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Revealed: The secret of why these 10 markets will grow the most in 3Q

Realtor.com spies 10 markets that will take off in the next 3 months

Reno Nevada
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Although home price growth has slowed dramatically from last year and will continue to slow into mid-2015 are now enjoying the advantage of price increases, while buyers have more choices.

In 10 key markets, strong price appreciation and increases in housing inventory increase are an early sign of potential strong home sales, in contrast to what’s happening in the rest of the housing market nationwide, realtor.com reports in its June National Housing Trend Report.

“National housing trends are masking some of the excitement we’re seeing in individual markets,” said Jonathan Smoke, chief economist for realtor.com. “For the last two years, listing shortages constrained home sales and frustrated buyer demand. Our June data shows monthly inventory picking up in markets already experiencing price increases and fast property turnover.

“These dynamics will result in strong home sales and extend the buying season past the usual June/July peak to later in the third quarter,” Smoke said.

Homes in the Charlotte, N.C. region are selling 14 days faster compared to a year ago – the most improved in median inventory age among these markets.

Meanwhile Reno, Nevada, the “biggest little city in America,” has the biggest year-over-year home price increase at nearly 18.5%.

“The markets where we expect significant third quarter home sales are all very different – ranging from small to large, affordable to expensive, previously distressed to minimally affected by the downturn,” Smoke said. “Diversification in the areas experiencing healthy real estate economies is a key indicator that the housing recovery has become more sustainable.”

Median list prices are up 7.6 percent in June over last year. Month-over-month price acceleration is slower compared to April, when the home-buying season traditionally starts.

National housing inventory is now roughly in line with June 2013 levels when rising home prices first generated a surge in market supply. Additionally, homes in June sold 5 percent faster than last year.

  Top Markets Set for Significant Growth in Home Sales

(Listed in alphabetical order)

 

MSA

Median Listing Price

% YY

% MM

Total Listings

% YY

% MM

Median Age of Inventory

% YY

% MM

Albany-Schenectady-Troy, NY

$226,025

0.50%

0.50%

6,145

1.10%

9.83%

80 days

-4.76%

-3.61%

Baton Rouge, LA

$188,000

4.50%

1.62%

3,630

1.79%

7.27%

74 days

-8.64%

-6.33%

Charlotte-Gastonia-Rock Hill, NC-SC (NC)

$209,000

7.18%

2.00%

12,906

-2.15%

3.53%

64 days

-17.95%

-7.25%

Columbia, SC

$162,500

2.20%

0.03%

5,190

-0.63%

2.98%

83 days

-8.79%

-13.54%

Des Moines, IA

$179,900

7.47%

0.50%

3,654

-4.09%

5.97%

59 days

-4.84%

-1.67%

Philadelphia, PA-NJ (NJ)

$187,000

1.14%

1.14%

12,233

-4.75%

3.59%

97 days

-9.35%

-1.02%

Portland-Vancouver, OR-WA (WA)

$299,000

11.15%

1.05%

2,207

-3.79%

15.55%

59 days

-16.90%

-4.84%

Reno, NV

$295,000

18.47%

1.76%

2,539

2.01%

6.82%

60 days

-1.64%

-1.64%

Spokane, WA

$198,000

7.06%

4.27%

3,986

8.20%

7.90%

61 days

-3.17%

-14.08%

Washington, DC-MD-VA-WV (VA)

$429,000

4.63%

0.00%

14,776

4.06%

6.34%

53 days

-8.62%

-7.02%

Each market listed demonstrates strong supply and demand dynamics including:

Inventory increases:  For-sale inventory shortages have played a significant role in limiting home sales during the past two years. Each community listed is getting its supply in check with month-over-month inventory growth. Additionally, half of these markets also are increasing on a yearly basis.   

Median list price increases: Price increases encourage sellers to put homes on the market and indirectly keep inventory levels more sustainable. While each region listed had price increases on a monthly and yearly basis, they vary from hot markets with fast price acceleration, such as Reno, Nevada, to communities just beginning to see appreciation, such as Albany, N.Y

Median age of inventory decreases: Declining median age of inventory indicates listings growth has not satisfied demand. Properties in these areas are selling faster than last year, demonstrating continuing homebuyers’ interest that will propel sales.  

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