[Up + Less Distressed] 2Q 2013 Miami Report

Posted by Jonathan Miller - Thursday, July 18, 2013, 2:58 PM

We just published our report on the Miami Coastal Community housing markets. This is part of an evolving market report series I’ve been writing for Douglas Elliman since 1994.

Key Points

Inventory fell to 8-year low.
Jump in both number of sales and signed contracts.
Housing prices rose above year ago level.
Median sales price rose to highest level for second quarter in 8 years.
Credit remains tight keeping inventory low.
Heavy contract momentum carrying into next quarter.

Here’s an excerpt from the report:

The overall number of sales rose by 15.4% to 6,416 to the highest total since we began tracking this metric in 2006. The market share for non-distressed sales comprised 67.2% of all market sales, up from 46.6% in the same quarter three years ago…There were 9,490 listings at the end of the second quarter, 18.8% less than in the prior year quarter. Distressed inventory fell by 44.1% and non-distressed inventory was down by 12% over the same period…

You can build your own custom data tables for Miami as well as view charts on the Miami market, all updated with 2Q13 data.

The Elliman Report: 2Q 2013 Miami Sales [Miller Samuel]
The Elliman Report: 2Q 2013 Miami Sales [Douglas Elliman]
Aggregated Custom Market Data Tables [Miller Samuel]
Miami Market Charts [Miller Samuel]

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[Not Feeling Distressed] 2Q 2012 Miami Sales Report

Posted by Jonathan Miller - Thursday, July 12, 2012, 5:16 PM

We published our report on the Miami sales market for 2Q 2012 this morning.   This is part of an evolving market report series I’ve been writing for Douglas Elliman since 1994.

Key Points

-Distressed sale market share has fallen to 40.6% of all sales from 2/3 in early 2011. Fewer lower priced distressed sales are skewing prices higher.
-Non-distressed sales showed stable to modest price appreciation.
-Listing inventory continues to fall sharply.
-Days on market had second fastest rate in more than six years.

Here’s an excerpt from the report:

…The housing market in Miami’s coastal communities continued to show increases in nondistressed sales, falling inventory, and demand from foreign buyers from Europe and South America.

The median sales price jumped 20.9% to $196,500 from $162,500 in the prior year quarter. The $399,440 average sales price and $257 price per square foot both showed the same pattern, with respective gains of 17.7% and 14.2% over the same period. The 28.5% year-over-year gain in median condo prices largely outpaced the 4.4% gain in median single-family home prices. This was largely due to the drop in lower priced distressed sales activity over the past year, related to the “robo-signing” scandal at the end of 2010. In addition to the court-related foreclosure backlog, servicers slowed the volume of property entering the market during most of 2011 and early 2012. Condo sales saw more of a decline related to this matter; distressed condo sales fell 31.9% over the past year, while distressed single family sales fell only 11.7% over the same period…

You can build your own custom data tables on the Miami sales market – now updated with 2Q 12 data. I’ll have the latest charts on the Miami sales market uploaded this evening.

The Elliman Report: 2Q 2012 Miami Sales [Miller Samuel]
The Elliman Report: 2Q 2012 Miami Sales [Prudential Douglas Elliman]

View the original article here

Lack of Distressed Supply Continues to Hit Home Sales

The unexpected drop in signed contracts to buy existing homes in April should have come as no surprise. It is all about price point, supply, and where the action is/has been.

Depending on which survey you follow, sales of distressed properties (foreclosures and short sales), make up anywhere from a quarter to 40 percent of all home sales nationwide.

The bulk of these sales are out west in cities like Phoenix, Las Vegas and much of Southern California. Real estate agents out west will tell you that supplies of these distressed properties are dropping fast, thanks to huge investor demand. That, in turn, led to a huge drop in sales of lower priced properties, as we reported last week, down 26% in the $0-100,000 price range, according to the National Association of Realtors.

Now we see contracts to buy existing homes in April dropping 12 percent out west, far lower than sales in the northeast and mid-west, which were essentially flat.

