Report: Property Values Rise For South Fla. Homeowners

MIAMI (CBSMiami) — South Florida homeowners have something to rejoice about: higher property values.

CBS4 news partner The Miami Herald reportsthe S&P/Case-Shiller home price index, released Tuesday, indicated home prices in the area rose 4.4 percent in June.

The June increase is when compared to June 2011.

Nationally, single-family home prices also showed solid improvement, with the annual growth rate turning positive — 1.2 percent — for the first time since 2010 when federal tax credits were fueling sales.

Also bolstering signs that the residential market is finally on the upswing, prices in Miami-Dade, Broward and Palm Beach counties rose 1.6 percent in June from May, and they were up 0.7 percent in the second quarter from the first quarter, according to S&P/Case-Shiller.

The widely monitored report tracks sales of thousands of single-family homes.

South Florida, which was among the hardest hit spots in the nation during the housing crisis, chalked up its seventh straight month of rising values in June. That is the area’s longest positive streak logged since 2006.

Despite the recent gains in prices, South Florida home prices are still down 48 percent from their 2006 peak.

“There is a lot of pent-up demand, a lot of enthusiasm at open houses,” said Lisa Dority, an agent with REMAX/Advance Realty. “I don’t know that I’ve had a house on the market for more than three weeks.”

Along with rising confidence that the market has bottomed, buyers are attracted by the historically low mortgage rates. “You can get a 30-year fixed-rate mortgage for 3.625 percent with no points,” said Ron Rosen, a mortgage broker with Abacus Lending Group in Miami. “It’s been very active.”

Lucy and Alex Arrieta expect to close soon on a three-bedroom, two-bath house in Aventura with an attractive FHA loan. The Arrietas, who have three children, are moving from a condo to a single-family house with a pool, capping a yearlong search. “We’re tired of looking,” said Lucy Arrieta, who with her husband had waited months to complete a short sale that eventually fell through.

Ron Shuffield, president of Esslinger-Wooten-Maxwell in Miami, said a primary factor shaping the market continues to be the tight inventory of homes for sale at a time that buyers are feeling convinced the housing market is safe to jump into again.

“When you get down to a four or five months’ supply [of homes for sale], it’s inevitable that prices will rise,” said Shuffield. “Buyer confidence is increasing, making people willing to make these deals.”

Despite the dearth of inventory, agents say buyers have a keen sense of the market and overpriced homes will sit untouched.

“The new inventory that is coming on the market priced correctly is selling,” said Nancy Klock Corey, who manages Coldwell Banker’s Miami Beach office. “There is a percentage of inventory on the market that is not saleable because it is overpriced.”

Jon Mann, an agent with The Jills team at Coldwell Banker, said the latest Case-Shiller data echo what he sees in the market. But Mann stressed that the Miami market is highly segmented, with homes in the downtown and coastal areas posting gains, “but down south and out west, you’re still seeing a continued decrease in home values.”

On a national basis, the latest Case-Shiller data were positive for all three major indexes the firm tracks — national, 10- and 20-city lists — in June. The national composite price rose 1.2 percent in the second quarter from the year-ago period and increased 6.9 percent from the first quarter of 2012.

“The combined positive news coming from both monthly and annual rates of change in home prices bodes well for the housing market,” David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

All 20 of the cities tracked saw average home price increases in June from May. Only six cities – Atlanta, Chicago, Las Vegas, Los Angeles, New York and San Diego – still showed negative annual rates of change, according to the report.

While the Case-Shiller report focuses on single-family homes, the South Florida condo market, which is a major part of the region’s housing scene, is also back from the dead.

Maria Gugliotta, a Miami real estate investor, bought a one-bedroom condo at Paramount Bay at 2020 North Bayshore Drive for $395,000 in November 2011 and sold it about a month ago for $520,000. “But I don’t think you can stretch the rubber much more,” said Gugliotta, who thinks condo prices have gotten so high the math for renting them as an investment soon won’t add up. “Miami is beautiful. It’s full of opportunity, but it ends. [When prices get too high,] it’s not an investment anymore.”

U.S. home prices post first 12-month gain since 2010

U.S. home prices rose in June from the same month last year, the first year-over-year increase since the summer of 2010. The increase is the latest evidence of a nascent recovery in the housing market.

Southwest Florida has been experiencing a rebound in prices for months now.

The Standard & Poor's/Case-Shiller national home price index released Tuesday showed a gain of 0.5 percent from June 2011.

