Phoenix has more college students than DC, Seattle

Just how important is the college-age demographic?
Some new numbers from the Zillow real estate research and listing firm show there are close to 106,800 undergraduate and graduate students just in the city of Phoenix.
There are another 44,700 students living in Tempe where Arizona State University is based, 33,700 in Mesa and 20,800 in Chandler, according to Zillow.
College students make up 44 percent of Tempe’s population. That number is also high in Tucson and Flagstaff where students account for 13 percent and 30 percent of the population, respectively.
Flagstaff has more than 19,200 college students, mostly going to Northern Arizona University.
There are 64,200 college students in Tucson where the University of Arizona is located.
There are actually more college students living just in the city of Phoenix than Washington, D.C. (72,100), Atlanta (61,700), Denver (51,200) and Seattle (74,800), according to Zillow.
Yet, those markets tend to be landing spots for young professional and millennials more than the Valley.
Having a healthy population of college students drives the apartment and rental housing and retail markets in those cities. ASU’s growing footprint in downtown Phoenix has helped draw more restaurants and bars to the historically sleepy business district.
The Zillow numbers out today also show Tempe is one of the top real estate markets among college towns. Muncie, Indiana, and Tuscaloosa, Alabama, also are on that list.

Mike Sunnucks writes about politics, law, airlines, sports business and the economy.

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Why Redfin Is Predicting a Home Sales Surge

A slowdown in home price growth and a shift in pricing power from sellers to one that more closely aligns with buyers expectations will “drive an unusual surge in home sales this fall,” predicts analysts at the real estate brokerage Redfin in its latest housing report.

“Home buyers who have been willing to wait for better deals are starting to be rewarded for their patience, as sellers drop listing prices to meet buyers’ more value-focused expectations,” Redfin notes in its latest report.

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The number of homes that sold above list price in July was down nearly 7 percent to 20.1 percent from 26.8 percent a year ago, according to Redfin’s analysis.

“Sellers are finally catching on that it’s not a seller’s market anymore,” says Jeremy Cunningham, a Redfin real estate professional in Virginia.

Sellers are adjusting their prices, particularly in markets that have seen a large increase in for-sale inventories or big increases in home price appreciation over the past year.

According to Redfin, Denver is the metro that has registered the largest percentage of listing price drops. Its median sales price has increased by 15 percent year-over-year compared with an average of 5.5 percent for all metros.

On the other hand, Ventura County and Sacramento, Calif., have seen more moderate price growth year-over-year but have seen their for-sale inventories rise by 25.6 percent and 18.3 percent, respectively. The two metros had the second and third largest percentage of homes for sale with price drops in July, according to Redfin.

Some of the metros with the fewest price drops tended to have smaller increases in median home prices and for-sale inventories, analysts note. On the other hand, some West Coast markets like San Francisco, San Jose, Los Angeles, and Seattle continue to sell for more than list price.

Get Ready for a Hot Fall?

Redfin analysts are predicting a surge in home sales in September and October.

“We continue to see strong buyer demand as we head into fall,” according to Redfin’s housing report, which shows the number of tours and offers picking up from July and into August. “The buyer fatigue from competing against multiple offers, bidding wars. and tight inventory is diminishing. Additionally, the widespread increase in price drops is likely to give buyers even more confidence that they have regained some of the bargaining power lost last year.”

Also, analysts note that borrowing costs still remain attractive, which will help buyers off the fence. Mortgage rates continue to hover near yearly lows.

Source: “Listing Price Drops Will Help Drive a Fall Surge in Home Prices,” Redfin (Aug. 29, 2014)

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Home prices rise in Phoenix by 22.5 percent over the past year!

