Home Sales Are Up Again

A month-over-month dip in home sales last month caused real estate watchers to ponder—gasp—a potential cooling of the market. But on Thursday the National Association of Realtors® reported that sales are up again.

Existing-home sales—completed sales of single-family homes, townhomes, condominiums, and co-ops—rose 4.7% from August to September, reaching 5.55 million. That’s the 12th consecutive month to see year-over-year growth, and the second-highest peak since February 2007, when sales totaled 5.79 million.

The median existing-home price for all housing types was $221,900 in September, 6.1% more than September 2014. This is the 43rd consecutive month that we’ve had year-over-year gains. Single-family home sales increased 5.3%, with a median price of $223,500, while condo and co-op sales remained unchanged, with a median existing-condo price of $209,200.

All-cash sales rose, too: They represented 24% of transactions in September, up from 22% in August. Short sales stayed on the market for an average of 135 days, but short sales and foreclosures are still down from a year ago—7% now and 10% then.

Why the reversal on sales in general? These are seasonally adjusted numbers, so they don’t reflect the typical fall slowdown. August sales, however, were affected by the stock market dips that shook buyers’ confidence.

Please, Mr. P

   “Sales are impacted by major stock market declines, since at least one in five buyers funds at least a portion of their purchase with stock or retirement funds,” said realtor.com® chief economist Jonathan Smoke. “But barring stock corrections that reflect real economic downturns—which we are not experiencing—homes sales typically return to the prior trend after stock values stabilize.”

But not all numbers were up: Inventory decreased 2.6% and is 3.1% lower than a year go. There’s a 4.8-month supply of unsold housing—in August, it was 5.1 months.

Maybe it’s counterintuitive—how can there be more sales when there’s less inventory?

It’s all that pent-up demand. Unfortunately for first-time buyers, all that competition has driven house prices up; you’re more likely to buy a home if you already have one.

“First-time buyers fell to 29% of sales in September after climbing to their highest share of the year in August (32%),” according to the NAR. “A year ago, first-time buyers represented 29% of all buyers.”

That’s the biggest surprise, Smoke said, but “despite that decline, we estimate from the monthly sales data this year that first-time buyers have been responsible for 45% of the growth in sales over last year.”

Whether the rise in existing-home sales continues depends on one thing: jobs. The 6% rise in prices is just about double the pace of wages. We need more, and better-paying, employment to keep sales up. That’s complicated by the fact that most future job growth is rooted in the relatively low-paying service sector. Sales may be up, but we’ll need inventory to rise with them.

Regional breakdown

Northeast: September existing-home sales rose 8.6% to an annual rate of 760,000, 11.8% above a year ago. The Northeastern median price was $256,500, 4% above September 2014.

Midwest: September existing-home sales rose 2.3% to an annual rate of 1.31 million, 12% above a year ago. The Midwestern median price was $174,400, 5.4% above September 2014.

South: September existing-home sales rose 3.8% to an annual rate of 2.21 million, 5.7% above a year ago. The Southern median price was $191,500, 6.2% above September 2014.

West: September existing-home sales rose 6.7% to an annual rate of 1.27 million, 9.5% above a year ago. The Western median price was $318,100, 8% above September 2014.

By
Lisa Davis  Realtor.com

Buyers seeking multi family homes

According to several news articles, there is a dramatic spike in the real estate world, and

it’s not for the traditional. More and more potential homeowners and renters are seeking

out multi-family residences rather than single family. In fact, World Property Journal

reports the rise was 29.4% in multi-family properties and single family properties declined

by .9%.

Today’s generation has an affinity to seek living quarters in and around the city rather than

in a suburban neighborhood, and would much rather rent than buy according to the

reports of Christine Jordan Sexton at Realtor.org.

What are the benefits of renting the multi-family verses owning the single family?

Less worry over maintenance: yard work, appliance fixing, structural malfunctions are just

a few of the up sides to renting, that’s the land lords job to maintain and fix. Whereas with

owning your own property, the responsibility to fix things lands with you.

Living inside the city in a multi-family means less of a work commute and easy pedestrian

access to entertainment and take-out for the young who are not ready to settle down. It

also means easy access to hospital or emergency care.

However, there is no investment in renting as there is in owning. The hundreds of dollars

wasted every month in rent go into the pockets of the landlord, so when you decide to

move there’s nothing there for you. Owing your home means equity; a sold investment

even for a fluctuating market like real estate is always a better option.

