Welcome to my quarterly round-up of US housing data:
A quote from Frank Nothaft, Chief Economist at Corelogic, accurately sums up the current “mood” relative to US Real Estate: “The overall economy has provided mixed signals on its performance so far this year, but one thing is clear: Home sales are off to a brisk start through April. We expect house prices in our national index to be up about 5 percent in the next 12 months, and mortgage rates are likely to move higher over the next year.”
To bolster that claim, Corelogic reported the following on June 9, 2015: “The National foreclosure inventory fell by 24.9 percent year over year in April 2015 to approximately 521,000 homes, or 1.4 percent of all homes with a mortgage. This marks 42 months of consecutive year-over-year declines.”
Additionally and supportive of positive market conditions, CoreLogic also reported (June 8) that distressed sales—real estate-owned (REO) and short sales—accounted for 12.1 percent of total home sales nationally in March 2015, a 3.2 percentage point drop from March 2014 and a 1.9 percentage point decrease from February 2015. At their peak, distressed sales totaled 32.4 percent of all sales in January 2009, with REO sales representing 27.9 percent of that share.
Corelogic also noted that eight of the 10 fastest growing new home sales markets are in the South and the fastest growing new home sales market in the U.S. is Nashville, Tenn., where new sales grew by 17 percent over the prior year.
From the National Association of Realtors (NAR):
San Francisco remained the most expensive market in the United States for the ninth straight month, according to the Zumper Report, with median 1-bedroom rents rising to $3,460, the highest ever recorded. The gain was particularly notable considering that NYC, the second most expensive market, saw rents plateau in February, even after a slight drop of 3.2% in January. Boston maintained its third place position, despite a 4.2% drop to $2,300. Rounding out the top five were Washington, D.C., down 0.5% to $2,000, and Oakland, up a strong 5.3% to $1,980.
Big movers upward included Milwaukee, Louisville, and Omaha.
Down markets included Boston, Cleveland, Columbus.
The Houston housing market had a mixed bag of indicators in the May 2015 versus May 2014 analysis, with single-family home sales and total property sales down, total dollar volume flat, and prices up to the highest levels of all time. Month-end pending sales for single-family homes totaled 8,127, a 3.0 percent decline versus one year earlier.
Houston’s housing inventory expanded in May to a 3.1-months supply versus the 2.8-months supply of one year earlier. That matches the inventory level of October 2013, but is well below the current national supply of homes which stands at a 5.3-months supply, according to the National Association of Realtors.
At this point, it’s safe to conclude that the impact on the Houston market is null as indicated by just a small uptick in day-on market and inventory while prices rise. The 3 percent decline in pending sales is the only negative but cannot be recognized as meaningful unless the drop continues through summer.
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