PHOENIX — The Phoenix housing market is showing big improvement. In fact, prices in Phoenix rose 22.5 percent over the past 12 months, the biggest gain among cities.
Phoenix was followed by San Francisco, with a 22.2 percent spike, and Las Vegas, with a 20.6 percent jump.
New York City had the smallest year-over-year increase at 2.6 percent, followed by Cleveland at 4.8 percent.
Overall, U.S. home prices jumped 10.9 percent in March compared with a year ago, the most since April 2006. A growing number of buyers are bidding on a tight supply of homes, driving prices higher and helping the housing market recover.
The Standard & Poor’s/Case-Shiller home price index released Tuesday also showed that all 20 cities measured by the report posted year-over-year gains for the third straight month.
And prices rose in 15 cities in March from February. That’s up from only 11 in the previous month. The monthly figures aren’t seasonally adjusted and may reflect the beginning of the spring buying season.
“Rising home prices may begin to alleviate a lack of housing inventory by encouraging more homeowners to put their properties on the market,” said Maninder Sibia, an economist with Economic Advisory Service. “The housing market is clearly improving.”
The index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The March figures are the latest available.
The U.S. housing market is steadily recovering, buoyed by solid job gains and near-record low mortgage rates. Sales of new homes rose in April to nearly a five-year high. And sales of previously occupied homes ticked up in April to the highest level in three and a half years.
Despite the gains, a limited number of homeowners are putting their houses on the market. That’s helped lift home prices. And it’s made builders more willing to ramp up construction. Applications for building permits rose in April to the highest level in nearly five years.
The supply of available homes jumped in April, but was still 14 percent below its level a year earlier.
Stan Humphries, chief economist at Zillow, a real estate data provider, said that the increase in the Case-Shiller index has been skewed higher by cities such as Phoenix and San Francisco. Fewer homes are available in those areas because many homeowners still owe more on their mortgages than their homes are worth. That makes it difficult to sell.
Still, even excluding those markets, home prices are rising steadily nationwide, Humphries said. The increases are “certainly confirmation that the housing market is experiencing a brisk recovery,” he added.
The housing recovery is creating more construction jobs and bolstering the economy in other ways. Higher home prices make homeowners feel wealthier and encourages them to spend more.
Rising prices also encourage more would-be buyers to purchase homes, before prices rise further. They also enable more homeowners to sell homes, by reducing the number of people who owe more on their mortgages than the homes are worth.
Prices have been increasing steadily since last summer. Still, they are about 29 percent below the peak reached in July 2006.
Banks have raised their credit standards since the housing bubble burst and are demanding larger down payments. That’s made it particularly hard for potential first-time buyers to get a mortgage.

Source:
http://www.azfamily.com/marketplace/phoenix-real-estate/news/US-home-prices-jump-109-percent–209247091.html

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US home prices rose at solid pace in January

ASHINGTON — U.S. home prices rose in January after three months of declines. A tight supply of homes might have helped boost prices and offset sales slowed by cold weather.

Real estate data provider CoreLogic says prices rose 0.9 percent in January after dipping 0.1 percent in December. Over the past 12 months, home prices have risen 12 percent, the biggest year-over-year gain in more than eight years.

CoreLogic’s price figures aren’t adjusted for seasonal patterns, such as winter weather, which can depress sales.

Snowstorms and low temperatures contributed to a sharp drop in sales of existing homes in January. The National Association of Realtors said sales plunged to their lowest level in 18 months. Still, the number of homes for sale remained low, a factor that might have helped increase prices.

Home sales and construction have faltered over the winter, partly because the weather has likely discouraged many Americans from house-hunting. The average rate on a 30-year mortgage is also about a percentage point more than it was last spring, which means buying costs are higher.

Most recent housing reports suggest that the market is slowing. Economists think the housing recovery could pick up once the spring buying season begins, though likely at a slower pace than last year.

A measure of signed contracts was unchanged in February. Signed contracts usually lead to a finished sale in one to two months. And builders broke ground on 16 percent fewer homes in January than in December, the government said last month. That was the second straight decline.

Other price gauges are falling. The Standard & Poor’s/Case-Shiller 20-city home price index dipped in December, the latest period for which data are available, and its year-over-year gain slowed.

Nationwide, home prices are still 17 percent lower than at the peak of the housing bubble in April 2006, according to CoreLogic. Prices have set highs in three states: Louisiana, Nebraska and Texas. They are within 10 percent of their peaks in 19 additional states.

The five states with the biggest price gains in January, compared with a year earlier, were Nevada, where prices rose 22.2 percent; California, 20.3 percent; Oregon, 14.3 percent; Michigan, 13.7 percent; and Georgia, 13.4 percent. Mississippi was the only state to report a price decline.

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Real Estate Reality: Building is back- by Gary Harper

PHOENIX — The once stormy real estate market is making a turnaround, particularly when it comes to new homes in the Valley. Builders are back to leveling lots. Framework is becoming a more common site. And construction workers are once again making noise. And, it’s all because the real estate market is on its way up.

“It has come up and we are out of the bottom. Everyone is excited about it,” R.L. Brown told 3 On Your Side when we asked him to assess new home construction in the Valley.

