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U.S. Home-Price Growth Fastest in Nearly 7 Years

by Ruth Mantell, Market Watch

 

WASHINGTON (MarketWatch) — Prices for U.S. homes rose in March, marking the fastest annual growth rate in nearly seven years, according to data released Tuesday.

The S&P/Case-Shiller 20-city composite rose 1.4% in March, the largest monthly growth since July. On a seasonally adjusted basis, prices rose 1.1% in March.

 
The growth from the same period of last year was 10.9%, which marks the highest year-on-year growth rate since April 2006. All 20 cities tracked by the gauge saw year-over-year improvements for a third consecutive month.

“Other housing market data reported in recent weeks confirm these strong trends: housing starts and permits, sales of new home and existing homes continue to trend higher,” said David Blitzer, chairman of the index committee at S&P Dow Jones Indices.

U.S. stock markets were up sharply.

Low inventory and interest rates, as well as pent-up demand, are supporting home prices. There are also fewer distressed sales. A government gauge of consumer costs for shelter indicates that prices have increased about 2.2% over the past year. Despite recent gains, prices remain about 28% below a 2006 peak.

Rising home prices encourage market activity as more owners are willing and able to place their homes on the market.

“Overall, the ongoing rise in home prices should remain supportive for the broader housing market recovery, helping to sustain the improvement in homebuyer confidence and to bring a considerable number of underwater homeowners back above water,” said Gennadiy Goldberg, U.S. strategist at TD Securities.

However, rapidly rising prices and bidding wars in certain markets are preventing first-time buyers from participating. With fewer first-time buyers, it’s tougher for other owners to sell and move up from starter homes.

Phoenix posted the largest year-over-year price growth at 22.5%, while New York had the lowest at 2.6%.

“The big gains continue to come from the cities which were most affected by the bursting of the housing bubble,” said Steven Ricchiuto, chief economist at Mizuho Securities USA.

While there is some concern about the formation of new bubbles, credit is much tougher to obtain now. In fact, some economists are concerned that the pendulum has swung too far, barring credit-worthy applicants from obtaining mortgages.

 

Ruth Mantell is a MarketWatch reporter based in Washington. Follow her on Twitter @RuthMantell.

 

For more information, please contact Ashlie DuCros at 714-743-9778, or go to www.AshlieDuCros.com

Existing-home sales rose in April but remain below underlying demand because of limited inventory and tight credit, according to the National Association of REALTORS®. All regions are showing strong price gains from a year ago.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 0.6 percent to a seasonally adjusted annual rate of 4.97 million in April from an upwardly revised 4.94 million in March. Resale activity is 9.7 percent above the 4.53 million-unit level in April 2012.

Lawrence Yun, NAR chief economist, said the market is solidly recovering. “The robust housing market recovery is occurring in spite of tight access to credit and limited inventory. Without these frictions, existing-home sales easily would be well above the 5-million unit pace,” he said. “Buyer traffic is 31 percent stronger than a year ago, but sales are running only about 10 percent higher. It’s become quite clear that the only way to tame price growth to a manageable, healthy pace is higher levels of new home construction.”

Existing-home sales are at the highest pace since November 2009 when the market spiked to 5.44 million in response to the home buyer tax credit. Total sales have been above year-ago levels for 22 consecutive months, while prices show14 consecutive months of year-over-year price increases.

Total housing inventory at the end of April rose 11.9 percent, a seasonal increase to 2.16 million existing homes available for sale, which represents a 5.2-month supply at the current sales pace, compared with 4.7 months in March.Listed inventory is 13.6 percent below a year ago, when there was a 6.6-month supply, with current availability tighter in the lower price ranges.

The national median existing-home price for all housing types was $192,800 in April, up 11.0 percent from April 2012. The last time there were 14 consecutive months of year-over-year price increases was from April 2005 to May 2006.

