Posted by Kim Adamof on Thu, Oct 29, 2009 @ 08:51 AM
Exploring how far your real estate dollar will stretch in various American housing markets
by Luke Mullins
In the more than three years since the housing bubble popped, American real estate prices have declined at a historic clip. The national median price of an existing home dropped to $177,700 in August. That's 21 percent below the level in August 2006, when the median home price was $225,000. But just as the housing crash has hit various parts of the country with unequal force, $177,700 will buy you a much different house in one real estate market than it will in the next. To get a sense of how far your real estate dollar will stretch in different parts of the country today, here is a look at homes listed in the $177,700 range in 10 distinct U.S. cities. The listings were provided by real estate firm Trulia.com, a U.S. News partner.
#4 Raleigh North Carolina
Read the entire article ...
Posted by Kim Adamof on Thu, Oct 22, 2009 @ 11:08 AM
Fortune Small Business magazine ranked the Raleigh metro area as the third-best place in the U.S. to start a business.
Raleigh trailed Oklahoma City and Pittsburgh among large metros in the annual study, which was conducted by the magazine and the Ewing Marion Kauffman Foundation. Charlotte ranked seventh on the list, while Wilmington and Durham ranked 14th and 15th, respectively, among mid-sized metro areas.
The magazine cited relatively low housing costs in the Triangle, the region's climate and accessibility to both the coast and the mountains, Raleigh's downtown revitalization efforts and the local educational and research opportunities.
"Historically, fast-growing small companies have led the U.S. economy out of recession, and according to our latest poll, nearly half of all small-business owners would consider moving if doing so would help their companies," Fortune Small Business editor Jessica Bruder said in a statement. "Location matters more than ever before. The great recession redrew the map of America."
Click here to see the full story
Posted by Kim Adamof on Wed, Jun 17, 2009 @ 06:39 PM
According to the
Triangle Business Journal of
Raleigh North Carolina. A report by the Brookings Institution that gauges the impact of the recession on metropolitan America has listed the Raleigh-Cary metro area as the strongest in North Carolina, and among the top 40 in the nation.
Brookings' MetroMonitor ranks the nation's 100 largest metro areas based on their economic performance as judged by six key indicators - employment, unemployment rates, wages, gross metropolitan product, housing prices and foreclosure rates.
The listing is broken down into five groups of 20. The groups are listed as strongest, second-strongest, middle, second-weakest and weakest. The report covers the entire first quarter of 2009.
The Greensboro metro was listed in the report as one of the country's second-weakest metros, while Charlotte was among the 20 middle metros.
Here's how the Raleigh-Cary metro are fared in key data: The percentage change in employment from peak employment to first quarter 2009 was negative 2.9 percent; the percentage change in the unemployment rate from the first quarter 2008 to the same quarter in 2009 was 4.6 percent; the percentage change in gross metropolitan product from peak GMP to first quarter 2009 was negative 1.1 percent; and the real percent change in housing prices from first quarter 2008 to first quarter 2009 was 2 percent.
Four of the top five strongest performing metros, according to the report, are in Texas. They are San Antonio, Austin, Houston and Dallas. Oklahoma City was the other representative on the top five list. On the other hand, four of the five weakest are in Florida. They are Bradenton, Tampa, Lakeland and Jacksonville. MetroMonitor determined that Detroit was the weakest-performing metro in the country.
The MetroMonitor, which will be released on a quarterly basis, bills itself as an interactive barometer of the health of America's metropolitan economies and looks at national economic statistics to portray the diverse metropolitan trajectories of recession and recovery across the country.
Posted by Kim Adamof on Thu, May 21, 2009 @ 09:47 AM
WASHINGTON, May 19, 2009 (Reuters) - Raleigh Realtors look at the U.S. housing starts and permits fell to record lows in April, weighed down by a slump in multifamily units, according to data on Tuesday that still hinted the U.S. recession may be drawing to a close.
The Commerce Department said housing starts fell 12.8 percent to an annual rate of 458,000 units last month, the lowest since records began in January 1959.
The drop reflected a 46.1 percent plunge in breaking ground for multifamily units and indicated homebuilding remains a drag on the economy. However, starts for single-family homes, rose 2.8 percent, a second straight gain that showed the worst-hit part of the market was stabilizing.
"There is some stability. When you look at the housing starts numbers, they are going to be vulnerable to kind of two steps forward, one step back," said Nick Kalivas, vice president of financial research at MF Global in Chicago. "Housing starts are at a level where they are bottoming out."
