Housing News
Housing starts dip 30.5% in the West and 11.7% nationally
Nationwide housing starts declined 11.7% according to the U.S. Commerce Department but it’s not all bad news as single family starts only dropped 1%. The bad news is that the drop is mostly suffered by multifamily which plummeted 43.5%. Yesterday, the National Association of Home Builders (NAHB) reported builder confidence at stable rates and sources tell us that various builders don’t have a positive outlook for 2011. Nationally, permit activity remained unchanged in October, although the Midwest region jumped up 14% with declines in all other areas.
“Home builders continue to be very cautious about starting new projects at this time,” said Bob Jones, chairman of the NAHB. “That said, in markets where consumer demand for new homes is reviving, builders are finding it almost impossible to obtain construction financing, and this frustrating situation is producing an unnecessary drag on both new home production and economic growth.”
NAHB claims that “much of the U.S. single-family housing market is underbuilt following the severe decline in production that has taken place since 2006. This finding underscores the concern that demand for new homes could quickly overwhelm supplies as economic conditions improve.”
In January of this year, NAHB laid claims of an impending multifamily shortgage (which we disputed) and again we have to point out that the glut of homes is more likely to be in bank owned homes than new homes.
Housing starts didn’t fall in all areas, in fact, in the Northeast, starts rose 12.9% and jumped up 1% in the Midwest. The biggest dip in starts were felt in the South with a dip fo 13.4% and 30.5% in the West.
The struggle for builders to obtain financing and maintain traffic will continue to struggle next year. Perhaps we should look toward 2012 for a builder recovery?
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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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Kelsey Teel
November 17, 2010 at 8:53 pm
Not great news, but I’m happy to see that the single family starts only dropped 1%. However, a 43.5% drop in multifamily is huge! WOW. It really doesn’t surprise me considering all of the multi-family projects that have either been built and remain empty or have completely halted construction. The last thing we need is more empty buildings and abandoned projects.
I know of a $5 million project in particular that has been completely planned with 32 units pre-sold and countess dollars spent on marketing, but it can’t even begin building due to problems with obtaining construction financing.