Housing News
Is the new home sector improving or declining?
With housing data released by the U.S. Commerce Department, the status of the new home sector remains similar to last month’s data with some minor changes.
Builders (like any other real estate related sector) have been highly impacted by the slumping economy, namely with obtaining funds and moving product. But while other sectors sink lower, starts are up 4.4% in single family homes in September and permits issued remain at the same level as August.
The National Association of Home Builders (NAHB) reports that builder confidence is up in October for the first time in five months, but it is notable that the confidence is merely a tick- the industry remains cautiously optimistic.
“The new-homes market is finally moving past the lull that occurred when the home buyer tax credits expired and economic growth stalled this summer,” noted NAHB Chief Economist David Crowe. “While challenges such as competition from foreclosures, inaccurate appraisal values, and general consumer uncertainty about the economy and job market continue to be major factors, builders have seen a slight increase in consumers who are considering a home purchase. The toughest obstacles really come down to financing – the scarcity of construction credit for builders along with tougher mortgage requirements for consumers.”
So to boil it down, the new home sector is relatively steady right now- starts are up, permits are level, and although lending is still complicated, builders remain cautiously optimistic. Much of the future in the new home sector will rely on unemployment rates nationally, so it’s still no sure thing.
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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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Sheila Rasak
October 20, 2010 at 12:11 am
All that being said, there’s good cause for being slightly optimistic in that affordable newer housing is less costly in terms of repair and maintenance for the new owner. If I were a first time buyer in this market, I’d be looking at something easier to maintain with a clean start.
Aaron Catt
October 20, 2010 at 11:02 am
Thanks for the post on what seems to be, ‘not more bad news’!
I think that while it’s good to see signs of stabilization from a National standpoint, it’s imperative that agents and consumers both have a firm understanding of the locality of real estate–both new and used.
Every market offers clear and unique opportunities for housing.
Al Lorenz
October 20, 2010 at 11:54 am
Most of the “new” homes in our market were completed in 2008 and sometimes before. There haven’t really been any projects designed and implemented since the housing bubble burst. Something done from current land prices designed to hit the price points in this market might do well, but there is no sales data to confirm it!