Median home prices continue improving
According to the National Association of Realtors’ second quarter report, median home prices continued improving, with annual price gains showing their strongest read in 7.5 years. Compared to the second quarter of last year, 87 percent of metropolitan areas studied showed gains, 31 percent posting double-digit gains.
Eight markets were added to the report in the latest quarter. In the second quarter of last year, 75 percent of all available areas showed price gains from a year earlier, and only 14 percent of markets rose by double-digit amounts.
The trade group cites market challenges like rising mortgage interest rates and buyers being impacted by rising prices, but assert that most buyers remain “well positioned to afford a home in their area.”
Dr. Lawrence Yun, NAR chief economist, said tight inventory is continuing to drive home prices. “There continue to be more buyers than sellers, and that is placing pressure on home prices, with multiple bids common in some areas of the country.” he said.
“Higher interest rates are now causing sales to level out, but the tight supply conditions look to be with us for the balance of the year in most of the country,” Dr. Yun added. “Areas with tighter supplies generally are seeing the strongest price growth, including markets such as Sacramento, Atlanta, Las Vegas, Naples, San Francisco and Los Angeles.”
Median home price hits $203,500
Nationally, the median existing single-family home price rose 12.2 in one yer to $203,500, marking the strongest year-over-year increase since the fourth quarter of 2005 when it surged 13.6 percent.
NAR reports that “a shrinking market share of lower priced homes accounts for some of the price growth,” with distressed sales accounting for only 17 percent of sales in the second quarter, down from 26 percent a year ago.
Dr. Yun stated, “In areas where foreclosed inventory still looms because distressed properties are mired in a slow process, lender and market uncertainty are holding back price growth. This includes areas such as New York City; Hartford; Conn.; and some markets in New Jersey.”
Supplies to remain low
At the end of the second quarter, the 2.19 million existing homes available for sale represented a 7.6 percent annual drop in inventory, with the average supply dipping to 5.1 months, down from 6.4 months last year at this time.
“Supplies in the low 5-month range can be expected for the foreseeable future,” Dr. Yun said. “Steady increases in new home construction will help to relieve shortage conditions going into 2014, which would moderate price growth.”
Regional performance varied
In the Midwest, existing-home sales rose 2.3 percent in the second quarter and are 14.6 percent higher than a year ago. The median existing single-family home price in the Midwest increased 7.9 percent to $160,600 in the second quarter from the same quarter last year.
Existing-home sales in the South increased 3.2 percent in the second quarter and are 15.1 percent above the second quarter of 2012. The median existing single-family home price in the South was $180,700 in the second quarter, up 11.0 percent from a year earlier.
In the West, existing-home sales rose 2.5 percent in the second quarter and are 7.4 percent above a year ago. With limited inventory, the median existing single-family home price in the West surged 18.2 percent to $277,500 in the second quarter from the second quarter of 2012.
Existing-home sales in the Northeast were unchanged in the second quarter but are 9.1 percent above the second quarter of 2012. The median existing single-family home price in the Northeast was $257,900 in the second quarter, up 6.9 percent to from a year ago.
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?
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.”
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.
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
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