Widespread House Price Declines In Fourth Quarter, But Not Severe
February 28, 2008 | Filed Under Real Estate News | Leave a Comment
The Office of Federal Housing Enterprise Oversight (OFHEO) reported today that home purchase prices fell by 1.3 percent nationwide during the fourth quarter of 2007 from the previous quarter and were down 0.3 percent for the year. This marks the first four-quarter decline in the purchase-only index since 1991.
By comparison, the purchase-only house price index declined 0.3 percent between the second and third quarters. “Although prices for home purchases in the [fourth] quarter fell in every state except Maine, only 16 states plus the District of Columbia showed price declines for the full year in 2007,” says James B. Lockhart, director of OFHEO.
The all-transactions Home Price Index (HPI), which includes data from home sales and appraisals for refinancing, rose 0.1 percent over the third quarter and 0.8 percent over the previous year.
“Both the purchase-only and all-transactions indexes showed relatively greater house price stability than do other nationwide house price indexes,” Lockhart says. “That may reflect, in part, the greater stability in the prime, conforming mortgage market served by the Enterprises than in other segments of the mortgage market.”
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2008 Begins with More Foreclosures
February 28, 2008 | Filed Under Real Estate News | Leave a Comment
Foreclosure activity continued its upward trend in January, rising 8 percent from the previous month and climbing 57 percent from January 2007, according to RealtyTrac, an online marketer of foreclosed properties. Foreclosure filings, which include default notices, auction sales notices and bank repossessions, were reported on 233,001 properties in January. It is the sixth straight month that foreclosures totaled more than 200,000. Nevada, California and Florida had the top foreclosure rates for the month.
James J. Saccacio, RealtyTrac’s chief executive officer, said the 8 percent monthly increase isn’t as steep as the 19 percent increase that occurred in January 2007, and several key states actually had fewer foreclosures than the previous month. “It could be that some of the efforts on the part of lenders and the government — both at the state and federal level — are beginning to take effect,” Saccacio said. “The big question is whether those efforts are truly helping homeowners avoid foreclosure in the long term or if they are just temporarily forestalling the inevitable for many beleaguered borrowers.”
Foreclosed Homes Could Invite Squatters
February 23, 2008 | Filed Under Real Estate News | 3 Comments
The rising number of foreclosures has created an abundance of vacant homes in some communities. Now it appears that homeless people are beginning to take advantage of the situation by becoming squatters, reports the Detroit Free Press.
For squatters, foreclosed homes have an advantage over abandoned, dilapidated housing because the heat, lights and water still work. “Many homeless people see the foreclosure crisis as an opportunity to find low-cost housing (FREE!) with some privacy,” said Brian Davis, the director of the Northeast Ohio Coalition for the Homeless.
Cleveland had the country’s sixth highest foreclosure rate, with 2.972 percent of homes in some stage of foreclosure in 2007, according to RealtyTrac. The city also has seen a steady increase in the number of squatters. Davis said there are about 4,000 homeless in the Cleveland area on any given night, while an estimated 15,000 single-family homes are vacant due to foreclosure.
Housing Starts, Builder Confidence Edge Higher
February 21, 2008 | Filed Under Real Estate News | 1 Comment
According to a U.S. Commerce Department report released yesterday, housing starts rose in January to a rate of 1.012 million, a 0.8 percent increase from the revised December 2007 total. But the January figure was 27.9 percent lower than during the same period last year. The Northeast and Midwest regions posted month-over-month increases of 18.9 percent and 12.0 percent respectively, while housing starts fell 2.9 percent in the South and 6.2 percent in the West. All four regions posted substantial year-over-year declines: 33 percent in the Northeast; 16.3 percent in the Midwest; 24.2 percent in the South; and 39.6 percent in the West.
New-home permit authorizations fell 3 percent last month, to 1.048 million. Permits were 33.1 percent below the January 2007 estimate of 1.566 million.
Builder confidence in the market for new single-family homes rose slightly this month, according to the latest NAHB/Wells Fargo Housing Market Index report. Despite the modest boost in builder confidence, the index remains near its all-time low.
Most Affordable U.S. City? Indianapolis, Again
February 21, 2008 | Filed Under Real Estate News | 1 Comment
For the tenth consecutive quarter, Indianapolis ranks as the most affordable major U.S. housing market, according to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index. During the fourth quarter of 2007, 89.5 percent of the houses sold in Indianapolis were affordable to people making the area’s median household income of $63,800. Youngstown, Ohio, Detroit, Toledo, Ohio and Grand Rapids, Mich. follow Indianapolis as the most affordable major metro areas. Los Angeles, where only 6.2 percent of homes sold were affordable to those earning the median income of $61,700, was the least-affordable city for the 13th consecutive quarter.
Nationwide, however, housing affordability has increased to its highest level since the first quarter of 2005, the report finds.
Commercial Brokerage Business Flattens in Fourth Quarter
February 21, 2008 | Filed Under Commercial Real Estate, Boston Real Estate | Leave a Comment
The fourth quarter of last year was a telling quarter for the commercial real estate brokerage industry. While major brokerage firms reported record revenues and healthy net income last year, results dropped off sharply in the fourth quarter reflecting a weakening commercial real estate environment. The latest quarter results are also a sign of what is to come this year.
CB Richard Ellis Group Inc. reported full year 2007 revenue rose 49.7% to $6 billion. The company reported net income of $390.5 million compared to net income of $318.6 million in 2006. However, fourth quarter revenue was just 30.4% compared to the year earlier and net income was less in the fourth quarter of 2007 compared to a year earlier.
Jones Lang LaSalle Inc. reported record net income of $256 million for the year, an increase of 46% over 2006. Revenue for the full year 2007 was $2.7 billion, an increase of 32% from the prior year. Fourth quarter net income increased just 30% from a year earlier and revenue only 22% from 2006.
