november 2016 amazonaws com
NOVEMBER 2016
“Overall, the fundamental trends we have been seeing all year remain solidly in place as we enter the traditionally slower sales season, and pent-up demand remains substantial as buyers seek to get a home under contract while rates remain so low.”
Jonathan Smoke realtor.com Chief Economist
Mortgage Rates Freddie Mac 30 Year Fixed Rate
2016
2015
2017
- Actual - Projected 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 Rate
3.7
3.8
4
3.9
3.7
3.6
3.5
3.6
3.6
3.6
3.7
3.9
Freddie Mac
“Extremely limited supply is stopping the market from reaching its full potential, counteracting positive increases in market fundamentals, such as employment and wages.”
Mark Fleming PhD. Chief Economist, First American
Median Seller Tenure in Home since 1985 12
10 10
9
9
9
9
8 8
7 6
6
6
6
6
6
7 6
6
6
6
6
6
6
5
4
Pent-Up Seller Demand 2
0 1985 1987 1989 1991 1993 1995 1997 2000 2002 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
“We see home prices rising another 5 percent in the coming year based on the latest projected national CoreLogic Home Price Index. Assuming this growth is uniform across the U.S., that should release an additional 700,000 homeowners from the scourge of negative equity.” Anand Nallathambi President and CEO of CoreLogic
Average Equity Gain per Homeowner June 2015 – June 2016
CoreLogic
“First-time buyers face more challenges than the buyers who have dominated the market for the last 5 years. These buyers are more than three times more likely than a repeat buyer to say that they lack the funds for a down payment. Likewise, they are 2.9 times more likely to be held back because they are subject to the terms of a lease. And they are 2.7 times more likely to say that they need to improve their credit score.”
Jonathan Smoke Chief Economist – realtor.com
AVERAGE Down Payment 25 23 20 20 20
23 22
21
21
Repeat Buyers
19
16 16
15 15
16
15 13
10
9 7
6
14
13
14
First-Time Buyers 6
5
6 3
2
2
3
4
4
4
5
4
5
6
6
3 1989 1991 1993 1995 1997 1999 2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
FICO Score
32.7%
Distribution
24.5% 21.2% 13.0%
8.2% 0.02%
0.34%
500-549
550-599
600-649
650-699
53.9%
700-749
750-799
800+
All Closed Loans as per Ellie Mae
“Did you know that the average down payment among first–time homebuyers is 6% and it's 13–14% for repeat buyers… It's possible to put down even less. Many potential homebuyers think that only the FHA helps make mortgage loans with low down payments. Not true. Freddie Mac's Home Possible mortgage products let qualified homebuyers put down as little as 3%.”
Freddie Mac
"There's hope the leap in sales to first-time buyers can stick through the rest of the year and into next spring. The market fundamentals — primarily consistent job gains and affordable mortgage rates — are there for the steady rise in first-timers needed to finally reverse the decline in the homeownership rate." Lawrence Yun NAR’s Chief Economist
U.S. Homeownership Rate by Decade 61.9
62.9
1960
1970
64.4
64.2
1980
1990
67.1
67.1 62.9
55 46.7
45.9
45.6
1900
1910
1920
47.8 43.6
1930
1940
1950
2000
2010
Today Census
Homeownership Rate in 2015 by State
CoreLogic
“This represents an 'oh shift' moment in housing. With so many first time buyers in the market, competition will be even fiercer next year for affordable starter homes in the suburbs. Those looking to buy may want to consider a winter home purchase in order to avoid bidding wars and higher prices spurred by a potential increase in millennial buyers.”
Jonathan Smoke realtor.com Chief Economist
“Our home-builder clients sell hundreds of homes every weekend to buyers with 5% down payments and below average credit scores. Yet, many middle-income households with average credit and access to a 5% down payment assume they cannot become homeowners because of the ‘tight credit’ headlines.”
Brenda Garcia Lemus John Burns Real Estate Consulting
28%
% of all Home Sales that were
New Construction 23%
23%
23%
21% 18%
1981
18%
1991
2001
2003
2005
2007
2009
16%
16%
16%
2011
2013
2015 NAR
“We also discovered that buyers aren’t replacing the expertise of real estate agents with online research—but they are doing a tremendous amount of research online before contacting an agent. Those who start their home searches online are actually more likely to use an agent than other buyers. ” Consumer Housing Trends Report 2016
Home Search & Purchase 100%
90%
80%
70%
60%
% who used internet in home search 50%
% who used a real estate agent to purchase the home
40%
30%
2001
2005
2010
2015 NAR
“While older generations rely on real estate agents for information and expertise, Millennials expect real estate agents to become trusted advisers and strategic partners.” Consumer Housing Trends Report 2016
Average Days on the Market By State
NAR
5500000
EXISTING Home Sales
5000000
4500000
Since January 2012 4000000
Jan 2012
Jan 2013
Jan 2014
Jan 2015
Jan 2016
NAR 11/2016
5,600,000
5,500,000
5,400,000
5,300,000
EXISTING Home Sales
5,200,000
5,100,000
5,000,000
4,900,000
4,800,000
4,700,000
4,600,000
4,500,000
4,400,000
Since January 2014
4,300,000
Jan 2014
Jan 2015
Jan 2016
NAR 11/2016
EXISTING
2.3%
Home Sales
1.6%
Y-O-Y by region
0.6% 0.0% U.S.
