010.

In the condo sector, metro area condominium and cooperative prices - covering changes in 53 metro areas - showed the national median existing-condo price was $152,900 in the first quarter, down 10.4 percent from the first quarter of 2010. Eleven metros showed increases in the median condo price from a year ago, one was unchanged and 41 areas had declines.

Regionally, existing-home sales in the Northeast increased 0.8 percent in the first quarter to a level of 800,000 but are 7.3 percent below the first quarter of 2010. The median existing single-family home price in the Northeast declined 5.0 percent to $234,100 in the first quarter from a year ago.

Existing-home sales in the Midwest rose 7.9 percent in the first quarter to a pace of 1.09 million but are 5.0 percent below a year ago. The median existing single-family home price in the Midwest fell 5.3 percent to $124,400 in the first quarter from the same period in 2010.

In the South, existing-home sales increased 8.5 percent in the first quarter to an annual rate of 1.96 million and are 2.8 percent higher than the first quarter of 2010. The median existing single-family home price in the South slipped 0.6 percent to $141,800 in the first quarter from a year earlier.

Existing-home sales in the West jumped 13.5 percent in the first quarter to a level of 1.29 million and are 2.1 percent above a year ago. The median existing single-family home price in the West fell 4.7 percent to $197,400 in the first quarter from the first quarter of 2010.

The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

# # #

NOTE: Data tables for both metro area home prices and state existing-home sales are posted at: www.realtor.org/research/research/metroprice. For areas not covered in the tables, please contact the local association of Realtors®.

There often are differences between NAR's data and locally reported data because of differences in methodology, which may include the geographic coverage area, housing types, and Census benchmarking used in NAR's model. More importantly, there is a parallel between the percentage changes over time that is typically seen even when using different methodologies.

¹The seasonally adjusted annual rate for a particular quarter represents what the total number of actual sales for a year would be if the relative sales pace for that quarter was maintained for four consecutive quarters. Total home sales include single family, townhomes, condominiums and co-operative housing. NAR began tracking the state sales series in 1981.

Seasonally adjusted rates are used in reporting quarterly data to factor out seasonal variations in resale activity. For example, sales volume normally is higher in the summer and relatively light in winter, primarily because of differences in the weather and household buying patterns.

²Areas are generally metropolitan statistical areas as defined by the U.S. Office of Management and Budget. A list of counties included in MSA definitions is available at: www.census.gov/population/estimates/metro-city/0312msa.txt.

Regional median home prices include rural areas and samples of many smaller metros that are not included in this report; the regional percentage changes do not necessarily parallel changes in the larger metro areas. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Quarter-to-quarter comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns.

NAR began tracking of metropolitan area median single-family home prices in 1979; the metro area condo price series dates back to 1989.

Because there is a concentration of condos in high-cost metro areas, the national median condo price generally is higher than the median single-family price. In a given market area, condos typically cost less than single-family homes. As the reporting sample expands in the future, additional areas will be included in the condo price report.

³Distressed sales, first-time buyers, investors and all-cash transactions are from a survey for the Realtors® Confidence Index.

Second quarter metro area home price and state resale data will be released August 10 at 10:00 a.m. EDT.

Copyright National Association of REALTORS®. Reprinted with permission.

Just curious how many of you are utilizing this relatively new tool in your real estate business?

QR codes for smartphones becoming embedded in advertising - The Denver Post www.denverpost.com

Square, black-and-white barcodes are popping up far and wide. They

A QR Code from one of our listings....

The World Park Campaign

http://www.youtube.com/watch?v=7OCyfV_k2_g&feature=player_detailpage

Daily Real Estate News  |  May 6, 2011  |   Share In Time for Buying Season, Rates Hit Yearly Lows
The 30-year fixed-rate mortgage, a popular choice among buyers, sank even lower this week, matching its yearly low of 4.71 percent from January, reports Freddie Mac in its weekly mortgage market survey. Last year at this time, the 30-year fixed-rate mortgage averaged 5 percent.

Meanwhile, the 15-year fixed-rate hit a new yearly low of 3.89 percent this week. Last week, the 15-year fixed-rate mortgage averaged 3.97 percent. The 15-year rate averaged 4.36 percent last year at this time. It reached its lowest level on record in November when it averaged 3.57 percent.

The one-year adjustable-rate mortgage averaged 3.14 percent, down from last week's 3.15 percent. Last year at this time, it averaged 4.07 percent.

"Weaker economic data reports reduced Treasury bond yields and allowed mortgage rates to drift lower for the third consecutive week," says Frank Nothaft, Freddie Mac's chief economist.

