RISMEDIA, June 29, 2010—United States real estate broker and agent forward-looking confidence edged higher in Point2 Technologies’ monthly Real Estate Confidence Index (RECI) survey in June 2010, rising 0.70% to 5.76 on the RECI scale of 1-10, versus last month. Relatively strong long-term optimism sent the Index’s 12-18 month optimism/pessimism variable higher by three percentage points and was the key catalyst behind the upside.

Current Sentiment, one of the three key Index components that tracks survey respondent views of existing market conditions, dropped by 1.92%, to 5.12 on the 1-10 RECI scale (10 being “Good” and 1 being “Bad”).

The Short-Term (3-6 months) optimism/pessimism variable rose marginally, by 0.53%, to 5.64.

Closing at 5.76 on the 1-10 RECI scale, the national Index remained virtually flat in the June 2010 survey, versus a year ago (-0.17%).

Since the RECI was launched in June 2009, broker and agent sentiment has held the Index between the 5.59 low recorded in October 2009 and the high of 6.03 hit in November that year. The RECI peaked just ahead of the expiry of the first federal government tax credit incentive that offered $8,000 to new home buyers.

Notably, the lack of a clear directional improvement in broker and agent outlook over the past twelve months indicates that while government incentive programs have helped to spur market activity, a self sustaining recovery remained a challenge.

Feedback offered by 2,574 real estate brokers and agents who participated in the June 2010 survey from across every U.S. state sent mixed signals regarding the outlook for the market, even though the longer term view remained relatively strong.

In most states, respondents frequently referred to healthy sales activity and optimism, with some citing low interest rates as the primary driver. In some pockets around the country, shorter time-on-market was also reported, which indicates a relatively more fluid sales and financing environment in the respective regions.

Concerns over employment and job insecurity, lending obstacles and more foreclosures coming to market were however persistent. Brokers and agents nationwide expect these issues will apply downward pressure on home values for the foreseeable future, and, in cases, the next several years.

Uncertainty over the future of the market following the lapse of government incentives was also repeatedly discussed and captured in the June 2010 RECI Report. The concern highlights growing reliance on government intervention in many parts of the country. Sudden slowdown in sales activity right after the April 30, 2010 expiry of the latest program was felt and reported by sales professionals in a number of states.

For more information, visit http://www.RealEstateConfidenceIndex.com.

http://rismedia.com/2010-06-28/predictive-u-s-national-real-estate-confidence-index-rises-0-70-percent-in-june-2010/

RISMEDIA, May 26, 2010—Existing-home sales rose again in April 2010 with buyers motivated by the tax credit, improving consumer confidence and favorable affordability conditions, according to the National Association of Realtors.

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 7.6% to a seasonally adjusted annual rate of 5.77 million units in April from an upwardly revised 5.36 million in March, and are 22.8% higher than the 4.70 million-unit pace in April 2009. Monthly sales rose 7.0% in March.

Lawrence Yun, NAR chief economist, said the gain was widely anticipated. “The upswing in April existing-home sales was expected because of the tax credit inducement, and no doubt there will be some temporary fallback in the months immediately after it expires, but other factors also are supporting the market,” he said. “For people who were on the sidelines, there’s been a return of buyer confidence with stabilizing home prices, an improving economy and mortgage interest rates that remain historically low.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.10% in April from 4.97% in March; the rate was 4.91% in April 2009.

Total housing inventory at the end of April rose 11.5% to 4.04 million existing homes available for sale, which represents an 8.4-month supply at the current sales pace, up from an 8.1-month supply in March. Raw unsold inventory is 2.7% above a year ago, but remains 11.6% below the record of 4.58 million in July 2008.

“Although inventory levels remain above normal and much of the gain last month was seasonal, the housing price correction appears essentially over,” Yun said. “In fact, a majority of the markets have seen price gains recently. A return to old-fashioned responsible lending and buying will help the housing market avoid disruptive and painful bubble-bust cycles.”

The national median existing-home price for all housing types was $173,100 in April, up 4.0% from April 2009. Distressed homes accounted for 33% of sales last month, compared with 35% in March.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said buyer traffic is mixed. “It looks like the level of home sales that close in May and June will stay elevated, but many buyers remain in the market even without the tax credit,” she said. “Some Realtors tell us they are very busy with clients who are entering the market now as a result of improved conditions, while others are welcoming a slowdown from frantic market conditions in recent months.

“Buyers are focused on finding the right house and taking advantage of favorable affordability conditions. For many buyers, owning a home is a lifestyle choice. They want a place of their own to raise a family, build memories, and be part of a larger community,” Golder said.

