The lazy, hazy days of summer are here, bringing family fun, vacation trips, barbecues and summer camps. The days are longer and in many cases, hotter.
Similarly, the mood is generally positive, as is the latest real estate report: fewer distressed properties, fewer foreclosures, continued appreciation.
Speaking of hot, that’s a word your local Realtor might use to describe the real estate market. In fact, we’re seeing a lot of emerging “hot spots” across the United States—areas that are experiencing favorable real estate market conditions. Sure, questions remain. How long will the trend last? When will the Fed raise the interest rates? What impact will that have? When will supply increase to cool off appreciation? When will TRID be an afterthought?
We have no choice but to wait. As the answers unfold, let’s enjoy what summer has to offer. Here are some market highlights from the National Association of Realtors (NAR):
- Low inventories and escalating prices continue to define residential real estate markets across the country. Low mortgage rates are a boon for business, but first-time buyers need a greater supply of homes and easier financing to get them back into the market at normal levels.
- The median number of days a home sits on the market before being sold has fallen by more than half over the last four years, from 98 days to 46 days. The sales pace for distressed homes, by contrast, has bounced up and down, but those homes comprise a steadily shrinking share of the market.
- Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 1.7 percent to a seasonally adjusted annual rate of 5.45 million in April from an upwardly revised 5.36 million in March. After last month’s gain, sales are now up 6.0 percent from April 2015.
- The median existing-home price for all housing types in April was $232,500, up 6.3 percent from April 2015 ($218,700). April’s price increase marks the 50th consecutive month of year-over-year gains.
- April existing-home sales in the Northeast climbed 2.8 percent to an annual rate of 740,000, and are now 17.5 percent above a year ago. The median price in the Northeast was $263,600, which is 4.1 percent above April 2015.
- In the Midwest, existing-home sales soared 12.1 percent to an annual rate of 1.39 million in April, and are now 12.1 percent above April 2015. The median price in the Midwest was $184,200, up 7.7 percent from a year ago.
- Existing-home sales in the South declined 2.7 percent to an annual rate of 2.19 million in April, but are still 4.3 percent above April 2015. The median price in the South was $202,800, up 6.5 percent from a year ago.
- Existing-home sales in the West decreased 1.7 percent to an annual rate of 1.13 million in April, and are 3.4 percent lower than a year ago. The median price in the West was $335,000, which is 6.5 percent above April 2015.
Switching focus to the rental market, our latest survey (see page 4) provided some good insight to renters in regard to lump sums.
For example, referral to an agent/broker is one of the more common services provided with a lump sum, but it only speaks to homeowners/homebuyers. Renters seeking assistance may get quickly frustrated when they learn that most agents/brokers are not willing to provide the same types of free services to them.
As a result, many new platforms have been introduced to expedite area orientation and link renters who are “on their own” to vetted suppliers, discounts and other resources. This helps both the employer and employee improve productivity while enjoying the lower administrative burdens of lump sums. If you’d like information on Weichert’s lump sum solution for renters, contact us.
As for rental markets, the top four, according to Zumper, are as follows:
- San Francisco, CA saw modest rent growth of 0.8% this May for one bedroom units. Two bedrooms similarly rose 0.4% over the period. Yearly rent appreciation has been low compared to previous years, up only 2.6% for both bedroom types since last May. Despite this, rent prices in San Francisco still reign as the most expensive in the United States.
- New York, NY saw a decline in prices for both bedroom types last month. Prices remain up 4.8% and 3.1% in the past year for one and two bedroom units, respectively.
- San Jose, CA for the first time ever displaced Boston as the third most expensive market in the country, breaking a tie from last month. Median rents were $2,290 for a one bedroom and $2,910 for a two bedroom.
- Boston, MA saw prices slide 0.4% for one bedrooms and 1.9% for two bedrooms this May, dropping the city to fourth place on this report for the first time. Prices remain moderately up year over year.
Sacramento continued its recent climb in prices through last month. The city jumped two spots to a three-way tie for 21st place with Houston and Nashville at a median price of $990 for a one bedroom.
Fort Worth, TX
Fort Worth jumped one spot to 28th position, up 2.4% for one bedrooms and 2.1% for two bedrooms. Current median prices are $850 and $990 for one and two bedroom units, respectively.
Columbus increased 3.3% for one bedrooms and 2.3% for two bedrooms last month. The city jumped one spot to tie with Memphis and Oklahoma City for 41st position.