Housing News
Housing starts dip, is this good news or bad news?
According to the U.S. Census Bureau, single family housing starts fell below expectations dropped 4.3% in December, and a total 8.2% from December 2009. This drop is the lowest since May 2009.
It’s not all bad news, in fact, in a strange turn of events, multifamily starts rose- a sector that has been limping along. Housing completions are up across the board as well meaning projects aren’t just getting started then sitting there. Housing completions mean vendors and subcontractors are getting paid which can be tricky in this environment of extremely difficult financing.
Also surprising was the volume of building permits issued which rose 16.7% from November, also breaking with economists’ expectations. This rise is the largest since April 2010 and multi family permit issuance rose to its highest since November 2008.
Multi family is seeing an upturn as home ownership rates are chipped away at by continuing high foreclosure rates and general buyer apprehension.
So is it good news or bad news?
In this environment where we’re still in a relatively over inventoried marketplace as a nation, it is actually better to see stable housing starts (which I would argue they are getting close to as rise and falls this past year have mostly been single digit).
The short term impact is negative on the construction sector but the silver lining for them is that permit applications and issuances are on the rise, so the hammers won’t stop swinging soon. With completions on the rise, construction workers can more readily finish one project and move to the next which helps their bottom line.
I would argue that the new home sector is down considerably over the years but is currently stable and looking up and builders’ confidence levels tend to agree.
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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.
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Short Sale Artisan
January 20, 2011 at 4:21 pm
Well housing starts staying lower are obviously critical to clearing inventory. That said, the lag is enough that starting too late means an lack of available housing (although I think we are very, very early on that point!)
Ruthmarie Hicks
January 20, 2011 at 7:13 pm
Our area didn’t go “hog wild” with building. The exception being high end condos – particularly high rise. So much of the area is built up and the rest is on wetlands. However- the last thing we need – or anyone else needs – is a bunch of brand spanking new inventory competing with resales when the market is moving at a glacial pace. So I say its a good thing.