A parallel NAR practitioner survey shows first-time buyers purchased 49% of homes in April, up from 44% in March. Investors accounted for 15% of transactions in April, down from 19% in March; the remaining sales were to repeat buyers. All-cash sales stood at 26% in April; they were 27% in March.

Single-family home sales rose 7.4% to a seasonally adjusted annual rate of 5.05 million in April from a pace of 4.70 million in March, and are 20.5% above the 4.19 million level in April 2009. The median existing single-family home price was $173,400 in April, up 4.5% from a year ago.

Single-family median prices rose in 18 out of 20 metropolitan statistical areas reported in April from a year ago; six of the areas experienced double-digit increases. In data recently reported for the first quarter, 91 out of 152 metros saw price gains.

Existing condominium and co-op sales jumped 9.1% to a seasonally adjusted annual rate of 720,000 in April from 660,000 in March, and are 42.3% above the 506,000-unit pace in April 2009. The median existing condo price was $171,000 in April, which is 0.6% below a year ago.

Regionally, existing-home sales in the Northeast surged 21.1% to an annual level of 1.09 million in April and are 41.6% higher than a year ago. The median price in the Northeast was $243,000, up 2.1% from April 2009.

Existing-home sales in the Midwest rose 9.9% in April to a pace of 1.33 million and are 29.1% above a year ago. The median price in the Midwest was $146,400, up 5.8% from April 2009.

In the South, existing-home sales increased 8.6% to an annual level of 2.14 million in April and are 23.0% higher than April 2009. The median price in the South was $150,000, up 1.2% from a year ago.

Existing-home sales in the West fell 6.2% to an annual rate of 1.21 million in April but are 5.2% above a year ago. The median price in the West was $212,400, up 3.8% from April 2009.

For more information, visit http://www.realtors.org.

http://rismedia.com/2010-05-25/existing-home-sales-continue-to-improve-in-april-2010/

RISMEDIA, May 20, 2010—(MCT)—The “staycation” is so last year. Americans who plan to vacation this summer will spend more money and stay away longer than last year, when staying home was more the norm, according to a new survey commissioned by American Express Co.

Although the percentage of Americans who will travel this summer has remained about the same (51%), of those who will hit the road, 67% will spend more money than they did a year earlier and 74% will take the same length of vacation or longer, according to a survey of 2,000 Americans.

The survey findings, along with improving hotel occupancy rates and rising demand for airline seats, suggest Americans are loosening their purse strings somewhat on vacation spending, in contrast to the penny-pinching habits of travelers during the economic slump of the past year and a half.

“The summer vacation, and particularly the family vacation, is alive and well this year,” said Audrey Hendley, vice president of American Express Travel, a division of the credit card company.

Jason Womack, a consultant from Ojai, Calif., who coaches business executives on efficiency, said he tells clients to take time off work to get a better perspective on business. “What the recession taught me is that even when it looks like the best thing to do is to hunker down with my nose to the grindstone, it’s equally important to lift up, get away and get perspective,” he said.

After declining for the last two summers, demand for airline travel is expected to rise by about 1% this summer, an increase of 202 million passengers compared with last summer, according to a forecast issued this month by the Air Transport Association of America, the trade group that represents most U.S. airlines.

Until recently, occupancy rates and average daily room rates had been dropping monthly since October 2008. The hotel industry now expects to see occupancy rates increase 2.2% this summer to 63% compared with last summer, with the average daily room rate rising 1.9% to $95, according to a forecast by Smith Travel Research Inc., a major hospitality industry consultant.

by Hugo Martin (c) 2010, Los Angeles Times.

Distributed by McClatchy-Tribune Information Services.

http://rismedia.com/2010-05-19/americans-more-likely-to-travel-spend-this-year/

The Associated Press
Wednesday, February 17, 2010

WASHINGTON — Housing construction posted a better-than-expected increase in January which pushed activity to the highest level in six months. The solid gain raised hopes that the construction industry is beginning to mount a sustained rebound from its worst slump in decades.

The Commerce Department said Wednesday that construction of new homes and apartments rose 2.8 percent last month to a seasonally adjusted annual rate of 591,000 units. That was better than the 580,000 annual pace that economists were forecasting.

Applications for building permits, considered a good barometer of future activity, fell 4.9 percent to a rate of 621,000, but that was after two months of large increases.