All 20 cities tracked by the index also rose in June from May, the second consecutive time in which every city posted month-over-month gains. All but two cities posted stronger gains in June than May.

Detroit, Minneapolis, Chicago and Atlanta recorded the biggest one-month gains.

No cities in Southwest Florida are included in the Case-Shiller measure, but Tampa and Miami are: Tampa's prices were up 3.4 percent from a year ago while Miami's were up 4.4 percent.

"The combined positive news coming from both monthly and annual rates of change in home prices bode well for the housing market," said David Blitzer, chairman of the S&P's index committee.

Separate data from the Sarasota Association of Realtors showed the median price for a single-family home sold during July in the group's territory was $178,000. That is up more than 30 percent from the market nadir recorded 16 months ago, when the median price was $137,500.

The S&P/Case-Shiller monthly index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The June figures are the latest available.

The increases partly reflect the effect of seasonal buying. The month-to-month prices are not adjusted for seasonal factors.

Still, a measure of national prices rose for the third straight month. Home prices jumped nearly 7 percent in the April-June quarter, compared with the previous quarter.

The housing market is making a modest but steady recovery in part because homes are more affordable: Mortgage rates have fallen to near-record lows. Housing prices are about one-third lower than at the peak of the housing bubble in 2006. Those trends have helped lift sales of both new and previously occupied homes.

Sales of previously occupied homes increased in July from June, the National Association of Realtors said last week. Sales have jumped 10 percent in the past year.

Builders are growing more confident after seeing more traffic from potential buyers. Last month, they applied for the largest number of building permits in nearly four years.

The housing market has a long way to go to reach a full recovery. Some economists forecast that sales of previously occupied homes will rise 8 percent this year to about 4.6 million. That is still well below the 5.5 million annual sales pace considered healthy.

Sales have been held back by a low supply of homes on the market and by tight credit standards, economists said. Many would-be buyers are having trouble qualifying for loans or cannot afford larger down payments required by banks. A Federal Reserve report last month showed many banks tightened their mortgage credit standards this summer.

Still, the housing market is steadily improving and is poised to contribute to economic growth this year. Modest economic growth and job gains are encouraging more Americans to buy homes.

New home sales match two-year high

WASHINGTON

New home sales in July climb 3.6 percent, matching May's total of new home sales. The supply of new homes for sale falls to a 49-year low.

In another sign of improvement in the housing market, new home sales increased 3.6 percent in July from the previous month, the government reported Thursday.

Sales of new residential homes rose to a seasonally adjusted level of 372,000 units in July, matching a more than two-year high for total sales, the Census Bureausaid.

The same number of new homes were sold in May before sales dipped to 359,000 in June. The last time more new homes were sold in the U.S. was in April 2010, when there were 422,000 sold, according to government data.

Economists had expected a smaller increase in July, to about 365,000 sales. But a sharp rise in the Northeast offset slight declines in the South and West to boost the numbers.

July sales were up 25.3 percent nationwide from a year earlier. And although sales aren’t close to the levels normally associated with an economic recovery, the trend is improving.

“Levels of housing activity remain extremely depressed relative to previous peaks, but growth rates across most of the housing data are clearly moving in the right direction,” Jill Brown, vice president of economics for Credit Suisse, said in a note.

On Wednesday, the National Association of Realtors reported that sales of previously occupied homes were up 2.3 percent in July after also dipping in June.

But new home construction has yet to pick up. The number of new houses for sale at the end of July fell slightly to 142,000 — a 4.6-month supply — compared to 143,000 at the end of June.

The July figure marked the lowest level of new houses for sale since the Census Bureau began tracking the data in 1963.

South Florida Condos Rising For Real Estate Revival

A balcony overlooks the bright Atlantic at sold-out Trump Hollywood, a luxury condo project in Hollywood, Fla. AP.

Groundbreaking parties are back and champagne glasses are clinking again on South Florida's Gold Coast. Hello to new condo towers from Miami to West Palm Beach, less than a year since one of the hardest-hit regions started showing signs of a real estate recovery.

The scene evokes the mid-2000s' bubble years, before the housing market crashed and left condo canyons of empty new buildings.

New condos are going up as developers try to lure cash-rich foreign buyers to the balmy region, especially the global hub of Miami. But a potential oversupply and financing hurdles could dampen odds that all envisioned projects will succeed.

About 60 condo towers with 10,000 units are in the pipeline on or by the coast in Miami-Dade, Broward and Palm Beach counties, says Peter Zalewski, principal of Miami consulting firm CondoVultures.