Distressed homes — foreclosures and short sales — accounted for 18 percent of April sales, down from 21 percent in March and 28 percent in April 2012. Eleven percent of April sales were foreclosures, and 7 percent were short sales. Foreclosures sold for an average discount of 16 percent below market value in April, while short sales were discounted 14 percent.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 3.45 percent in April from 3.57 percent in March; it was 3.91 percent in April 2012.

The median time on market for all homes was 43 days in April, down sharply from 62 days in March, and is 48 percent faster than the 83 days on market in April 2012.

NAR President Gary Thomas said market conditions have flipped in the past year. “With homes selling in half the time it took to sell a year ago, buyers must be both decisive and prudent,” he said. “Advice with contract terms and negotiations is where the expertise of a Realtor® shines for both buyers and sellers.”

Short sales were on the market for a median of 73 days, while foreclosures typically sold in 43 days and non-distressed homes took 44 days. Forty-four percent of all homes sold in April were on the market for less than a month, while only 8 percent were on the market for a year or longer.

First-time buyers accounted for 29 percent of purchases in April, compared with 30 percent in March and 35 percent in April 2012.

All-cash sales were at 32 percent of transactions in April, up from 30 percent in March; they were 29 percent in April 2012. Individual investors, who account for most cash sales, purchased 19 percent of homes in April, unchanged from March; they were 20 percent in April 2012.

Single-family home sales rose 1.2 percent to a seasonally adjusted annual rate of 4.38 million in April from 4.33 million in March, and are 9.0 percent above the 4.02 million-unit level in April 2012. The median existing single-family home price was $193,300 in April, which is 11.0 percent above a year ago.

Existing condominium and co-op sales declined 3.3 percent to an annualized rate of 590,000 units in April from 610,000 in March, but are 15.7 percent above the 510,000-unit pace a year ago. The median existing condo price was $189,500 inApril, up 11.3 percent from April 2012.

Regionally, existing-home sales in the Northeast rose 1.6 percent to an annual rate of 640,000 in April and are 4.9 percent above April 2012. The median price in the Northeast was $245,100, up 5.1 percent from a year ago.

Existing-home sales in the Midwest fell 3.4 percent in April to a pace of 1.12 million but are 9.8 percent above a year ago. The median price in the Midwest was $149,300, up 6.7 percent from April 2012.

In the South, existing-home sales rose 2.0 percent to an annual level of 2.01 million in April and are 14.9 percent above April 2012. The median price in the South was $168,700, which is 10.6 percent above a year ago.

Existing-home sales in the West increased 1.7 percent to a pace of 1.20 million in April and are 4.3 percent above a year ago. Given limited choices and multiple bidding, the median price in the West was $263,600, up 17.5 percent from April 2012.

For more information, please contact Ashlie DuCros at 714-743-9778, or go to www.AshlieDuCros.com

Custom Ocean View Estate in San Clemente

by Ashlie DuCros

Beautiful Ocean View Custom Estate! Nestled in San Clemente Hills, this spacious 6500 sq. ft. Private Estate features 5 bedrooms that include 3 master suites, 4.5 baths, and office/library with retreat area. The long driveway welcomes you to spacious front yard, with your own putting green area. Enter thru the gorgeous foyer with Travertine flooring, crown moldings, with warm colors thru out. Step down to large formal living room with cozy fireplace. Gourmet kitchen features custom maple cabinets, granite counter tops, Center Island, and high end stainless steel appliances. Enjoy the breathtaking views from the kitchen, family room, and almost all the bedrooms. One master suite is located downstairs for you guests. Relax in your secluded backyard with panoramic views and beautiful sunsets. This home awaits you.

(Range Pricing $1,999,980- $2,300,000)

The Home Bidding Wars Are Back!

by Ashlie DuCros

By Les Christie @CNNMoney 

The competition has been most intense in California, where 9 out of 10 homes sold in San Francisco, Sacramento and cities in Southern California have been drawing competing bids.

The bidding wars are back. Seemingly overnight, many of the nation's major housing markets have gone from stagnant to sizzling, with for-sale listings drawing offers from a large number of house hunters.

