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RISMEDIA, December 31, 2009—Data through October 2009, recently released by Standard & Poor’s for its S&P/Case-Shiller Home Price Indices, one of the leading measures of U.S. home prices, show that the annual rate of decline of the 10-City and 20-City Composites improved compared to last month’s reading. This marks approximately nine months of improved readings in these statistics, beginning in early 2009.
The annual returns of the 10-City and 20-City Composite Home Price Indices, declining 6.4% and 7.3%, respectively, in October 2009 compared to the same month last year. All 20 metro areas and both Composites showed an improvement in the annual rates of decline with October’s readings compared to September.
“The turnaround in home prices seen in the spring and summer has faded with only seven of the 20 cities seeing month-to-month gains, although all 20 continue to show improvements on a year-over-year basis. All in all, this report should be described as flat,” says David M. Blitzer, chairman of the Index Committee at Standard & Poor’s. “Coming after a series of solid gains, these data are likely to spark worries that home prices are about to take a second dip. Before jumping to conclusions, recognize that the one time that happened at the beginning of the 1980s, Fed policy saw dramatic reversals, which is very different from the stable and consistent Fed policy we have today. Further, sales of existing homes-those included in the S&P/Case-Shiller Home Price Indices-have been very strong in recent months, working off the inventories of houses for sale. At the same time, housing starts remain weak, fears that the market will be swamped by a wave of foreclosures are heard and government programs aimed at the housing market will expire in the first half of 2010.”
As of October 2009, average home prices across the United States are at similar levels to where they were in the autumn of 2003. From the peak in the second quarter of 2006 through the trough in April 2009, the 10-City Composite is down 33.5% and the 20-City Composite is down 32.6%. With the relative improvement of the past few months, the peak-to-date figures through October 2009 are -29.8% and -29.0%, respectively.
San Francisco has reported seven consecutive months of positive returns, San Diego has reported six and Los Angeles and Phoenix are close behind with five. While the two Composites were flat, seven of the MSAs reported positive monthly returns for October and two of those- Phoenix and San Francisco- were greater than +1.0%. Looking at the annual statistics, both Minneapolis and Portland are no longer reporting double-digit declines. Denver and Dallas are nearing positive territory with their annual figures at -0.1% and -0.6%, respectively.
Las Vegas remains the one market that has not seen a glimmer of hope so far this year. Prices have declined for 38 consecutive months, with a peak-to-trough reading of -55.4%. It is now barely 5% above its January 2000 level. This compares to its peak in August 2006, when the average home price was 135% above that same level.
For more information, visit http://www.standardandpoors.com/.
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RISMEDIA, December 29, 2009—Florida’s existing home sales rose in November 2009, marking 15 months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors.
Existing home sales rose 61% last month with a total of 14,026 homes sold statewide compared to 8,694 homes sold in November 2008, according to Florida Realtors. Statewide sales of existing condos increased 111% last month compared to November 2008’s sales figure.
For the second month in a row, all of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales and higher condo sales in November. A majority of the state’s MSAs have reported increased sales for 17 consecutive months.
“The extended and expanded federal homebuyer tax credit will continue the positive momentum of the housing sector’s recovery- people will want to take advantage of this incredible, not-to-be-missed opportunity to buy a home of their own in Florida,” says 2009 Florida Realtors President Cynthia Shelton, CCIM, CRE, a broker and director of investment sales with Colliers Arnold in Orlando.
“For 15 months now, statewide sales of existing single-family homes in Florida have increased each month compared to the year-ago figures. The continued, gradual absorption of housing inventory will help stabilize home prices. National research notes that housing affordability is at its peak and the highest on record: Along with still-low mortgage rates, it means that the buying power of a typical family has never been better.”
Florida’s median sales price for existing homes last month was $139,000; a year ago, it was $158,200 for a 12% decrease. Housing industry analysts with the National Association of Realtors (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in October 2009 was $173,100, down 6.8% from a year earlier, according to NAR. In California, the statewide median resales price was $297,500 in October; in Massachusetts, it was $287,000; in Maryland, it was $250,210; and in New York, it was $209,900.
According to NAR’s latest industry outlook, home sales are experiencing a pendulum upswing. “Keep in mind that housing had been underperforming over most of the past year,” said NAR Chief Economist Lawrence Yun. “The tax credit is helping unleash pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future. In the second half of 2010, if home values show consistent stabilization or even a modest increase, then home sales could register normal healthy levels.”
