Job growth, low mortgage rates, rising rents and a relatively inexpensive housing stock. These are just some of the playful teases in the burlesque revue that is today's market recovery. Another week passed with buyers displaying no signs of slowing down. In general, sellers are discovering a less-intimidating scene, and buyers are reveling in the showy marketplace. As expected, spring's warming glow continues to fuel optimism and consumer activity. But that won't necessarily be the case in every area or segment, so do your research before making that move.
In the Twin Cities region, for the week ending April 14:
• New Listings decreased 9.5% to 1,637
• Pending Sales increased 25.5% to 1,170
• Inventory decreased 27.8% to 17,384
For the month of March:
• Median Sales Price increased 7.1% to $149,900
• Days on Market decreased 9.6% to 145
• Percent of Original List Price Received increased 3.8% to 92.1%
• Months Supply of Inventory decreased 38.0% to 4.7
For more Real Estate information www.mplsrealtor.com
Thursday, April 26, 2012
Friday, April 13, 2012
11 Irrefutable Signs of a Real Estate Recovery
Auto sales. Consumer confidence. Manufacturing. Retail Sales. Exports. You name it. Over the last six months, nearly every facet of the U.S. economy has shown improvement. And the real estate market is no exception.
Here’s the irrefutable proof:
Recovery Sign #1: Housing Starts. In February, housing starts checked-in at an annual rate of 698,000 units. That’s up 14.7% from the 608,800 starts in 2011… up 18.9% from the 586,900 starts in 2010… and up 25.9% from the record-low 554,000 starts in 2009. Even after the uptick, though, we’re nowhere close to the high-water mark of 2.07 million starts hit in 2005.
Recovery Sign #2: Building Permits. In February, building permits – a proxy for future construction – climbed to an annual rate of 717,000 units. That was ahead of expectations. It also represents the highest level since October 2008.
Recovery Sign #3: Dwindling Inventory. Expect even more building on the horizon. Why? Because new home inventories plumbed their lowest level on record in January at 150,000 units.
If we include existing homes in the mix, the total number of homes listed for sale has dropped – on a year-over-year basis – for 12 consecutive months. Now there are 2.43 million homes listed for sale, which is down 19.3% in the last year and down 39.8% from the record inventory of 4.04 million homes in July 2007.
Recovery Sign #4: Bidding Wars. The lack of inventory is creating a competitive bidding environment. Online brokerage firm, Redfin, reports that agents encountered multiple bids on about 50% of offers in Seattle, Boston, Washington D.C. and Oregon through March 15.
Recovery Sign #5: A Bottom in New Home Sales. Last year, new home sales fell to 302,000 units – the worst reading on record. For comparison’s sake, in 2005, 1.28 million new homes were sold. The market has likely bottomed out. I say that because new home sales in February checked-in at an annual rate of 313,000 units, which is 11.4% higher than last February’s rate.
Recovery Sign #6: A Rebound in Existing Home Sales. In the last year, demand for previously owned homes ticked 8.8% higher to an annual rate of 4.59 million. And the number of contracts to buy existing homes in February jumped even more – up 14% year-over-year.
Recovery Sign #7: Prices. As I’ve written before, prices will be the last sign of a recovery. They’re a lagging indicator, like unemployment. That being said, signs of a price rebound are materializing. Based on the latest Case-Shiller Indexes, prices in Miami and Phoenix – arguably two of the hardest-hit real estate markets – were up in January by 1.2% and 2%, respectively. That marks the third consecutive month of improving prices in Miami and the fourth in Phoenix.
Recovery Sign #8: Rising Confidence. If insiders know best, they’re certainly sending bullish signals. The National Association of Realtors/Wells Fargo Index of builder confidence climbed for the sixth month in March. It’s now at the highest level since 2007.
Individual builders aren’t hiding their optimism, either. The CEO of the nation’s third-largest homebuilder recently said, “A very real trend is beginning to take shape… There are empirical data points that are today confirming that the market is showing real signs of stability.” Indeed!
Recovery Sign #9: Historic Affordability. With prices down an average of 36% from the peak – and rent prices rising – it’s never been cheaper to buy a home. In fact, the National Association of Realtors Housing Affordability Index hit a record high of 206.1 in January. (A value of 100 means a family earning the national median income can afford a median-priced property at current mortgage rates.)
