Investors Take a More Cautious Approach

Daily Real Estate News | Thursday, June 27, 2013

Investors are growing cautious over rapid home price appreciation in some markets and the potential for lower affordability, according to a report by Bank of America Merrill Lynch.
While investors have been credited with helping to stabilize the housing market when it was down, they may start to retreat from the market, leaving opportunities for other home buyers to step in.
Investor demand has been shrinking as the number of distressed homes shrinks. Investors mostly targeted the hardest hit housing markets to take advantage of low home prices. Investor transactions make up the highest share of total transactions in Miami, according to first-quarter data from RadarLogic.
"This will be part of the transition back to a more normal housing market, but also another reason to expect slowing price appreciation in coming years," writes Chris Flanagan, Michelle Meyer and Justin Borst, mortgage-backed securities strategists for Bank of America Merrill Lynch. "The dynamics of investor buying and their subsequent sales will be important to monitor over the coming years.”

Home Prices Rising at ‘Unsustainable’ Rate

Daily Real Estate News | Friday, June 21, 2013

Home prices have been soaring by double digits compared to last year’s numbers and the National Association of REALTORS® are calling the rises “unsustainable.”
The price for existing home sales surged 15.4 percent higher in May compared to last year.
"Some of the increases can be explained by the fact that it is recovering from an over-corrected situation," says Lawrence Yun, NAR chief economist. "But with people's income rising at only 1 or 2 percent and prices rising in double digits, it cannot continue.”
The price discounts for bank-owned homes are vanishing rapidly, says Rick Sharga of Carrington Mortgage Holdings. Prices of distressed homes — particularly in markets like California, Arizona, and Florida — are rising faster than traditional home prices.
"You can at least make an argument that part of the dramatic increase in median home prices can be attributed to the foreclosure discount evaporating,” Sharga says. “That suggests that overall home price increases may be slightly overstated.”
However, according to NAR’s latest report, more expensive homes are seeing higher price rises. For example, homes priced at more than $500,000 have had prices soar 33 percent in the last year while homes priced below $100,000 have had prices down 9 percent year-over-year.
Source: “Home Price Rise ‘Unsustainable,’ Realtors Report Says,” CNBC (June 20, 2013)
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Home Prices Soar to Largest Gain in 7 Years

Home Prices Soar to Largest Gain in 7 Years

Daily Real Estate News | Wednesday, June 05, 2013

The housing recovery has picked up speed, as home prices posted their highest year-over-year gain since February 2006, according to the latest housing data from CoreLogic.
CoreLogic's home price index climbed 12.1 percent in April over year-ago levels. Home prices have been on the rise for more than a year.
"The pace of the housing market recovery quickened in April as home prices rose across the U.S.," says Anand Nallathambi, CoreLogic's chief executive officer. "We expect this trend to continue, bolstered by tight supplies and pent-up buyer demand."
CoreLogic economists predict home prices will rise another 2.7 percent in May.
The following five states had the largest price gains over the past year:

• Nevada: +24.6%
• California: +19.4%
• Arizona: +17.3%
• Hawaii: +17%
• Oregon: +15.5%

Source: “April home prices see biggest yearly gain in seven years: CoreLogic,” Reuters (June 4, 2013) and “U.S. Home Prices In April Jumped Most in 7 Years,” Th