Northeast
South
Midwest
West
-0.9% NAR 11/2016
Existing Home Sales in thousands 2015
January
February
March
April
May
June
July
August
September
October
2016
November December
Freddie Mac
New Home Sales in thousands 2015
January
February
March
April
May
June
July
August
September
October
2016
November
December
Freddie Mac
New Home Sales Annualized in thousands
Census
13%
13%
New Home Sales % of sales by price range
6%
6% 5%
2%
1% Under $150K
$150-$199K
$200-$299K
$300-$399K
$400-$499K
$500-$749K
Over $750K Census
New Homes Selling Fast (median months from completion to sold) 4.0 3.8
3.9
4.0
4.0 3.7 3.5 3.5
3.2 3.0
3.3
3.3
3.2 2.9
3.0
4.1
4.0 3.8 3.6
3.2
3.1
2.9
Census
Total Home Sales in thousands
616
632
594
578 525
586
568 547
542
507
497 451
341 320
January
340
530
471
359
February
March
April
May
2015
June
2016
July
August
September
Freddie Mac
Pending Home Sales
2016
2015
2014 January
February
March
April
May
June
July
August
September
October
November
December
NAR 11/2016
115
PENDING Home Sales
110
since 2012
105
100
100 = Historically Healthy Level
95
90 January 2012
January 2013
January 2014
January 2015
January 2016
NAR 11/2016
114
PENDING
112
Home Sales
110
since 2014
108 106 104 102 100
100 = Historically Healthy Level 98 96 94 92 90
January 2014
January 2015
January 2016 NAR 11/2016
PENDING
7.7%
Home Sales Year-Over-Year By Region
4.0%
2.4% 1.7%
U.S.
Midwest
West
South
Northeast
-1.0% NAR 11/2016
35%
Percentage of Distressed Property Sales
7% 4%*
January 2012 - Today Jan 2012
Jan 2013
Jan 2014
Jan 2015
Jan 2016
*Marks the lowest share of distressed sales since NAR began reporting in October 2008
NAR 11/2016
Home Prices
EXISTING Home Prices Y-O-Y by region
8.1%
6.6%
5.6%
5.9%
2.1%
U.S.
Northeast
South
Midwest
West NAR 11/2016
% Change in Sales from last year by Price Range
17.0% 15.1% 11.0%
11.9%
3.1%
-10.2% %
$0-100K -10.2%
$100-250K 3.1%
$250-500K 15.1%
$500-750K 17.0%
$750K-1M 11.0%
$1M+ 11.9% NAR 11/2016
Case Shiller 0.14
Year-Over-Year 0.12
PRICE
0.1
CHANGES
0.08
0.06
0.04
0.02
0
June 2012
January 2013
January 2014
January 2015
January 2016
S&P Case Shiller 11/2016
Case Shiller
13.2% 12.9% 12.4%
Year-Over-Year PRICE CHANGES 20 City Composite
10.8%
9.3%
8.1%
6.7%
5.6%
5.4% 5.5% 4.8%
5.0% 5.0% 4.9% 4.9% 5.0% 5.0% 4.5% 4.3%
4.5%
4.6%
4.7%
5.7% 5.7% 5.7%
5.4% 5.5% 5.4% 5.3%
5.1% 5.0% 5.1%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 2014 2015 2016
S&P Case Shiller 11/2016
Forecasted Year-Over-Year % Change in Price by State
CoreLogic
Appraiser Home Value Opinions Compared to Homeowner Estimates
-1.26
-1.98
-1.87
-1.8
-1.69
-1.75 -1.95
-1.99
-1.89
-1.56
-1.93
-2.17
Last 12 Months %
Nov
Dec
Jan-16
Feb
Mar
April
May
Jun
Jul
Aug
Sep
Oct
-1.98
-1.87
-1.8
-1.75
-1.99
-2.17
-1.95
-1.89
-1.93
-1.69
-1.56
-1.26
Quicken Loans
HOUSING INVENTORY
Seller Traffic By State
NAR
Months Inventory of HOMES FOR SALE 2011 - Today
January 2011
January 2012
January 2013
January 2014
January 2015
January 2016 NAR 11/2016
Months Inventory of HOMES FOR SALE
6
last 2 years
5.5
5
4.5
4
3.5
Oct
Nov
Dec
Jan-15
Feb
Mar
Apr
May
Jun
July
Aug
Sep
Oct
Nov
Dec
Jan-16
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
NAR 11/2016
Months Inventory of HOMES FOR SALE Last 12 Months 5.0 4.8
4.7
3.9
Oct
Nov
Dec
4.4
4.4
Feb
Mar
4.7
4.7 4.5
4.6
4.5
4.0
Jan
Apr
May
Jun
Jul
Aug
Sep NAR 11/2016
Year-over-Year Inventory Levels Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep
% -24% -20. -16. -14% -13% -7.6 -5% -6.2 1.8% 0.9% 5.0% 1.6% 7.3% 5.3% 3.2% 6.5% 6% 5.5% 5.8% 4.5% 6% 5.2% 5% -0.5 -0.5 -0.5 2.0% -0.9 1.8% 0.4% -4.7 -1.7 -3.1 -4.5 -1.9 -3.8 -2.2 -1.1 -1.5 -3.6 -9.6 -5.8 -5.8 -10. -6.8
