Market Report

Clear Capital: Bakersfield, CA Tops Metros With Largest Projected Gains Through Last Half of the Year. Really.

Las Vegas projected to lead metros with total 2013 price growth.

TRUCKEE, Calif. – July 2, 2013 – Clear Capital (www.clearcapital.com), the premium provider of data and solutions for real estate asset valuation and collateral risk assessment, today released its Home Data Index™ (HDI) Market Report with data through June 2013. Using a broad array of public and proprietary data sources, the HDI Market Report publishes the most granular home data and analysis earlier than nearly any other index provider in the industry.

June 2013 highlights include:

  • The forecast through June 2013 reveals trends that highlight the overall recovery’s strength and potential for sustainability. Nationally, home prices continue to benefit from the more active spring buying season.
    • Quarterly, yearly and two quarter forecasts all came in stronger at 1.4%, 8.6%, and 1.7% respectively, relative to months past.
      • A more optimistic update to our total 2013 national forecast of 6.0% over the 2.6% growth projected in our April 2013 report is attributed to increasing home price gains across much of the nation, continuous improvements in distressed market measures and improvements in broad-based economic inputs, such as consumer confidence.
  • Should 2013 forecasts be realized, the housing market would outperform historical average gains between 4.0% and 5.0%, but indicate moderation from the current yearly gains of 8.6%.
  • Regionally, home price gains saw moderate growth in the short-term, long-term and forecast.
    • The West, South, Midwest and Northeast are forecasted to see total 2013 gains of 10.1%, 5.2%, 4.6% and 4.1%, respectively. These gains are comprised of year-to-date growth and two quarter forecasts of 2.2%, 1.5%, 1.8% and 1.5%, respectively. Moderation is key to a sustained recovery. With this in mind, projected regional growth rates are healthy compared to year-over-year gains through June of 17.1%, 7.1%, 6.2% and 4.3%, respectively.
  • While metro level market trends showed continued variability, they remained positive overall. Local market economic fundamentals continue to drive varying degrees of price growth.
    • 45 out of the top 50 major metro markets are forecasted to see yearly growth over the final two quarters of 2013. Four of the five markets not expected to see home price gains over the next two quarters are projected to see declines of less than 0.5%.
    • Las Vegas held its lead in June with yearly gains of 29.3%. The metro is one of six others to have realized more than 20.0% in yearly growth. Considering the two quarter forecast for Las Vegas of 5.0%, the metro will likely end the year as the recovery front runner with total 2013 gains of 19.4%.
    • Bakersfield, CA’s two quarter forecast of 5.2% puts this metro in the lead for short term anticipated gains out of the top 50 metros. Bakersfield moved from 29 in March’s Forecast to the first position in June. This leap is an example of the fundamentals driving the overall recovery. Bakersfield shares many characteristics of a First In First Out Recovery and serves as a reminder that the recovery continues to unfold market by market. This market was hard hit in the downturn and now offers an attractive opportunity for homebuyers. From the peak, prices are currently down 54.3%, substantially more than the national losses of 34.2%. Additionally, REO saturation remains relatively high, but on the decline at 21.3%. And overall median prices are relatively low at $160,000.
    • Cleveland is expected to continue to struggle with home price declines of 2.2% over the next two quarters. The metro has yet to see the positive fundamental shift in its distressed sale environment that other markets have seen prior to recovery. The rate of REO saturation has been on the rise, up nearly seven points over the last three quarters to a current rate of 36.7%. Until this market sees REO saturation subside, it’s unlikely to see prices rise.
  • Contact Alanna Harter for your June 2013 file of the Top 30 MSAs or access our data on the Bloomberg Professional service by typing CLCA <GO>.

 

“June home price trends and forecasts were nearly all positive across the country”, said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital. “We saw quarterly, yearly and six month forecasts all tick up, relative to the past few months’ performance. These improved trends signal spring buying activity continues to have a positive impact, while our forecasts point to moderation ahead. Certainly this is an interesting and important dynamic unfolding and while it could seem contradictory at the surface, perspective lends clarity. Increasing gains are great news for homeowners and to be expected at this time of the year, when home buyers are typically most active. While there is a lot of buzz right now in terms of double digit housing gains, over the long run, we don’t expect to see the current rates of growth sustained. Keep in mind this is really not a bad thing. National growth for all of 2013 is expected to hit 6.0%, lower than current yearly growth of 8.6%, yet higher than historical norms between 4.0% and 5.0%. After more than a full year of recovery, we consider the current momentum and expected moderation a really healthy move toward a more sustained recovery.

