december market report
TRANSCRIPT
KCM Divided into Three Sections
“We expect single-family home sales and housing starts to be at the highest
level since 2007.”
Frank E. NothaftChief Economist at Freddie Mac
PRICES
FHFA 3Q Home Price Index11/2013
Year-over-Year Price Changes by Region
2012 4Q 2013 1Q
2013 3Q2013 2Q
Days on Market
FHFA 3Q Home Price Index11/2013
Year-over-Year Price Changes by State
CoreLogic11/2013
DISTRESSED PROPERTIES Months Supply
S&P Case Shiller 11/2013
Year-over-Year Change in Prices
Sustainability of Current Price Increases
Fitch Ratings11/2013
S&P Case-Shiller Home Price Indices
S&P Case Shiller 11/2013
Metropolitan Area Month-Over-Month
Atlanta .5%
Boston .5%
Charlotte -.2%
Chicago .3%
Cleveland .3%
Dallas .2%
Denver .2%
Detroit 1.5%
Las Vegas 1.3%
Los Angeles 1.1%
Metropolitan Area Month-Over-Month
Miami .8%
Minneapolis .8%
New York .6%
Phoenix 1.2%
Portland .7%
San Diego .9%
San Francisco .8%
Seattle .3%
Tampa .2%
Washington .4%
"The conditions that led to the robust appreciation experienced earlier this year, including historically low mortgage interest rates, high affordability, low inventory and high demand, are waning. In their
place, we're beginning to see more inventory and rising mortgage rates, which will lead to further
normalization in the market going forward."
Dr. Stan Humphries Zillow Chief Economist
Months Inventory of Homes for Sale
NAR 11/2013
5-6 Months = Normal Market Inventory
-24%
-20.8%
-16.8%
-14%-13%
-7.6%
-5%-6.2%
1.8% 0.9%
-25%
-20%
-15%
-10%
-5%
0%
5%
January February March April May June July August Sept October
% -24% -20.8% -16.8% -14% -13% -7.6% -5% -6.2% 1.8% 0.9%
NAR 11/2013
Year-over-Year Inventory Levels
Affordability is still good compared to any time over the last 50 years.
"All those young people who moved in with their parents over the past few
years and didn't move out during the recession, there should be pent-up demand for household formation."
Jed Kolko Trulia’s Chief Economist
Affordability is still good compared to any time over the last 50 years.
“We believe millennials will follow every generation that
preceded them, buying homes once their economic situation
improves.”
Joseph SniderVP and senior credit officer at Moody’s
Urban Land Institute 11/2013
121M Current Households in the United States
Projected Growth over the Next 3 Years
3.7% Number of Additional Households Formed
4.48M
ta·perˈtāpər/Verb – to diminish or reduce
A government stimulus package…
for the HOUSING INDUSTRY
Affordability is still good compared to any time over the last 50 years.
“Although the consensus is the Fed will wait until 2014 to start
to taper asset purchases, December is still possible.”
Bill McBride Calculated Risk
2013 30 Year Fixed Mortgage Rates
Federal Reserve 11/2013
Mortgage Rate Projections
Analyst Projected Rate 4Q 2014
Fannie Mae 4.8% National Assoc of Realtors 5.3% Freddie Mac 5.0% Mortgage Bankers Assoc 5.3%
Mortgage Interest Rate Payment (P&I)
Today $250,000 4.3% 1,237.18
Next Year $250,000 5.3% 1,388.26
Monthly Difference $161.08
The Cost of Waiting
30 DAY PLAN
Re-up all of your existing listings
List EVERY expired listing in January
NAR 11/2013
0
5
10
15
20
25
30
35
40
45
50
2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Newspaper Yard Sign
Internet
Where Buyers Found the Home They Purchased by percentages
eGuides AvailableeGuides Available
4,000,000
4,500,000
5,000,000
5,500,000
Existing Home Sales
S&P Case Shiller 11/2013
NAR 11/2013
100 = Historically Healthy Level
Pending Home Sales
RETURN ON INVESTMENT
47
29.5
3
65.7
Dow S&P NASDAQ Real Estate
January 2000 – November 2013
MSN Money.com, Case Shiller
30 Year Fixed Rate Mortgage HistoryJanuary 2012 – November 2013
Federal Reserve 11/2013
S&P Case-Shiller Home Price Indices
S&P Case Shiller 11/2013
Months Inventory of Homes for Sale
NAR 11/2013
4.0
5.0
6.0
7.0
8.0
9.0
10.0
5-6 Months = Normal Market Inventory
NAR 11/2013
Percentage of Distressed Property Sales
35%
14%
SALES
UP 6% over last year
PRICESUP 12.8%
over last year
INVENTORY
UP .9% over last year
NAR’s NovemberExisting Home
Sales ReportOn Average
14,027Homes Sell
EVERY DAY!
