Housing News
New Home Sales Were Up in October But Plummeted in November
We reported just last month that new home sales were up over 6% in October of this year but news over the holidays from the U.S. Department of Housing and Urban Development is that sales dipped 13.8% from that sexy six percent increase.
In November, we spoke with Danelle Guilbeau of Boulevard Realty in Houston who aptly noted then that she “hope[d] that this is a trend upward, but I will still remain guarded” mostly because of the first time buyer’s tax incentive was extended, causing new distrust by buyers who now believe Realtors cried wolf by insisting sales must be completed before the tax credit incentive expired.
The HUD report also reveled that the median sales price of new homes sold in November was $217,400 with a 7.9 month supply.
Despite the slide, could there be good news in store? Perhaps a pricing adjustment that could cause an upward blip in sales? Perhaps the “we’ll just throw in free upgrades instead of pricing new homes properly” movement will begin to die? Maybe buyers are focusing on purchasing resale homes over new homes? What good can you take from the news of falling new home sales?
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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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Houstonblogger
December 29, 2009 at 12:16 am
Well, to be honest, the good news I take from it is that New Home Builders are going to have to answer to the consumer. The “throwing in upgrades” to dissuade correct pricing has been a thorn in my side for awhile now, and to think that it might finally have to go by the way side is good not only for myself as a Realtor, but for my buyer clients. The days of trying desperately to keep your comps up has passed. If a New Home Builder wants to compete, they are going to need to keep the costs more friendly and somewhat in comparison with resales of existing homes that are only 3-4 years old. My only hope is that in the effort to compete with existing homes, the quality of the new homes don’t suffer.
Doug Francis
December 29, 2009 at 5:40 pm
I think you also need to look at new construction permits issued over a certain period (you pick) to get a forecast on the new home supply in next six months. If they keep the supply low, then they can better control their future price-point.
Karen Brewer
December 31, 2009 at 5:31 pm
In my neck of the woods, Fairfield County,CT new home sales are down because no one has been building for the past year! Duh.
Jeff Green
January 19, 2010 at 11:11 am
Lani, this is a fantastic post! We need this kind of information.
Houstonblogger, I a strongly agree with your point on new home builder. It has been a thorn for me too.