In March, 75% of agents with broker Redfin said their clients' offers were countered by rival bids, up from 56% who said so in late 2011.


"The only question is not whether a new listing will get multiple bids but how many it will get," said Kris Vogt, who manages 14 Coldwell Banker offices in the Sacramento area. One home in an Elk Grove, Calif., subdivision recently received 62 separate bids. The final sale price was for more than $150,000, well above its $129,000 asking price. The competition has been most intense in California, where 9 out of 10 homes sold in San Francisco, Sacramento and cities in Southern California drew competing bids during the month. And at least two-third of listings in Boston, Washington D.C., Seattle and New York generated bidding wars. In Cambridge, Mass., two condos that could be combined into one large home hit the market two weeks ago for $800,000 each, according to Pat Villani, president of Coldwell Banker Residential Brokerage in New England.

"The brokers stopped taking names after the number of bidders reached 250," she said. The winning bidder offered $2 million for both units.

Five best markets to buy a home

Homebuyers eager to purchase before home prices and mortgage rates rise are finding few homes for sale as sellers hold out for better deals, said Glenn Kelman, Redfin's CEO.

Many homeowners are still underwater, owing more on their mortgages than their homes are worth, and they want to wait until selling becomes profitable again. By doing so, they can avoid short sales, which carry big hits on credit scores, 85 to 160 points, according to FICO.

"Many people have been holding on for a profit and they're just now getting their heads above water," said Kelman.

Those who want to sell and buy a new home are encountering a market where it's difficult to find a new place of their own, said Vogt.

Five best markets to sell a home

Over the past few months, Jackie and Cliff Kaufman have bid on four different homes in St. Petersburg, Fla., including one short sale and a foreclosure.

The pair, who have two adult children and run an online jewelry business, said they bid $5,000 more than the $495,000 asking price on the first home they had their eye on and never heard back from the seller's agent. They were later told the house sold for nearly $550,000.

Next, they bid on a short sale listed for $600,000. This time, they came in $10,000 above the asking price and again, they were beaten out. The house was only on the market for two days.

The third attempt to make an offer on a bank-owned property was also met with silence.

Related: Buy or rent? 10 major cities

"It was very frustrating," said Jackie Kaufman. "We felt we were always on the outside of the loop and that people who won the homes had the inside track."

By the fourth try, the couple successfully bid through a listing agent, who they believe pushed their bid harder in order to earn a double commission since she was representing both the buyer and seller in the deal. And they managed to get the place for $30,000 less than the asking price.

They were lucky. Inventories of homes for sale continue to shrink. In February, the National Association of Realtors reported a 19.2% decline in inventory year-over-year. While the number of homes for sale should rise with the onset of the spring selling season, housing inventory is expected to remain low, pushing prices higher.

 Fastest growing boomtowns

And new home construction, especially in markets hit hard by the housing bust, is still moving forward at a snail's pace, since the cost to build the homes is often more than what the property ends up selling for, said Jeff Culbertson, president of Coldwell Banker's Southern California operations.

Even though home prices are on the rise, the balance between buyers and sellers has been thrown off balance, said Kelman.

"With buyers out in force and sellers cautious, the market is in an awkward 'tweener' phase," he said. 

May 2013 Orange County Real Estate Market Stats

by Ashlie DuCros
Orange County Home Stats                         May 2013                   
 
City For Sale In Escrow  
Anaheim 131 238  
Anaheim Hills 66 42  
Brea 36 37  
Fullerton 124 116  
Irvine 259 165  
Laguna Beach 193 28  
Newport Coast 69 16  
Orange 118 120  
Tustin 48 70  
Yorba Linda 120 90  
       
Check out these numbers of homes for sale vs. in escrow for the month of May in Orange County Real Estate. For more information, please contact us at Aducroshomes@gmail.com, or 714-743-9778

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Ashlie DuCros & Associates
Coldwell Banker Previews Global Luxury
21580 Yorba Linda Blvd.
Yorba Linda CA 92887
714-743-9778
Fax: 714-849-5489