CoreLogic11/2013
DISTRESSED PROPERTIES Months Supply
of all buyers search online during home buying process
of all buyers purchased a home through an agent
of all buyers look to print newspaper ads
28%
88%
92%
Where Do Buyers Find a Home?
0
5
10
15
20
25
30
35
40
45
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Where Buyers Find the Home They Purchase Over the Last 10 Years
by percentage
*NAR 11/2013
Newspapers
Yard Signs
The Internet
2013 30 Year Fixed Mortgage Rates
Federal Reserve 11/2013
facebook.com/groups/kcmmembersfacebook.com/groups/kcmmembers
Resources
KEEPINGCURRENTMATTERS.COM
Slide Slide Title Link
5 Frank Nothaft Quote http://www.freddiemac.com/news/finance/docs/Nov_2013_public_outlook.pdf
7 Year-over-Year Price Changes by Region http://www.fhfa.gov/webfiles/25844/3Q2013HPIreleasepacket.pdf
8 FHFA Maps http://www.fhfa.gov/
9 Days on Market http://zillow.mediaroom.com/index.php?s=159&item=396
10 Year-over-Year Change by State http://www.fhfa.gov/webfiles/25844/3Q2013HPIreleasepacket.pdf
11 Distressed Properties http://www.corelogic.com/about-us/researchtrends/the-marketpulse.aspx
12 Year-over-Year Change in Priceshttp://www.housingviews.com/wp-content/uploads/2013/11/CSHomePrice_Release_Sept-Results.pdf
13 Sustainability of Current Price Increaseshttp://www.zerohedge.com/sites/default/files/images/user5/imageroot/2013/11/Fitch%20-%20Housing%20Economic%20Risk%20Factor%20Report.pdf
14 S&P Case-Shiller Home Price Indiceshttp://www.housingviews.com/wp-content/uploads/2013/11/CSHomePrice_Release_Sept-Results.pdf
15 Dr. Stan Humphries Quotehttp://www.dsnews.com/articles/housing-market-performs-well-despite-rising-interest-rates-2013-10-24
17 Year-over-Year Inventory Levels www.realtor.org
19 Jed Kolko Quotehttp://www.chicagotribune.com/classified/realestate/sns-201311091600--tms--realestmctnig-a20131115-20131115,0,5318891.column
Resources
KEEPINGCURRENTMATTERS.COM
Slide Slide Title Link
20 Joseph Snider Quotehttp://www.dsnews.com/articles/slow-household-formation-cyclical-like-all-things-real-estate-moodys-says-2013-11-13
22 Emerging Trends in 2014http://www.uli.org/wp-content/uploads/ULI-Documents/Emerging-Trends-in-Real-Estate-Americas-2014.pdf
25 Bill McBride Quote http://www.calculatedriskblog.com/2013/11/will-fed-taper-in-december-inflation-is.html
26 2013 30 Year Fixed Mortgage Rates http://www.freddiemac.com/pmms
28 Mortgage Rate Projections
http://www.mortgagebankers.org/files/Bulletin/InternalResource/84813_.pdf http://www.freddiemac.com/news/finance/docs/Jun_2013_public_outlook.pdf http://www.realtor.org/sites/default/files/reports/2013/embargoes/phs-6-27-hgbfjnv/july-2013-outlook-2013-6-27.pdf http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_061313.pdf
34 Where Buyer Found the Home They Purchasedhttp://economistsoutlook.blogs.realtor.org/2013/11/05/2013-profile-of-home-buyer-and-sellers-technology-trends
39 Pending Home Sales http://www.realtor.org/
40 Return on Investment http://www.spindices.com/index-family/real-estate/sp-case-shiller
41 30 Year Fixed Rate Mortgage History http://www.freddiemac.com/pmms
42 Dr. Stan Humphries Quotehttps://www.spice-indices.com/idpfiles/spice-assets/resources/public/documents/19529_cshomeprice-release-0730.pdf
Resources
KEEPINGCURRENTMATTERS.COM
Slide Slide Title Link
44, 45Months Inventory of Homes for Sale, Percentage of Distressed Property Sales
www.realtor.org
47 Distressed Properties http://www.corelogic.com/about-us/researchtrends/the-marketpulse.aspx
48 Where Do Buyers Find a Home? www.realtor.org
50 2013 30 Year Fixed Mortgage Rates http://www.freddiemac.com/pmms
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