To more information in this trend check out the full articles here at:

http://www.realtor.org/articles/the-rise-of-multifamily-housing-multiple-family-

residences-are-dominating-new-construction

http://www.worldpropertyjournal.com/real-estate-news/united-states/new-home-

construction-july-2015-housing-starts-us-department-of-housing-and-urban-

development-new-home-construction-nahb-david-crowe-9234.phpB

Getting your home ready for photos

According to the National Association of Realtors, well over 90% of home buyers look on the

internet for homes. So, setting the stage in photos and making sure they are of good quality is

an important point in selling your home.
Think of the photos you see in magazines like Better Homes and Gardens. The displays of

photos in these magazines have simple style with clear horizontal surfaces with just a few

decorative items placed sparsely. As you see that image in your mind, now look around your

home to find what needs to be done. Less “stuff” in the photos will make the rooms look bigger.

Clear all unnecessary objects from the kitchen countertops, especially bright colored items.

Don’t forget the paper towels, soap dispenser, hand towels. Clear family photos, children’s

drawings and magnets from the refrigerator, and stacks of “out of reach” items from the top.

In the bathrooms, clear objects such as cosmetics and soap dispensers. Tip: group daily

toiletries in Rubbermaid containers for each family member so you can move them to a closet.

This will also help with showings.

Remove personal photos, flowers and statues from walls, mantles and tabletops. Remove

small mirrors to minimize flash reflections. Keep rooms neat and organize toys, magazines, and

books. Remove any blankets off furniture.

Check all bulbs and replace any that are burned out because a burned out bulb will likely be

noticed in the photo. Also, with the new types of bulbs it is sometimes hard to gauge light output

so do not use mismatched bulbs and make sure they are not too bright. Research shows that

buyers feel that lighting adds “warmth” to the photographs.

If you are not able to be present at the photo session, turn on all lights or at least those that

have switches that might be hard to find and turn off all ceiling fans because they might be

blurred in the photos but leave the ceiling fan lights on.

Make sure that pet bedding, bowels and cages are out of the open areas. MLS rules prohibit

showing pets in the photos, so please cage or remove them from the premises on the day of the

photo session.

That first photo of the front exterior shot is perhaps the most important shot out of the whole

series of photos. It’s the primary photo that a buyer looking at their search results online may

use to decide whether to click or not to click to open and see the details of your home. So, take

a walk around the perimeter, remove any trash containers and other items like hoses. Also, tell

your agent when the sun hits the front of your home (morning or afternoon) so the pictures can

be taken with minimal shadows.

The photographer cannot take the responsibility for moving your personal items. It is up to you

to get your home ready. Remember that the photos will be displayed on the Internet on multiple

websites, so remove everything that you do not want the public to see.

Existing-Home Sales Rebound

WASHINGTON (October 21, 2014) – After a modest decline last month, existing-home sales bounced back in September to their highest annual pace of the year, according to the National Association of Realtors^®.  All major regions except for the Midwest experienced gains in September.

Total existing-home sales¹, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2.4 percent to a seasonally adjusted annual rate of 5.17 million in September from 5.05 million in August. Sales are now at their highest pace of 2014, but still remain 1.7 percent below the 5.26 million-unit level from last September.

Lawrence Yun, NAR chief economist, says the improved demand for buying seen since the spring has carried into the fall. “Low interest rates and price gains holding steady led to September’s healthy increase, even with investor activity remaining on par with last month’s marked decline,” he said. “Traditional buyers are entering a less competitive market with fewer investors searching for available homes, but may also face a slight decline in choices due to the fact that inventory generally falls heading into the winter.”

The median existing-home price² for all housing types in September was $209,700, which is 5.6 percent above September 2013. This marks the 31^st consecutive month of year-over-year price gains.

Total housing inventory³ at the end of September fell 1.3 percent to 2.30 million existing homes available for sale, which represents a 5.3-month supply at the current sales pace. Despite fewer homes for sale in September, unsold inventory is still 6.0 percent higher than a year ago, when there were 2.17 million existing homes available for sale.

All-cash sales were 24 percent of transactions in September, up slightly from August (23 percent) but down from 33 percent in September of last year. Individual investors, who account for many cash sales, purchased 14 percent of homes in September, up from 12 percent last month but below September 2013 (19 percent). Sixty-three percent of investors paid cash in September.  

