Housing News
American rental house pricing is currently erratic at best
Apartment for rent sign in Cincinnati, photo by The Cincy Project.
Houses versus apartments for rent
Often, when we analyze the rental market in America, we and other industry analysts typically lump multi-family in with houses for rent, but analyzed separately, they paint quite a different picture.
This week, we charted the apartment rental trends in the ten largest American cities which reveals that although rents are on the rise across all unit sizes, most increases are gradual. Apartment communities are increasingly using complex systems like Rent Roll to determine rents taking into account availability in their property along with comparable properties and their availability, amenities within each unit, time on market and the like.
Often, houses for rent rely on a comparative market analysis from the MLS which accounts for these same factors, but relies on a professional to discern these factors. Also, rents are set by homeowners who have a personal attachment to a home and a pride that complexes pricing, and ultimately the price is set by the homeowner.
Increasingly, homeowners are becoming “accidental landlords” as they rent out their home to cover their mortgage and move into a less expensive home in an effort to avoid foreclosure.
Why rental house pricing is so erratic
Taking all of that into account, it is no wonder that rental trends for houses appear far less stable and predictable than apartments. There is no consistent national trend for houses, as many spiked in May, some are actually declining, while others are sharply increasing. In some cities, we are noticing a premium on larger apartments, most likely due to families losing their homes or becoming renters after selling a home to downsize.
Rentals are far more complex to analyze than residential sales, but take a look at the top ten largest cities and how house rents are performing on a local basis to get an idea of how it compares to your city.
Average house rents in New York City
over the last 12 months
Average house rents in Los Angeles
over the last 12 months
Average house rents in Chicago
over the last 12 months
Average house rents in Houston
over the last 12 months
Average house rents in Philadelphia
over the last 12 months
Average house rents in Phoenix
over the last 12 months
Average house rents in San Antonio
over the last 12 months
Average house rents in San Diego
over the last 12 months
Average house rents in Dallas
over the last 12 months
Average house rents in San Jose
over the last 12 months
Data source: RentBits.com.
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Housing News
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
Click here to continue reading this story…
Housing News
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.
…Click here to continue reading this story…
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Manhattan Beach Agent
July 30, 2011 at 4:43 pm
I recently read a news headline that declared rental prices are increasing across the country. Excited by the news, I check my local market in Los Angeles (Manhattan Beach), and was shocked to see that y-o-y median rents have fallen over 18%! Talk about erratic!
As an economist I'm used to seeing more efficient markets and smooth price movements, not the kind of disjoint movements we're seeing in our rental market.
I wonder if pricing tools will eventually work to smooth fluctuations, or if home owner landlords will continue to operate inefficiently?