Today's Headlines - Realty Times
Posted On Monday, 24 June 2024 10:53
Posted On Monday, 24 June 2024 08:19 Written by

Housing costs could come down in the coming months, as mortgage rates are coming down a bit and there are signs price growth could slow

Pending home sales fell 3.8%, the biggest year-over-year decline in nearly four months, during the four weeks ending June 16. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

Buyers are shying away from earlier steps in the house-hunting process, too: Redfin’s Homebuyer Demand Index, a measure of requests for tours and other buying services from Redfin agents, declined 17% year over year to its lowest level since February.

Buyers are backing off largely because housing costs are high. The median U.S. home-sale price is up 4.8% to an all-time high of $396,000, and the median monthly mortgage payment is $2,781, about $60 below its record high. The weekly average mortgage rate declined slightly to 6.95% this week, but it’s still more than double pandemic-era lows.

The irony of near-record-high housing costs: They’re causing buyers to back off, and enough of them have backed off to give buyers who remain more negotiating power for certain homes. The other piece of good news for buyers is that housing costs could come down soon. There are signs that price growth could lose some momentum: The share of sellers dropping their list price is at its highest level since November 2022, and asking-price growth has already slowed. Mortgage rates have fallen a bit since last week’s cooler-than-expected inflation report, and they may continue declining.

New listings are still near historic lows. Another reason for the decline in pending sales is a lack of new, desirable listings for buyers to choose from. New listings are up 7.7% year over year, but they’re sitting well below typical levels for this time of year; the only time on record June listings have been lower was in 2023.

Many home listings are becoming stale, sitting on the market for 30 days or longer without going under contract; Redfin agents report that most buyers are willing to pay sky-high housing costs only for move-in ready homes in popular neighborhoods.

“A few years ago, I never would have told a seller they need to freshen up their paint, fix their furnace and make sure their roof is up to date before putting their home on the market–but now, I tell them to make the house as pretty as they possibly can,” said Des Bourgeois, a Redfin Premier agent in Detroit. “Buyers are still out there and they’re willing to pay today’s high prices, but only if the house is in really good shape. They don’t want to spend extra money on paint or new appliances.”

Homes that need work and/or aren’t in the most desirable locations can be a good opportunity for today’s buyers: They’re selling under asking price in some places–if they do sell. “Things have reversed since the pandemic,” said Jonathan Ader, a Redfin Premier agent in the Palm Springs, CA area. “Now, most homes—the exception is relatively affordable homes that are move-in ready—are selling under asking price.”

For Redfin economists’ takes on the housing market, please visit Redfin’s “From Our Economists” page.

Leading indicators

Indicators of homebuying demand and activity

 

Value (if applicable)

Recent change

Year-over-year change

Source

Daily average 30-year fixed mortgage rate

7.02% (June 18)

Down from 7.16% a week earlier; down from a 5-month high of 7.52% 6 weeks earlier

Up from 6.94%

Mortgage News Daily

Weekly average 30-year fixed mortgage rate

6.95% (week ending June 13)

Down slightly from 7.03% 2 weeks earlier; down from a 5-month high of 7.22% about a month earlier

Up from 6.69%

Freddie Mac

Mortgage-purchase applications (seasonally adjusted)

 

Increased 2% from a week earlier (as of week ending June 14)

Down 12%

Report about Mortgage Bankers Association data

Redfin Homebuyer Demand Index (seasonally adjusted)

 

Down 5% from a month earlier to its lowest level since February (as of week ending June 16)

Down 17%

Redfin Homebuyer Demand Index, a measure of requests for tours and other homebuying services from Redfin agents

Touring activity

 

Up 19% from the start of the year (as of June 17)

At this time last year, it was also up 19% from the start of 2023

ShowingTime, a home touring technology company

Google searches for “home for sale”

 

Unchanged from a month earlier (as of June 17)

Down 21%

Google Trends

Key housing-market data

U.S. highlights: Four weeks ending June 16, 2024

Redfin’s national metrics include data from 400+ U.S. metro areas, and is based on homes listed and/or sold during the period. Weekly housing-market data goes back through 2015. Subject to revision.

 

Four weeks ending June 16, 2024

Year-over-year change

Notes

Median sale price

$396,000

4.8%

All-time high; biggest increase since March

Median asking price

$411,749

5.5%

 

Median monthly mortgage payment

$2,781 at a 6.95% mortgage rate

7.8%

$58 below all-time high set during the 4 weeks ending April 28

Pending sales

86,225

-3.8%

Biggest decline in nearly 4 months

New listings

98,527

7.7%

 

Active listings

942,916

16.5%

 

Months of supply

3.2

+0.6 pts.

