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Truth In September’s Housing Starts Report

Tucson Realtor - Michael Krotchie — Thu, 20 Oct 2011 21:12:23 +0000

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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Weekly Reading Rainbow – 8/19/2011

Tucson Realtor - Michael Krotchie — Fri, 19 Aug 2011 14:25:29 +0000

Below is a compilation of Real Estate related resources that I’ve come across during the week that are good reads for anyone in the market to buy or sell a home.

September bottom seen for housing prices (AZStarnet)
Homebuilder Confidence Sags; Doors Open For Ready Buyers (The Mortgage Reports)
Industry Opinions Weigh In on Extended Forecast for Short Sales (RISMedia)
Foreclosures fall for 10th straight month (CNN Money)
Existing-home sales slip amid tight credit (MSNBC)

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Tucson Real Estate Statistics released for July 2011

Tucson Realtor - Michael Krotchie — Thu, 18 Aug 2011 15:49:40 +0000

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

Total Sales Volume dipped a little this month by 11.27%, but is up 27.93% from July 2010.
Average Sales Price increased by 3.57% from June.
The Average List Price of $181,603 is up 4.21% from June’s number of $174,262.
Total Unit Sales decreased 14.33% from June, but increased 41.92% from July 2010.
Median Sales Price decreased slightly to $125,000.
Active Listings showed a slight decrease of 2.77% from June.

Overall the market continues to improve. Total unit sales is significantly up from last year and a rise in list price signals higher competition from buyers.

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Tucson Real Estate Statistics released for Februrary 2011

Tucson Realtor - Michael Krotchie — Mon, 14 Mar 2011 13:59:32 +0000

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

Total Sales Volume increased significantly from $130,258,440 in January to $160,319,228 in February, an increase of 23.08%!
Average Sales Price is up 9.22% from January.
Average List Price of $191,957 showed an 8.43% increase over January.
Total Under Contract had a 12.87% increase from January.
Total Unit Sales rose by 12.69%, from 780 in January to 879 in February, and by 18.62% compared to January 2010.
The Median Sales Price went from $134,250 in January to $137,000 in February with a total increase of 2.05%

Overall the market continues to improve. Total volume is significantly up and a rise in list price signals higher competition from buyers. Although median sales price rose only slightly it is expected to lag statistically until higher list price homes close escrow.

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Mortgage Rates are on a Roller Coaster

Tucson Realtor - Michael Krotchie — Fri, 19 Nov 2010 15:37:21 +0000

I read several mortgage blogs in addition to my normal real estate blog reading and during the past week the mortgage market has gone pretty bonkers (even the Wall Street Journal thinks so). Over the past several months we have seen a steady decline of mortgage rates but recently rates have spiked. Take a look at the chart below:

If you are in the market for a home and area waiting to lock in a rate (like me) or are still on the fence about refinancing your loan now seems to be the time to do it. I have spoken with a couple loan officers I work with and they have not shown much confidence in rates remaining low in the near term.

Check out this excerpt from TheMortgageReports.com latest post, I would highly recommend taking a quick look if you want to learn more about how mortgage rates are determined:

Mortgage rates are as volatile as they’ve been all year.

After the Federal Reserve announced its $600b QE2 program to support bonds, markets caught whiff of pending inflation. The concern sparked a major MBS sell-off that drive rates from all-time lows to a 10-week high in just 5 days.

And it’s not just that rates are moving — it’s how fast they’re moving.

Comparing average daily price changes in the MBS market:

January 1 – November 8, 2010 : 26 basis points per day

The last 5 days of trading : 60 basis points per day

Mortgage lenders are issuing up to 4 rate sheets per day now. That means that the price quote you took in the morning is likely expired by noon. It expires two more times during the course of the day, too.

If anyone needs some loan officer information feel free to contact me and I’ll send some information your way.

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Twin Peaks Interchange Finally Opens

Tucson Realtor - Michael Krotchie — Thu, 18 Nov 2010 13:18:43 +0000

Great news residents of NW Tucson! Tomorrow marks the grand opening of the fabled Twin Peaks Interchange (formerly known as the Camino de Manana project). This interchange has been a long time coming; I remember talk of it being done back in 1998 when I moved to Continental Ranch.

The communities who will benefit most from this new interchange will be those in Continental Ranch, Continental Reserve and Dove Mountain, although many other residents will be able to take advantage of the new ramp. One immediate benefit is that traffic congestion at the Cortaro road exit should decline as more cars decide to use the Twin Peaks exit.