Analysts said the decline in starts should help the housing market work through a huge stock of unsold homes and lay the foundation for a recovery from a three-year slump, which was the main trigger of the economic downturn.
Compared to the same period last year, housing starts were down 54.2 percent.
"This is essentially a good thing. It means supply will eventually come back in line with demand," said Joseph Brusuelas, an economist at Moody's Economy.com in West Chester, Pennsylvania.
Shares of U.S. homebuilders fluctuated in choppy trade. The Dow Jones home construction index ended slightly lower following strong gains on Monday after data showed homebuilder sentiment had improved.
In related news, shares of Home Depot Inc, the world's largest home improvement chain, fell 5 percent after the company reported an almost 10 percent drop in quarterly sales.
GLIMMERS OF HOPE
New building permits, which give a sense of future construction activity, fell 3.3 percent to 494,000 units in April, the lowest since records were started in January 1960.
The decline in permits reflected a 19.9 percent decrease in new building plans for multifamily units. Building permits for single family homes rose 3.6 percent.
Compared to April of last year, permits were down 50.2 percent.
While housing activity continues to fall, the report still offered glimmers of hope for an economy in its 17th month of recession, according to analysts.
A National Association of Home Builders survey on Monday showed U.S. home builder sentiment surged to an eight-month high this month, with industry leaders hopeful the slump was nearing a bottom and market stability was around the corner.
"Multifamily starts have hit or will soon hit bottom. Single-family starts may continue to test the bottom. In the second half of this year, however, they will be on a sustained but slow path to recovery," said Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts.
A report on shopping activity at U.S. retail chains from the International Council of Shopping Centers and Goldman Sachs on Tuesday showed sales slid 1.2 percent last week, the biggest drop since late January, after two weeks of gains.
Both the ICSC-Goldman Sachs report and a separate index from Johnson Redbook showed sales off 0.3 percent from a year ago, a decline that ICSC noted was above recent lows.
High unemployment and strained incomes are cooling consumer demand.
Posted by Kim Adamof on Tue, Feb 24, 2009 @ 01:31 PM
According to the Hanley Wood Market Intelligence Report, the Raleigh area ranked #6 for 2009.
6. Raleigh, N.C. 2008 total building permits: 11,386
Another state capital with multiple universities, Raleigh was still adding jobs at a 1.9 percent annual rate though the third quarter of last year. With a population of more than 1 million, it also has one of the highest rates of population growth of any top metro market in the country over the last five years: nearly 5 percent annually. Though the price of a median home here, $221,900, is above the national average, it is well below other cities in the mid-Atlantic and Northeast. The metro area has added roughly 68,000 jobs since 2005, and employment held steady last year. With a glut of national builders in the market, locals such as Dixon Kirby have experimented with different looks and styles to keep sales alive.
AT A GLANCE
2009 Healthiest Housing Markets
1. Houston
2. Austin, Texas
3. Fort Worth, Texas
4. San Antonio
5. Dallas
6. Raleigh, N.C.
7. Seattle
8. Indianapolis
9. Fayetteville
10. Washington, D.C.
11. Nashville, Tenn.
12. Denver
13. Charlotte, N.C.
14. Wilmington, N.C.
15. Myrtle Beach, S.C.
Source: Hanley Wood Market Intelligence
To read about the top 15 area visit BuilderOnline.com
Posted by Kim Adamof on Mon, Feb 23, 2009 @ 07:46 AM
I came across this article on the Voice of America website. This statement was fascinating. "About 95 percent of folks are playing by the rules and struggling, but still paying their mortgages," said Sanford. "The idea that somebody down the street gets a different system is something that, ultimately, is going to undermine a whole lot of other folks with regard to paying their mortgage."
The "President Obama Plan" was hailed as a savior for our flailing economy. My sales in the Raleigh Real Estate Market have been done because both sellers and buyers were sitting on the sidelines with their breath held, waiting for President Obama to give us all a stimulus package.
Here is the link to read the article http://www.voanews.com/english/2009-02-22-voa19.cfm
It talks about how President Obama plans to help homeowners who are struggling financially, save their home from foreclosure.
"President Obama says his home foreclosure plan is one of three tools he will deploy to stabilize the U.S. economy. The other two are the stimulus plan he signed into law last week and Treasury Secretary Timothy Geithner's initiative to save troubled U.S. financial institutions. "
The New York Times today had this to say about the Presidential State of the Union Speech tomorrow night.
