Posts Tagged ‘homes’
RealtyTrac reports that the home market continued to be burdened by foreclosure-related sales in 2011. Increasing from one in five home sales in the 3rd quarter of 2011 to nearly one in four in the 4thquarter, the sector accounted for just over 907,000 homes sold in the year. Additionally, sales of pre-foreclosure homes, or short sales, increased by 15.0% while the total for bank-owned properties (REO) decreased by 12.0%, and that they were sold at a respective average discounted price from non-foreclosed homes of 21.0% and 36.0%. The company anticipates foreclosure-related sales to increase in 2012 as the process banks use to release these properties on the market is hastened.
Retail sales for January enjoyed a slight gain to $401.4 billion, an uptick of 0.4 percent from the previous month, the Census Bureau reported last week. More encouragingly, this was 5.8 percent higher than January 2011, and total sales for the November 2011 through January 2012 period were up 6.3 percent from the same period a year ago.
Looking at categories, January’s retail trade sales were up 0.4 percent from December 2011 and 5.5 percent above last year. Food services and drinking establishment sales were up 8.2 percent from January 2011 and building material sales were up 8.1 percent from last year.
In fact, January retail sales pointed to growing underlying strength in the economy, given that core retail sales, which exclude auto, gasoline and building material sales, actually increased 0.7 percent, indicating increased consumption by Americans.
“[The] retail sales data are better than they look, but they don’t suggest that consumption growth is about to set the economic recovery alight,” wrote Paul Dales, an economist at Capital Economics, in a note to clients.
First-time claims for unemployment benefits placed in the week ending February 11 dropped to 348,000, a decrease of 13,000 from the previous week’s revised figure of 361,000, the Employment and Training Administration reported last week. The four-week moving average was 365,250, a decrease of 1,750 from the previous week’s revised average of 367,000.
The total number of insured unemployed workers during the week ending February 4 dropped to 3,426,000, a decrease of 100,000 from the preceding week’s revised level of 3,526,000, the Administration also reported. The four-week moving average was 3,492,500, a decrease of 8,250 from the preceding week’s revised average of 3,500,750.
Turning to real estate, building permits issued in January for construction of private housing ticked up to an annual rate of 676,000, which was 0.7 percent over December’s revised rate of 671,000, and 19 percent over the January 2011 estimate of 568,000, the Census Bureau and the Department of Housing and Urban Development reported last week. Permits for single-family homes issued in January were at a rate of 445,000; this is 0.9 percent above the revised December figure of 441,000.
Actual starts on construction of private housing initiated in January hit an annual rate of 699,000, which was 1.5 percent above December’s revised estimate of 689,000 and 9.9 percent higher than the January 2011 rate of 636,000. Starts on single-family homes in January declined to a rate of 508,000, which was 1 percent less than December’s revised rate of 513,000.
Completions of private housing in January were at a seasonally adjusted annual rate of 530,000, which was 12 percent below December’s revised estimate of 602,000, but 4.1 percent higher than the January 2011 rate of 509,000. Completions of single-family homes in January were at a rate of 389,000, which was 14.9 percent under December’s revised rate of 457,000.
Industrial production was unchanged from December to January, as a gain of 0.7 percent in manufacturing was offset by declines in mining and utilities for the month, the Federal Reserve reported last week. Looking at specific segments, the index for motor vehicles and parts jumped 6.8 percent and the index for other manufacturing industries increased 0.3 percent. The output of utilities fell 2.5 percent, as demand for heating was held down by temperatures that moved further above seasonal norms; the output of mines declined 1.8 percent.
This week sees an extremely light calendar of financial headlines due to the Presidents’ Day holiday, starting Wednesday with existing home sales for January form the National Association of REALTORS®. This is followed Thursday by initial jobless claims for last week from the Employment and Training Administration. The week closes with the University of Michigan’s consumer sentiment score for February and new home sales for January from the Census Bureau.
