Headlines in newspapers can be misleading — especially with respect to housing figures. Media coverage of the most recent Housing Starts data serves as an excellent illustration.

Wednesday, the Census Bureau released its September Housing Starts report. In it, the government said that national Housing Starts rose 15 percent in September as compared to August 2011, tallying 658,000 units on a seasonally-adjusted annualized basis.

The September reading is the highest monthly reading since April 2010, the last month of last year’s home buyer tax credit.

The sudden surge in starts is big news for a housing market that has struggled of late, and the press was eager to carry the story. Here is a sampling of some headlines:

• U.S. Housing Starts Rise 15%, Hit 17-Month High (MarketWatch)
• Home Building Jumps 15% in September (ABC)
• New Construction Surges In September (LA Times)

These headlines are each accurate. However, they’re also misleading.

Yes, Housing Starts did surge in September, but if we remove the “5 or more units” grouping from the Census Bureau data — the catgory that includes apartment buildings and condominium structures — we’re left with Single-Family Housing Starts and Single-Family Housing Starts rose just 1.7 percent last month.

That’s a good number, but hardly a great one. And for home buyers and sellers throughout Las Vegas and nationwide, it’s the Single-Family Housing Starts that matter most. Individuals like you and I don’t buy entire apartment buildings. Most often, we buy single-family homes. Therefore, that’s the data for which we should watch.

The good news is that media tales work in both directions.

Building Permits dropped 5 percent last month when the volatile 5-unit-or-more-units category was included from the math. Isolating for single-family homes, we find that permits were unchanged.

This is good housing because 82% of homes begin construction within 60 days of permit-issuance, hinting at a steady, late-fall housing market.

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Below are some highlights from the October Statistics courtesy of the Tucson Association of Realtors:

Overall I would say this is pretty good news. Total sales YTD remains about the same while inventory is shrinking, a healthy trend that will encourage a speedier market recovery as more buyers are competing for less homes. This is evidenced by the 151% year-over-year increase in listings under contract as buyers are coming off of the fence and finally deciding to purchase.

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I get this question from my Buyers quite often, and usually the correct answer is “Whenever you are ready.” Prices in Tucson are nearly at a ten year low and there are some great deals out there but our market is much more stable than it was five years ago.

Take a look at the graph below. It shows Tucson sales history for the past four years with the same general trends present for all four, that of increased market activity during the summer and a slowdown during the winter months. And this makes perfect sense; most people move during the summer when school is out and most people settle down for the holidays so market movement is slower.

Tucson Sales Trends

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HAFA is an acronym for Home Affordable Foreclosure Alternatives, a government-sponsored program that helps individuals and families who are experiencing difficulty in selling their homes. In conjunction with the Home Affordable Modification Program (HAMP), HAFA was initiated on November 30, 2009 by the U.S. Treasury Department under the Obama Administration with the goal of revitalizing the housing market.

Via the program, borrowers are provided incentives that will help them take advantage of either a short sale, whereas the borrower and the mortgage servicer agree to sell the home for less than the value of the loan; or a deed-in-lieu of foreclosure, whereas the homeowner voluntarily gives the deed of the property to the servicer.

Here is a great video explanation of HAFA:

www.youtube.com/watch?v=8TXx8rKy-Ow

In simple terms, HAFA helps people quickly sell their homes by giving them pre-approved short sales terms before listing the property. They are fully released from future liability for the first mortgage debt, and can receive $1,500 for borrower relocation assistance. Investors and servicers can also receive financial assistance through the program for administrative costs, processing fees, etc. Keep in mind the program is actually quite complex with many guidelines and rules.

Although the program was initiated in November 2009, it officially began on Monday, April 5, 2010 and will end on Monday, December 31, 2012. Experts say that if the program is successful, it will likely be extended and the terms may be adjusted for more to qualify.

To apply for the HAFA program homeowners should visit or call their banks to inquire about how they can participate. If you’d like some local lenders to answer your questions shoot me an email and I’ll send your their contact info.

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It really does drive me crazy. Why don’t they call up one of the 5,000 agents in Tucson and ask them for concrete statistics and evidence of housing activity in Tucson?

In today’s AZ Daily Star there is an article (South side hit hardest by housing value drop) that has the following graphic:

Year over Year Statistics for Tucson Housing Market

Look I like Zillow.com and the service they provide, but their “Zestimates” and housing statistics in general are never going to be as solid as talking to a local agent who can run actual comparables for you.

If you ever have a question about a home’s value or price trending in a particular area please contact a local agent.

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The Tucson market has shown a level of stability over the past few months that we have not seen for quite awhile; most of the past few years has been a story of gradual but continual decline.

It appears that the market is beginning to right itself from the foundation up as evidenced by the data below. The bulk of sales in the Tucson market resides with homes under the $250,000 level (as it always has) and just as this segment of the market was the first to fall out in the sudden decline 4 years ago it also is the first to recover and appears to indicate a coming upswing in the market.

