Housing News
Why pending home sales continue to decline
(AGENT/GENIUS) – The National Association of Realtors data reveals that pending home sales have fallen not only for the month, but for the year, but why?
Pending home sales continue to drop
(AGENT/GENIUS) – According to the National Association of Realtors, pending home sales (contracts signed) declined for the fourth consecutive month in September, which the trade group says is the fault of higher mortgage interest rates and higher home prices which have curbed buying power.
The Pending Home Sales Index fell 5.6 percent in September from a downwardly revised 107.6 in August, and is 1.2 percent below September 2012. The index is now at the lowest level since December 2012, which spells for fewer closings in coming months.
The role of the government shutdown
NAR chief economist, Dr. Lawrence Yun said concerns over the government shutdown also played a role. “Declining housing affordability conditions are likely responsible for the bulk of reduced contract activity,” he said.
Dr. Yun added, “In addition, government and contract workers were on the sidelines with growing insecurity over lawmakers’ inability to agree on a budget. A broader hit on consumer confidence from general uncertainty also curbs major expenditures such as home purchases.”
Yun notes this is the first time in 29 months that pending home sales weren’t above year-ago levels. “This tells us to expect lower home sales for the fourth quarter, with a flat trend going into 2014. Even so, ongoing inventory shortages will continue to lift home prices, though at a slower single-digit growth rate next year.”
Regional performance varied
In the Northeast, signed contracts dipped 9.6 percent for the month, falling 6.4 percent for the year.
Signed contracts dipped 9.0 percent in the West this month, down 9.8 percent compared to September 2012.
Pending homes in the Midwest fell 8.3 percent, but is actually 5.7 percent higher than September 2012.
In the South, pending home sales only fell 0.4 percent for the month, and have risen 2.0 percent for the year.
Forecasting the future
According to NAR, total existing-home sales this year will be 10 percent higher than 2012, reaching more than 5.1 million, and are likely to hold even in 2014.
They forecast that the national median existing-home price will rise 11 to 11.5 percent for all of 2013, but moderate to a 5 to 6 percent gain in 2014.
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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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John
October 28, 2013 at 12:54 pm
I am surprised at home sales in the south. They have continued to grow, despite the issues of the government shutdown and overall decline, since May 2013. Though sales are falling for 2013, they’re still higher than they were in 2012. To know that the housing market is doing better is hopefully a great sign of things to come.