Source: "30-Year Fixed-Rate Mortgage Matches Yearly Low of 4.71 Percent," Freddie Mac (May 5, 2011)

Copyright National Association of REALTORS®. Reprinted with permission.

Daily Real Estate News | April 27, 2011 | Share

California boasted the highest number of cities where homes tended to spend the shortest amount of time on the market last month, based on March housing data from Realtor.com.

In Oakland, Calif., the average days on the market for listings was 50 in March--the least amount of days for median days on the market for the 146 markets reviewed.

Nationally, the median for homes for days on the market was 160 in March, which is an increase of 40 percent in a year.

Here is a list of the cities with the fewest median days on the market from March:

Oakland, Calif.
Median days on the market: 50
Median list price: $319,000

San Francisco
Median days on the market: 63
Median list price: $639,000

Denver
Median days on the market: 66
Median list price: $259,900

Iowa City, Iowa
Median days on the market: 66
Median list price: $187,500

Los Angeles-Long Beach, Calif.
Median days on the market: 70
Median list price: $345,000

Stockton-Lodi, Calif.
Median days on the market: 70
Median list price: $175,000

Bakersfield, Calif.
Median days on the market: 70
Median list price: $141,500

San Jose, Calif.
Median days on the market: 71
Median list price: $470,000

Anchorage, Alaska
Median days on the market: 71
Median list price: $279,975

Fresno, Calif.
Median days on the market: 71
Median list price: $170,000

Tulsa, Okla.
Median days on the market: 71
Median list price: $147,900

Source: REALTOR® Magazine online (April 27, 2011

Copyright National Association of REALTORS®. Reprinted with permission.

No Surprise That Colorado is One of the Top Five Places to Live!

Daily Real Estate News  |  October 20, 2010  |   Share Where Do Most People Want to Live?
If you could live in any state, except the one you live in now, what state would you choose to live in?

The Harris Poll has asked this question every year since 1997. While California tops the list of most popular states to live in among Echo Boomers (now ages 18 to 33) and Gen Xers (ages 34 to 45), Hawaii is the top pick for Baby Boomers (ages 46 to 64) and Matures (ages 65 and over). Among Echo Boomers, Hawaii drops out of the top five.

Here are the top-10 states across the age groups:

1. California
2. Hawaii
3. Florida
4. Colorado
5. Arizona
6. North Carolina
7. Oregon
8. Texas
9. New York
10. Washington

Source: Harris Interactive (10/19/2010)

Copyright National Association of REALTORS®. Reprinted with permission.

Daily Real Estate News  |  September 14, 2010  |   Share 10 Markets Most Likely to Appreciate
Forbes magazine turned to real estate research firm Local Market Monitor to figure out which markets have the greatest likelihood of price appreciation because they offer a mix of jobs weighted toward growth industries.

These are the top markets, the research company concludes:

1. Raleigh-Cary, N.C.
2. McAllen-Edinburg-Mission, Texas
3. Austin-Round Rock, Texas
4. Nashville-Davidson-Murfreesboro-Franklin, Tenn.
5. San Antonio, Texas
6. Colorado Springs, Colo.
7. Albuquerque, N.M.
8. Denver-Aurora-Broomfield, Colo.
9. Springfield, Mo.
10. Indianapolis-Carmel, Ind.

Source: Forbes, Francesca Levy (09/13/2010)

Copyright National Association of REALTORS®. Reprinted with permission.

Daily Real Estate News  |  July 26, 2010  |   Share

It's a Great Time for Housing Deals

Paying off an underwater mortgage and buying a better home could be the best tactic in this troubled market.

"If you are trading up, what better time than when interest rates are at record lows and the cost of the trade-up is much less than it used to be?" says Christopher J. Mayer, a Columbia Business School economist.

With 15-year fixed-rate mortgages at about 4.5 percent, it also makes sense to pay off the mortgage and keep the house. "At this point," says Jay Brinkmann, chief economist of the Mortgage Bankers Association in Washington, D.C., "if they don't have anything else that is bringing a tremendous return, then they are buying themselves an annuity by paying their house off sooner than they needed to."

Source: The Wall Street Journal, M.P. McQueen (07/24/2010)

Copyright National Association of REALTORS®. Reprinted with permission.

Daily Real Estate News  |  July 8, 2010  |   Share Global Interest in U.S. Homeownership Gains
International home buyers are increasingly attracted to property in the U.S., according to the National Association of REALTORS®' 2010 Profile of International Home Buying Activity. Several factors, including the strength of the dollar, the value and desirability of U.S. real estate, and the emerging economic recovery, continue to drive international interest in owning a home in this country.