A separate study by Trulia found it’s now less expensive to buy than rent in 98 of America’s 100 most populous metropolitan areas. (Honolulu and San Francisco were the lone exceptions.)
And yet another study found that the affordability gap is widening, strongly in favor of buying. Deutsche Bank reports that the average rent is now 14.9% more than the average home loan payment – up from 8.1% in the previous quarter.
It’s worth noting, too, that borrowing costs are down about 20% in the last year. Mortgage rates hit an all-time low of 3.87% in February – down from 4.95% a year ago.
Recovery Sign #10: Employment. It’s hard to buy a house if you don’t have a job. And no one can deny that the labor market is improving. In the last eight months, the unemployment rate is down almost one full percentage point.
Recovery Sign #11: An Influx of “Smart Money.” Greg Zuckerman of The Wall Street Journal reports, “Over the last couple months some of the best investors on the street… have been making big bets on homebuilders.” And he’s not kidding.
The list reads like a “Who’s Who” on Wall Street. It includes SAC Capital, Blackstone, Caxton Associates, Cerberus, Canyon Partners and CQS U.K.
Bottom line: Add all the hard data up and it’s clear – the real estate market has officially entered recovery mode.
I’m not alone in this conclusion, either. My colleague, Karim Rahemtulla, believes the same. And in the latest issue of WSD Insider, released on Friday, we both revealed our favorite ways to profit from the unfolding recovery.
It’s not too late to act on the opportunities we revealed. All you have to do is sign up for a risk-free trial here and you’ll be granted immediate access to our recommendations.
Published Mon, Apr 9th, 2012 Louis Basenese
http://www.wallstreetdaily.com/2012/04/09/signs-of-real-estate-recovery/
Here’s the irrefutable proof:
Recovery Sign #1: Housing Starts. In February, housing starts checked-in at an annual rate of 698,000 units. That’s up 14.7% from the 608,800 starts in 2011… up 18.9% from the 586,900 starts in 2010… and up 25.9% from the record-low 554,000 starts in 2009. Even after the uptick, though, we’re nowhere close to the high-water mark of 2.07 million starts hit in 2005.
Recovery Sign #2: Building Permits. In February, building permits – a proxy for future construction – climbed to an annual rate of 717,000 units. That was ahead of expectations. It also represents the highest level since October 2008.
Recovery Sign #3: Dwindling Inventory. Expect even more building on the horizon. Why? Because new home inventories plumbed their lowest level on record in January at 150,000 units.
If we include existing homes in the mix, the total number of homes listed for sale has dropped – on a year-over-year basis – for 12 consecutive months. Now there are 2.43 million homes listed for sale, which is down 19.3% in the last year and down 39.8% from the record inventory of 4.04 million homes in July 2007.
Recovery Sign #4: Bidding Wars. The lack of inventory is creating a competitive bidding environment. Online brokerage firm, Redfin, reports that agents encountered multiple bids on about 50% of offers in Seattle, Boston, Washington D.C. and Oregon through March 15.
Recovery Sign #5: A Bottom in New Home Sales. Last year, new home sales fell to 302,000 units – the worst reading on record. For comparison’s sake, in 2005, 1.28 million new homes were sold. The market has likely bottomed out. I say that because new home sales in February checked-in at an annual rate of 313,000 units, which is 11.4% higher than last February’s rate.
Recovery Sign #6: A Rebound in Existing Home Sales. In the last year, demand for previously owned homes ticked 8.8% higher to an annual rate of 4.59 million. And the number of contracts to buy existing homes in February jumped even more – up 14% year-over-year.
Recovery Sign #7: Prices. As I’ve written before, prices will be the last sign of a recovery. They’re a lagging indicator, like unemployment. That being said, signs of a price rebound are materializing. Based on the latest Case-Shiller Indexes, prices in Miami and Phoenix – arguably two of the hardest-hit real estate markets – were up in January by 1.2% and 2%, respectively. That marks the third consecutive month of improving prices in Miami and the fourth in Phoenix.