The south, which includes troubled foreclosure states like Florida and Georgia, also saw a sizeable drop in pending sales of nearly 7 percent. Florida has plenty of foreclosures in process, but few are making it to the market, as Florida requires a judge in the process, and judicial state timelines are still far longer than non-judicial states.

“Aside from the inescapable month-to-month variability, the increasing problem is on the shortage of inventory,” admits Lawrence Yun, chief economist for the NAR. “Areas like Phoenix and Vegas, Orange Country, California are all reporting sharp reductions in inventory, and this is a problem because this is reducing the business transaction potential. So the demand is there, but if someone blinks they’re losing out on the contract signing.”

Why is inventory so low? Because banks are trying to modify more loans as part of the recent $25 billion mortgage servicing settlement. States that require a judge in the foreclosure process are also taking far longer to get the properties out to the market. Approximately 1.4 million homes are currently in the foreclosure process, according to a report today from CoreLogic, with far more loans in some stage of delinquency. Many of these properties will inevitably reach the sales market, probably in Q3 and Q4, and that will in turn boost low-end sales again, but that in turn could push slowly recovering home prices lower again.

Questions?  Comments?  document.write("");document.write("RealtyCheck"+"@"+"cnbc.com");document.write('');And follow me on Twitter @Diana_Olick

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Distressed Property Sales Drop, Despite Push to Sell

The share of distressed sales in May, that is foreclosed properties and short sales (when the property is sold for less than the value of the loan), fell to 31 percent of all sales from 37 percent in April. Investors, who purchase a large share of these distressed properties, also represented a smaller share in May. So what's going on?

We know there is still a huge supply of bank owned (REO) properties, and we also know that banks are pushing short sales on many more properties than ever before. But they are also pushing REO sales, thanks to new sales incentives from lenders and the GSE's (Government-Sponsored Enterprises).

"Realtors and mortgage loan officers nationwide are driving mid-to-high end organic, short and distressed sales on the fear that buyers will be unable to qualify for loans once the QRM (Qualified Residential Mortgage) rules are in place requiring 20 percent down," says mortgage market analyst Mark Hanson, describing new rules being considered for risk retention by banks (part of the banking overhaul legislation passed last summer).

Some bloggers though, writing in to me after the existing home sales report, claimed that Fannie and Freddie are holding on to REOs, trying to game home prices. Fannie strongly disputes that.

"Fannie Mae doesn't have a shadow inventory of REO properties that are available to be sold. As soon as we acquire a property, we quickly identify a market competitive price, determine whether to make any necessary repairs and list the property. In the first three months of 2011, we sold a record number of REO properties, selling more properties than we acquired," said Amy Bonitatibus, Fannie Mae spokeswoman.

"We watch taxpayer dollars like it's our own money. We have an immense responsibility to get the most possible value from each REO property we sell. We are committed to stabilizing neighborhoods and preserving communities across the country," she added.

In fact, Fannie Mae recently launched another program of financial incentives to Realtors to sell REO properties. A note from analysts at Goldman Sachs, titled Foreclosure Sales: Federally Backed Lenders Shifting to Net Sellers, states:

"Although these entities could hold property off the market to reduce the negative effects of distressed properties on house prices, they do not appear to be doing so...in Q1 the GSEs and FHA became net suppliers of foreclosed properties to the market for the first time since 2009. Moreover, if the temporary slowdown in REO sales over the last two quarters ends, the federal entities seem likely to add roughly 30 percent to the sales of fore loses property over the next year as compared with the previous four quarters."

Bottom line, in order for this housing market to recover, the distressed properties need to go, whether by short sales or REO sales. The distress is driving the fear, which in turn keeps buyers on the sidelines. We need investors, and we need first time buyers, and I will say it until I'm blue in the face: These buyers need better access to credit.

Questions?  Comments?  document.write("");document.write("RealtyCheck"+"@"+"cnbc.com");document.write('');And follow me on Twitter @Diana_Olick

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