In another sign of strength, Wednesday’s report revised up activity in December to show builders were starting construction at an annual pace of 575,000 units during that month, much stronger than the 557,000 originally reported. Even with the upward revision, activity fell a slight 0.7 percent in December, a dip that was blamed on severe weather in many parts of the country that depressed construction activity.

Economists are hoping that housing is beginning to recover and a rebound in this area will help support the economy as it struggles to mount a sustained recovery from the deepest recession since the 1930s.

The strength last month was led by a 10 percent jump in activity in the Northeast and an 8.9 percent increase in the West. Construction was up a smaller 1 percent in the South and 3.2 percent in the Midwest.

The strength in January pushed construction activity up by 21.1 percent from the pace in January 2009. Last month’s building rate the fastest pace since July.

Construction of single-family homes rose by 1.5 percent to a seasonally adjusted annual rate of 484,000 units while construction of multi-family units increased 9.2 percent to an annual rate of 107,000 units.

The National Association of Home Builders said Tuesday that its housing market index rose by two points to 17 in February after having fallen for two consecutive months.

That increase in sentiment was likely influenced by a number of favorable developments including a report earlier this month that the nation’s unemployment rate fell in January to 9.7 percent, still high, but lower than the 10 percent of the previous month.

In other favorable developments, mortgage rates are hovering around 5 percent, pushed down by a Federal Reserve program to buy mortgage-backed securities. And builders say they are also seeing a boost in the demand for homes coming from a government stimulus program. That program provides tax credits of up to $8,000 for first-time home buyers and up to $6,500 for current homeowners who decide to move.

Bob Jones, chairman of the home builders, said builders were “slightly more optimistic that the housing recovery is finally beginning to take root.”

http://www.washingtonpost.com/wp-dyn/content/article/2010/02/17/AR2010021701302.html?hpid=topnews

RISMEDIA, February 15, 2010—Strong gains in existing-home sales were the predominant pattern in most states during the fourth quarter, with many more metro areas seeing prices rise from a year earlier, according to the latest survey by the National Association of Realtors®.

Sales increased from the third quarter in 48 states and the District of Columbia; 32 states saw double-digit gains. Year-over-year sales were higher in 49 states and D.C.; all but three states had double-digit annual increases.

Total state existing-home sales, including single-family and condo, jumped 13.9% to a seasonally adjusted annual rate of 6.03 million in the fourth quarter from 5.29 million in the third quarter, and are 27.2% above the 4.74 million-unit level in the fourth quarter of 2008. Distressed property accounted for 32% of fourth quarter transactions, down from 37% a year earlier.

Lawrence Yun, NAR chief economist, said the first-time home buyer tax credit was the dominant factor. “The surge in home sales was driven by buyers responding strongly to the tax credit combined with record low mortgage interest rates,” he said. “With inventory levels trending down over the past 18 months, we expect broadly balanced housing market conditions in much of the country by late spring with more areas showing higher prices.”

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage fell to a record low 4.92% in the fourth quarter from 5.16% in the third quarter; it was 5.86% in the fourth quarter of 2008.

In the fourth quarter, 67 out of 151 metropolitan statistical areas reported higher median existing single-family home prices in comparison with the fourth quarter of 2008, including 16 with double-digit increases; one was unchanged and 84 metros had price declines. In the third quarter only 30 MSAs showed annual price increases and 123 areas were down.

The national median existing single-family price was $172,900, which is 4.1% below the fourth quarter of 2008; the median is where half sold for more and half sold for less. “This is the smallest price decline in over two years, with the most recent monthly data showing a broad stabilization in home prices,” Yun said.

“Because buyers are taking on long-term fixed rate mortgages, avoiding adjustable-rate products, and trying to stay well within their budgets, the price recovery process appears durable,” Yun said.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said near-term market conditions will remain favorable. “Mortgage interest rates are expected to trend up later this year, but right now we have very good conditions with steadying home prices and favorable inventory in most areas, especially in the higher price ranges,” she said.

“The biggest issue is for repeat buyers, who will have to accelerate their buying plans if they want the expanded tax credit. Since you must have a contract in place by the end of April, the best advice is to consult a Realtor now about qualification criteria and options in your area,” Golder said. Repeat buyers do not have to sell their existing home, but all buyers must occupy the property they purchase as a primary residence to qualify for the tax credit. Buyers who have a contract in place by April 30, 2010, have until June 30, 2010, to finalize the transaction to get a credit of up to $8,000 for first-time buyers and $6,500 for repeat buyers.

