Month: April 2019

Home-price growth expected to pick up in year ahead

Strong spring home buying season may spur growth

Home prices have been appreciating rapidly since the housing market’s recovery, but they’ve stepped off the fast track in recent months, displaying a notable slowdown in appreciation.

But CoreLogic predicts a turnaround thanks to low mortgage rates, which should spur strong home buying activity this spring and nudge home prices upward.

In February, home prices revealed a modest month-over-month increase of just 0.7% – an unusually slow start to the year, CoreLogic revealed.

“During the first two months of the year, home-price growth continued to decelerate,” said CoreLogic Chief Economist Frank Nothaft. “This is the opposite of what we saw the last two years when price growth accelerated early.”

On an annual basis the picture was slightly rosier, with a 4% increase over February 2018.

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    Uncertainty Chills International Apartment Investment

    After a giant year in 2018, international investment in apartments slowed early this year, according to early data.

    Rising interest rates and uncertainty about the economy’s prospects slowed the pace of investment in apartment properties during the first few months of 2019.

    “The deal activity in January and February was light,” says Jim Costello, senior vice president for Real Capital Analytics (RCA), a data firm based in New York City.

    Lower interest rates are expected to lure some investors back to make deals later this year. And whatever course the economy takes in 2019, apartment properties are likely continue to attract buyers.

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      Millennials, seniors are fleeing cities in search of affordable housing

      Home building and sales are heating up in the “exurbs,” and the trend could be risky.

      While the housing market on the whole has experienced a slowdown, there are some unexpected markets that are heating up.

      They’re called the exurbs – or remote areas just beyond affluent suburbs – and Millennials and retirees in areas near Dallas, Atlanta, Las Vegas and San Francisco are flocking to them.

      Why?

      Because rising home prices and high mortgage rates are driving some homebuyers out of urban centers toward remote locations where homes are more affordable. Plus, low gas prices make longer commutes a bit more palatable.

      According to a recent article in The Wall Street Journal, home building and sales in these areas are heating up.

      The WSJ quotes yet-to-be-released data from the National Association of Home Builders, which shows that single-family construction in exurban areas rose 7% from last year, compared with just a 3% rise in home building nationwide.

      Fannie Mae loan data reveals that these home seekers purchased new abodes located an average of 16 miles from central business areas last year – the greatest distance since 2004.

      Fannie Mae Chief Economist Doug Duncan told the WSJ that buyers are simply “having to drive further from the city center in order to be able to afford a house.”

      But the last time these exurban areas witnessed such a flurry of activity was during the housing boom, and we all know how that turned out.

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        Case-Shiller: Home price gains are shrinking, further escalating a housing market slowdown

        Las Vegas continues to lead the nation in annual gains

        In January, annual home price gains slid nationwide, according to the latest Case-Shiller Home Price Index from S&P Dow Jones Indices and CoreLogic.

        The report’s results showed that January 2019 saw an annual increase of 4.3% for home prices nationwide, inching backwards from the previous month’s report.

        The graph below highlights the average home prices within the 10-City and 20-City Composites.

        Before seasonal adjustment, the National Index decreased 0.2% month over month in January. The 10-City Composite and the 20-City Composite posted a 0.3% and 0.2% month over month decrease.

        After seasonal adjustment, the National Index recorded a month-over-month gain of 0.2% in January. Notably, the 10-City Composite did not post any gains; however, the 20-City Composite posted a 0.1% month-over-month increase.

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