4 to 5 months of supply is considered balanced, with a lower number indicating seller’s market conditions

Share of homes off market in two weeks

42.1%

Down from 47%

 

Median days on market

31

+3 days

 

Share of homes sold above list price

32.2%

Down from 36%

 

Share of homes with a price drop

6.6%

+2.1 pts.

Highest level since Nov. 2022

Average sale-to-list price ratio

99.7%

-0.2 pts.

 

Metro-level highlights: Four weeks ending June 16, 2024

Redfin’s metro-level data includes the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy.

 

Metros with biggest year-over-year increases

Metros with biggest year-over-year decreases

Notes

Median sale price

Newark, NJ (16.4%)

Anaheim, CA (16%)

Nassau County, NY (14.7%)

New Brunswick, NJ (14.1%)

Milwaukee (10.7%)

Austin, TX (-3.7%)

San Antonio (-1.5%)

Fort Worth, TX (-1.4%)

Portland, OR (-1.1%)

Declined in 4 metros

Pending sales

San Jose, CA (13%)

Columbus, OH (5.7%)

Pittsburgh (5.4%)

Anaheim, CA (4.5%)

Los Angeles (4.3%)

Houston (-14.5%)

West Palm Beach, FL (-12.9%)

Miami (-12.3%)

New Brunswick, NJ (-10.8%)

Atlanta (-10.7%)

Increased in 14 metros

New listings

San Jose, CA (44.1%)

Phoenix (23.6%)

San Diego (21.4%)

Miami (20.5%)

Seattle (17.1%)

Chicago (-9.2%)

Minneapolis (-6.7%)

Atlanta (-5.6%)

Newark, NJ (-4.1%)

Portland, OR (-3.9%)

Declined in 8 metros

To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-record-high-prices-buyers-gain-power

Posted On Sunday, 23 June 2024 06:50 Written by

There has been a great deal of discussion about homes prices and affordability. There are all kinds of ways to measure things like affordability or if a home represents true value or not. The reality is, since value is a subjective term, and that each of us bears the cost of shelter, we can use a variety of tools to measure and compare values.

I was speaking to one of my clients this week who shared some information he read in an article about inflation and prices. It was actually very interesting to look through a very specific and measurable lens to compare a very measurable set of values. I took the conversation a little further and wanted to just share what I discovered. The conversation was about the price of gold per ounce and the cost of an average house over time. To add a little more context to this, I inserted new car prices as an item to help add to the picture. While certainly not a scientific study or a deep dive into all the causation, I thought this might be interesting to share.

The USA came off the gold standard in 1971 when gold was about $36 per ounce. So, I took that number and made it a starting point. Then I took a point in time 25 years later in 1996, and then came to today.

1971 – Gold was $36 per ounce, an average house was $30,000, and the average car was $3,700. So, it took 833 ounces of gold in 1971 to buy an average house and 103 ounces to buy the average car. Oh yes, 30-year mortgage rates were about 7.5% and minimum wage was $1.60 an hour.

1996 – Gold was about $390 an ounce, the house was $140,000 so it took 359 ounces to purchase; the car was $18,000, so 46 ounces to secure, and mortgage rate was about 7.8% and minimum wage was $4.75 an hour.

Today – Gold is about $2,300 per ounce, the house is $400,000 so 174 oz to buy, the car is $47,500 and 21 oz to buy; rates on mortgages are 7% and the minimum wage ranges from $7.25 to $17.00 per hour.

Like I said, not scientific, but certainly an interesting discussion, Thanks G for the nudge to explore this topic. If you have any questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.

Posted On Monday, 24 June 2024 00:00 Written by
Posted On Saturday, 22 June 2024 10:19
Posted On Friday, 21 June 2024 14:48
Posted On Friday, 21 June 2024 14:36 Written by

Sales should be fun and exciting. When your persistence in sales isn’t getting you the desired results in sales, several factors could be at play. Here are 5 reasons why you might be spinning your wheels:

1. YOU ARE TARGETING THE WRONG PEOPLE: If you target the wrong audience, they are not your people! Your sales efforts are a waste of time. It’s time to identify your ideal customer profile. Define the age, income level, family size, and occupation of your ICP. What are their buying habits and preferred property types? Pay attention to the details. They’re all important.

2. YOU ARE NOT QUALIFYING LEADS: Not all leads are effective. Spending time on the wrong contacts is a huge waste. Instead, determine which prospects are serious. Are they looking to buy or sell? What is their timing? Next, find out why they desire to move, such as family growth or downsizing, etc. Qualify them financially, too! Discuss their budget or price range. Identify all decision-makers in the real estate process.