"While all real estate in the U.S. is local, the same is not true for property owners," said NAR President Vicki Cox Golder, owner of Vicki L. Cox Real Estate in Tucson, Ariz. "The U.S. continues to be a top destination for international buyers from all over the world. Foreign buyers understand the value of owning a home in this country and can rely on REALTORS® to help guide them through the complex process of buying property in the U.S. With expertise, knowledge and experience, REALTORS® have a global perspective."

The survey, released today, covers the period between April 1, 2009, and March 31, 2010. During that time foreign buyers, including those with residency outside the U.S. as well as recent immigrants and temporary visa holders, are estimated to have purchased $66 billion of U.S. residential property, or 7 percent of the residential market.

Slightly more than a quarter of REALTORS®, 28 percent, reported working with at least one international client in the past year. This is a significant increase from the 2009 report, when 23 percent of REALTORS® worked with foreign clients. Eighteen percent of all REALTORS® were estimated to have completed at least one sale, compared to 12 percent last year.

"Several factors have contributed to an increase in international buyer interest in the U.S.," said Golder. "A large majority of REALTORS® report the changes in value to the U.S. dollar have had a strong impact on the international real estate business. In addition, perceptions abroad about trends in the U.S. real estate market have led many international clients to believe purchasing a home in the U.S. is more affordable than in their country and holds more value."

International buyers came from 53 different countries around the world. The top four countries were Canada, Mexico, the U.K. and China/Hong Kong. With 23 percent of international buyers coming from Canada, the country has remained the largest buying group in the past three years. Foreign buyers from Mexico have been steadily increasing. In 2010 Mexico replaced the U.K. as the second largest buying group with 10 percent of buyers. Buyers from the U.K. buyers decreased from 10.5 percent in 2009 to nine percent in 2010. Eight percent of recent buyers came from China/Hong Kong.

Two factors important to international clients when purchasing property in the U.S. are proximity to their home country and the convenience of air transportation. Florida typically attracts European, Canadian and South American buyers while the East Coast draws Europeans. The West Coast brings Asian buyers and the Southwest attracts Mexicans.

International buyers were reported in 39 states in 2010, but a slight majority of the total buyers are concentrated in Florida, California, Arizona and Texas. These four states account for 53 percent of purchases and have remained the top destinations for the past three years, with Florida and California remaining the top two destinations.

The median price paid by international buyers for a home in the U.S. was $219,400, a decrease from 2009's median price of $247,100. However, the median price paid by foreign buyers was significantly higher than the overall median market price, which was $172,500 in 2009. On average, foreign buyers tend to purchase closer to the upper end of the market; 16 percent of the total international purchases were for homes priced at more than $500,000. According to REALTORS®, this was because international buyers are typically looking for a second home.

A majority of international buyers, 66 percent, purchased single-family detached homes. However, more international buyers purchased a condo than did their U.S. counterparts, at 23 percent and 7 percent, respectively. Only 44 percent of international buyers used a mortgage to pay for their home, compared to 92 percent of domestic buyers. Fifty-five percent of foreign buyers paid all cash. REALTORS® reported that a majority of international buyers use all cash because of the difficulty in establishing international credit in the U.S. Over one-third, 34 percent, of potential foreign buyers was unable to complete transactions because of financing problems in the U.S.

Source: NAR

Copyright National Association of REALTORS®. Reprinted with permission.

Real Estate News June 10, 2010, 5:40PM EST text size: TT

Denver is the Most Improved U.S. Housing Market

The housing market in Denver and 20 other markets are showing signs of life, but still a long way from precrash highs

By Venessa Wong

Across the U.S., signs of life are budding in the housing market. This statement will have many people scratching their heads. Yes, more foreclosed homes will enter the market. Yes, job creation has been disappointing, and unemployment hovers at high rates. And yes, more mortgages are going to become delinquent. So what is the good news?

With help from the government's first-time home buyers tax credit, which expired in April, home prices improved slightly. Some metro areas appear to have entered the early phases of the long recovery process. According to CoreLogic, a data company in Santa Ana, Calif., national home prices increased 1.73 percent from March 2009 to March 2010. The next few years will be rocky, but gains on Wall Street during the first quarter and hiring improvements in some areas since January have improved confidence, with a positive effect on housing. Things are not rosy, but several markets are showing modest signs of improvement.

To determine which places experienced the biggest overall improvements, Bloomberg and Businessweek.com ranked the 50 largest metropolitan statistical areas (MSAs), based on first-quarter data from CoreLogic. We emphasized first-quarter home prices, foreclosures, and delinquent loans and also looked at overall home sales, distressed sales, and local unemployment figures from the U.S. Bureau of Labor Statistics.