NAR 11/2016
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
-5.8%
-5.8%
Aug
Sep
-1.1% -1.5%
-1.9%
-2.2%
-3.8%
-3.6%
-4.5%
-6.8%
HOUSING SUPPLY Year-Over-Year Last 12 Months
-9.6% -10.1%
NAR 11/2016
New Home Inventory 5.8
months supply 5.5 5.5
5.5
5.5 5.2 5.0
5.0
5.1
5.0
5.2
5.2 5.1
4.8
4.9 4.8 4.5 4.5
Jan
Feb
Mar
Apr
May
2015
Jun
2016
Jul
Aug
Sept
Census
New Home Inventory months supply Last 12 Months 5.6 5.5
5.5
5.5
5.4 5.2
5.2 5.1
5.1 4.9 4.8
4.5
Oct
Nov
Dec
Jan-16
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept Census
BUYER DEMAND
Buyer Traffic By State
NAR
Foot Traffic indicator of future sales
Jul 2013
Jan 2014
Jan 2015
Jan 2016 NAR 10/2016
Foot Traffic
Last 12 Months
indicator of future sales
September
October
November
December
January 2016
February
March
April
May
June
July
Aug
NAR 10/2016
Foot Traffic indicator of future sales
January
February
March
2015
April
May
June
July
August
September
October
November
2016
December
NAR 10/2016
INTEREST RATES
3.9
3.6
3.4 1/7 1/14 1/21 1/28 2/4 2/11 2/18 2/25 3/3 3/10 3/17 3/24 3/31 4/7 4/14 4/21 4/28 5/5 5/12 5/19 5/26 6/2 6/9 6/16 6/23 6/30 7/7 7/14 7/21 7/28 8/4 8/11 8/18 8/25 9/1 9/8 9/15 9/22 9/29 10/6 10/13 10/20 10/27 11/3
4
3.97
30 Year Fixed Rate Mortgages from Freddie Mac
3.8
3.7
3.54
3.5
Freddie Mac 11/2016
Mortgage Rate Projections Quarter
Fannie Mae
Freddie Mac
MBA
NAR
Average of All Four
2016 4Q
3.5
3.6
3.7
3.7
3.63
2017 1Q
3.5
3.6
3.9
3.8
3.70
2017 2Q
3.5
3.6
4.1
4.0
3.80
2017 3Q
3.5
3.7
4.3
4.2
3.93 11/2016
Mortgage Rates Freddie Mac 30 Year Fixed Rate
2016
2015
2017
- Actual - Projected 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 Rate
3.7
3.8
4
3.9
3.7
3.6
3.5
3.6
3.6
3.6
3.7
3.9
Freddie Mac
Mortgage Credit Availability YES
NO
MAYBE
Mortgage Credit Availability
Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association Apr 2013
Jan 2014
Jan 2015
Jan 2016 MBA
900
800
700
600
500
Historic Data for the MORTGAGE CREDIT AVAILABILITY INDEX (a report from the Mortgage Bankers Association)
400
300
200
100
0
June 2004 June 2005 June 2006 June 2007 June 2008 June 2009 June 2010 June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 September
MBA
Average Days To Close A Loan Last 12 Months
49 49
50 48
46
46
46 46 46 45 44 44
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
All Closed Loans as per Ellie Mae
FICO Score
32.7%
Distribution
24.5% 21.2% 13.0%
8.2% 0.02%
0.34%
500-549
550-599
600-649
650-699
53.9%
700-749
750-799
800+
All Closed Loans as per Ellie Mae
Average FICO Score for Closed Purchase Loans by Loan Type
731
754 708 686
All Loans
Conventional
FHA
VA All Closed Loans as per Ellie Mae
Average Back End DTI for Closed Purchase Loans by Loan Type
42 37
All Loans
40
34
Conventional
FHA
VA All Closed Loans as per Ellie Mae
Resources Slide
Slide Title
Link
4, 10
Jonathan Smoke Quote
http://www.housingwire.com/articles/38190-summer-housing-market-not-cooling-down-this-fall http://realtormag.realtor.org/daily-news/2016/10/21/what-first-time-buyers-need-from-you
5, 64
Freddie Mac Mortgage Rates
http://www.freddiemac.com/finance/pdf/201610-Outlook-10%2020%2016.pdf
6
Mark Fleming Quote
http://blog.firstam.com/economics/market-is-missing-its-potential-due-to-tight-supply
7
Median Seller Tenure
http://economistsoutlook.blogs.realtor.org/2016/10/13/tenure-in-home-has-steadily-increased-in-last-30-years/#sf38806443
8
Anand Nallathambi Quote
http://www.corelogic.com/research/negative-equity/corelogic-q2-2016-equity-report.pdf
9
Average Equity Gain Map
