Connect with us

Real Estate Big Data

Contract signings on homes for sale falls 1.8 percent

Published

on

contract signings on homes for sale

Pending home sales (contract signings on homes) fell 1.8 percent in August, marking the eighth consecutive month of slight decreases, according to the National Association of Realtors.

This metric is important as it is an indicator of what is to come in the housing market.

As he has repeatedly in recent years, Dr. Lawrence Yun, NAR Chief Economist reiterates that tight inventory levels continue to restrict the market. He points directly Westward.

“The greatest decline [of pending home sales] occurred in the West region where prices have shot up significantly, which clearly indicates that affordability is hindering buyers and those affordability issues come from lack of inventory, particularly in moderate price points,” Dr. Yun observed.

Further. Dr. Yun asserts that rising prices has homeowners sitting on the sideline, hoping to accumulate more equity, but as values begin to decelerate, it is anticipated that more properties will come online, alleviating the inventory challenges that have long put a wet blanket on sales.

Regarding rising mortgage rates, Dr. Yun believes that while rising rates are always a deterrent to potential buyers, it should not lead to a significant decline.

“We have two opposing factors affecting the market: the negative impact of rising mortgage rates and the positive impact of continued job creation,” adding that “as long as there is job growth, rising mortgage rates will hinder some buyers; but job creation means second or third incomes being added to households which gives consumers the financial confidence to go out and make a home purchase.”

Dr. Yun projects that existing home sales will dip 1.6 percent his year, while the median home price will rise 4.8 percent. Next year, he projects existing sales are forecast to rise 2 percent and home prices around 3.5 percent.

Real Estate Big Data

Qualified Opportunity Zones are seeing growth! What does that mean?

(REAL ESTATE BIG DATA) It’s hard to keep track of all the important factors involving the housing market but yet another is qualified opportunity zones.

Published

on

Qualified opportunity zones

Almost three years after the 2017 Tax Cuts and Jobs Act, things are looking up. In fact, in almost half of the Qualified Opportunity Zones (QOZ), home prices have increased. This reflects the growth these areas have been experiencing – pretty exciting given these zones were originally “distressed communities” in need of a boost.

To get an idea of what this really means, here’s a quick refresher of QOZs. First of all, there are 8,760 Qualified Opportunity Zones. According to the U.S. Economic Development Administration, these zones are located “ in all 50 States, the District of Columbia, and five United States territories.” Investments in these struggling areas are incentivized due to tax cuts, which helps the zones recover.

If median house prices are any indication, the plan seems to be working.

Recently, ATTOM Data Solutions released a third report on these Opportunity Zones, marking an increase in over half the median home prices between 2018 and 2019. (To compare, the national increase was 9.4%, which was beaten by QOZs in 20 states.) This is a great sign that these areas are making strides towards recovery, though it should be noted that over three quarters of homes are still below the national median price, which is roughly $250k. Awesome for buyers, but for sellers, not so much.

This growth also varied by region. For instance, QOZs in the Midwest were very likely to have median home prices under $150k, which is well under the national average. Not to mention, many areas saw their home prices decrease, rather than grow.

It’s also worth noting that although there has been growth, it might not be permanent. According to Todd Teta, who is ATTOM Data Solutions’ chief product officer: “These areas are among the most vulnerable to economic downturns. As a result, the recent upswing could change on a dime if the broader housing market flattens out or sags.”

Although things are up in the air, for now the 2017 Tax Cuts and Jobs Act is still helping to revive struggling areas. So if you’re considering moving to one of the over 8,000 Qualified Opportunity Zones, you might just be coming in at a great time.

Continue Reading

Real Estate Big Data

‘Boom, boom, boom,’ Kudlow declares this a ‘housing boom’ as sales fluctuate

(REAL ESTATE) Existing home sales slide for the month but surge for the year – challenges remain, but Kudlow declares this a “housing boom.”

Published

on

existing home sales

Existing home sales (contracts signed) dipped 1.3% in January, following the current trend of “a fluctuating pattern of monthly increases and declines,” according to the National Association of Realtors (NAR).

NAR points to sluggish sales in the Western region as dragging down the national average, while other regions saw little to no change last month.

The good news, however, is that year over year, existing home sales actually surged 9.6%. Also hopeful is the news this week that housing permits hit a 13-year high, and housing starts recently hit a 13-year high as well.

Although affordability and tight inventory levels continue to hold back the housing market, Larry Kudlow, Director of the United States National Economic Council calls this a “housing boom.”

In jest, when Fox News began to ask about existing home sales, Kudlow interrupted with the words “boom, boom, boom.”

“Whatever the question is, the answer is boom. We’re in a housing boom,” Kudlow asserted.

NAR Chief Economist, Dr. Lawrence Yun calls the outlook for 2020 home sales “promising despite the drop [in existing home sales] in January.”

In a statement, Dr. Yun said, “The trend line for housing starts is increasing and showing steady improvement, which should ultimately lead to more home sales.”

The median existing home price rose 6.8% from January 2019 to hit $266,300. Supply conditions are driving price grown, notes Dr. Yun, adding that low mortgage rates have aided with affordability.

The average days on market fell to 43 days in January (down from 49 in January 2019). Fully 42% of all homes sold in January 2020 were on the market for less than a month.

On Wednesday, Dr. Yun called the housing start and building permit data “jumpy,” which is proving to be applicable to current home sales as well.

It’s this muddy mix of monthly setbacks with wildly successful annual increases. Spring sales are set to similarly trend positively, so long as starts and permits continue to fuel what Kudlow calls a “housing boom.”

Continue Reading

Real Estate Big Data

Get in on alternative data – an inventive new way to market

(REAL ESTATE BIG DATA) Alternative data is a wild ride with surveillance planes, satellite images, and specially equipped helicopters, and it’s not stopping anytime soon.

Published

on

Alternative data

The road less traveled has always been a little stranger and trust me, alternative data is a little strange. Buckle-up your seatbelts, it’s going to be a wild ride.

Data has always been a hot commodity. The digital world has made it easier than ever for investors to get their hands on all kinds of data. The problem is, if one person can gain access to a data set then nearly everyone else can too. So, how are investors supposed to get an edge over their competitors and make the best decisions in their power? Please welcome, alternative data to the stage.

First of all, what the heck is alternative data? According to alternativedata.org, it refers to “data used by investors to evaluate a company or investment that is not within their traditional data sources.” Alternative data is the road less traveled. It offers investors a way to add new and unique variables to the mix.

This data can be anything from private aircraft surveillance to satellite images of parking lots. Every bit of data that investors can gather to determine their next course of action has value. It gets wild, y’all.

In the oil and gas industry, one company uses helicopters decked out with infrared beams to estimate the amount of oil in storage tanks. It may sound like something out of a silly movie, but it’s actually quite clever.

So, is alternative data just an industry fad? Probably not, but what qualifies as this kind of data will evolve over time. As certain practices become more mainstream, they will lose that “alternative” edge. Kind of like when the band you’ve been following for years gets a hit song and now, they’re everyone’s favorite band.

What’s already clear is alternative data is not pixie dust. These creative data sets can provide an interesting insight, but it shouldn’t be the sole basis of any decisions. At the end of the day, alt data points are just more variables on the table. It’s best to not get caught up in the sexiness of private jets and satellites.

One thing is for sure, we will be seeing more creative uses of alternative data in the future.

Continue Reading
Advertisement

Our Parnters

Get The Daily Intel
in your inbox

Subscribe and get news and EXCLUSIVE content to your email inbox!

Still Trending

Get The American Genius
in your inbox

subscribe and get news and exclusive content to your email inbox