3. YOU DON’T FOLLOW UP: Sales prospecting often involves multiple touchpoints. You don’t want potential deals to slip through the cracks. Take the necessary time to call prospects a couple of times. Following up with real estate leads is paramount for maintaining engagement and moving them through the sales funnel. Do so quickly, within 24 hours of an inquiry. Use multiple channels – text, phone, email, etc.

4. YOU DON’T COMMUNICATE EFFECTIVELY: Solid communication is key in sales. If you fail to pay close attention to what prospects tell you, you won’t be able to handle objections. Signs of poor communication include taking too long to respond to customer inquiries. Even an unprofessional tone can be off-putting. Learn to be an active listener and take good notes.

5. YOU DON’T BELIEVE IN SALES TRAINING: Continuous sales training is powerful and effective for keeping your sales skills sharp. Roleplay sessions may seem silly, but boy, can they put you on the spot. Challenge your current ways of doing things. Keep learning and investing in yourself.

Its time to improve your overall sales performance. Pay attention to your selling approach. Continue to learn about the competition to maintain your edge. Keep the learning process going. Most of all, enjoy the ride.

 

Posted On Friday, 21 June 2024 12:46 Written by

Existing-home sales slightly declined in May as the median sales price climbed to a record high, according to the National Association of Realtors®. In the four major U.S. regions, sales slid month-over-month in the South but were unchanged in the Northeast, Midwest and West. Year-over-year, sales rose in the Midwest but receded in the Northeast, South and West.

Total existing-home sales[1] – completed transactions that include single-family homes, townhomes, condominiums and co-ops – retreated 0.7% from April to a seasonally adjusted annual rate of 4.11 million in May. Year-over-year, sales waned 2.8% (down from 4.23 million in May 2023).

“Eventually, more inventory will help boost home sales and tame home price gains in the upcoming months,” said NAR Chief Economist Lawrence Yun. “Increased housing supply spells good news for consumers who want to see more properties before making purchasing decisions.”

Total housing inventory[2] registered at the end of May was 1.28 million units, up 6.7% from April and 18.5% from one year ago (1.08 million). Unsold inventory sits at a 3.7-month supply at the current sales pace, up from 3.5 months in April and 3.1 months in May 2023.

The median existing-home price[3] for all housing types in May was $419,300, the highest price ever recorded and an increase of 5.8% from one year ago ($396,500). All four U.S. regions registered price gains.

“Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” Yun added. “The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning.”

REALTORS® Confidence Index

According to the monthly REALTORS® Confidence Index, properties typically remained on the market for 24 days in May, down from 26 days in April but up from 18 days in May 2023.

First-time buyers were responsible for 31% of sales in May, down from 33% in April but up from 28% in May 2023. NAR’s 2023 Profile of Home Buyers and Sellers – released in November 2023[4] – found that the annual share of first-time buyers was 32%.

All-cash sales accounted for 28% of transactions in May, unchanged from April and up from 25% one year ago.

Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in May, identical to April and up from 15% in May 2023.

Distressed sales[5] – foreclosures and short sales – represented 2% of sales in May, unchanged from last month and the previous year.

Mortgage Rates

According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.87% as of June 20. That’s down from 6.95% the prior week but up from 6.67% one year ago.

Single-family and Condo/Co-op Sales

Single-family home sales declined to a seasonally adjusted annual rate of 3.71 million in May, down 0.8% from 3.74 million in April and 2.1% from the prior year. The median existing single-family home price was $424,500 in May, up 5.7% from May 2023.

At a seasonally adjusted annual rate of 400,000 units in May, existing condominium and co-op sales were unchanged from last month and down 9.1% from one year ago (440,000 units). The median existing condo price was $371,300 in May, up 5.1% from the previous year ($353,300).

Regional Breakdown

Existing-home sales in the Northeast in May were identical to April at an annual rate of 480,000, a decline of 4% from May 2023. The median price in the Northeast was $479,200, up 9.2% from the prior year.

In the Midwest, existing-home sales were unchanged from one month ago at an annual rate of 1 million in May, up 1% from one year ago. The median price in the Midwest was $317,100, up 6.4% from May 2023.

Existing-home sales in the South fell 1.6% from April to an annual rate of 1.87 million in May, down 5.1% from the previous year. The median price in the South was $374,300, up 3.6% from last year.

In the West, existing-home sales in May were equivalent to April at an annual rate of 760,000, a drop of 1.3% from one year before. The median price in the West was $632,900, up 5.5% from May 2023.

Posted On Friday, 21 June 2024 07:08 Written by
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