Brown is a recognized authority in real estate and is a housing economist and analyst. He has spent decades monitoring new home construction.

He said permits to build new homes have increased steadily over the past year and continues to increase.

“Traffic at new model homes and subdivisions are up,” he said. “New contracts and new orders are up. We are definitely in a recovery when it comes to new housing here in Phoenix.”

But, what is kick starting all of this new home construction in the Valley? According to Brown, there is significantly more consumer confidence. That means consumers are loosening up their wallets now and are not afraid to make a move in real estate by putting down money on new home construction.

John and Mary Ann Bost certainly fall into that category. After recently selling their house, they started touring new Pulte homes in a subdivision called Lone Mountain in Cave Creek. Before they knew it, they signed on the dotted line and are currently waiting for their new Pulte home to be finished.

“We see the price of homes going up and the price of these homes where we bought went up just 24 hours after we signed the contract,” John Bost said. “So, we are glad we got in and bought when we did.”

And real estate analysts say that’s the kind of consumer confidence that’s fueling new home construction.

“Consumers sit on the side line and say, ‘Golly gee, if we wait a little longer is that house I am interested in going to cost me more?'” The answer is probably yes,” Brown said.

He has a point. For example, the median cost of a new home has increased a whopping $40,000 just over the past 12 months.

Data collected by 3 On Your Side shows new homes are being constructed in all parts of the Valley. However, there are some areas hotter than others. Gilbert is leading the charge with the most home permits issued in the past year. The town received 2,418 new home permits. Phoenix was second with 1,651 permits granted. Goodyear issued 976 permits. Mesa was granted 860. New home permits for Peoria totaled 768. And Buckeye, which was once one of the fastest-growing areas in Arizona, is back in new home construction by getting 691 construction permits.

Brown said those numbers are extremely encouraging and proves that real estate is back.

“It’s a slow and steady kind of recovery and we expect that to continue for the next few years,” Brown said.

As for Jon and Mary Ann Bost, they can’t wait to move into their new home when it’s finished and realize their timing was perfect because prices are inching up.

Brown agrees and said consumers should expect a nice, steady increase in home prices to continue here in the Valley.

“If you can do it and build, then the key is to do it now,” Brown said.

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Buying After Short Sale

Because of the housing crisis, many people have had to sell their homes via a short sale. While this is not uncommon, many people have questions as to how long after a short sale will they have to wait until they’re permitted to purchase another home. The truth is that depending on your situation, buying after short sale has been completed can be done in a relatively short period of time, in some cases immediately. Here are some things to consider.

Waiting Periods For Buying After a Short Sale

There will be a waiting period before buying after short sale proceedings. For most short sales the waiting period will be 4 years. However, if you’re able to come up with a larger down payment, for example 20 percent of the value of the home that you’re considering, you should be able to be approved for a mortgage in two years. If there are extenuating circumstances surrounding your short sale you can apply for a mortgage after two years with as little as 3.5% down.

The exception to this waiting period is the Flexible Credit Home Loan Program offered by CFS Mortgage. This program is unique in that it allows home buyers to purchase immediately after a short sale or foreclosure. Home buyers that look to use this program will need to have at least a 25% down payment and a minimum credit score of 600. More information on buying after a short sale.

 

Your Credit Score after a Short Sale

It’s also worth noting that your credit is going to be taken into account when applying for a loan after short selling your home. There is no way to avoid the fact that your credit rating is probably going to take a hit from a short sale. This will occur because of the late payments that are typically the catalysts for a homeowner short selling their home.

However, the lender is much more willing to work with somebody who has short sold their home. In most cases, an approved short sale means that you’ve settled your debt with your prior mortgage company. This is much easier than trying to get a mortgage company to work for you after your home has been foreclosed upon.

 

Getting Your Finances in Order

Lastly, you want to get your financial house in order. You want to establish good credit for at least a year before applying for mortgage and buying after a short sale. You’ll also want to pay off as much debt or all of your debt if possible. You want to keep detailed financial documents and cut your spending wherever you can to maximize the amount of money that you are able to save.

Simply because you have had to short sell your home doesn’t mean that you are blacklisted from getting a mortgage forever. You may have to wait a few years and in some cases you may be able to apply for mortgage immediately. Whatever the case may be its good to know that the dream of home ownership is not out of your reach simply because of past financial difficulties.

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New-home sales edged higher in March, the latest sign that the housing recovery is here to stay.