Market Comparison Snapshot

The data above paints an interesting picture, that of the “luxury market” (homes priced at least twice the market average) still feeling the effects of the economic slowdown while the foundation of the market is already in recovery mode. I wonder if this lag time is indicative of natural progression of a recession where the lower classes are affected immediately while the upper class feels the pinch later as the economy contracts?

Also, the average sales price of homes from $250k-$500k dropped nearly 25% from 2006 to 2010 but that makes sense as the bulk of foreclosures and short sales originate in this same section of the market.

At the very least the data above is encouraging in that it shows a stable market is beginning to emerge and I expect the trend to continue. With mortgage rates at historic lows and with Obama pushing for a small-business friendly bill that will loosen community bank purse strings, lending money should become available for consumers to help aid the recovery of the housing market.

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Dove Mountain is still expanding and one of the builders at the front of the expansion is Miramonte Homes, an established local builder whose attention to detail is evident in their quality home construction.

They are currently building in The Preserve along with another builder (Insight Homes) but have a much more attractive price point; when I was walking through their models over the weekend I was impressed by the build quality and the features that come standard with the home that other builders have available as upgrades.

They have several spec-homes (available for immediate move-in) available, here is one that the broker informed me was “very popular”

We're sorry, but we couldn't find MLS # 20934663 in our database. This property may be a new listing or possibly taken off the market. Please check back again.

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The Tucson Association of Realtors released their March 2009 MLS Statistics report recently and, just like the report from last month,  it paints an encouraging (if bland) analysis of MLS activity during March.

Here are the main highlights from the report:

.. For the third month in a row we see a leveling off from nearly every perspective.. If this trend (less listings/more sales) continues, we’ll start to absorb some of that excess inventory.

The median sales price is down 10% year over year and only moved fractionally from February to March. This is in direct contract to national reports that show a continued downward spiral in values.  Our market usually out performs other parts of the country during this season and this year is no exception.

There is a definite lack of equilibrium in the housing market despite historically low interest rates and increased affordability.  Buyers at all price points are hesitant to move forward. Are we close to the tipping point? It’s very possible.

The bottom line is the market is still flat here in the Old Pueblo, which is still being hailed as a good thing by nearly everyone. I think once the first few fence sitting buyers make a move the floodgates will eventually open to return the market to a proper activity level.

March 2009 Absorption Rate

Current Absorption Rate for the Tucson market stands at 9 months.

“Absorption Rates” means the average number of homes sold per month over a particular period of time. It is a solid indication of market conditions and predicting how long a property may be on the market before being sold.

At 9 months the absorption rate for March 2009 is a definite  improvement over the 12.4 month absorption rate we saw in February.

What constitutes a Buyers Market, a Sellers Market and a Neutral Market?

The amount of inventory determines market sway. A “Neutral Market” is 6 months of inventory. Anything less than that is a “Sellers Market”, and conversely, an inventory of more than 6 months is a “Buyers Market.”

Even with a relatively uneventful month Tucson appears to be on the path to recovery. As I wrote in my February 2009 MLS Statistics post last month I think the Tucson market will continue to remain relatively anemic until mid-summer when things will being to actually pick up.

There it is folks, Tucson MLS Statistics for March 2009. To view the full report click here.

Stay tuned for next month’s April 2009 Statistics report!

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The Tucson Association of Realtors released their February 2009 MLS Statistics today and it paints an encouraging (if bland) analysis of MLS activity last month.

Here are the main highlights from the report:

When comparing this year to ’08 we see very moderate declines and a big improvement over the January comparison… This leveling off indicates we are experiencing more predictable activity and less drama.

The median sales price is now $178,000, 11% lower than last year but remarkably close to the ’05 median sales price of $186,500. It appears that realistic pricing is a strategy that’s taking hold.

Our current listing inventory counts are very encouraging. We now have 7,532 active listings as opposed to February ’08 when we had 9,168. That’s a 17.84% reduction and if you compare it to the mere .75% drop in sales you can see that we’re gaining ground.

The bottom line is that it was a pretty boring month. Which, in this market, is good news (funny how that works isn’t it?).

February 2009 Absorption Rate

Current Absorption Rate for the Tucson market stands at 11.4 months.

“Absorption Rates” means the average number of homes sold per month over a particular period of time. It is a solid indication of market conditions and predicting how long a property may be on the market before being sold.

At 11.4 months the absorption rate for February 2009 is an improvement over the 13 month absorption rate we saw in January.

What constitutes a Buyers Market, a Sellers Market and a Neutral Market?

The amount of inventory determines market sway. A “Neutral Market” is 6 months of inventory. Anything less than that is a “Sellers Market”, and conversely, an inventory of more than 6 months is a “Buyers Market.”

Tucson still is in the throes of a Buyer’s market but appears to be on the path to recovery. As I wrote in my January 2009 MLS Statistics post last month I think the Tucson market will continue to remain relatively anemic until mid-summer when things will being to actually pick up.

There it is folks, Tucson MLS Statistics for February 2009. To view the full report click here.

And for those of you who are wondering what the jousting image at the top of this post has to do with MLS statistics, the answer is.. nothing. BUT, the Arizona Renaissance Festival is in full swing and if you have a chance I would recommend stopping by!

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