Here is a brief history courtesy of the AZ Daily Star:

TIMELINE

April 5, 1988: The town adopts the Continental Ranch Specific Plan, in which the developer mentions a future freeway interchange at Twin Peaks but doesn’t include any funding method for it.
Jan. 23, 2001: Marana creates its first impact fee to fund its estimated $14 million portion of the interchange.
June 2001: The Arizona Department of Transportation puts the interchange on its agenda.
September 2004: The project’s design concept report is completed.
April 11, 2006: Final design of the project plans begins.
April 2009: Contractor bids are opened, with Phoenix-based Pulice Construction Inc. winning the contract.
May 11, 2009: Town conducts a groundbreaking for the Twin Peaks interchange.
Today: Town and local dignitaries will hold a ribbon-cutting to mark completion.
Friday: New interchange and road are open to traffic.

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Tucson Real Estate Statistics released for October 2010

Tucson Realtor - Michael Krotchie — Sun, 14 Nov 2010 14:20:49 +0000

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

Total listings under contract increased by 25.35% over September and by 151.52% over October of 2009.
The number of new listings decreased by 16.24% compared to October of 2009.
Total unit sales decreased in October by 13.86% from 873 in September to 752 in October.
The median sales price decreased by 4.01% from September to October.
Active listings have decreased by 7.21% compared to October 2009.
When comparing total Home Sales Units Year To Date, as of October 31, 2009, we had sold 9,616 homes and Year To Date 2010, we have sold 9,588, a decrease of 0.29% over last year.

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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Tucson Investment Property Statistics

Tucson Realtor - Michael Krotchie — Tue, 02 Nov 2010 04:39:15 +0000

Search parameters: Property type Residential Income Status of ‘Closed’; Sold Date between ’11/1/2008′ and ’11/1/2020′; Property Sub-Type of ’2 Plex’, ’3 Plex’, ’4 Plex’, ‘Apartment’, ‘Comb’.

	Active Listings	New Listings	Sold Listings	Months Inventory
Oct-10	6	0	14	0.43
Sep-10	11	2	7	1.57
Aug-10	19	3	19	1
Jul-10	30	13	14	2.14
Jun-10	30	16	22	1.36
May-10	25	10	16	1.56
Apr-10	29	9	14	2.07
Mar-10	33	23	22	1.5
Feb-10	35	16	12	2.92
Jan-10	30	15	15	2
Dec-09	31	15	15	2.07
Nov-09	30	11	12	2.5
Oct-09	28	19	20	1.4
Sep-09	37	17	22	1.68
Aug-09	34	9	7	4.86
Jul-09	38	15	18	2.11
Jun-09	34	12	15	2.27
May-09	42	18	13	3.23
Apr-09	35	14	23	1.52
Mar-09	40	13	6	6.67
Feb-09	42	15	16	2.63
Jan-09	47	12	8	5.88
Dec-08	45	9	9	5
Nov-08	42	14	10	4.2

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Current Tucson Market Stats: Active, Sold & New Listings

Tucson Realtor - Michael Krotchie — Tue, 19 Oct 2010 19:12:39 +0000

	Active Listings	New Listings	Sold Listings	Months Inventory
Sep – 2010	9,204	2,099	950	9.69
Aug – 2010	9,025	2,110	966	9.34
Jul – 2010	8,840	2,101	873	10.13
Jun – 2010	8,601	1,976	1,285	6.69
May – 2010	8,366	1,877	1,359	6.16
Apr – 2010	8,793	2,388	1,349	6.52
Mar – 2010	9,047	2,486	1,274	7.10
Feb – 2010	8,942	2,271	831	10.76
Jan – 2010	8,590	2,609	776	11.07
Dec – 2009	8,565	1,496	974	8.79
Nov – 2009	8,544	1,713	1,120	7.63
Oct – 2009	8,497	2,221	1,126	7.55
Sep – 2009	8,452	2,016	1,028	8.22
Aug – 2009	8,422	1,982	1,055	7.98
Jul – 2009	8,592	2,004	1,285	6.69
Jun – 2009	8,804	2,065	1,249	7.05
May – 2009	9,099	1,864	1,084	8.39
Apr – 2009	9,475	1,873	982	9.65
Mar – 2009	9,604	2,229	960	10.00
Feb – 2009	9,648	1,955	727	13.27
Jan – 2009	9,553	2,542	625	15.28
Dec – 2008	9,811	1,627	839	11.69
Nov – 2008	9,867	1,732	681	14.49
Oct – 2008	9,881	2,181	878	11.25

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When is the Best Time to Buy in Tucson?

Tucson Realtor - Michael Krotchie — Mon, 18 Oct 2010 13:51:40 +0000

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.

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