NEW YORK (CNNMoney)
New-home sales edged higher in March, the latest sign that the housing recovery is here to stay.
New homes sold at an annual pace of 417,000 in the month, a gain of only 1.5% rise from February but an 18.5% jump compared to a year earlier. The supply of new homes on the market remained relatively tight, as only a 4.4 month supply of homes are available at the current sales pace.

Recent months have seen improvement in a number of market fundamentals that have lead to a recovery in housing. Those factors include a drop in foreclosures, near record-low mortgage rates, rising home prices and a drop in unemployment. All are helping to bring more buyers back into the market.
The recovery in housing also has led to a rebound in home building. But despite the multiple signs of renewed strength in the real estate market, a report Monday on previously-owned homes sales showed a slight drop in sales in March.

The sale of new homes is typically considered more important for economic growth than the larger market for existing homes. Beyond the construction workers needed to build the homes, new-home sales help drive economic growth by prompting new owners to buy everything from appliances and carpeting to other large-ticket items. The new home sales report is also somewhat more forward looking than the existing-home sales reading, since it tracks the sales at the time a contract is signed, rather than when the sale is closed.

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Metro Phoenix housing rises across the board

By Catherine Reagor, Matthew Dempsey and Ryan Konig
The Republic | azcentral.com

For the first time since the housing-market free fall began more than five years ago, it’s now possible for every type of player to get back in the real-estate game.

Basic economic laws of supply and demand worked their magic over the past year, as a huge number of distressed properties were snapped up by institutional buyers and other investors. That played a big role in solidifying the market, and as the year passed, a stronger economy brought a healthier mix of players into the game. They included an ever-growing number of first-time buyers, new-home buyers and homeowners who finally were able to sell for a profit.

Overall, the growing group of buyers helped propel the region’s median sales price up more than 34 percent in the past year, as affordable properties on the market were in limited supply. That price increase, in turn, has motivated more homeowners to put their homes up for sale because they are no longer underwater.

Analysts say home prices are expected to continue to climb this year because of the low supply of homes for sale and rising demand from regular buyers trying to purchase.

Big investors, always looking for rock-bottom prices, appear to be moving on to other markets, leaving metro Phoenix more accessible to traditional homebuyers.

The increase in home values has made it more difficult for prospective first-time buyers, but properties are still affordable compared with prices during the boom.

New-home sales and prices also are rising, mostly due to buyers tired of competing to purchase houses in areas with good schools, jobs and shopping. Most important, a growing number of homeowners can sell for a profit again.

Increases

Overall, metro Phoenix homeowners are likely feeling more flush. The median sales price in most of the region’s ZIP codes climbed more than 10 percent last year, according to The Arizona Republic’s Valley Home Values report. Much larger median sales-price increases often were recorded in ZIP codes where prices had dropped the most.

Some parts of the Valley saw home-sales prices soar more than 30 percent. In the west-central Phoenix ZIP code 85015, the median price shot up more than 55 percent during 2012, the biggest annual gain in metro Phoenix. The number of homes sales in nearby Phoenix ZIP code 85012 jumped 53 percent, the biggest increase Valley-wide.

Around Mesa’s Red Mountain Freeway in ZIP code 85207, the median home jumped 40 percent. In north Glendale, the median sales price soared 35 percent. South Scottsdale, a more affordable part of the city, saw a 24 percent increase in prices within ZIP 85250. Tolleson led the southwest Valley with a 36 percent increase in its median sales price. Queen Creek’s 85142 ZIP Code led Pinal County for home price gains with a 37.8 percent increase.

Overall, the median home-sales price rose 34 percent, to $164,000 in 2012 from $122,500 in 2011, up 34 percent. Reflecting the tight supply, the number of home sales dropped almost 2 percent, to 102,837 in 2012 from 104,629 in 2011.

The median price of a metro Phoenix home hit a record $250,000 during the housing-boom peak in 2006.

“Areas of the Valley with the biggest shortage of homes for sale are seeing the biggest price increases,” said Mike Orr, real-estate analyst with the W.P. Carey School of Business at Arizona State University. “Everyone is participating in the housing-market recovery, and those who aren’t want to, but can’t yet.”

A further sign of a healthier market: Foreclosures dropped 46 percent, to 24,073 in 2012 from 44,700 in 2011.

First-time buyers

Because prices remain affordable, the biggest obstacle for most first-time buyers is competing with investors who can pay cash and who are not concerned about a house’s appraisal. For homebuyers taking out mortgages, the appraisal must come in at least as high as the purchase price, or they have to come up with the difference.