Meanwhile, 3,400 units still remain unsold from the boom years of 2003 to 2006, when about 49,000 new units arrived. The rest of the inventory burned off as bargain-hungry investors paid cash for units priced so low that they were sometimes below the construction cost.

Still, "developers are really getting ahead of themselves by tripling the new condo inventory," Zalewski said. "It's crazy. Here we go again."

Miami, the area's top market, has a long history of booms and busts.

"Three come to mind since the 1970s," said Jack McCabe, CEO of McCabe Research & Consulting in Deerfield Beach, Fla. "This (last one) has been the most spectacular since the Great Depression. It was all due to speculative loans to anyone who could fog a mirror."

Different This Time

Speculators flipped properties before buildings were even built, but this time around more cash is required to reserve a unit before completion, and flipping is discouraged.

With mortgages for new condos hard to get, buyers are paying largely in cash. Most are foreign nationals, especially from South America, Russia and Canada, analysts say.

"This is a market that is being propped up by foreign buyers paying cash," McCabe said. "And Americans are unable (or unwilling) to participate because they either lack cash or they cannot qualify for a mortgage due to today's stricter lending standards."

South Florida isn't the only part of the state rising from the ashes of the housing bust. On the Gulf Coast, asking prices for single-family homes and condos in Cape Coral-Fort Myers jumped 15.9% in July from a year ago, according to real estate site Trulia, as sales lifted off lows.

Signs of Revival, Slight but Sure, for Home Sales

The number of existing homes sold rose 2.3 percent in July from the previous month, according to figures released Wednesday. Volume was up more than 10 percent from a year ago.

For several months, economic data and accounts from real estate agents across the country have calmed fears that the overall market could take another big step down, giving prospective home buyers some assurance that prices were stabilizing.

Yet the nascent recovery is still a convalescent one, with the pace of activity uneven and far below the levels reached before the bubble burst. Home prices remain under pressure in many markets.

In fact, Wednesday’s report from the National Association of Realtors showed that average sales prices actually dipped slightly from June to July. This seeming contradiction — increasing demand but anemic growth in home values — could represent a new normal in the housing market, experts said.

Real estate agents across the country cited the weak job market, stagnant wages and tight lending standards as continuing restraints on prices, despite pent-up demand andmortgage rates near record lows.

Even relatively optimistic observers like Michelle Meyer, an economist with Bank of America Merrill Lynch, foresaw only gradual improvements in home values. She expected home prices to rise 2 percent annually in 2012 and 2013, with momentum gradually increasing later in the decade. At that rate, the average home price would regain its 2006 peak in 2022.

“Inventory is lower and construction is incredibly depressed,” she said. “But it’s bumpy. We could see prices weaken slightly in the fourth quarter of 2012 and the first quarter of 2013.”

Joe Abbruzzese, a retired farmer from upstate New York, was in southwest Florida this week bargain hunting for a second home. “I wanted to get down here before the snowbirds arrive,” he said. He was looking at five or six properties in the low- to mid-$100,000s before he left New York, but by the time he arrived in Florida only one was left.

Mr. Abbruzzese said that while prices had increased in recent months, he was betting that they would rise still more after the presidential election restored some certainty to the country’s political course. “I think people are really scared right now; they’re not spending the money,” he said.

While new buyers might take comfort in the fact that deep declines in home values seem to have passed, more than 11 million current homeowners owe more on their mortgages than their homes are worth. In July, home sales were running at an annual pace of 4.47 million, an improvement over a year ago, but well below the high of 7.25 million reached in September 2005.

New-home sales also were picking up, lifting share prices for many home builders. On Wednesday, Toll Brothers reported a sharp rebound in profits, lifting its stock 3.8 percent.

A number of factors have helped nudge prices higher, including shrinking inventory — particularly on the more affordable end of the market. There is about a six-month supply of homes, according to the Realtors’ group, down from more than nine months last summer.

In California, the supply of houses has become so slim that agents protested a bulk sale of 500 foreclosed houses by Fannie Mae, the mortgage giant, saying there was no need to sell the homes at a discount to investors when there were retail buyers willing to buy them. (Most of the properties would not have been sold individually because they were occupied by renters.)

Concerns that a flood of distressed properties will soon hit the market were also receding.

