Tag Archives: california
Metro home prices in the US continued to accelerate in first quarter of 2015
Stronger demand combined with lagging inventory levels caused home prices in the US to accelerate in many metro areas during the first quarter of 2015, new data shows. And the number of areas experiencing double digit price appreciation doubled compared to last quarter of 2014, according to the latest quarterly report by the National Association of Realtors. The median existing single family home price increased in 85% of measured markets, with 148 out of 174 metropolitan statistical areas (MSAs) showing gains based on closings in the first quarter compared with the first quarter of 2014. However, 25 or 14% recorded lower median prices from a year earlier but the number of rising markets in the first quarter was mostly unchanged compared to the fourth quarter of last year, when price increases were recorded in 85% of metro areas. Then data also shows that 51 metro areas or 29% experienced double digit increases in the first quarter of the year, a sharp increase from the 24 metro areas in the fourth quarter of 2014 and above the 37 that experienced double digit increases in the first quarter of 2014. According to Lawrence Yun, NAR chief economist, after moderating to healthier levels of growth at the end of 2014, prices picked up in several metro areas during the first quarter. ‘Sales activity to start the year was notably higher than a year ago, as steady hiring and low interest rates encouraged more buyers to enter the market. However, stronger demand without increasing supply led to faster price growth in many markets,’ he explained. ‘Sales could soften slightly in some of these markets seeing sharp price appreciation unless housing supply markedly improves and tempers its unhealthy level of growth,’ he added. The national median existing single family home price in the first quarter was $205,200, up 7.4% from the first quarter of 2014 when it was $191,100. The median price during the fourth quarter of 2014 increased 5.8% from a year earlier. Total existing home sales, including single family and condo, declined 1.8% to a seasonally adjusted annual rate of 4.97 million in the first quarter from 5.06 million in the fourth quarter of 2014, but are 6.2% higher than the 4.68 million pace during the first quarter of 2014. At the end of the first quarter, there were 2.00 million existing homes available for sale, slightly above the 1.96 million homes for sale at the end of the first quarter in 2014. The average supply during the first quarter was 4.6 months, down from 4.9 months a year ago. A supply of six to seven months represents a healthy balance of supply between buyers and sellers. ‘Home owners throughout the country have enjoyed accumulating household wealth through the steady rise in home values in the past few years. However, some homeowners are hesitant to move-up and sell because they aren't confident they'll find another home to buy,’ said Yun. ‘This trend, in addition to subpar home building… Continue reading
Majority of US metro areas experiencing falling home ownership rates, new research shows
Rising home prices in many metro areas in the United States have helped home owners build housing wealth in recent years, according to new research from the National Association of Realtors. But the continued decline in home ownership means the gains are going to fewer people and likely leading to worsening inequality in the nation. The NAR reviewed data on home ownership rates, changes in single family median home prices and a measure of inequality between 2010 and 2013 to estimate wealth and income inequality in 100 of the largest metropolitan statistical areas across the US. The findings reveal that over 90% of metro areas have experienced declining home ownership rates at a time when home values have risen and incomes have remained flat. According to the study, wealth distribution is seen as most unequal in metro areas with the lowest homeownership rates, including high cost areas such as Los Angeles, New York and San Diego. According to Lawrence Yun, NAR chief economist, home prices have steadily recovered in most metro areas in the past five years, providing a boost of $5 trillion in housing wealth from the downturn’s cyclical low for home owners during this time. ‘Home ownership plays a pivotal role in the US economy and has historically been one of the primary sources of wealth accumulation for middle class families,’ he said. ‘Unfortunately, due to an underperforming labour market, insufficient housing supply and overly-stringent underwriting standards since the recession, home ownership has plunged to a rate not seen in over two decades. As a result, the country has become more unequal as the number of homeowners has fallen while the number of renters has significantly risen,’ he added. Yun explained that the inability for renter households to become home owners is leaving them behind financially. A typical homeowner’s net worth climbs because of upticks in home values and declining mortgage balances. On the other hand, renters have likely seen increased rental housing costs and are less likely to have been active investors in the stock market’s strong growth in recent years. NAR’s study examined intensifying or lessoning inequality by measuring the change in the number of owners and renters during the recent period of rising home values. The findings show that an overwhelming 93 out of 100 analysed markets experienced a declining home ownership rate from 2010 to 2013. Because renters typically have much lower net worth than home owners, a metro area’s low homeownership rate is associated with greater wealth inequality. As a result, Los Angeles, New York, Las Vegas, Fresno in California and San Diego were found to have the most unequal wealth distribution. ‘Changes in wealth during this period are especially profound in high cost metro areas that have seen robust price growth. For instance, a typical home owner in San Jose, California, enjoyed an increase of $210,671 in housing wealth while renters were left behind and likely exposed to annual rent increases,’ said… Continue reading
Solid home price growth in the US in last quarter of 2014
Home prices in the United States posted solid gains in the fourth quarter of 2014, with the majority of metro areas seeing a slightly stronger price growth. This growth was propelled by tight housing supplies, low interest rates, and a strengthening job market, according to the latest quarterly report from the National Association of Realtors. It means that the national median existing single family home price was $208,700 in the fourth quarter, up 6% year on year and the median existing single family home price rose in 150 out of the 175 metro markets tracked, some 86%. That marks a stronger price gain compared to the third quarter when 73% of the metro areas had posted increases. The data also shows that 24 areas, or 14%, saw double digit increases in the fourth quarter. ‘Home prices in metro areas throughout the country continue to show solid price growth, up 25 percent over the past three years on average,’ said Lawrence Yun, NAR’s chief economist. ‘This is good news for current home owners, but remains a challenge for buyers who are seeing home prices continue to outpace their wages. Low interest rates helped preserve affordability last quarter, but it’ll take stronger income gains and more housing supply to help meet the pent-up demand for buying,’ he explained. Meanwhile, total existing home sales, including single family and condos, fell 1% in the fourth quarter to a seasonally adjusted annual rate of 5.07 million. But existing home sales are still 2.6% higher year on year. By the end of the fourth quarter, 1.85 million existing homes were available for sale, which is slightly below the 2.01 million homes for sale during the fourth quarter of 2013. The average supply was 4.9 months in the fourth quarter. Most economists consider a supply of six to seven months a healthy balance of supply between buyers and sellers. ‘Despite affordable housing conditions in most of the country, an upward pressure on home prices still persists in some metro areas, particularly in the West, where the current supply of new and existing homes for sale is failing to keep pace with overall demand and growing populations,’ Yun pointed out. ‘Unless home builders significantly boost construction, housing supply shortages could develop and lead to further price acceleration this spring,’ he added. The most expensive housing markets in the fourth quarter were San Jose, California, where the median existing single family home price reached $855,000, followed by San Francisco at $742,900, Honolulu at $701,300, Anaheim-Santa Ana, California at $688,500 and San Diego at $493,100. A regional breakdown shows that in the Northeast total existing home sales increased 2.5% in the fourth quarter and are 4.1% below the fourth quarter of 2013. Median existing single family home price was $246,300, up 2.2% from a year ago. In the Midwest existing home sales fell 4.7% in the fourth quarter and are 0.6% below a year ago. Median existing single family home prices reached $162,000, a 6.2% jump… Continue reading