In the condo sector, metro area condominium and cooperative prices–covering changes in 54 metro areas–showed the national median existing-condo price was $177,300 in the fourth quarter, down 4.8% from the fourth quarter of 2008. Eleven metros showed increases in the median condo price from a year earlier and 43 areas had declines; in the third quarter only four metros experienced annual price gains.

Northeast
Regionally, existing-home sales in the Northeast rose 11.1% in the fourth quarter to a pace of 1.03 million and are 33.6% higher than a year ago. The median existing single-family home price in the Northeast declined 5.6% to $234,900 in the fourth quarter from the same quarter in 2008, but with widely varying conditions. “In the Northeast, markets with lower median prices that have avoided wide swings, such as Buffalo, are generally showing consistent price gains,” Yun said. “Even so, some of the higher cost areas are showing signs of stabilization, such as Nassau-Suffolk, N.Y., and Boston.”

Midwest
In the Midwest, existing-home sales jumped 14.5% in the fourth quarter to a pace of 1.38 million and are 29.9% above a year ago. The median existing single-family home price in the Midwest rose 1.1% to $141,100 in the fourth quarter from the same period in 2008, with the region accounting for the majority of metro areas experiencing double-digit gains.

Yun said markets with high unemployment rates in Ohio and Michigan experienced large price swings. “Big price gains in many Midwestern areas are due to a more normal range of home sales in contrast with predominately foreclosed sales a year ago,” he said.

South
In the South, existing-home sales rose 13.8% in the fourth quarter to an annual rate of 2.23 million and are 28.2% higher than the fourth quarter of 2008. The median existing single-family home price in the South was $153,000 in the fourth quarter, down 2.4% from a year earlier. “Affordable markets in the South that have relatively better local economies are seeing healthy price gains, such as Houston, Oklahoma City and Shreveport, La.,” Yun said.

West
Existing-home sales in the West jumped 16.2% in the fourth quarter to an annual rate of 1.38 million and are 18.2% above a year ago. The median existing single-family home price in the West was $227,200 in the fourth quarter, which is 8.9% below the fourth quarter of 2008, but with many areas showing notable gains.

“Markets in the West such as San Francisco, San Jose and Denver are showing double-digit price increases, and other markets like San Diego and Anaheim have begun to firm up,” Yun said.

For more information, visit http://www.realtor.org.

http://rismedia.com/2010-02-14/existing-home-sales-surge-in-most-states-in-fourth-quarter/

 RISMEDIA, January 21, 2010—(MCT)—According to David Crowe, chief economist of the National Association of Home Builders, home builders, mired in their deepest slump since the Great Depression, are likely to see a rebound in sales in 2010 as stabilizing home prices and record-high affordability conditions draw buyers into the market.

“The stage is set for the consumer to return,” said Crowe. “It won’t be a strong recovery, but it will be a recovery.” Crowe predicts that housing starts will rise more than 25% in 2010, to 700,000 units, from 550,000 in 2009. Low interest rates will continue to help the housing industry: Even though they are expected to rise, the 30-year mortgage—now just above 5%—will stay below 6% through the year, predicted Frank Nothaft, chief economist for mortgage agency Freddie Mac.

But Crowe and other economists speaking at the International Builders show, being held this week in Las Vegas, cautioned that there are plenty of reasons to be cautious about the home building outlook for 2010. Even home builders themselves are reluctant to embrace the positive predictions.

Any optimism on home building should be tempered on a number of counts, said Ed Sullivan, chief economist for the Portland Cement Association, whose members provide concrete used in residential and commercial projects. “I’m much more cautious as to the magnitude and timing of when that optimism comes,” Sullivan said. “There are hurdles still facing this industry and the issues don’t start to abate until the second half of this year.” Single-family starts could rise 20% in 2010, but that is “from a desperately low level and pathetically mild in absolute numbers,” he said.

Sullivan laid out six items that work against any big recovery in housing in 2010:

-A slow labor market recovery. “Much hinges on the labor market and when that turns,” Sullivan said. But both the government’s payroll survey and the household survey show continuing, if moderating, job losses. “Employment is the No. 1 reason caution persists,” Crowe said. “We’re not going to add jobs for at least several more months.”

-Payback from the expiration of the home buyer tax credit. “The tax credit is pulling people forward who were in the market anyway. So the sales pace isn’t quite as vibrant as suggested by the raw data. There could be a payback that materializes in July when the current version expires,” Sullivan said.