In Florida’s year-to-year comparison for condos, 4,889 units sold statewide last month compared to 2,320 units in November 2008 for an increase of 111%. The statewide existing condo median sales price last month was $104,400; in November 2008 it was $131,400 for a 21% decrease. The national median existing condo price was $172,900 in October 2009, according to NAR.
Interest rates for a 30-year fixed-rate mortgage averaged 4.88% last month, a significant drop from the average rate of 6.09% in November 2008, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Among the state’s smaller markets, the Tallahassee MSA reported a total of 174 homes sold in November compared to 100 homes a year earlier for a 74% increase. The market’s existing home median sales price last month was $162,000; a year ago it was $170,000 for a 5% decrease. A total of 5 condos sold in the MSA in November, up 150% over the 2 units sold in November 2008. The existing condo median price last month was $110,000; a year earlier, it was $95,000 for an increase of 16%.
For more information, visit www.floridarealtors.org.
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The Pending Home Sales Index, a forward-looking indicator based on contracts signed in October, increased 3.7% to 114.1 from 110.0 in September, and is 31.8% above October 2008 when it was 86.6. The rise from a year ago is the biggest annual increase ever recorded for the index, which is at the highest level since March 2006 when it was 115.2.
Lawrence Yun, NAR chief economist, said home sales are experiencing a pendulum swing. “Keep in mind that housing had been underperforming over most of the past year. Based on the demographics of our growing population, existing-home sales should be in the range of 5.5 million to 6.0 million annually, but we were well below the 5-million mark before the home buyer tax credit stimulus,” he said. “This means the tax credit is helping unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future.
The PHSI in the Northeast surged 19.9% to 100.2 in October and is 44.2% above a year ago. In the Midwest the index rose 11.6% to 109.6 and is 36.6% higher than October 2008. Pending home sales in the South increased 5.4% to an index of 115.4, which is 31.6% above a year ago. In the West the index fell 11.2% to 127.7 but is 21.9% above October 2008.
Yun cautioned that home sales could dip in the months ahead. “The expanded tax credit has only been available for the past three weeks, but the time between when buyers start looking at homes until they close on a sale can take anywhere from three to five months. Given the lag time, we could see a temporary decline in closed existing-home sales from December 2009 until early spring when we get another surge, but the weak job market remains a major concern and could slow the recovery process.
“Still, as inventories continue to decline and balance is gradually restored between buyers and sellers, we should reach self-sustaining housing conditions and firming home prices in most areas around the middle of 2010. That would mean broad wealth stabilization for the vast number of middle-class families,” Yun said.
For more information, visit www.realtor.org.
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RISMEDIA, December 3, 2009—Single-family home sales in Rhode Island rose 20.5% in October 2009, the fifth consecutive month that home sales have increased year-over-year, according to The Warren Group. Condominium sales also climbed 7%, but prices for both single-family homes and condos continued to slide in October and are off by double-digit percentages from last year.
“Rhode Island’s housing market is on the mend because sales volume has been growing for several months. But the residential real estate market is still facing challenges because prices are declining and foreclosures continue to remain a concern as unemployment has reached record levels,” said Timothy M. Warren Jr., CEO of The Warren Group, a Boston-based real estate tracking and publishing firm.
Warren noted that over 2,300 residential foreclosures have taken place in Rhode Island from January through October.
Single-family home sales surged 20.5% to 787 from 653 in October 2008, posting the highest number of sales for the month of October since 2005. Year-to-date home sales crept up 6.4% to 6,267 from 5,888.
The median price for single-family homes sold in October dipped 3.6% to $203,500 from $211,000 a year earlier. The year-to-date median home price fell 16% to $200,000 from $238,000.
“Even though single-family home prices are still dropping, October delivered the smallest percentage decline in prices year-over-year. In the first seven months of 2009, prices dropped by double-digit percentages compared to year-ago levels,” Warren said.
Condominium sales increased 7% to 122 in October from 114. It was the second month in a row that condo sales rose in Rhode Island. A total of 1,097 condos have been sold from January through October, down 15.6% from 1,300 last year.
The median price for condos sold in October tumbled 19.1% to $161,750 from $199,900. The year-to-date median condo price retreated 16.3% to $180,000 from $215,000.
For more information, visit www.thewarrengroup.com.
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