http://www.corelogic.com/blog/authors/frank-nothaft/2016/10/us-economic-outlook-october-2016.aspx#.WAUQREkzWcz
11
Average Down Payment
http://www.realtor.org/reports/highlights-from-the-profile-of-home-buyers-and-sellers
13
Freddie Mac Quote
http://www.freddiemac.com/blog/homeownership/20161020_down_payment_20_percent.html?attr=rssCB
14
Lawrence Yun Quote
http://www.realtor.org/news-releases/2016/10/first-time-buyers-steer-existing-home-sales-higher-in-september
15-16
Homeownership Rate
http://www.census.gov/housing/hvs/files/currenthvspress.pdf
17
Jonathan Smoke Quote
http://news.move.com/2016-10-19-Realtor-com-Consumer-Survey-Reveals-First-Look-into-2017-Home-Buying-Season
18
Brenda Garcia Lemus Quote
https://www.realestateconsulting.com/mortgages-more-available-than-people-think/
19
New Construction
http://economistsoutlook.blogs.realtor.org/2016/09/29/to-buy-a-new-or-previously-owned-home/#sf37422133
20, 22
Consumer Housing Trends Quote
http://cdn1.blog-media.zillowstatic.com/3/ZillowGroupReport2016-11bcad.pdf
21
Home Search & Purchase
http://economistsoutlook.blogs.realtor.org/2016/10/19/internet-real-estate-agents-some-things-change-others-remain-the-same/#sf39316437
KEEPINGCURRENTMATTERS.COM
Resources Slide
Slide Title
Link
25, 48, 57
Average Days on Market, Buyer & Seller Traffic Maps
http://www.realtor.org/reports/realtors-confidence-index
26-28, 39, 41-42, 49-53
Existing Home Sales Report
http://www.realtor.org/
29-30, 34
Freddie Mac Home Sales
http://www.census.gov/construction/nrs/pdf/newressales.pdf http://www.realtor.org/
31-33, 54-55
New Home Sales, Inventory
http://www.census.gov/construction/nrs/pdf/newressales.pdf
35-38
Pending Home Sales Report
http://www.realtor.org/
43-44
Case Shiller Price Index
https://www.spice-indices.com/idpfiles/spice-assets/resources/public/documents/422175_cshomeprice-release-1025.pdf
45, 81
Forecasted Price Changes
http://www.corelogic.com/about-us/researchtrends/corelogic-home-price-insights.aspx#
46
Appraisal Challenge
http://www.quickenloans.com/press-room/2016/10/11/gap-between-appraisals-perceived-home-value-narrows/
58-60, 82
Foot Traffic, FTHB by Age
http://www.realtor.org
62
Freddie Mac 2016 Rates
http://www.freddiemac.com/pmms
63
Mortgage Rate Projections
http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_101816.pdf http://www.freddiemac.com/finance/pdf/201610-Outlook-10%2020%2016.pdf https://www.mba.org/Documents/Research/Mtg%20Fin%20Forecast%20Oct%202016.pdf http://www.realtor.org/sites/default/files/reports/2016/embargoes/forecast-11-2016-us-economic-outlook-11-04-2016.pdf
66-67
Mortgage Credit Availability
https://www.mba.org/news-research-and-resources/research-and-economics/single-family-research/mortgage-credit-availability-index
12, 68-72
Ellie Mae Report
http://www.elliemae.com/origination-insight-reports/Ellie_Mae_OIR_SEPTEMBER2016.pdf
80
Quarter-Over-Quarter Percent Change in Price Map
http://www.fhfa.gov/DataTools/Tools/Pages/House-Price-Index-(HPI).aspx
83-84
Projected & Cumulative Appreciation
https://www.pulsenomics.com/Q2_2016_HPE_Survey.php
KEEPINGCURRENTMATTERS.COM
Using Charts & Graphs to Differentiate Yourself from the Competition
Firm: RE/MAX Location: Atlanta, GA Annual GCI: $525,000
“My most valuable asset is using the charts and graphs to position myself far ahead of my competitors when I go on listing appointments.”
Firm: RE/MAX Location: Atlanta, GA Annual GCI: $525,000
Quarter-Over-Quarter Percent Change in Price by State
FHFA
Forecasted Year-Over-Year % Change in Price by State
CoreLogic
Insert Chart About Millennials or Other Group of Buyers?