"Longer exposures allow people to take a measure of a person, rather than a snapshot," said Rahm Emanuel, the president's chief of staff. "It's only been a month since he was sworn into office, but hopefully they will walk away with something more intrinsic to sustain him through the ups and down and all the turns in the road.
The address comes at an opportune time for Mr. Obama, whose approval ratings remain strong despite growing criticism about some of the administration's economic plans. The White House was frustrated by a furor that erupted on cable television last week over whether some homeowners facing foreclosure were being given an unfair break. The speech, aides said, is intended to better explain why the intervention is needed."
Seems we'll find out Tuesday evening what the plan actually means.
Posted by Kim Adamof on Tue, Jan 27, 2009 @ 09:41 AM
According to the Raleigh MLS, we have 16,678 homes for sale as of 1-27-09. But is that an accurate number?
There are some experts that believe there is a little talked about problem that can affect our sales prices lurking in our real estate economy called Shadow Inventory.
Of course, as realtors, we know there are sellers out there who don't list their house the traditional way in the MLS. These homes won't show up in our current inventory number.
What about foreclosures owned by banks & mortgage companies, developers & builders holding some of their inventory back, sellers who want to sell but are expired listings, and vacant homes not in foreclosure just sitting unsold & uninhabited? Where do these homes fit into our numbers?
If we have a 7 month supply of inventory, what economists are really saying is that if no other homes come onto the market and based on how many homes are currently selling per month, and then it will take 7 months to sell our current inventory.
If you are a seller, the higher the number, the more competition you have, which ultimately drives down prices. However, I've noticed in Raleigh, that our sales prices are staying pretty steady. Most sellers aren't drastically reducing their prices.
This might change because of Shadow Inventory.
Based on the December 2008 numbers, there was a 1% decrease in homes coming onto the market compared to December 2007. It sounds like there is less inventory; however, re-sale listings are up by 63% and new construction is down by 21%.
Builders control which homes they enter into the MLS. In order to maintain the developments property values, builders aren't listing all of their homes. Yes, they've slowed down in construction. Experts predict that once the economy picks up some, builders will once again list those homes for sale.
In the past 6 months, there have been 7,402 sellers that want to sell but haven't been able to. These include new construction as well. Sellers are either choosing to sell on their own, which won't show up in our MLS stats, or are waiting until the market picks up.
According to the Census Bureau, there are about 6 million vacant homes either for sale or for rent. About 10% of the homes built for owner-occupancy since 2000 are vacant. It is hard to judge how many vacant houses will come onto the market at any given time but most will eventually find their way into the MLS. Unfortunately their competition against re-sales can drive down sales prices.
Most foreclosures are sold through a real estate company. A few are sold directly to investors by the bank.
RealtyTrac reports foreclosures based on bank/lender information and public records. I've noticed throughout my career in real estate that some of the houses listed weren't in the MLS. I thought that maybe Realtytrac had their information wrong or the house was sold.
I didn't think the Raleigh area had a problem with Shadow Inventory until someone posted an article and referenced the RealtyTrac website. I commented not to believe in those online websites because their information isn't accurate. What I thought was their inaccuracy could possibly be shadow inventory.
Then I noticed on Realtytrac there was a home in my farm neighborhood which wasn't in Raleigh MLS. I knew this house was foreclosed on because I had listed it before the seller lost it to foreclosure. Eventually it got listed but it took the lender 6 months to put it back onto the market for sale, $25,000 less than I was trying to market for. It's a good deal in that neighborhood and will probably sell soon.
With lots of fresh inventory waiting to hit the market, we are at the tip of the iceberg in the Raleigh Real Estate Market for sales prices declining. Economists are predicting we're nearing the bottom though.
Aggressive marketing is your best bet for getting your house sold in 2009.
Posted by Kim Adamof on Thu, Jan 08, 2009 @ 05:31 PM
Economic Factors to watch.
Affordability is critical for our area to sustain its market value. We need to improve income, as well as watch unemployment and inflation rates.
Below is a graph showing our inflation rates since 1999.
Unemployment is growing. As of November, 2008, statistically North Carolina is #44 out of the 51 states for unemployment at 7.9%. For the Raleigh/Cary area, we are fairing better at 5.2%.
On the bright side.
