Real Estate News

Pending Home Sales Remain Strong In June

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The National Association of REALTORSPending Home Sales Index is “a forward-looking indicator based on contract signings”. The higher the Pending Home Sales Index number, the more contracts have been signed by buyers that will soon translate to sales.

The latest index was released last week, with the headline:

Pending Home Sales Dip in June

As we reported last month, May’s Index levels were the highest recorded in the last 9 years. The small 1.8% decline from May remains 8.2% over last June and the third highest reading in two years. The NAR headline, while accurate, isn’t the best representation of what really happened.

NAR’s Chief Economist Lawrence Yun points towards “low inventory levels in many markets” leading to “reduced choices” at higher price points for the small decline in National Pending Home Sales.

In every major region of the country, pending sales are up year-over-year as shown by the graph below:

Yun goes on to say that there needs to be a significant influx of inventory into the market before anything will change.

“Unfortunately, because nearly all of these sellers are likely buying another home, there isn’t a net increase in inventory. A combination of homebuilders ramping up construction and even more homeowners listing their properties on the market is needed to tame price growth and give all buyers more options.” 

So What Does This Mean To Buyers?

There is a lot of competition out there right now for your dream home. Prices are going to continue to climb, act now before you are priced out of your future home.

What Does This Mean to Sellers?

If you are on the fence about listing your home for sale and debating whether now is the time to move on with your plans of relocating… don’t wait!

There are more buyers that are ready, willing and able to buy their first, second, third, vacation, or investment property now than there has been in years! The supply of homes for sale is not keeping up with the demand of these buyers.

Listing your home for sale now will give you the most exposure to buyers and the best sales price.

Bottom Line

Whether you are planning on buying or selling a house this year, waiting to act no longer makes sense.

Posted by The KCM Crew in Keeping Current Matters

May 2015 Another Great Month for Missouri Home Sales

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Missouri home sales continue to grow in the month of May! They are up from May of last year. Click below for a full report of sales statistics or to watch the video.

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Top 10 Markets Powered by Serious Job-Creation Mojo

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The best spring housing market we have seen since 2006 is underway, with above-average price appreciation. But unlike the 2003–2006 housing bubble, these gains are real and sustainable. How real? Let’s take a look at the 10 best large markets where job growth is powering home price increases.

Top 10 Markets Powered by Serious Job-Creation Mojo

The main factor driving home price acceleration across the nation is strengthening demand. Nearly 3 million jobs have been created in the past 12 months, and (not coincidentally) consumer confidence is higher.

These 10 markets have major job-creation mojo. They stand out among the 100 largest housing markets in the country, because they have the highest level of job creation in the past three years, as well as above-average price appreciation. Furthermore, they are also forecast to see more of such growth in the year ahead.

Here’s a closer look at them, in alphabetical order, with their key distinguishing statistics. Figures for multiyear growth are given as compound annual growth rates.

Atlanta–Sandy Springs–Roswell, GA

Employment growth, 2011–2014: 1.7%

Median home price growth, 2011–2014: 20.3%

Median list price in May: $238,000

Median list price growth, May 2015 vs. May 2014: $13.3%

Market size rank:  9

Atlanta took the most time to recover from the housing downturn, but it has seen an eye-popping 20.3% compound annual growth rate in median home price over the past three years as the market bounced back from the bottom in 2011. Now the diversified local economy is seeing strong gains driven by professional and business services, and construction activity should start to provide even more economic growth going forward. The market’s affordability is a draw for new households and employers alike.

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Austin–Round Rock, TX

Employment growth, 2011–2014: 3.7%

Median home price growth, 2011–2014: 8.5%

Median list price in May: $374,000

Median list price growth, May 2015 vs. May 2014: 20.7%

Market size rank: 34

Austin has been no stranger to top market lists throughout the past decade, as Texas has been one of the few reliable states for economic growth. Austin’s biggest employment sector is government, but professional and business services has been powering the more recent growth. Austin also has the highest household formation rate as a result of the employment growth.