-Rising foreclosures. Moratoriums on foreclosures and an unworkable backlog that paralyzed many lenders made it look as if the foreclosure situation was easing in the second half of 2009. Expect the pace to accelerate this year. “Serious-delinquency rates haven’t peaked yet,” said Nothaft. “That usually happens six to 12 months after the employment recovery begins.”

-Price pressures. A rise in bank repossessions of homes will undoubtedly create additional pressure on home prices, Sullivan said. “Home prices have stabilized, but is that permanent?” asked David Berson, chief economist for PMI Group, a mortgage-insurance firm. “You’ll see more price declines—part is seasonal because we always see declines in the winter, but we’ll see more delinquencies and foreclosures,” and that could add to inventory increases and price cuts. “It could be three years before we get back to the long-term trends of home price appreciation,” Berson said.

-Tight lending standards. Mortgage lenders are unlikely to ease underwriting standards with the labor market soft and home prices unstable. That will crimp housing demand, Sullivan said.

-The potential for interest-rate increases. Lenders may demand a bigger risk premium for home loans in this environment and with the Fed about to wind down its purchases of mortgage-backed securities, there is a potential that interest rates will rise this year.

The good news? “Once we get out of this, there is going to be a lot of pent-up demand that is going to be released in 2011, 2012 and 2013,” Sullivan said.

Though December 2009 was another slow month for housing, sales and traffic picked up immediately following Christmas and continue to show more strength into the New Year, according to John Burns Real Estate Consulting’s January survey of home builders. “Traffic improvements are more about quality than about sheer numbers,” said Jody Kahn, a vice president with the firm. “Still, this better end to the year buoyed builders’ perspectives for the next six months.”

Kahn said new home prices were mostly flat around the country, with four key regions—Southern California, Texas, Midwest and southern Florida—showing stable prices for the first time since the downturn began. That price stability, though, may have contributed to slowing sales in all but the southern Florida region.

According to the survey, many builders are starting the year with low inventories of homes for sale, following a strong fall for deliveries. But Kahn said a rise in inventory is expected through March as home builders anticipate a strong spring selling season, sparked in part by the April 30 deadline to qualify for the home buyer tax credit.

(c) 2010, MarketWatch.com Inc.

Distributed by McClatchy-Tribune Information Services.

http://rismedia.com/2010-01-20/real-estate-analysts-cautiously-optimistic-for-2010/print/

January 12, 2010

By Nick Churton, Mayfair International Realty

Since the beginning of 2009 the Central London property market has confounded just about every one involved with it.  The weak pound has attracted overseas buyers who have been absent for some years.  Buyers from France and Italy have been particularly notable.

But buyers are being choosy.  Locations such as Mayfair, Belgravia, Kensington and Knightsbridge have been especially popular but only the best property examples are generating special interest.  Condition is very important, as is interior finish.  Good is no longer good enough.  Exceptional finish is now the accepted norm if a house or apartment is going to get a top price.  This is the international effect: expectations are high and this is certainly having an influence on how London homeowners modernise and improve their homes.

Well-appointed properties in the best locations should continue to sell well – in many cases at pre 2007 levels. This activity in prime Central London will, no doubt, ripple out most quickly to the South East of England and prime centres such as Oxford, Cambridge, Winchester, Bath and York.

Whilst the stock of property for sale remains extremely limited prices will be forced upwards.  But this could change rapidly during 2010 if sellers are encouraged to come to the market through rising prices – thus reversing the trend and creating a second dip in property values.

However if the supply of property remains relatively low because of continued rock bottom interest rates and the fear of rising unemployment, there is unlikely to be a repeat of the bargain prices of late 2008/early 2009.  Also, any weakening of the pound against the dollar or euro will see further interest from abroad that will positively affect supply and demand for house sellers.

The UK general election before June may also have an influence on the market.  The UK government will want to do its utmost to improve the public mood, and we can expect that there will be further pressure on the banks to increase the residential lending necessary to stimulate the housing market.

Central and southwest London are expected to lead the way in the house-price recovery into 2010. With low levels of stock and growing confidence and demand, buyers will be forced to broaden their search to find value.  Areas that have been lagging in the recovery will benefit from this effect and there will be a direct impact on prices as family movers push up house prices in metropolitan suburbs and major towns.   City centres, burdened with an over supply of apartments will take longer to recover but as the buy-to-let market gathers pace these areas will also begin to show signs of improvement.

**Click on the image below to download a PDF version of the flyer.

by Steve Harney on December 29, 2009

Though the upper end market has been weak over the last few years, this may be proof that it is starting to turn. It is something we will continue to keep our eye on.