Businesses are still looking to move here but they want to know if they can recruit talent. We are fortunate to have many dynamic colleges at our disposal. Our educational level plus our wonderful weather, create a draw for corporations.
Seattle has the most educated population with Raleigh right behind in 2nd place.
41% of employers worldwide say they can't find enough talented workers. 37% of college grads say they would move anywhere to find a good job. Tech jobs aggregate where high tech research is. Life Sciences make up two-thirds of new employment here in North Carolina.
People move here for jobs but also for our quality of life. We can offer good education, quality health care, cheaper housing, and low crime rates.
Appreciation
The median price of homes in Wake County overall has increased 7% since November 2006. The median price for Johnston County has increased 1.4% in the same time. The median price has only increased 1.9% in the entire MLS area.
The average price for a resale in a four-county area of our MLS has dropped. The above chart represents November stats for the last 4 years.
Concerns for our housing economy
November closings were the lowest amount since January of 2000 and were off 42% compared to 11/07. Based upon analysis of monthly closings, this year is shaping up to be very similar to 2002 and 2003.
Is there any hope on the horizon?
Hope and change got elected in November but our local real estate market will need more buyers and fewer sellers during December and in 2009. Pending sales were off 35% making November the 22nd consecutive month of lower sales when compared to the prior years month.
Months Supply of Inventory
63% of all price points have an over-supply of listings. We have had 21 consecutive months of increased re-sale inventory when compared to the prior years month and 14 consecutive months of inferior showings when compared to the prior years month. In 2008 there was 8 months supply of listings currently on the market unsold.
Another telling statistic is the Supply & Demand chart below. This represents the number of units sold each month.
For the month of November there were 2,527 units sold in 2006, 2,169 units sold in 2007, and only 1,186 units sold in 2008. This represents the entire MLS.
Days on Market
I think a great statistic for sellers is the Average Days on Market for Under Contract Properties.
This chart shows when we started to have problems in the Triangle. I noticed an affect on my business by the end of 2007 when the Raleigh market started feeling the effects from the rest of the country. Hopeful buyers living in other parts of the country were commenting to me about how tough their marketplace was. Grid lock started to take over around here. Relocating families were having a hard time selling so they weren't as quick to buy in North Carolina.
Our market had picked up this past spring in April and May. However, since July, the average days on market has been hovering around 3 months. Back in November 2007, our average days on market was 73. Currently November 2008 average days on market is 96.
Showings
Let's take a look at showings, another great statistic about our housing market. We had a spike in the number of showings around April and May but then the showings continuously fell off from June on. My sellers are asking me why they aren't getting showings. This graph explains there are less buyers every month out there shopping.
November showings for the past 4 years
How were sellers able to close on their house in November?
Have a house located in the sweet spot of buyers and have it priced correctly. For houses that closed in November where the final list price was equal to the original list price, the average sales price was $194,900, the average days on market was 44 and the average sales price/list price ratio was 96.15%. This number matches up nicely with the average closed price during the month at $206,000.
If you are thinking of selling, I'd recommend waiting until at least until the Spring market. If you need to sell, hopefully you are in a position to be able to negotiate your price. Buyers who are out there now want a deal. There is too much inventory to select from. If they feel they can get a deal and they have the means to buy, they'll buy. My buyers are emailing me about new listings and saying "It's over-priced. I don't want to look at it." The market will set the price of your house. Sellers should be open to that price and not blame the realtor, appraiser, or neighbor who sold a few months ago and got a higher price.
It's the perfect time to buy. With all that is going on in our economy right now, buyers seem to be sitting on the sidelines - waiting. Sellers are getting very motivated because of the lack of real buyers currently looking for homes. Why not find a motivated seller and make an offer. You never know what they'd be willing to take. Start hunting for a deal.
If you wait until the spring and the market starts improving, sellers will not be as willing to negotiate. They will rather wait for a better offer, than take a lower priced one.
In Conclusion. There is too many homes on the market, obviously. With builders dropping their prices, the threat to re-sales is declining values. The pool of buyers has significantly dried up, based on the showings. In speaking with mortgage reps, seems everyone is re-financing with the lower interest rates instead of selling and moving up. Foreclosures play a huge role in lowered house values. See my blog article "Shadow Inventory".
No one knows for sure when our economy and real estate market will improve. After talking to many different people around the country, most believe that by the middle of 2009 into 2010 we will see an improvement. I will be tracking several key indicators and keep you up to date. Stay tuned to my blog.