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Charlotte–Concord–Gastonia, NC–SC

Employment growth, 2011–2014: 2.7%

Median home price growth, 2011–2014: 8.4%

Median list price in May: $232,000

Median list price growth, May 2015 vs. May 2014: 14.9%

Market size rank: 24

Charlotte is one of the most affordable markets in the nation, even with its strong price appreciation. The median list price was up 15% over last year in May, while the median age of inventory dropped six days to 48. The diversified local economy should be seeing even stronger growth in employment in the year ahead.

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Dallas–Fort Worth–Arlington, TX

Employment growth, 2011–2014: 2.9%

Median home price growth, 2011–2014: 8.2%

Median list price in May: $278,000

Median list price growth, May 2015 vs. May 2014: 19.3%

Market size rank: 4

Dallas–Fort Worth is the largest market with major mojo. Dallas has been one of the healthiest housing markets in the country over the past decade and did not experience as severe declines in home values as other markets did. The job market is relatively diversified, and growth in jobs is expected at an even higher pace in the year ahead.

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Denver–Aurora–Lakewood, CO

Employment growth, 2011–2014: 2.9%

Median home price growth, 2011–2014: 10.8%

Median list price in May: $445,000

Median list price growth, May 2015 vs. May 2014: 11.8%

Market size rank: 20

Denver reigns as the hottest housing market in the country so far this spring. While the market did see growth from the energy sector in recent years, it remains relatively diversified with professional and business services as the primary driver of job growth. Jobs and prices should continue to grow in the next year at better than the national rate.

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Grand Rapids–Wyoming, MI

Employment growth, 2011–2014: 4%

Median home price growth, 2011–2014: 9.8%

Median list price in May: $184,000

Median list price growth, May 2015 vs. May 2014: 14.3%

Market size rank: 53

Grand Rapids is the smallest market on our mojo list. Its largest employment sector is educational and health services, but professional and business services has been powering the growth rate of 4% over the past three years. In addition, its strong affordability is a draw.

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Orlando–Kissimmee–Sanford, FL

Employment growth, 2011–2014: 3.6%

Median home price growth, 2011–2014: 12.5%

Median list price in May: $234,000

Median list price growth, May 2015 vs. May 2014: 13%

Market size rank: 25

Orlando has seen substantial economic recovery in recent years, but it remains relatively affordable. The local job market is dependent on leisure and hospitality. Affordability and strong growth ahead should drive substantial population and household growth in the year ahead.

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Salt Lake City, UT

Employment growth, 2011–2014: 2.8%

Median home price growth, 2011–2014: 10.3%

Median list price in May: $298,000

Median list price growth, May 2015 vs. May 2014: 14.2%

Market size rank: 52

Salt Lake City is the second smallest market on our list, ranked just ahead of Grand Rapids at No. 53. Despite its size, the local job market is very diversified, and nearly 3% annual growth in jobs over the past three years has powered over 10% annual gains in home prices. This year’s market is showing no signs of slowing down those gains.

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San Francisco–Oakland–Hayward, CA

Employment growth, 2011–2014: 3.2%

Median home price growth, 2011–2014: 16.8%

Median list price in May: $749,000

Median list price growth, May 2015 vs. May 2014: 8.7%

Market size rank: 11

San Francisco is the second-hottest housing market this spring. The type of employment that the Bay Area creates has driven a substantial increase in high-income households: Those with an annual income of $250,000 or more have almost tripled since 2000. This year’s employment growth should end up very similar to the recent three-year trend.

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San Jose–Sunnyvale–Santa Clara, CA

Employment growth, 2011–2014: 4.1%

Median home price growth, 2011–2014: 15.6%

Median list price in May: $898,000

Median list price growth, May 2015 vs. May 2014: 27.9%

Market size rank: 36

San Jose  represents the heart of Silicon Valley, and ranks as the third-hottest housing market this spring. The market is highly concentrated in the tech sector, but that sector’s growth has had a substantial impact in increasing the number of high-income households. In 2000, 4% of the households in the market had an annual income of $250,000 or more. Today it’s 12%.

These 10 markets show just how important job growth is to strong demand for housing. And with housing and new construction producing significant gains, a virtuous economic cycle will be reinforced.

Published by Jonathan Smoke on realtor.com.

June is National Homeownership Month!

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National Homeownership Month actually started as a week-long celebration of homeownership during the Clinton administration in 1995.