Banks have been taking more aggressive measures to avert foreclosures, which have been declining for almost two years, according to RealtyTrac. Short sales, the practice of allowing homeowners to sell their property for less than they owe before the home reaches the auction block, are on the rise. Some banks have recently introduced “deed for lease” initiatives to convert delinquent owners into renters instead of evicting them.

Sales of distressed properties, which act as a drag on prices, represented 24 percent of all activity, down from 29 percent a year ago.

“The broad opinion is that housing is definitely improving and on the upswing,” said David Blitzer, the chairman of the index committee for S.& P.’s Dow Jones Indices, which produces the Case-Shiller Home Price Index. “And that is a positive factor for the economy as well.”

In some areas, real estate brokers were skeptical that any improvement would be sustained.

Michael Parra, a real estate agent in Las Vegas, said investors who had been fueling the market with cash purchases were starting to get cold feet, fearing values would not appreciate further as long as incomes lag and jobs are scarce.

“You’re going to have a catfish market,” Mr. Parra said. “You know, catfish stay on the bottom and they occasionally jump up to the surface.”

Economists like to caution that there is no such thing as a national real estate market. Results vary widely from place to place, and some of the biggest increases in prices have come in parts of the country hit the hardest when the housing boom turned to bust.

Home prices in Phoenix fell 55.9 percent from June 2006 through September 2011, when they bottomed, according to the Case-Shiller index. Since then, they have risen 8.8 percent. And in San Francisco, which had a 46.1 percent decline, prices have recovered 10.6 percent from the low in March 2009.

John Gurzinski for The New York Times

Houses in the Las Vegas Valley. Nationally, existing-home sales were up by 2.3 percent in July. 

By SHAILA DEWAN and NELSON D. SCHWARTZ

Published: August 22, 2012 108 Comments

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Analysts are hailing the beginnings of a recovery in the nation’s housing market. But to beleaguered homeowners, it will not feel like much of one for many months to come.More typical is Chicago, which hit a low in March 2012. Prices there have risen 1.1 percent since then. Case-Shiller is still showing a slight decline nationally in average prices over the past year, but analysts will be closely watching data due out next week for signs of a turnaround.

Barbara Gargiulo, a real estate broker in northern New Jersey, said market conditions in her area varied widely. Montclair, she said, has only a two-month supply of houses on the market — far less than some of its neighbors.

Still, she said, a house that sold last year for $620,000 sold again this year for $650,000, above its list price.

“I think we’ll have some small little peaks, small little valleys, but in general we’ll see an upward curve over the next few years,” she said.

South Florida’s existing single-family home sales rise in July

Amid tight inventory, the median price of a single-family home in Miami-Dade and Broward counties rose in July, bolstering evidence the housing market is recovering.

The median price of a single-family home in Miami-Dade rose 2.8 percent to $185,000 in July from a year earlier, marking the eighth consecutive month of rising prices and bolstering the evidence of a recovery in the battered housing market.

The number of residential sales, including single-family homes and condos, increased 11 percent in Miami-Dade to 2,201 in July from a year earlier.

“The Miami real estate market continues to attract demand as inventory consistently decreases, yielding significant price appreciation,” Martha Pomares, chairman of the board of the Miami Association of Realtors, said in issuing Wednesday’s report. “The condominium market in particular is performing quite well, as international buying activity continues to heat up in Miami.”

A pivotal force driving the residential market continues to be the dearth of inventory, both in South Florida and across the state. In Miami-Dade, the number of residential listings plunged 27 percent in July to 11,454 from 15,727 in July 2011.

In Broward, the inventory of homes for sale was down by nearly half, with 4,964 available in July compared to 9,884 a year earlier.

“We’re down to a three-month supply of homes in Broward and a four-month supply in Dade,” said Ron Shuffield, president of Esslinger-Wooten-Maxwell. “That metric is the most important one in our business. When those numbers go down, prices are going up.”

In Broward, existing sales of single-family homes jumped 19.9 percent in July to 1,308 units from a year earlier.

The median price of a single-family home in Broward rose 13.2 percent to $215,000 in July, compared with $190,000 a year earlier.

The number of sales of existing condos and townhouses in Broward rose 3.8 percent in July to 1,357 from July 2011. The median condo and townhouse price climbed 14.5 percent to $85,900 from a year earlier.

Single-family home prices in Broward were flat between June and July, while condo and townhouse prices dipped 2.2 percent to $84,000 in July from $85,900 in June.