NAR
PROJECTED Mean Percentage Appreciation
Home Price Expectation Survey 2016 2Q
Cumulative House Appreciation by 2020
Bulls
All Projections
Bears
Home Price Expectation Survey 2016 2Q
NOVEMBER 2016
“Overall, the fundamental trends we have been seeing all year remain solidly in place as we enter the traditionally slower sales season, and pent-up demand remains substantial as buyers seek to get a home under contract while rates remain so low.”
Jonathan Smoke realtor.com Chief Economist
Mortgage Rates Freddie Mac 30 Year Fixed Rate
2016
2015
2017
- Actual - Projected 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 Rate
3.7
3.8
4
3.9
3.7
3.6
3.5
3.6
3.6
3.6
3.7
3.9
Freddie Mac
“Extremely limited supply is stopping the market from reaching its full potential, counteracting positive increases in market fundamentals, such as employment and wages.”
Mark Fleming PhD. Chief Economist, First American
Median Seller Tenure in Home since 1985 12
10 10
9
9
9
9
8 8
7 6
6
6
6
6
6
7 6
6
6
6
6
6
6
5
4
Pent-Up Seller Demand 2
0 1985 1987 1989 1991 1993 1995 1997 2000 2002 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
“We see home prices rising another 5 percent in the coming year based on the latest projected national CoreLogic Home Price Index. Assuming this growth is uniform across the U.S., that should release an additional 700,000 homeowners from the scourge of negative equity.” Anand Nallathambi President and CEO of CoreLogic
Average Equity Gain per Homeowner June 2015 – June 2016
CoreLogic
“First-time buyers face more challenges than the buyers who have dominated the market for the last 5 years. These buyers are more than three times more likely than a repeat buyer to say that they lack the funds for a down payment. Likewise, they are 2.9 times more likely to be held back because they are subject to the terms of a lease. And they are 2.7 times more likely to say that they need to improve their credit score.”
Jonathan Smoke Chief Economist – realtor.com
AVERAGE Down Payment 25 23 20 20 20
23 22
21
21
Repeat Buyers
19
16 16
15 15
16
15 13
10
9 7
6
14
13
14
First-Time Buyers 6
5
6 3
2
2
3
4
4
4
5
4
5
6
6
3 1989 1991 1993 1995 1997 1999 2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
FICO Score
32.7%
Distribution
24.5% 21.2% 13.0%
8.2% 0.02%
0.34%
500-549
550-599
600-649
650-699
53.9%
700-749
750-799
800+
All Closed Loans as per Ellie Mae
“Did you know that the average down payment among first–time homebuyers is 6% and it's 13–14% for repeat buyers… It's possible to put down even less. Many potential homebuyers think that only the FHA helps make mortgage loans with low down payments. Not true. Freddie Mac's Home Possible mortgage products let qualified homebuyers put down as little as 3%.”
Freddie Mac
"There's hope the leap in sales to first-time buyers can stick through the rest of the year and into next spring. The market fundamentals — primarily consistent job gains and affordable mortgage rates — are there for the steady rise in first-timers needed to finally reverse the decline in the homeownership rate." Lawrence Yun NAR’s Chief Economist
U.S. Homeownership Rate by Decade 61.9
62.9
1960
1970
64.4
64.2
1980
1990
67.1
67.1 62.9
55 46.7
45.9
45.6
1900
1910
1920
47.8 43.6
1930
1940
1950
2000
2010
Today Census
Homeownership Rate in 2015 by State
CoreLogic
“This represents an 'oh shift' moment in housing. With so many first time buyers in the market, competition will be even fiercer next year for affordable starter homes in the suburbs. Those looking to buy may want to consider a winter home purchase in order to avoid bidding wars and higher prices spurred by a potential increase in millennial buyers.”
Jonathan Smoke realtor.com Chief Economist
“Our home-builder clients sell hundreds of homes every weekend to buyers with 5% down payments and below average credit scores. Yet, many middle-income households with average credit and access to a 5% down payment assume they cannot become homeowners because of the ‘tight credit’ headlines.”
Brenda Garcia Lemus John Burns Real Estate Consulting
28%
% of all Home Sales that were
New Construction 23%
23%
23%
21% 18%
1981
18%
1991
2001
2003
2005
2007
2009
16%
16%
16%
2011
2013
2015 NAR
“We also discovered that buyers aren’t replacing the expertise of real estate agents with online research—but they are doing a tremendous amount of research online before contacting an agent. Those who start their home searches online are actually more likely to use an agent than other buyers. ” Consumer Housing Trends Report 2016
Home Search & Purchase 100%
90%
80%
70%
60%
% who used internet in home search 50%
% who used a real estate agent to purchase the home
40%
30%
2001
2005
2010
2015 NAR
“While older generations rely on real estate agents for information and expertise, Millennials expect real estate agents to become trusted advisers and strategic partners.” Consumer Housing Trends Report 2016
Average Days on the Market By State
NAR
5500000
EXISTING Home Sales
5000000
4500000
Since January 2012 4000000
Jan 2012
Jan 2013
Jan 2014
Jan 2015
Jan 2016
NAR 11/2016
5,600,000
5,500,000
5,400,000
5,300,000
EXISTING Home Sales
5,200,000
5,100,000
5,000,000
4,900,000
4,800,000
4,700,000
4,600,000
4,500,000
4,400,000
Since January 2014
4,300,000
Jan 2014
Jan 2015
Jan 2016
NAR 11/2016
EXISTING
2.3%
Home Sales
1.6%
Y-O-Y by region
0.6% 0.0% U.S.