Strength in San Jose, Boston, St. Louis

The greatest year-on-year price increase in the first quarter, 8.3 percent, occurred in the San Jose area, but it was Denver that ranked as the most improved market overall. Prices in the Denver area jumped 5.8 percent during the first quarter, and unemployment dropped slightly, to 7.8 percent in April from 8.3 percent in January. Boston and St. Louis came in second and third. At the bottom of the list were Las Vegas and Miami, where prices fell 13.1 percent and 7.6 percent, respectively.

Development Research Partners, an economic research firm in Littleton, Colo., expects home sales and prices in the metro Denver area to increase about 5 percent this year, says President Patty Silverstein. Also, an influx of renewable energy companies and the relocation of kidney care giant DaVita's (DVA) headquarters to Denver from California in 2009 are expected to create jobs. In fact, about one in 25 employers in the Denver-Aurora-Broomfield area plans to add jobs in the second quarter, according to the most recent Manpower Employment Outlook Survey.

Other leading private-sector employers in the region include DISH Network (DISH), Liberty Global (LBTYA), Liberty Media (LCAPA), Ball Corp. (BLL) and Newmont Mining (NEM).

"We never went up as fast in terms of value, and we never came down as fast," says Jim Nussbaum, a broker associate for Kentwood Real Estate in Greenwood Village, Colo. "Last year [buyers] were like deer in headlights-they were afraid to move. When the stock market improved, they started to feel better."

Is the Upturn Sustainable?

Sam Khater, a senior economist at CoreLogic, says government subsidies and low interest rates have temporarily boosted demand. A good portion of the gains in home sales this year are due to the federal first-time buyer and repeat buyer tax credits, which expired on Apr. 30, and the large supply of low-priced distressed properties. (A state tax credit program in California will continue to encourage buyers for the rest of the year.) Also, fewer new constructions, moratoriums on foreclosures, and loan modifications over the past year have limited the supply of foreclosed homes on the market.

Government life support has boosted the economy, but "the issue is what happens when you reprivatize the market," he says. In many cases, these programs delayed inevitable foreclosures. "We've got our foot on the gas pedal pressed to the floor, but it's not sustainable."

Brokers expect sales to slow this summer, as a large number of buyers signed contracts before the April deadline for the federal credit. In the Denver area, homes under contract in May dropped by 39.3 percent from April and 27 percent year-on-year, according to data from Metrolist, the real estate Multiple Listing Service (MLS) for the area.

Bids Above Listing Prices

California had six metros on our list of improving markets but remains volatile. Zillow's chief economist, Stan Humphries, says California is now experiencing a boom because its housing market went into recession earlier and it had already experienced tremendous declines in home values. Also, state foreclosure laws do not require court action, so foreclosures can be dealt with efficiently. "You can clear through the foreclosure backlog fairly quickly," he says, so markets can bottom out and start to heal.

C.J. Brasiel, a broker in San Jose, Calif., says that since October, her listings have moved quickly, and she has received bids above the listing price for many homes. Sales activity has improved, but more than 70 percent of Brasiel's listings last year were distressed properties, and about half her sales were foreclosed homes.

If first-time buyers retreat following the expiration of the federal tax credit and banks release foreclosed homes on to the market, increasing supply, Brasiel says prices could drop more than 5 percent in some areas in Santa Clara County this summer, unless there are government interventions to mitigate a flood of shadow inventory. "We'll be bumping along the bottom," she says.

Optimism About Next Year

Despite the projected dips over the next months and years, an end is in sight. An April report on the Fiserv-Case Shiller home price indexes says a prolonged recovery will begin early next year, and some markets are poised for a relatively fast recovery, including those that did not see large price declines, such as Pittsburgh, Columbia, S.C., and metro areas in Texas, Washington state, and upstate New York.

Nationally, Zillow's Humphries expects the market to bottom in the third quarter and be flat for the next three to five years as the market works through foreclosures, shadow inventory, other economic issues.

CoreLogic's Khater sees a need for a correction. "When you adjust for inflation, which until recently was 2 percent to 3 percent a year, then prices should return to roughly 1997 rates," he says. "We're not that far off from late 1990s in terms of wealth and income when adjusting for inflation, so home prices should not be much higher than that."

Rising home prices may be encouraging, but in the long term, they will need to climb out of the recession in step with the rest of the economy-even though many would like to see them race ahead.

Click here to see which markets show the most improved housing markets.

Wong is a lifestyle and real estate reporter for Bloomberg Businessweek.