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Brian Opsal

Vice President, Marketing

brian.opsal@clearcapital.com

Phone: 530.550.2546

Detroit Takes the Recovery Lead in October.

After 31.6% yearly growth, the metro would need to see another 262.3% growth to reach peak prices.

 

TRUCKEE, Calif. – November 4, 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 October 2013 data. 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.

 

October 2013 highlights include:

 

  • National home price trends showed signs of moderation in October.
    • Nationally, prices expanded 11.7% over the last year. The West maintained the regional lead with 19.5% yearly growth.
    • Rolling quarterly rates of growth indicate moderation is underway. National quarterly rates of growth have fallen from 3.8% to 2.1%.
    • Nationally, low price tier homes (with values in the 25th percentile of all homes sold) have seen strong moderation from the last rolling quarter. Current rolling quarterly gains of 2.5% are less than half of the prior rolling quarter. Considering this sector led the recovery, the current cooling is further indication that moderation is unfolding.
  • Metro markets continue to exhibit variation in their growth drivers, yet share some similarities in overall trends:
    • Of the 15 highest performing major metro markets, 11 have seen yearly gains top 20.0%.
    • Lowest performing major metro markets remained relatively stable. Only one metro saw price declines over the last year at -1.1%, a relatively minor decline.
  • Out of the top 50 major metro markets, the Detroit MSA turned out the strongest quarterly growth at 7.8% and second highest yearly gains of 31.6%. This can be attributed, in part, to its improved REO saturation rate, down 34.7 percentage points from the high of 64.6% in 2009.
    • Detroit’s median price is $120,000, just over half the national median price of $210,000. Relatively small price gains will more heavily influence percentage gains in Detroit than in higher priced markets.
    • Detroit also ranks number one in REO Saturation at 29.9%.
    • In a market with severely depressed prices, bubble-like behavior is unlikely. A sustained recovery will depend on the strength of the local economy. Unemployment sits at more than 9.0% in Detroit, and median incomes are nearly half of national median incomes.
  • Contact Brian Opsal for your October 2013 file of the Top 30 MSAs or access our data on the Bloomberg Professional service by typing CLCA <GO>.

 

“While prices across the country saw another boost in October, gains are starting to taper over the last quarter, in what could be the tail end of the summer buying season,“ said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital. “We continue to see trends in the low tier price sector support a likely moderation ahead. And as we’ve maintained, moderation defines a healthy recovery. While some markets currently have eye-popping growth rates reminiscent of the housing run-up, these trends are mainly short term corrections as markets fall back in line with their long run levels.

 

“While the speed at which some markets are returning to pre-bubble norms is noteworthy, recovery is relative. Detroit is a great example. While it has seen more than 30% growth over the year, the market would need to see another 262% growth to hit peak prices. Our graph shows how Detroit prices have fallen in line with its historical trends (pre-2006). Following 2006, prices fell nearly 77%, so what we’re seeing is a response to a severe price correction.”

 

For the complete file of the Top 30 MSA price trends for October 2013, please contact Brian Opsal.

 

Oct2013_Map

 

 

 Highest Performing Major Metro Markets
Qtr/Qtr Rank Metropolitan Statistical Area Qtr/Qtr % +/- Yr/Yr REO  Saturation
1 Detroit, MI – Warren, MI – Livonia, MI 7.8% 31.6% 29.9%
2 Milwaukee, WI – Waukesha, WI – West Allis, WI 4.9% 15.3% 10.9%
3 Birmingham, AL – Hoover, AL 4.5% 10.8% 17.8%
4 San Francisco, CA – Oakland, CA – Fremont, CA 4.0% 28.4% 6.0%
5 Sacramento, CA – Arden, CA – Roseville CA 3.7% 28.0% 9.8%
6 San Jose, CA – Sunnyvale, CA – Santa Clara, CA 3.6% 25.8% 2.6%
7 Las Vegas, NV – Paradise, NV 3.6% 32.4% 17.6%
8 Atlanta, GA – Sandy Springs, GA – Marietta, GA 3.5% 26.3% 20.4%
9 Riverside, CA – San Bernardino, CA – Ontario, CA 3.2% 22.5% 15.1%
10 Los Angeles, CA – Long Beach, CA – Santa Ana, CA 3.1% 22.7% 8.6%
11 Chicago, IL – Naperville, IL – Joliet, IL 3.1% 22.6% 20.2%
12 Honolulu, HI 3.0% 11.8% 1.2%
13 Bakersfield, CA 2.9% 21.3% 16.6%
14 Cleveland, OH – Elyria, OH – Mentor, OH 2.7% 7.2% 27.3%
15 Miami, FL – Ft. Lauderdale, FL – Miami Beach, FL 2.7% 21.0% 22.3%

 

 Lowest Performing Major Metro Markets
Qtr/Qtr Rank Metropolitan Statistical Area Qtr/Qtr % +/- Yr/Yr REO  Saturation
1 Dayton, OH -0.6% 1.6% 24.4%
2 Charlotte, NC – Gastonia, NC – Concord, NC -0.1% -1.1% 16.1%
3 Dallas, TX – Fort Worth, TX – Arlington, TX 0.2% 1.5% 13.1%
4 Rochester, NY 0.3% 2.0% 2.3%
5 Louisville, KY 0.4% 5.1% 14.5%
6 Raleigh, NC – Cary, NC 0.6% 1.9% 13.1%
7 New Orleans, LA – Metairie, LA – Kenner, LA 0.6% 5.2% 13.5%
8 St. Louis, MO 0.7% 1.1% 23.4%
9 Virginia Beach, VA – Norfolk, VA – Newport News, VA 0.9% 5.1% 10.3%
10 Hartford, CT – West Hartford, CT – East Hartford, CT 0.9% 5.3% 3.4%
11 Pittsburgh, PA 1.0% 5.1% 4.6%
12 Baltimore, MD – Towson, MD 1.1% 6.1% 7.5%
13 Richmond, VA 1.1% 8.3% 11.4%
14 Philadelphia, PA – Camden, NJ – Wilmington, DE 1.3% 5.6% 4.7%
15 Columbus, OH 1.5% 8.9% 23.2%

 


Nov2013_Chart

 

 

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 (clearcapital.wpengine.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.

 

Brian Opsal

Vice President, Marketing

brian.opsal@clearcapital.com

Phone: 530.550.2546