Alyssa Shanosky, a pharmacist, recently bought her first house. She found the south Arcadia home when it had been on the market for only a few days and competed with other buyers by agreeing to purchase the house “as is.” She put 20 percent cash down.

“It’s tough for many first-time buyers to compete with investors who can pay cash,” said Christine Espinoza of Phoenix-based HomeSmart, who worked with Shanosky. “The sellers knew the price they wanted and didn’t want to get nickled and dimed. And luckily the appraisal came in higher than the selling price.”

Shanosky is updating the house with wood floors, stainless-steel countertops and tile.

Orr said the shortage of homes for sale under $150,000 is causing bidding wars among first-time buyers and investors.

Normalicia Arellano lived in a manufactured home and saved for several years to buy her first house. The single mother works at Intel and wanted to buy a house near her daughter’s school.

“It was like finding a needle in a haystack, but we found a house she could afford across the street from the school,” said Yamile Hirsh of HomeSmart. “I feel bad for many first-time buyers. There’s so much competition for the houses they can afford.”

New-home buyers

The number of homes built in the Phoenix area climbed 71 percent to 11,600 in 2012. New-home sales followed the trend, with buyers closing on 10,034 new houses last year, up 41 percent from 2011. These are the biggest jumps for the new-home market since 2006.

Overall, the median price of a new house climbed almost 15 percent during 2012 to reach $240,000.

Southeast Valley communities Gilbert, Chandler, Mesa and Queen Creek are seeing the most home construction because the areas have the strongest buyer demand.

Sam Cutruzzula recently purchased a new Fulton home in Gilbert’s Freeman Farms. It’s the second Fulton home he has bought. The first house he was able to sell for a profit to help pay for the new one.

“We looked at existing homes, but it was difficult to find one that matched our needs,” Cutruzzula said. “Even houses that were six or seven years old needed work.”

New-home prices in the Cutruzzulas’ neighborhood climbed almost 13 percent in 2012.

In February, the median price for a new metro Phoenix house reached $257,428, a 15 percent increase in 12 months, according to RL Brown Reports.

Move-up buyers

Overall, a growing number of homeowners in areas with the biggest increases in sales prices can sell for a profit again. By fall, more homeowners who bought in 2002-03 realized they finally had enough equity to sell for a profit.

But most homeowners interested in making a move are still on the fence, waiting for prices to increase more before moving up or downsizing. That keeps the supply of homes for sale tight. But growing signs of a more normal market are evident.

Regular home sales — between homeowners who don’t need to sell through a short sale or to avoid foreclosure and buyers who are going to move into the house — climbed 50 percent in January from the year before.

“Rising prices have allowed many more metro Phoenix homeowners to sell,” said Diane Brennan of Scottsdale-based Keller Williams Integrity First Realty. “The worst mistake sellers can make now is not pricing their home correctly.”

Shoppers are getting weary of bidding wars and listings pulled off the market by sellers only to be re-listed at higher prices a month later, she said.

Investors back off

Investors purchased thousands of houses in 2012 and helped drive up prices, particularly in metro Phoenix’s more affordable neighborhoods.

Now, higher prices are deterring some. Foreclosures have slowed to 2007 levels, so the supply of inexpensive houses being sold by lenders, mostly to investors, is rapidly dwindling.

In January, 31 percent of the region’s home purchases were made by investors. That’s still relatively high for a normal housing market. But its the lowest level of investor homebuying in metro Phoenix since early 2011.

“As prices have increased, we’re now seeing more real buyers with families looking for a home as opposed to investors looking for investment properties to turn a profit,” said Diane Watson of Scottsdale-based Russ Lyon Sotheby’s International Realty.

“Many of these investors have moved on to other markets.”

Forecast

Housing analysts predict this more normal housing market to expand in 2013, with more listings and steady price gains, especially in more affordable areas of metro Phoenix.

There could be setbacks if interest rates rise too fast or prices climb too high, Orr said.

Also important for the housing market’s continued recovery is more homeowners selling and more new homes going up.

Orr summed it up: “Housing prices are going to continue to climb more rapidly than normal, until there’s a balance between supply and demand in the market.”

