Tag Archives: florida
Residential property cash sales in the US falling, latest data shows
Cash sales in the United States made up 34.8% of total home transactions in September 2014, down from 37.2% a year ago, according to the latest data to be published. The year on year share has fallen each month since January 2013, making September the 21st consecutive month of declines, the data from real estate firm Core Logic. Month on month, the cash sales share ticked up by 1%, however, the firm points out that cash sales share comparisons should be made on a year on year basis due to the seasonal nature of the housing market. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25% with a peak in January 2011 when cash transactions made up 46.4% of total home sales. Real estate owned (REO) sales had the largest cash sales share in September 2014 at 58.1%, followed by re-sales at 34.4%, short sales at 32.4% and newly constructed homes at 16.8%. While the percentage of REO sales that were cash transactions remained high, REO transactions made up only 7.8% of total sales in September and, therefore, did not have a large influence on the overall cash sales share. In January 2011, when the cash sales share was at its peak, REO sales made up 23.9% of total sales. A breakdown of the figures shows that Delaware had the largest share of any state at 57.4%, followed by Florida at 50.8%, Alabama at 49.6%, New York at 44.4% and Idaho at 43.3%. Of the nation's largest 100 Core Based Statistical Areas (CBSAs) measured by population, Miami-Miami Beach-Kendall, Florida, had the highest share of cash sales at 56.2%, followed closely by West Palm Beach-Boca Raton-Delray Beach, also in Florida at 55.9%. Then came Fort Lauderdale-Pompano Beach-Deerfield Beach, in Florida at 54.8%, Cape Coral-Fort Myers, also in Florida, at 54.7% and Detroit-Dearborn-Livonia, in Michigan at 53.1%. The data also shows that Washington-Arlington-Alexandria, D.C. had the lowest cash sales share at 16.2%. Continue reading
US commercial real estate activity expected to be on a firmer footing in 2015
Despite a slowing global economy, forward economic momentum in the United States should keep commercial real estate activity on firmer footing, according to the National Association of Realtors. The latest NAR quarterly commercial real estate forecast says that commercial activity should progress at a gradual pace heading into 2015. ‘Solid economic growth in the third quarter proved that the second quarter wasn’t an anomaly, as business spending increased, commercial construction rose and the labour market continued to make positive strides,’ said Lawrence Yun, NAR chief economist. ‘Job growth is the catalyst to improved demand for commercial real estate leasing and new construction projects,’ he explained but pointed out that softening in the global economy will likely widen the trade deficit in the US and could trigger some weakening in the overall economy. ‘GDP growth in the fourth quarter will be sluggish at around 2% behind stalling exports. Although GDP will likely climb to near 3% in 2015, the current pace of job growth could slow and ultimately impact commercial real estate activity if sluggishness in the global economy persists,’ he added. National office vacancy rates are forecast to decrease 0.5% over the coming year due to job growth exceeding inventory coming onto the market. Improved manufacturing activity should lead to a declining vacancy rate for industrial space at 0.4%, while retail space is forecast to decline 0.2% behind a boost in consumer spending from personal income gains and lower gas prices. ‘Low housing inventory and the sizeable demand for rentals will continue to spur multifamily construction as well as keep rents rising above inflation through next year,’ explained Yun. The report includes overall projections for four major commercial sectors and analyses quarterly data in the office, industrial, retail and multifamily markets. Office vacancy rates are forecast to slightly decline from 15.7% in the fourth quarter to 15.6% through to the fourth quarter of 2015. The markets with the lowest office vacancy rates in the fourth quarter are Washington, D.C., at 9.3%, New York City at 9.6%, Little Rock at 11.6%, San Francisco at 12.2% and Seattle at 12.8%. Office rents are projected to increase 2.4% in 2014 and 3.3% next year. Net absorption of office space in the US, which includes the leasing of new space coming on the market as well as space in existing properties, is likely to total 35.6 million square feet this year and 48.8 million in 2015. Industrial vacancy rates are expected to fall slightly from 8.8% in the fourth quarter to 8.4% in the fourth quarter of 2015. The areas with the lowest industrial vacancy rates currently are Orange County, California, with a vacancy rate of 3.6%, Los Angeles at 3.7%, Seattle at 5.8%, Miami at 6%, and Palm Beach, Florida, at 6.5%. Annual industrial rents should rise 2.4% this year and 2.9% in 2015. Net absorption of industrial space nationally is expected to total 110.7 million square feet… Continue reading
Existing home sales in US above year ago levels for first time in 12 months
Existing home sales rose in the US increased in October for the second straight month and are now above year on year levels for the first time in a year, according to the latest report from the National Association of Realtors. Total existing home sales, which are completed transactions that include single family homes, town homes, condominiums and co-ops, rose 1.5% to a seasonally adjusted annual rate of 5.26 million in October from an upwardly revised 5.18 million in September. Sales are at their highest annual pace since September 2013 when they were also 5.26 million and are now above year on year levels for the first time since last October. Lawrence Yun, NAR chief economist, said that the housing market this year has been a tale of two halves. ‘Sales activity in October reached its highest annual pace of the year as buyers continued to be encouraged by interest rates at lows not seen since last summer, improving levels of inventory and stabilizing price growth,’ he explained. ‘Furthermore, the job market has shown continued strength in the past six months. This bodes well for solid demand to close out the year and the likelihood of additional months of year on year sales increases,’ he added. The data also shows that the median existing home price for all housing types in October was $208,300, which is 5.5% above October 2013 and the 32ndconsecutive month of year on year price gains. Total housing inventory at the end of October fell 2.6% to 2.22 million existing homes available for sale, which represents a 5.1 month supply at the current sales pace, the lowest since March. Unsold inventory is now 5.2% higher than a year ago, when there were 2.11 million existing homes available for sale. ‘The growth in housing supply this year will likely prevent the drastic sales slowdown and coinciding spike in home prices we saw last winter due to low inventory. However, more housing starts are needed to increase supply, meet current demand and keep price growth in check,’ said Yun. All cash sales were 27% of transactions in October, up from 24% in September but down from 31% in October of last year. Individual investors, who account for many cash sales, purchased 15% of homes in October, up from 14% from the previous month but below October 2013 when it was 19%. Some 65% of investors paid cash in October. The percent share of first time buyers in October remained at 29% for the fourth consecutive month. First time buyers have represented less than 30% of all buyers in 18 of the past 19 months. A separate NAR survey has found that the annual share of first time buyers fell to its lowest level in nearly three decades. Distressed sales were in the single digits for the third month this year, decreasing to 9% in October from 10% in September and 14% a year ago. Some 7% of October sales were foreclosures and 2% were short… Continue reading