National Homeownership Month | KCM

In 2002, President George W. Bush proclaimed June as the National Homeownership Month. Here is an excerpt from his proclamation:

“Homeownership is an important part of the American Dream…A home provides shelter and a safe place where families can prosper and children can thrive. For many Americans, their home is an important financial investment, and it can be a source of great personal pride and an important part of community stability.”

“Homeownership encourages personal responsibility and the values necessary for strong families. Where homeownership flourishes, neighborhoods are more stable, residents are more civic-minded, schools are better, and crime rates decline.”

“During National Homeownership Month, I encourage all Americans to learn more about financial management and to explore homeownership opportunities in their communities. By taking this important step, individuals and families help safeguard their financial futures and contribute to the strength of our Nation.”

If you are one of the many renters out there who would like to make the transition from renter to homeowner, contact a local real estate professional who can help evaluate your ability to do so.

Originally published on Keeping Current Matters.

The 20 Hottest U.S. Real Estate Markets in May 2015

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The housing market is chugging ahead, with even higher home prices and more buyer activity—and in May, we’re seeing more than the ordinary seasonal uptick.

The 20 Hottest U.S. Real Estate Markets in May 2015

“On the demand side, we are seeing traffic and searches on realtor.com® continue to set new highs,” said our chief economist, Jonathan Smoke, who did a preliminary analysis of our site’s data in May. Visits and searches are expected to be up more than 50% and 35%, respectively, year over year.

Helping create more opportunities for buyers, the listings inventory is now growing faster, at 4% over April—but it’s still down compared with last year, so buyers will need to keep on their toes. In part because of the limited inventory, the median list price increased nationally to $228,000, up 7% over the previous year and 1% over April. At the same time, homes are moving more quickly: Median days on market, now at 66, continued a sharp decline, down 11% year over year and 10% month over month.

Smoke’s team also ranked the nation’s 20 hottest real estate markets for buyers and sellers. Looking at the nation’s 300 largest markets, the team used the number of views per listing on realtor.com to gauge demand, and the median age of inventory to assess supply.

California dominated the list, with half of the country’s 20 hottest real estate markets, because of its tight supply of homes and economic-powered growth in demand. San Francisco and San Jose maintain the second and third spots from the April rankings, while the state capital, Sacramento, leaped from No. 21 in April to No. 12 in May.

“Sacramento typically follows strong growth in Silicon Valley and the San Francisco Bay Area, as it is a relatively more affordable alternative,” Smoke said. “But this market has had strong employment growth above the national average and is seeing strong household growth as a result.”

Three states pulled off a two-fer on the list: Texas, with No. 4 Dallas–Fort Worth and No. 16 Austin; Colorado, with No. 1 Denver and No. 13 Boulder; and Michigan, with No. 9 Ann Arbor and No. 10 Detroit. These markets’ success also reflects economic-powered gains, but the Texas and Colorado story is more of a continuing saga that shows the resilience and diversified nature of the states’ economies despite the declines in oil. Michigan’s performance is related to economic recovery and very strong affordability.

Denver resoundingly maintained the top ranking as inventory there shaved six days off the median age while listing views grew 7% over April. Like Dallas, Denver is experiencing substantial economic growth, and the tight supply of housing is resulting in the fastest-moving inventory in the country.

The 20 Hottest Real Estate Markets in May 2015

Market May Rank April Rank
Denver-Aurora-Lakewood, CO 1 1
San Francisco-Oakland-Hayward, CA 2 2
San Jose-Sunnyvale-Santa Clara, CA 3 3
Dallas-Fort Worth-Arlington, TX 4 4
Vallejo-Fairfield, CA 5 5
Boston-Cambridge-Newton, MA-NH 6 6
Santa Cruz-Watsonville, CA 7 8
Santa Rosa, CA 8 7
Ann Arbor, MI 9 9
Detroit-Warren-Dearborn, MI 10 11
San Diego-Carlsbad, CA 11 10
Sacramento-Roseville-Arden-Arcade, CA 12 21
Boulder, CO 13 17
Fargo, ND-MN 14 12
Los Angeles-Long Beach-Anaheim, CA 15 15
Austin-Round Rock, TX 16 14
Oxnard-Thousand Oaks-Ventura, CA 17 13
Manchester-Nashua, NH 18 31
Columbus, OH 19 22
Stockton-Lodi, CA 20 38

Published by Cicely Wedgeworth on realtor.com.