Reach the reporter at catherine.reagor@arizonarepublic.com. Follow her on Twitter @catherinereago

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Most Important Documents After Short Sale

Life after a short sale can involve a lot of dates. There may be a waiting period before a homeowner in a short sale can qualify for a new mortgage. The FHA Loans, conventional loans, and the VA Loans all have waiting period requirements before a new home loan can be approved. In that situation, it may be necessary to prove the date of the short sale. If waiting is out of the question to purchase a home after a short sale, one should consider the Flexible Credit Home Loan.

 

How to Prove a Short Sale Date

This is more complicated than it appears. The new lender may seek to determine which events constitute the sale date. From the point of view of the homeowner trying to get a new loan, the earliest date works best: the date the lender agrees to a short sale. The usual acceptance of a ‘sale date’ is the date of a sales agreement. Ultimately, there is a date of legal property transfer.

What Is an Important Document After Short Sale?

  • Short sale agreement -signed by the lender it represents the earliest date of an action, this is not a sale but it sets the transaction in the proper category of short sale and not a foreclosure. The waiting period for persons in foreclosure can be a long as seven years, so it is important to keep the short sale agreement in the event of a need to correct credit reports.
  • Closing Statement – the actual date of the closing is proof of sale and this document may be accepted by a lender as the date from which to calculate a waiting period.
  • Transfer date – the actual official record date that property ownership was transferred on an official property record such as a local government’s Recorder of Deeds. This is conclusive evidence of sale and transfer, it is the actual legal transfer.
  • Lien release – this is another important document after short sale. The Lender in the short sale may have an option to pursue satisfaction of any unpaid amounts under State or local law. This right can end upon signing a document which releases the debtor (short seller) from further liability on the debt. This is an important document to have in case a lien were to be later filed seeking repayment (such as by a company that purchases the assets of the original lender).

 

FHA Immediate Approval

The FHA can approve homeowner loans immediately after a short sale. Immediate loan eligibility can be given if:

(1) the homeowner was current on payments at the time of the short sale and for the previous twelve months; or

Waiting Periods After a Short Sale

For homeowners who were not current on their mortgages, the FHA requires a waiting period of three years from the short sale date. The VA requires a two year waiting period. Conventional lenders are not bound by a specific rule. There is a general industry practice to require a two year period in which the short seller demonstrates good financial responsibility. For either type of lender, records are needed to establish the date of sale.

Getting a New Loan After Short Sale

The path to a new loan is simple but perhaps not easy: demonstrate financial responsibility. One must clearly keep every important document after short sale transactions. One should make careful use of credit, pay bills on time, and create some savings. The amount of down payment needed will depend on credit scores and a modestly favorable score will be good enough to get a workable rate, and an excellent score could get a new loan rate near the best on the market.

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HOME VALUES RISE 0.8% IN MAY 2012

The housing market’s bottom is 9 months behind us. Home values continue to climb nationwide.
According to the Federal Home Finance Agency’s Home Price Index, home values rose 0.8% in May on a monthly, seasonally-adjusted basis. May’s reading marks the sixth time in seven months that home values rose.
Values are now higher by 4 percent since the market’s October 2011 bottom.
As a home buyer or seller, though, it’s important to understand what the Home Price Index measures. Or, more specifically, what the Home Price Index doesn’t measure.
Although widely-cited, the HPI remains widely-flawed, too. It should not be your sole source for real estate data.
As one example of how the Home Price Index is flawed, consider that the HPI only tracks the values of homes with an associated Fannie Mae- or Freddie Mac-backed mortgages. Homes with mortgages insured by the FHA are excluded, as are homes paid for with cash.
5 years ago, this wasn’t a big deal; the FHA insured just 4 percent of the housing market and cash sales were relatively small. Today, though, the FHA is estimated to insure more than 30% of new purchases and cash sales topped 17 percent in May 2012.
That’s a sizable subset of the U.S. housing market.
A second flaw in the Home Price Index is that it tracks home resales only and ignores new home sales. New home sales represent roughly 10% of the today’s housing market, so that’s a second sizable subset excluded from the HPI.
And, lastly, we can’t forget that the Home Price Index is on a 60-day publishing delay.
It’s nearly August, yet we’re only now receiving home valuation data from May. A lot can change in the housing market in 60 days, and it often does. The HPI is not reporting on today’s market conditions, in other words — it’s reporting on conditions as they existed two months ago. Information like that is of little use to today’s buyers and sellers.
For local, up-to-the-minute housing market data, skip the national data. Talk with a local real estate agent instead.
Since peaking in April 2007, the FHFA’s Home Price Index is off 16.0 percent.

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