“At the metro level, we saw some subtle, yet notable trends unfold in June. While price trends continued to diverge at the micro market level, they are for the most part positive. Our forecasts highlight expected price gains across the country over the rest of 2013. This is a really important piece to the recovery puzzle right now. The fact that 45 out of 50 major metro markets are expected to see price gains over the next six months speaks to this move toward a more balanced, broad-based recovery, another really healthy sign. It’s great that six metros have seen more than 20.0% growth over the last year, but on their own these few markets can’t support a long-term national recovery. Seeing the bulk of major metros move into positive territory is truly good news, even if their gains are still in the single digits.”

For the complete file of the Top 30 MSA price trends for June 2013, please contact Alanna Harter.

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 Top 50 Major Metro Markets
Forecast
Rank
  Metropolitan Statistical Area   Current Qtr/Qtr
% +/-
  Current Yr/Yr   Current REO Saturation   Forecast
Thru 2013
1   Bakersfield, CA   3.1%   17.7%   21.3%   5.2%
2   Las Vegas, NV – Paradise, NV   4.4%   29.3%   25.3%   5.0%
3   Chicago, IL – Naperville, IL – Joliet, IL   3.6%   15.2%   28.0%   4.9%
4   Sacramento, CA – Arden, CA – Roseville, CA   3.7%   23.7%   15.1%   4.8%
5   Milwaukee, WI – Waukesha, WI – West Allis, WI   1.5%   9.0%   18.9%   4.4%
6   Miami, FL – Ft. Lauderdale, FL – Miami Beach, FL   2.8%   18.2%   22.7%   4.3%
7   Washington, DC – Arlington, VA – Alexandria, VA   1.7%   9.5%   6.4%   3.6%
8   Minneapolis, MN – St. Paul, MN – Bloomington, WI   2.4%   17.4%   14.3%   3.4%
9   Jacksonville, FL   1.5%   9.2%   28.1%   3.2%
10   Tucson, AZ   2.1%   13.3%   23.6%   3.2%
11   Richmond, VA   1.7%   8.3%   14.7%   3.1%
12   San Francisco, CA – Oakland, CA – Fremont, CA   3.3%   23.3%   10.3%   3.0%
13   Fresno, CA   2.1%   14.5%   22.1%   2.9%
14   Providence, RI – New Bedford, MA – Fall River, MA   1.6%   9.3%   7.3%   2.7%
15   San Diego, CA – Carlsbad, CA – San Marcos, CA   2.7%   16.5%   11.7%   2.7%
16   Memphis, TN   1.8%   6.8%   25.0%   2.7%
17   Tampa, FL – St. Petersburg, FL – Clearwater, FL   2.5%   11.3%   23.3%   2.5%
18   Portland, OR – Vancouver, WA – Beaverton, OR   2.2%   13.1%   7.6%   2.5%
19   Oxnard, CA – Thousand Oaks, CA – Ventura, CA   2.5%   14.6%   12.8%   2.4%
20   Dayton, OH   0.5%   8.2%   25.6%   2.3%
21   Riverside, CA – San Bernardino, CA – Ontario, CA   2.8%   17.4%   21.2%   2.3%
22   Orlando, FL   2.9%   15.2%   21.5%   2.2%
23   Birmingham, AL – Hoover, AL   1.1%   6.0%   21.6%   2.2%
24   Boston, MA – Cambridge, MA – Quincy, MA   1.8%   8.5%   4.4%   2.2%
25   Philadelphia, PA – Camden, NJ – Wilmington, DE   1.1%   2.5%   7.0%   2.1%
26   Phoenix, AZ – Mesa, AZ – Scottsdale, AZ   2.9%   24.7%   13.5%   2.1%
27   Houston, TX – Baytown, TX – Sugar Land, TX   1.7%   11.3%   10.9%   2.0%
28   Honolulu, HI   1.3%   8.6%   2.3%   2.0%
29   Hartford, CT – West Hartford, CT – East Hartford, CT   1.0%   3.9%   5.8%   1.6%
30   Dallas, TX – Fort Worth, TX – Arlington, TX   0.7%   4.7%   12.9%   1.6%
31   Atlanta, GA – Sandy Springs, GA – Marietta, GA   3.3%   22.2%   29.3%   1.6%
32   Nashville, TN – Davidson, TN – Murfreesboro, TN   0.7%   3.9%   17.7%   1.5%
33   Pittsburgh, PA   1.0%   4.9%   5.9%   1.3%
34   St. Louis, MO   -1.1%   -4.4%   29.3%   1.2%
35   Baltimore, MD – Towson, MD   0.9%   5.6%   9.0%   1.1%
36   Los Angeles, CA – Long Beach, CA – Santa Ana, CA   2.9%   18.4%   12.9%   1.1%
37   San Jose, CA – Sunnyvale, CA – Santa Clara, CA   3.2%   23.6%   5.4%   1.0%
38   Cincinnati, OH – Middletown, OH   0.3%   1.9%   23.4%   0.9%
39   NY, NY – No. New Jersey, NJ – Long Island, NY   1.3%   6.1%   4.8%   0.7%
40   Columbus, OH   -0.3%   3.7%   28.4%   0.5%
41   New Orleans, LA – Metairie, LA – Kenner, LA   0.2%   2.2%   13.8%   0.4%
42   Detroit, MI – Warren, MI – Livonia, MI   -0.7%   5.6%   44.8%   0.4%
43   Rochester, NY   0.2%   2.1%   2.9%   0.3%
44   Seattle, WA – Tacoma, WA – Bellevue, WA   2.2%   17.9%   12.4%   0.3%
45   Virginia Beach, VA – Norfolk, VA – Newport News, VA   0.9%   5.2%   13.9%   0.1%
46   Louisville, KY   -0.1%   -0.3%   19.5%   0.0%
47   Denver, CO – Aurora, CO   1.6%   11.7%   9.8%   -0.2%
48   Charlotte, NC – Gastonia, NC – Concord, NC   -0.3%   -1.8%   21.7%   -0.2%
49   Raleigh, NC – Cary, NC   0.1%   0.1%   13.0%   -0.4%
50   Cleveland, OH – Elyria, OH – Mentor, OH   -1.1%   -1.8%   36.7%   -2.2%