Northeast
South
Midwest
West
-0.9% NAR 11/2016
Existing Home Sales in thousands 2015
January
February
March
April
May
June
July
August
September
October
2016
November December
Freddie Mac
New Home Sales in thousands 2015
January
February
March
April
May
June
July
August
September
October
2016
November
December
Freddie Mac
New Home Sales Annualized in thousands
Census
13%
13%
New Home Sales % of sales by price range
6%
6% 5%
2%
1% Under $150K
$150-$199K
$200-$299K
$300-$399K
$400-$499K
$500-$749K
Over $750K Census
New Homes Selling Fast (median months from completion to sold) 4.0 3.8
3.9
4.0
4.0 3.7 3.5 3.5
3.2 3.0
3.3
3.3
3.2 2.9
3.0
4.1
4.0 3.8 3.6
3.2
3.1
2.9
Census
Total Home Sales in thousands
616
632
594
578 525
586
568 547
542
507
497 451
341 320
January
340
530
471
359
February
March
April
May
2015
June
2016
July
August
September
Freddie Mac
Pending Home Sales
2016
2015
2014 January
February
March
April
May
June
July
August
September
October
November
December
NAR 11/2016
115
PENDING Home Sales
110
since 2012
105
100
100 = Historically Healthy Level
95
90 January 2012
January 2013
January 2014
January 2015
January 2016
NAR 11/2016
114
PENDING
112
Home Sales
110
since 2014
108 106 104 102 100
100 = Historically Healthy Level 98 96 94 92 90
January 2014
January 2015
January 2016 NAR 11/2016
PENDING
7.7%
Home Sales Year-Over-Year By Region
4.0%
2.4% 1.7%
U.S.
Midwest
West
South
Northeast
-1.0% NAR 11/2016
35%
Percentage of Distressed Property Sales
7% 4%*
January 2012 - Today Jan 2012
Jan 2013
Jan 2014
Jan 2015
Jan 2016
*Marks the lowest share of distressed sales since NAR began reporting in October 2008
NAR 11/2016
Home Prices
EXISTING Home Prices Y-O-Y by region
8.1%
6.6%
5.6%
5.9%
2.1%
U.S.
Northeast
South
Midwest
West NAR 11/2016
% Change in Sales from last year by Price Range
17.0% 15.1% 11.0%
11.9%
3.1%
-10.2% %
$0-100K -10.2%
$100-250K 3.1%
$250-500K 15.1%
$500-750K 17.0%
$750K-1M 11.0%
$1M+ 11.9% NAR 11/2016
Case Shiller 0.14
Year-Over-Year 0.12
PRICE
0.1
CHANGES
0.08
0.06
0.04
0.02
0
June 2012
January 2013
January 2014
January 2015
January 2016
S&P Case Shiller 11/2016
Case Shiller
13.2% 12.9% 12.4%
Year-Over-Year PRICE CHANGES 20 City Composite
10.8%
9.3%
8.1%
6.7%
5.6%
5.4% 5.5% 4.8%
5.0% 5.0% 4.9% 4.9% 5.0% 5.0% 4.5% 4.3%
4.5%
4.6%
4.7%
5.7% 5.7% 5.7%
5.4% 5.5% 5.4% 5.3%
5.1% 5.0% 5.1%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 2014 2015 2016
S&P Case Shiller 11/2016
Forecasted Year-Over-Year % Change in Price by State
CoreLogic
Appraiser Home Value Opinions Compared to Homeowner Estimates
-1.26
-1.98
-1.87
-1.8
-1.69
-1.75 -1.95
-1.99
-1.89
-1.56
-1.93
-2.17
Last 12 Months %
Nov
Dec
Jan-16
Feb
Mar
April
May
Jun
Jul
Aug
Sep
Oct
-1.98
-1.87
-1.8
-1.75
-1.99
-2.17
-1.95
-1.89
-1.93
-1.69
-1.56
-1.26
Quicken Loans
HOUSING INVENTORY
Seller Traffic By State
NAR
Months Inventory of HOMES FOR SALE 2011 - Today
January 2011
January 2012
January 2013
January 2014
January 2015
January 2016 NAR 11/2016
Months Inventory of HOMES FOR SALE
6
last 2 years
5.5
5
4.5
4
3.5
Oct
Nov
Dec
Jan-15
Feb
Mar
Apr
May
Jun
July
Aug
Sep
Oct
Nov
Dec
Jan-16
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
NAR 11/2016
Months Inventory of HOMES FOR SALE Last 12 Months 5.0 4.8
4.7
3.9
Oct
Nov
Dec
4.4
4.4
Feb
Mar
4.7
4.7 4.5
4.6
4.5
4.0
Jan
Apr
May
Jun
Jul
Aug
Sep NAR 11/2016
Year-over-Year Inventory Levels Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Jul
Aug Sep
% -24% -20. -16. -14% -13% -7.6 -5% -6.2 1.8% 0.9% 5.0% 1.6% 7.3% 5.3% 3.2% 6.5% 6% 5.5% 5.8% 4.5% 6% 5.2% 5% -0.5 -0.5 -0.5 2.0% -0.9 1.8% 0.4% -4.7 -1.7 -3.1 -4.5 -1.9 -3.8 -2.2 -1.1 -1.5 -3.6 -9.6 -5.8 -5.8 -10. -6.8