Both firms are world powerhouses, but it is clear from where the slowdown is coming. For Jones Lang LaSalle, revenue in the Americas region for the full year 2007 was $765 million, an increase of 23% over the prior year, but fourth quarter revenue increased just 11%.
For CB Richard Ellis, sales in the Americas increased by 7% for the full year but decreased by 14% for the fourth quarter. As for leasing, for the full year leasing activity increased 3% but fourth quarter was flat.
Executives from the two companies added color to the numbers and provided their outlooks for the coming year in their quarterly conference calls following the release of the results this month.
Source: Co-Star
Q4 Home Sales, Prices Fall, But 73 Cities Post Gains
February 16, 2008 | Filed Under Real Estate News, Real Estate Trends and Statistics, Boston Condos, Boston Real Estate | Leave a Comment
Sales of existing single-family homes and condos fell 20.9 percent during the fourth quarter of 2007, to a seasonally adjusted annual rate of 4.96 million units compared to a year ago, according to NAR. The national median sale price of an existing single-family home was $206,200 in the fourth quarter, down 5.8 percent from the previous year when the median price was $219,000. Median sale prices fell in the fourth quarter in all four U.S. regions, with declines of 3.2 percent in the Midwest; 4.8 percent in the Northeast; 5.4 percent in the South; and 8.7 percent in the West.
Still, of the 150 metro areas covered in NAR’s survey, 73 showed price gains, including 11 with double-digit increases. Seventy-seven had price declines, including 16 with double-digit drops.
Boston, according to the “Median Sales Price for Existing Condos - Coops Homes for Metropolitan Areas” survey, increased 2.4% from last year. San Fransisco increased 2.7%, Providence increased 3.6% and Chicago increased 6.4%. New York decreased 2.9%, Miami decreased 6%, Los Angeles decreased 9.7% and Las Vegas decreased 10.3%.
Source: NAR
Luxury in Cambridge at One First
February 15, 2008 | Filed Under Boston Lifestyle, Boston Condos, Boston Luxury Developments, Boston Real Estate | 2 Comments
So, you want to be a stone’s throw from Downtown, steps to shopping and restaurants, right on a T line and have a garage space…One First may be the place for you. One First in East Cambridge features five elegant buildings surrounding an beautifully landscaped courtyard and offers homeowners the intimacy of a small residential building without sacrificing luxury ammenities. The One First project offers buyers the choice of 86 different floor plans includings lofts, duplexes, flats and townhomes. The units are light and airy with soaring ceilings and exceptional attention to detail. One First offers a common roof deck, underground garage parking, a fitness room, a library and 24-hour concierge services. The project is steps from the Lechmere Green Line T, Charles River Esplanade and the CambridgeSide Galleria Mall, and minutes to the Red and Orange Lines as well as the Mass General Hospital medical area.
Please contact us with any questions.
U.S. Is Top Global Market For Foreign Investment
February 9, 2008 | Filed Under Real Estate News, Real Estate Trends and Statistics, Real Estate Investment, Boston Real Estate | 2 Comments
The United States was ranked the top global property market among foreign investors, but Asia is close behind, according to a new survey by the Association of Foreign Investors in Real Estate (AFIRE). China ranked second behind the U.S. for the second time in three years, and the gap between the two countries narrowed from 27 percent in 2005 to less than 5 percent in 2007.
The U.S. was also considered the most stable and secure for real estate investments by 56 percent of those surveyed, followed by Germany, the United Kingdom, Australia and Japan. New York City and Washington, D.C. were ranked the top two global cities for foreign investors’ real estate dollars, followed by London, Paris and Shanghai.
Other significant changes in 2007 where:
- Singapore, up to 6th place (tied with Tokyo) from 24th place in 2006
- Sydney, up to 9th place from 15th place in 2006
- Hong Kong, up to 10th place from 11th place in 2006
Top U.S. cities are:
- New York
- Washington DC
- Los Angeles
- San Fransisco
- Seattle
Boston was not mentioned in this survey.
Source: AFIRE
NAR Forecasts Housing Downturn to Continue in 2008
February 9, 2008 | Filed Under Real Estate News, Real Estate Trends and Statistics | Leave a Comment
Sales activity in the housing market will continue to be soft in the months ahead but should gradually improve during the second half of 2008, especially if loan limits are increased, NAR reports in its latest forecast. Sales of existing homes are projected to be at a pace of 4.9 million in the first half of the year and rise to 5.8 million in the second half before leveling off to 5.60 million for all of 2009. Existing-home sales totaled 5.65 million in 2007. Existing-home prices are expected to fall 1.2 percent in 2008 to $216,300 and rise 3.2 percent to $223,200 in 2009. National median existing-home prices fell 1.4 percent in 2007.
NAR also projects new-home sales to decline 17.7 percent in 2008 to 637,000 and then climb 7.6 percent to 685,000 in 2009. The median price of new homes is expected to fall 4.3 percent to $236,300 in 2008 and then increase 5.0 percent in 2009.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, slipped 1.5 percent compared to the prior month and was 24.2 percent below December 2006. The index rose in the Midwest by 3.4 percent but was 17.3 percent below a year ago. But the index fell in the other three regions. In the South, it fell 3.0 percent in December (27.0 percent below a year ago); in the Northeast, it slipped 1.7 percent (26.0 percent below December 2006); and in the West, it fell 3.1 percent (24.1 percent below a year ago).
Lawrence Yun, NAR’s chief economist, says higher loan limits for conventional mortgages could have a positive impact on sales. “If higher limits are enacted very quickly, we’ll see a faster and more meaningful recovery by expanding safe, affordable financing in high-cost areas — that, in turn, would help to stimulate overall economic activity.”
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