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About the Clear Capital® Home Data Index™ (HDI) Market Report

The Clear Capital HDI Market Report provides insights into market trends and other leading indices for the real estate market at the national and local levels. A critical difference in the value of the HDI Market Report is the capability of Clear Capital to provide more timely and granular reporting than nearly any other home price index provider.

The Clear Capital HDI Market Report:

  • Offers the real estate industry (investors, lenders, and servicers), government agencies, and the public insight into the most recent pricing conditions, not only at the national and metropolitan level, but within local markets as well.
  • Is built on the most recent information available from recorder/assessor offices, and then further enhanced by adding the company's proprietary streaming market data for the most comprehensive geographic coverage and local insights available.
  • Reflects nationwide coverage of sales transactions and aggregates this comprehensive dataset at ten different geographic levels, including hundreds of metropolitan statistical areas (MSAs) and sub-ZIP code boundaries.
  • Includes equally-weighted distressed bank owned sales (REOs) from around the country to give the most real world look of pricing dynamics across all sales types.
  • Allows for the most current market data by providing more frequent updates with patent pending rolling quarter technology. This ensures decisions are based on the most up-to-date information available.
Clear Capital HDI Methodology
  • Generates the timeliest indices in patent pending rolling quarter intervals that compare the most recent four months to the previous three months. The rolling quarters have no fixed start date and can be used to generate indices as data flows in, significantly reducing the multi-month lag time experienced with other indices.
  • Includes both fair market and institutional (real estate owned) transactions, giving equal weight to all market transactions and identifying price tiers at a market specific level. By giving equal weight to all transactions, the HDI is truly representative of each unique market.
  • Results from an address-level cascade create an index with the most granular, statistically significant market area available.
  • Provides weighted repeat sales and price-per-square-foot index models that use multiple sale types, including single-family homes, multi-family homes, and condominiums.
About Clear Capital

Clear Capital (www.clearcapital.com) is the premium provider of data and solutions for the mortgage finance industry. The Company’s products include appraisals, broker price opinions, property condition inspections, value reconciliations, automated valuation models, quality assurance services, and home data indices. Clear Capital’s combination of progressive technology, high caliber in-house staff, and a well-trained network of more than 40,000 field experts sets a new standard for accurate, up-to-date, and well documented valuation data and assessments. The Company’s customers include the largest U.S. banks, investment firms, and other financial organizations. Clear Capital’s home price data can be accessed on the Bloomberg Professional service by typing CLCA ‹GO›.

The information contained in this report is based on sources that are deemed to be reliable; however no representation or warranty is made as to the accuracy, completeness, or fitness for any particular purpose of any information contained herein. This report is not intended as investment advice, and should not be viewed as any guarantee of value, condition, or other attribute.

Alanna Harter
Marketing Manager

alanna.harter@clearcapital.com
Phone: 530.550.2515

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Alanna Harter
Marketing Manager

alanna.harter@clearcapital.com
Phone: 530.550.2515