NAR 11/2016
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
-5.8%
-5.8%
Aug
Sep
-1.1% -1.5%
-1.9%
-2.2%
-3.8%
-3.6%
-4.5%
-6.8%
HOUSING SUPPLY Year-Over-Year Last 12 Months
-9.6% -10.1%
NAR 11/2016
New Home Inventory 5.8
months supply 5.5 5.5
5.5
5.5 5.2 5.0
5.0
5.1
5.0
5.2
5.2 5.1
4.8
4.9 4.8 4.5 4.5
Jan
Feb
Mar
Apr
May
2015
Jun
2016
Jul
Aug
Sept
Census
New Home Inventory months supply Last 12 Months 5.6 5.5
5.5
5.5
5.4 5.2
5.2 5.1
5.1 4.9 4.8
4.5
Oct
Nov
Dec
Jan-16
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept Census
BUYER DEMAND
Buyer Traffic By State
NAR
Foot Traffic indicator of future sales
Jul 2013
Jan 2014
Jan 2015
Jan 2016 NAR 10/2016
Foot Traffic
Last 12 Months
indicator of future sales
September
October
November
December
January 2016
February
March
April
May
June
July
Aug
NAR 10/2016
Foot Traffic indicator of future sales
January
February
March
2015
April
May
June
July
August
September
October
November
2016
December
NAR 10/2016
INTEREST RATES
3.9
3.6
3.4 1/7 1/14 1/21 1/28 2/4 2/11 2/18 2/25 3/3 3/10 3/17 3/24 3/31 4/7 4/14 4/21 4/28 5/5 5/12 5/19 5/26 6/2 6/9 6/16 6/23 6/30 7/7 7/14 7/21 7/28 8/4 8/11 8/18 8/25 9/1 9/8 9/15 9/22 9/29 10/6 10/13 10/20 10/27 11/3
4
3.97
30 Year Fixed Rate Mortgages from Freddie Mac
3.8
3.7
3.54
3.5
Freddie Mac 11/2016
Mortgage Rate Projections Quarter
Fannie Mae
Freddie Mac
MBA
NAR
Average of All Four
2016 4Q
3.5
3.6
3.7
3.7
3.63
2017 1Q
3.5
3.6
3.9
3.8
3.70
2017 2Q
3.5
3.6
4.1
4.0
3.80
2017 3Q
3.5
3.7
4.3
4.2
3.93 11/2016
Mortgage Rates Freddie Mac 30 Year Fixed Rate
2016
2015
2017
- Actual - Projected 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 Rate
3.7
3.8
4
3.9
3.7
3.6
3.5
3.6
3.6
3.6
3.7
3.9
Freddie Mac
Mortgage Credit Availability YES
NO
MAYBE
Mortgage Credit Availability
Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association Apr 2013
Jan 2014
Jan 2015
Jan 2016 MBA
900
800
700
600
500
Historic Data for the MORTGAGE CREDIT AVAILABILITY INDEX (a report from the Mortgage Bankers Association)
400
300
200
100
0
June 2004 June 2005 June 2006 June 2007 June 2008 June 2009 June 2010 June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 September
MBA
Average Days To Close A Loan Last 12 Months
49 49
50 48
46
46
46 46 46 45 44 44
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
All Closed Loans as per Ellie Mae
FICO Score
32.7%
Distribution
24.5% 21.2% 13.0%
8.2% 0.02%
0.34%
500-549
550-599
600-649
650-699
53.9%
700-749
750-799
800+
All Closed Loans as per Ellie Mae
Average FICO Score for Closed Purchase Loans by Loan Type
731
754 708 686
All Loans
Conventional
FHA
VA All Closed Loans as per Ellie Mae
Average Back End DTI for Closed Purchase Loans by Loan Type
42 37
All Loans
40
34
Conventional
FHA
VA All Closed Loans as per Ellie Mae
Resources Slide
Slide Title
Link
4, 10
Jonathan Smoke Quote
http://www.housingwire.com/articles/38190-summer-housing-market-not-cooling-down-this-fall http://realtormag.realtor.org/daily-news/2016/10/21/what-first-time-buyers-need-from-you
5, 64
Freddie Mac Mortgage Rates
http://www.freddiemac.com/finance/pdf/201610-Outlook-10%2020%2016.pdf
6
Mark Fleming Quote
http://blog.firstam.com/economics/market-is-missing-its-potential-due-to-tight-supply
7
Median Seller Tenure
http://economistsoutlook.blogs.realtor.org/2016/10/13/tenure-in-home-has-steadily-increased-in-last-30-years/#sf38806443
8
Anand Nallathambi Quote
http://www.corelogic.com/research/negative-equity/corelogic-q2-2016-equity-report.pdf
9
Average Equity Gain Map
http://www.corelogic.com/blog/authors/frank-nothaft/2016/10/us-economic-outlook-october-2016.aspx#.WAUQREkzWcz
