Housing News
Home builder confidence levels hold steady in November
After dipping a bit in October, Builder confidence is back up to where it was in September. Headlines read that builder confidence is up, we’d like to think of it as builder confidence bouncing subtly at the bottom as they struggle to obtain financing and keep interest as they compete with the perception that short sales and foreclosures are better deals.
According to the National Home Builders Association in conjunction with Wells Fargo, the “Housing Market Index” (HMI) gauging builder perceptions of builder perceptions of current single-family home sales, buyer traffic and sales expectations, with all numbers bumping back up this month.
“Though the gains have been incremental, the fact that builder confidence has improved over the past two months is encouraging,” said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. “Many builders are reporting that while the quantity of buyer traffic through their model homes has not improved dramatically, the quality of that traffic seems to be getting better – meaning that more people appear to be serious about buying in the near future.”
Although rising nationally, the HMI dipped in the Northeast, stayed steady in the West and rose in the South and Midwest.
As we’ve been saying for a long time, without employment rates improving, builders will continue to suffer along with all sectors of real estate and heck, all sectors of the economy. The coming weeks in the lame duck Congress won’t likely change employment, but we’ll hold out hope for a miracle!
Austin
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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.
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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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BawldGuy
November 17, 2010 at 11:31 am
Just the other day, D.R. Horton told us they thought 2011 was gonna be pretty ‘challenging’. They don’t share their competitors’ outlook.
What’s your take?
Lani Rosales
November 17, 2010 at 4:58 pm
I think they’re more realistic than the overall builder community. But honestly, I think they all see challenge and even doom, but most are seeing an uptick in traffic, so it’s feeling a little more warm and fuzzy than 2009 (but most anything feels good compared to ’09)… what do you think?
BawldGuy
November 17, 2010 at 5:15 pm
I think it matters greatly whether the product attracts long term investors or not. If not, I tend to think Horton is probably, as you astutely suggested, more realistic. The rest are figuring out how to keep their crews workin’ without damaging their own bottom line. That’s an express lane to disappearing.
A solid example is Austin. Those who didn’t leave for greener investment pastures, stop investing their, have paid the price. Ironically, Austin is one of the most economically healthy regions in the country. But their real estate lost its allure where investors are concerned.
I don’t think it’s coincidental their local politics are more aligned with my state than Texas.
Kelsey Teel
November 17, 2010 at 9:13 pm
“Many builders are reporting that while the quantity of buyer traffic through their model homes has not improved dramatically, the quality of that traffic seems to be getting better – meaning that more people appear to be serious about buying in the near future.”
Great to hear that! Consumer confidence, along with jobs is a critical driving factor of our economy. If consumers aren’t confident, they aren’t spending money anywhere, driving all sectors of the economy down. If consumers are confident, they are spending money, increasing demand, and ultimately creating more jobs. (Not that you didn’t already know that) 😉
I’ve been told that the only reason we have been calling this a “recession” instead of what it really is, a “depression” is to keep that consumer confidence up.