Recovery Sign #8: Rising Confidence. If insiders know best, they’re certainly sending bullish signals. The National Association of Realtors/Wells Fargo Index of builder confidence climbed for the sixth month in March. It’s now at the highest level since 2007.
Individual builders aren’t hiding their optimism, either. The CEO of the nation’s third-largest homebuilder recently said, “A very real trend is beginning to take shape… There are empirical data points that are today confirming that the market is showing real signs of stability.” Indeed!
Recovery Sign #9: Historic Affordability. With prices down an average of 36% from the peak – and rent prices rising – it’s never been cheaper to buy a home. In fact, the National Association of Realtors Housing Affordability Index hit a record high of 206.1 in January. (A value of 100 means a family earning the national median income can afford a median-priced property at current mortgage rates.)
A separate study by Trulia found it’s now less expensive to buy than rent in 98 of America’s 100 most populous metropolitan areas. (Honolulu and San Francisco were the lone exceptions.)
And yet another study found that the affordability gap is widening, strongly in favor of buying. Deutsche Bank reports that the average rent is now 14.9% more than the average home loan payment – up from 8.1% in the previous quarter.
It’s worth noting, too, that borrowing costs are down about 20% in the last year. Mortgage rates hit an all-time low of 3.87% in February – down from 4.95% a year ago.
Recovery Sign #10: Employment. It’s hard to buy a house if you don’t have a job. And no one can deny that the labor market is improving. In the last eight months, the unemployment rate is down almost one full percentage point.
Recovery Sign #11: An Influx of “Smart Money.” Greg Zuckerman of The Wall Street Journal reports, “Over the last couple months some of the best investors on the street… have been making big bets on homebuilders.” And he’s not kidding.
The list reads like a “Who’s Who” on Wall Street. It includes SAC Capital, Blackstone, Caxton Associates, Cerberus, Canyon Partners and CQS U.K.
Bottom line: Add all the hard data up and it’s clear – the real estate market has officially entered recovery mode.
I’m not alone in this conclusion, either. My colleague, Karim Rahemtulla, believes the same. And in the latest issue of WSD Insider, released on Friday, we both revealed our favorite ways to profit from the unfolding recovery.
It’s not too late to act on the opportunities we revealed. All you have to do is sign up for a risk-free trial here and you’ll be granted immediate access to our recommendations.
Published Mon, Apr 9th, 2012 Louis Basenese
http://www.wallstreetdaily.com/2012/04/09/signs-of-real-estate-recovery/
Tuesday, April 3, 2012
Weekly Market Update
The last time you were at the doctor, your vital signs were checked – heart rate, pulse, temperature and blood pressure. Progress was documented and valuable insights were gained, whether it was a routine visit or one of many checks during an extended hospital stay. The housing market has been in and out of intensive care for the past several years. Monitoring vitals matters, and that's what you'll find on the following pages. The pulse of today's market indicates that we may be getting ready to leave the ICU. So if you could just please pull up your sleeve, let's check your blood pressure.
In the Twin Cities region, for the week ending March 24:
• New Listings increased 2.2% to 1,414
• Pending Sales increased 30.2% to 1,052
• Inventory decreased 27.3% to 17,193
For the month of February:
• Median Sales Price decreased 1.4% to $138,000
• Days on Market decreased 9.0% to 145
• Percent of Original List Price Received increased 2.5% to 90.6%
• Months Supply of Inventory decreased 34.8% to 4.7
Mark Allen, RCE, CIPS, CRS
Chief Executive Officer
Minneapolis Area Association of REALTORS®
952.988.3134
www.mplsrealtor.com
In the Twin Cities region, for the week ending March 24:
• New Listings increased 2.2% to 1,414
• Pending Sales increased 30.2% to 1,052
• Inventory decreased 27.3% to 17,193
For the month of February:
• Median Sales Price decreased 1.4% to $138,000
• Days on Market decreased 9.0% to 145
• Percent of Original List Price Received increased 2.5% to 90.6%
• Months Supply of Inventory decreased 34.8% to 4.7
Mark Allen, RCE, CIPS, CRS
Chief Executive Officer
Minneapolis Area Association of REALTORS®
952.988.3134
www.mplsrealtor.com
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