11
Average Down Payment
http://www.realtor.org/reports/highlights-from-the-profile-of-home-buyers-and-sellers
13
Freddie Mac Quote
http://www.freddiemac.com/blog/homeownership/20161020_down_payment_20_percent.html?attr=rssCB
14
Lawrence Yun Quote
http://www.realtor.org/news-releases/2016/10/first-time-buyers-steer-existing-home-sales-higher-in-september
15-16
Homeownership Rate
http://www.census.gov/housing/hvs/files/currenthvspress.pdf
17
Jonathan Smoke Quote
http://news.move.com/2016-10-19-Realtor-com-Consumer-Survey-Reveals-First-Look-into-2017-Home-Buying-Season
18
Brenda Garcia Lemus Quote
https://www.realestateconsulting.com/mortgages-more-available-than-people-think/
19
New Construction
http://economistsoutlook.blogs.realtor.org/2016/09/29/to-buy-a-new-or-previously-owned-home/#sf37422133
20, 22
Consumer Housing Trends Quote
http://cdn1.blog-media.zillowstatic.com/3/ZillowGroupReport2016-11bcad.pdf
21
Home Search & Purchase
http://economistsoutlook.blogs.realtor.org/2016/10/19/internet-real-estate-agents-some-things-change-others-remain-the-same/#sf39316437
KEEPINGCURRENTMATTERS.COM
Resources Slide
Slide Title
Link
25, 48, 57
Average Days on Market, Buyer & Seller Traffic Maps
http://www.realtor.org/reports/realtors-confidence-index
26-28, 39, 41-42, 49-53
Existing Home Sales Report
http://www.realtor.org/
29-30, 34
Freddie Mac Home Sales
http://www.census.gov/construction/nrs/pdf/newressales.pdf http://www.realtor.org/
31-33, 54-55
New Home Sales, Inventory
http://www.census.gov/construction/nrs/pdf/newressales.pdf
35-38
Pending Home Sales Report
http://www.realtor.org/
43-44
Case Shiller Price Index
https://www.spice-indices.com/idpfiles/spice-assets/resources/public/documents/422175_cshomeprice-release-1025.pdf
45, 81
Forecasted Price Changes
http://www.corelogic.com/about-us/researchtrends/corelogic-home-price-insights.aspx#
46
Appraisal Challenge
http://www.quickenloans.com/press-room/2016/10/11/gap-between-appraisals-perceived-home-value-narrows/
58-60, 82
Foot Traffic, FTHB by Age
http://www.realtor.org
62
Freddie Mac 2016 Rates
http://www.freddiemac.com/pmms
63
Mortgage Rate Projections
http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_101816.pdf http://www.freddiemac.com/finance/pdf/201610-Outlook-10%2020%2016.pdf https://www.mba.org/Documents/Research/Mtg%20Fin%20Forecast%20Oct%202016.pdf http://www.realtor.org/sites/default/files/reports/2016/embargoes/forecast-11-2016-us-economic-outlook-11-04-2016.pdf
66-67
Mortgage Credit Availability
https://www.mba.org/news-research-and-resources/research-and-economics/single-family-research/mortgage-credit-availability-index
12, 68-72
Ellie Mae Report
http://www.elliemae.com/origination-insight-reports/Ellie_Mae_OIR_SEPTEMBER2016.pdf
80
Quarter-Over-Quarter Percent Change in Price Map
http://www.fhfa.gov/DataTools/Tools/Pages/House-Price-Index-(HPI).aspx
83-84
Projected & Cumulative Appreciation
https://www.pulsenomics.com/Q2_2016_HPE_Survey.php
KEEPINGCURRENTMATTERS.COM
Using Charts & Graphs to Differentiate Yourself from the Competition
Firm: RE/MAX Location: Atlanta, GA Annual GCI: $525,000
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Firm: RE/MAX Location: Atlanta, GA Annual GCI: $525,000
Quarter-Over-Quarter Percent Change in Price by State
FHFA
Forecasted Year-Over-Year % Change in Price by State
CoreLogic
Insert Chart About Millennials or Other Group of Buyers?
NAR
PROJECTED Mean Percentage Appreciation
Home Price Expectation Survey 2016 2Q
Cumulative House Appreciation by 2020
Bulls
All Projections
Bears
Home Price Expectation Survey 2016 2Q
NOVEMBER 2016