A majority of Americans recently surveyed say now is a good time to buy a home. That’s no surprise, given that record-low mortgage interest rates and bargain home prices are boosting affordability.
But selling a home? That’s a different story. According to 71% of the 1,000 people surveyed by Fannie Mae in December, now is a good time to buy a house. But only 11% think it’s a good time to sell.
That’s because sellers sense that even if the housing market and the economy continue to show signs of improvement in 2012, the good news likely won’t be good enough for buyers to return to the market in droves—even if they can buy a home for a steal.
“For people to start buying in larger volume, they need to see home prices go up a bit,” says Ingo Winzer, president of Local Market Monitor, a firm that analyzes housing markets for bankers.
Many potential buyers also are waiting to see the jobs picture improve, which will give them confidence in the stability of their own employment, Mr. Winzer says.
Improvements Ahead
Still, various forecasts and surveys suggest better times for the housing market this year:
Sales of existing homes are expected to grow between 2% and 5% in 2012, according a recent forecast from Freddie Mac.
A recent survey of about 1,000 Re/Max real-estate agents found that 39% of agents think prices have hit bottom in their market, while almost 75% think home prices in their markets will have stopped declining by the end of 2012.
The number of improving housing markets rose to 76 in January, from 41 in December, according to the Improving Markets Index, from First American Financial Corp. and the National Association of Home Builders.
Nationwide, home prices are expected to be relatively flat in 2012, says Alex Villacorta, director of research and analytics at Clear Capital, a provider of real-estate asset-valuation data for financial-services companies. Indeed, 2012 seems to be a turning point before a healthier and sustained recovery in 2013, he says.
If You Can Hold Out
While now still may not be the perfect time to sell a home, it may be time for home sellers to get their places ready for a sale next year.
Of course, markets vary. Prices already are on the rise in some places, including parts of Florida, Washington, D.C., and Dayton, Ohio, Mr. Villacorta says.
But other markets—including Chicago, Atlanta, Detroit and Las Vegas—continue to be on a “downward slide,” according to a December report from Realtor.com.
Either way, holding out until next year could mean a quicker and more profitable sale.
“From a seller’s point of view, it’s still a little early, though tempting, to put the house up for sale and expect a lot of demand,” Mr. Villacorta says. “Unless there are circumstances that dictate they have to sell now, certainly waiting and tracking the markets a little bit more would be a more prudent thing to do.”
Still, some sellers have delayed their moving decisions for years now. For those champing at the bit to make a sale and move on with their lives, 2012 may offer glimmers of hope.
“There are a lot of people over the last few years that decided to put their life on hold,” says Budge Huskey, president of real-estate brokerage Coldwell Banker. Some now are saying, ‘I’ve waited long enough. I can’t put life on hold forever,’ ” Mr. Huskey says.
The market is finally nearing the point where people who don’t need to sell for financial reasons are starting to consider a move for lifestyle-related reasons, he says, such as a growing family that would be more comfortable in a larger home.
The good news for them: Inventory plunged to a 6.2-month supply in December, from a 12.4 month supply in July 2010, according to the National Association of Realtors. That means there are fewer sellers competing for buyers. (The month-supply figure is how long it would take to sell all the homes on the market now based on the current rate of sales per month. The higher the number, the more sellers there are looking for buyers.)
If You Can’t Wait
If you plan to sell a home this year, get the house in the best possible condition and price it to sell before it hits the market, Mr. Huskey says.
An appealing online listing, complete with quality photographs, is also crucial to bring traffic to your home.
“The buyer has the opportunity to prescreen all the homes online and see only the few that really shine online,” Mr. Huskey says, so a seller should do everything he or she can to get on a buyer’s shortlist of homes to physically visit.
Write to Amy Hoak at amy.hoak@dowjones.com
Amy Hoak is a reporter for MarketWatch. Read more at marketwatch.com.
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