According to Freddie Mac, after falling for four consecutive months, the average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.16 percent in September from 4.12 percent in August. Despite the slight increase, interest rates are 33 basis points less than a year ago (4.49 percent). 

“Economic instability overseas is leading to volatility in the stock market and is causing investors to seek safer bets, which will likely keep interest rates in upcoming weeks hovering near or below where they are now,” said Yun. “This is welcoming news for consumers looking to buy, although they could temporarily become more cautious by less certain economic conditions.”  

The percent share of first-time buyers continues to underperform historically, remaining at 29 percent for the third consecutive month. First-time buyers have represented less than 30 percent of all buyers in 17 of the past 18 months.

Distressed homes⁴ – foreclosures and short sales – increased slightly in September to 10 percent from 8 percent in August, but are down from 14 percent a year ago. Seven percent of September sales were foreclosures and 3 percent were short sales. Foreclosures sold for an average discount of 14 percent below market value in September (same as in August), while short sales were discounted 14 percent (10 percent in August).          

According to NAR President Steve Brown, co-owner of Irongate, Inc., Realtors^® in Dayton, Ohio, fewer distressed sales is good news for appraisers, who have faced undue pressure since the downturn. “An appraisal is an important part of the home buying and selling process,” he said. “With foreclosures and short sales falling closer to average levels, appraisers will have fewer distressed sales in their list of comparables when determining home valuations.”

Properties typically stayed on the market in September longer (56 days) than last month (53 days) and a year ago (50 days). Short sales were on the market for a median of 116 days in September, while foreclosures sold in 59 days and non-distressed homes typically took 55 days. Thirty-five percent of homes sold in September were on the market for less than a month.

Single-family home sales rose 2.0 percent to a seasonally adjusted annual rate of 4.56 million in September from 4.47 million in August, but remain 1.9 percent below the 4.65 million pace a year ago. The median existing single-family home price was $210,300 in September, up 5.9 percent from September 2013.

Existing condominium and co-op sales increased 5.2 percent to a seasonally adjusted annual rate of 610,000 units in September from 580,000 in August, and are unchanged from the 610,000 unit pace a year ago. The median existing condo price was $205,200 in September, which is 3.2 percent higher than a year ago.

Regionally, September existing-home sales in the Northeast climbed 1.5 percent to an annual rate of 680,000, but remain 1.4 percent below a year ago. The median price in the Northeast was $249,800, which is 4.8 percent higher than a year ago.

In the Midwest, existing-home sales declined 5.6 percent to an annual level of 1.17 million in September, and remain 4.9 percent below September 2013. The median price in the Midwest was $165,100, up 4.9 percent from a year ago.

Existing-home sales in the South increased 5.0 percent to an annual rate of 2.12 million in September, and are now 1.4 percent above September 2013. The median price in the South was $180,900, up 5.1 percent from a year ago.

Existing-home sales in the West jumped 7.1 percent to an annual rate of 1.20 million in September, but remain 4.0 percent below a year ago. The median price in the West was $294,200, which is 4.0 percent above September 2013.

# # #

NOTE:  For local information, please contact the local association of Realtors^® for data from local multiple listing services. Local MLS data is the most accurate source of sales and price information in specific areas, although there may be differences in reporting methodology.

¹Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR rebenchmarks home sales periodically using other sources to assess overall home sales trends, including sales not reported by MLSs.

Existing-home sales, based on closings, differ from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which account for more than 90 percent of total home sales, are based on a much larger data sample – about 40 percent of multiple listing service data each month – and typically are not subject to large prior-month revisions.

The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.

²The median price is where half sold for more and half sold for less; medians are more typical of market conditions than average prices, which are skewed higher by a relatively small share of upper-end transactions. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if additional data is received.

³Total inventory and month’s supply data are available back through 1999, while single-family inventory and month’s supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90 percent of transactions and condos were measured only on a quarterly basis).

The national median condo/co-op price often is higher than the median single-family home price because condos are concentrated in higher-cost housing markets. However, in a given area, single-family homes typically sell for more than condos as seen in NAR’s quarterly metro area price reports.

⁴Distressed sales (foreclosures and short sales), days on market, first-time buyers, all-cash transactions and investors are from a monthly survey for the NAR’sRealtors^® Confidence Index, posted at Realtor.org.

reprinted from realtor.org