Rents Rising Faster Than Home Values

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The last time this happened, home values were finally heating up after the housing bust. This time, they’re cooling off.

Rents Rising Faster Than Home Values

Buying a home is already far more affordable than renting one, and that imbalance could worsen as rents outpace home values for the first time in years.

In April, rents nationally rose an average of 4 percent compared to home values increasing by just 3 percent year-over-year, according to new data from Zillow.

One result: Renters who were considering buying are now taking that first step.

“We finally have more buyers who are serious now,” said Cyndi Mino, an agent with First Team Real Estate Agents in Huntington Beach, CA. “Landlords are raising rents ridiculously high, and people are saying, ‘That’s it — it’s time to buy.’”

In Mino’s area, first-time home buyers are finding 2-bedroom condos for $350,000 and 2-bedroom town homes for about $450,000.

Although millennials are expected to be the largest home-buying group in 2015, many first-time buyers are older, Mino said. “They never thought they would or could buy, but with rents going up, if they can save enough money to buy, they’ll pay less for a mortgage [than for rent].”

The last time this happened, it went on for a while — but the situation was considerably different.

In the wake of the housing bust, home values declined before rebounding. Rents, maintaining steady growth, easily stayed ahead.

That changed in April 2013, when home values finally heated up enough to pass rents. By April 2014, home values were sprinting at 8.8 percent year-over-year, while rent gains remained steady between 2 percent and 3 percent on an annual basis.

Now home values are cooling off, while rents pick up a little — and that’s enough for the tortoise to pass the hare.

For more information about rents and home values, visit Zillow Research or follow and ask questions of Zillow Chief Economist @StanHumphries on Twitter.

Rents Outrunning Home Values

Published by Melissa Allison on Zillow Blog.

“Lagging Supply” Leads to Slowdown in Sales

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The National Association of Realtors (NAR) recently released the results of their Existing Home Sales Report. Despite the fact that properties are selling faster than they have at any other time since July of 2013, existing home sales declined 3.3% from March.

Lagging Supply Leads to Slowdown in Sales

NAR’s Chief Economist Lawrence Yun explained the main reason for the slow:

“April’s setback is the result of lagging supply relative to demand and the upward pressure it’s putting on prices.”

One major news organization actually used this headline about the decline:

Existing home sales crater in April, falling 3.3%

They certainly haven’t cratered! April marked the second month in a row that the annual sales pace remained above the five million mark (5.04 million). Year-over-year sales have increased for seven consecutive months and are still 6.1% above a year ago.

Every month, SentriLock, LLC provides NAR Research with data on the number of homes shown to potential buyers. This data is referred to as ‘Foot Traffic’ and is a great predictor of future sales and buyer demand. In April, buyer demand remained at the same level experienced in March.

So why did sales go down?

Buyers who are ready and willing to make a purchase are entering a market where their dream house may not have been listed yet. They can’t find it! Or if they find it, it happens to catch the eye of other buyers and an ‘auction like environment’ begins.

“Housing inventory declined from last year and supply in many markets is very tight, which in turn is leading to bidding wars, faster price growth and properties selling at a quicker pace,” says Yun. “To put it in perspective, roughly 40 percent of properties sold last month went at or above asking price, the highest since NAR began tracking this monthly data in December 2012.” (emphasis added)

The median home price of existing homes sold in April was $219,400, which is 8.9% higher than last year, and marks the 38th consecutive month of year-over-year price gains.

Bottom Line

So how do you make sense of everything that’s going on in the housing market when there are so many conflicting headlines on the same report?

John Burns, real estate expert and CEO of John Burns Real Estate Consulting gives this advice:

“The bottom line is this: don’t make decisions based on newspaper articles. Read the actual press release, including the methodology, and make sure the results jive with other data points and qualitative feedback you receive.”

If you are one of the many homeowners out there realizing that now may be the time to list your home for sale, or one of the many renters debating a purchase, sitting with a local real estate professional who takes the time to find out what’s really going on in the market, should be your first step!

Published on Keeping Current Matters.