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Brian Opsal

Vice President, Marketing

brian.opsal@clearcapital.com

Phone: 530.550.2546

November Home Prices See First Post-Recovery Slow Down, As Expected.

Entering winter, moderating prices unfold at national, regional and metro market levels.

 

TRUCKEE, Calif. – December 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 November 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.

 

November 2013 highlights include:

 

  • National and regional rates of growth showed clear signs of moderation in November, as summer buying activity gave way to the typical winter slow down.
    • Nationally, home prices pulled back to 10.8% year-over-year growth, a slight tapering over the previous quarter’s 11.0% yearly growth.
    • More notable moderation took place in quarterly growth. November national quarterly growth of 1.8% was nearly cut in half when compared to the previous quarter’s 3.3% growth.
    • The regions experienced moderation over yearly and quarterly rates of growth as well, with few exceptions. The Midwest and the Northeast were the only regions to see slight gains in yearly rates of growth over the previous quarter.
    • While REOs and short sales accounted for 21.6% of all national sales over the previous quarter, it is substantially lower than peak rates of 41.0% in 2011.
    • Distressed sale activity, as a portion of total sales, can increase over winter due to some fair market sellers waiting for the more active spring season to list their homes.
    • Prior to the recovery taking hold, increasing distressed sale saturation rates pushed prices down. Yet, the First-In-First-Out recovery saw distressed markets drive gains, creating a new relationship between high levels of distressed sale saturation and price gains.
  • The Phoenix MSA has embodied this behavior as one of the first markets to exhibit a sustained recovery alongside its high levels of distressed sale saturation. After significant gains, the market’s growth is now moderating with quarterly growth of 2.4%, less than half of the current annual rate of growth when annualized. Having led the recovery for the better part of a year, Phoenix no longer sits on the top 15 performing list. Other metro markets also confirm higher levels of distressed sale activity can now correlate with higher price gains.
    • Average rates of yearly growth in the top performing markets were 19.2% in November, while average distressed sale saturation sat at a relatively high 24.5%.
    • Low performing markets, on the other hand, had average rates of yearly growth of 4.9% in November, while average distressed sale saturation sat at a relatively low 17.2%.
  • Contact Brian Opsal for your November 2013 file of the Top 30 MSAs or access our data on the Bloomberg Professional service by typing CLCA <GO>.

 

“As the year comes to a close, make no mistake, home prices across the country are cooling from the red-hot 2013 recovery, ” said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital. “Though some market observers may take this as a sign of a deflating bubble, we see this as a natural, and welcomed evolution on the horizon of the new housing landscape. Since the market trough in the fall of 2011, national prices are up 17%, undoubtedly a strong resurgence in overall prices. Yet national prices today are back to where they were in 2003, indicating that overall the housing market is at pre-run-up norms.

 

Understandably, many current homeowners would like to see hot gains continue for some time to come. Market participants, however, are better served by a cooler and more sustainable recovery. Moderating gains will create a stable market, instilling confidence in a broader base of buyers. And as we know all too well, meteoric rises and subsequent falls in prices create increasing risk of all types. That’s not to say all markets will continue a slow and steady assent. Next month, we release our 2014 forecasts and expect to see some interesting trends at the metro market level. Interestingly, for some metros, future declines are not out of the question.”

 

 

 

Dec2013_Map

 

 

 Highest Performing Major Metro Markets
Qtr/Qtr Rank Metropolitan Statistical Area Qtr/Qtr % +/- Yr/Yr REO  Saturation
1 San Francisco, CA – Oakland, CA – Fremont, CA 3.5% 27.4% 14.1%
2 Riverside, CA – San Bernardino, CA – Ontario, CA 3.4% 23.3% 26.8%
3 Sacramento, CA – Arden, CA – Roseville, CA 3.4% 27.6% 22.5%
4 Chicago, IL – Naperville, IL – Joliet, IL 3.3% 14.2% 34.3%
5 Las Vegas, NV – Paradise, NV 3.1% 24.3% 32.7%
6 Bakersfield, CA 3.1% 19.9% 26.6%
7 San Jose, CA – Sunnyvale, CA – Santa Clara, CA 3.0% 21.7% 9.4%
8 Los Angeles, CA – Long Beach, CA – Santa Ana, CA 3.0% 22.9% 17.6%
9 San Diego, CA – Carlsbad, CA – San Marcos, CA 3.0% 20.6% 19.0%
10 Providence, RI – New Bedford, MA – Fall River, MA 2.7% 15.7% 18.2%
11 Fresno, CA 2.7% 18.0% 28.2%
12 Dayton, OH 2.6% 2.0% 33.8%
13 Miami, FL – Ft. Lauderdale, FL – Miami Beach, FL 2.6% 19.2% 32.0%
14 Minneapolis, MN – St. Paul, MN – Bloomington, WI 2.6% 14.6% 14.8%
15 Orlando, FL 2.4% 16.3% 37.5%

 

 

 Lowest Performing Major Metro Markets
Qtr/Qtr Rank Metropolitan Statistical Area Qtr/Qtr % +/- Yr/Yr REO  Saturation
1 Houston, TX – Baytown, TX – Sugar Land, TX -1.4% 11.0% 8.2%
2 Birmingham, AL – Hoover, AL 0.3% 2.0% 19.6%
3 Honolulu, HI 0.4% 5.3% 8.7%
4 Rochester, NY 0.5% 2.9% 4.9%
5 Cincinnati, OH – Middletown, OH 0.5% 2.7% 31.2%
6 Atlanta, GA – Sandy Springs, GA – Marietta, GA 0.8% 6.9% 23.6%
7 Philadelphia, PA – Camden, NJ – Wilmington, DE 0.9% 5.0% 18.4%
8 Raleigh, NC – Cary, NC 1.0% 5.9% 11.3%
9 Louisville, KY 1.0% 6.4% 13.7%
10 Virginia Beach, VA – Norfolk, VA – Newport News, VA 1.0% 6.2% 24.8%
11 Hartford, CT – West Hartford, CT – East Hartford, CT 1.2% 6.2% 13.2%
12 Milwaukee, WI – Waukesha, WI – West Allis, WI 1.2% 7.4% 20.5%
13 New Orleans, LA – Metairie, LA – Kenner, LA 1.2% 7.0% 19.6%
14 Cleveland, OH – Elyria, OH – Mentor, OH 1.2% 8.0% 27.3%
15 Pittsburgh, PA 1.3% -9.3% 12.8%

 

 

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.

 

Brian Opsal

Vice President, Marketing

brian.opsal@clearcapital.com

Phone: 530.550.2546