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Home Price Index Now Back to Fall 2003 Levels – Real Estate Market in Recovery?

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S&P Case-Shiller Index

Today’s S&P Case-Shiller Home Price Index numbers show that October marked the ninth month of improved home prices across the nation with all 20 cities in their composite showing higher numbers. Although October barely saw a change and some are saying prices are flat, if you look at the last several years, we just might be seeing a recovery:

october 2009 case-shiller home price index

october 2009 case-shiller home pricing index chart

What is it like in your market?

We know, we know, all real estate is local. Some cities have spiked, others are still declining but overall it appears we just might be seeing a recovery in home pricing which is one of the main ingredients of an overall market recovery.

Andrea Geller with Sudler Sotheby’s International Realty told us that “in the Chicago real estate market, a greater number of transactions are occurring and are negatively impacting pricing as a result of distressed sales. In 2010 we should continue to see an increase in the numbers of homes sold but values will further be effected by short sales and foreclosures.”

David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s said, “coming after a series of solid gains, these data are likely to spark worries that home prices are about to take a second dip. Before jumping to conclusions, recognize that the one time that happened at the beginning of the 1980s, Fed policy saw dramatic reversals, which is very different from the stable and consistent Fed policy we have today. Further, sales of existing homes – those included in the S&P/Case-Shiller Home Price Indices – have been very strong in recent months, working off the inventories of houses for sale. At the same time, housing starts remain weak, fears that the market will be swamped by a wave of foreclosures are heard and government programs aimed at the housing market will expire in the first half of 2010.”

So, what do you think- is the market in for a recovery in 2010 or do you think a full recovery will be realized in 2011 or beyond?

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11 Comments

11 Comments

  1. Ruthmarie Hicks

    December 30, 2009 at 1:45 pm

    I’m in Westchester NY and the local market trends are all over the map. Some areas appear to be bottoming out while others are still in decline. There are even a couple of bidding wars here and there for more desirable properties in great locations. Overall the market is still suppressed (though volume is up this year) and the very high end $2 million+ which I don’t generally service – is doing very poorly. What is selling is great location and prices under about $850k thus avoiding jumbo loans.

  2. Joe Loomer

    December 30, 2009 at 3:27 pm

    We started the year down 28% on 2008’s numbers, but have rebounded solidly since mid-summer to the point we’re on track to match last year’s sales – no small feat given the way the year started. Prices are surprisingly stable, and our average sales price only came down about eight grand since 2006.

    Days on the market, however, have remained in triple digits all year, with an absorption rate in January of last year of 16.1 (now down to about 11).

    In short – Augusta, Georgia – the state’s second largest city – is plodding along in what seems to be the bottom of this Buyers Market cycle.

    Our recovery through 2010 should be very slow, especially given new FHA downpayment (5%) and seller contribution (max 3%) requirements and the expiration of the tax credit in April. Over 50% of our market is VA/FHA – has been for some time. This means anyone who purchased in 2005 or later can’t sell because they don’t have the equity. Folks smart enough to realize this (or who have a smart enough Realtor) rent their homes if they’re moving, which has kept our inventory from skyrocketing. I look for a good spring, followed by a bad summer and not-so-great winter in 2010 – keeping us at about this year’s numbers.

  3. Keith Lutz

    December 30, 2009 at 4:36 pm

    Charlottes market has been down, but we came to the party late. I expect since NC is an inbound state, with North Carolina (58.2%) capturing third place (dropping from the No. 1 spot in 2007) we will see some recovery in the spring… finger crossed!

  4. newhomelistings

    January 4, 2010 at 5:12 pm

    The Charlotte market has been down but there are a lot of promising factors in its recover. Charlotte has been able to actually create jobs recently. I believe that job creation will be a huge factor in Charlotte’s recovery in the coming months. Job creation, Im sure, has played a large part in the rebound from many of these markets listed.

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Austin

Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?

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Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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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.

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aging housing inventory

aging housing inventory

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…

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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.

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zillow move

zillow move

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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