“While it appears that median housing prices are declining slightly from June to July, prices are higher than a year ago and the available inventory is still declining,” Stephen B. McWilliam, president of the Greater Fort Lauderdale Realtors, said in a statement. “As long as demand for homes remains strong, housing prices will continue to increase.”

The housing picture for Florida as a whole also continued to improve, according to the Florida Realtors.

Single-family home sales jumped 9.8 percent in July from a year earlier. The median price of a single-family home in Florida rose 7.8 percent to $148,000 in July from a year earlier, as the number of homes on the market plunged 32.6 percent year over year.

Convinced that the housing market is safe to wade in to, Miami Beach resident Seth Cassel and his wife closed on a 4-bedroom, 3½-bath home on Miami Beach recently, capping a home search of five to six months.

“It was a combination of things: Mortgage rates are very low and the market feels like it’s starting to come back,” said Cassel. On top of that, he and his wife have a 14-month-old daughter and were looking for more space.

Cassel, who is president of EveryMundo, an international digital marketing company, said the 30-year fixed-rate mortgage they lined up has such great terms they were able to get more house for their monthly payment.

“I wish I had more inventory,” said Anthony Askowitz, a broker with Re/MAX Advance Realty in Miami. “If I had it, it’s gold. Sellers are getting a nice price. People are paying over the appraisals.”

2012 Housing Recovery Continues: July Sales, Prices Higher than 2011

By RE/MAX

Published: Monday, Aug. 20, 2012 - 2:01 pm

DENVER, Aug. 20, 2012 -- /PRNewswire/ -- 2012 has become the year of the housing recovery.  The July RE/MAX National Housing Report follows the trend of every month this year, with increasing sales and increasing prices.  July home sales are 10.3% higher than sales last July and year-over-year home sales have now risen for 13 consecutive months.  Median home prices have now reached levels higher than the previous year for six months in a row, with an increase of 3.7% over July 2011.  Inventory is now becoming a serious challenge to this recovering market, with available homes-for-sale falling 26.8% lower than the same month last year. Home sales could be much greater if more inventory was available, especially in the lower price range, where most sales are now occurring. With increased demand and shrinking inventory, the average Days on Market of homes sold in July was 82. 

"It's reassuring that both sales and prices continue to rise higher on a yearly basis, indicating that this housing recovery is real," said Margaret Kelly, CEO of RE/MAX, LLC.  "Overall, the picture is getting brighter each month, but what we need for a sustainable recovery is a turn-around in unemployment and better availability of mortgages, especially for higher priced homes."

Transactions – Year-Over-Year Change

Home sales appear to have peaked in June, with July sales down 9.4% from that level but still 10.3% above the number of sales in July 2011. July is the 13^th consecutive month with sales higher than the same month in the previous year. With continuing mortgage rates at historic lows and the most attractive home prices in years, sellers and buyers are returning to this recovering market.  Of the 53 metro areas surveyed, 44 saw higher sales than one year ago; 26 of those metro areas saw double digit increases, including:  Providence, RI +38.1%,  Albuquerque, NM +29.6%, Chicago, IL +29.5%, Boston, MA 25.7%, Nashville, TN  +25.4%, and Milwaukee, WI +25.1%.

Median Sales Price

The Median Sales Price of homes sold in July was $169,000.  This price marks a 3.7% increase over the median of July 2011, but is off fractionally from prices seen in June, down 0.6%.  The annual increase of 3.7% marks the sixth month in a row with year-over-year increases.  Of the 53 metro areas surveyed for the July RE/MAX National Housing Report, an impressive 42 reported price increases over last year, with 12 metro areas experiencing double-digit gains, including:  Phoenix, AZ +33.1%, Boise, ID +22.1%,  San Francisco, CA +20.6%, Little Rock, AR +14.5%,  Detroit, MI +14.1%, and Las Vegas, NV +13.2%. (Note: Median Sales Price is now being calculated as a straight median within and among all metro areas and is no longer being averaged.)

Days on Market – Average of 53 Metro Areas

For all homes sold during the month of July, the average Days on Market was 82.  This represents a drop of 2 days from the average in June and 6 days from July 2011. July represents the second month since September 2011 with a Days on Market below 90, and the lowest average since July 2010.  The Days on Market average continues to fall in many markets due to low inventory.   Days on Market is the number of days between first being listed in an MLS and when a sales contract is signed. 

Months Supply of Inventory – Average of 54 Metro Areas

The inventory of homes-for-sale fell 5.4% from June and 26.8% from inventory levels seen in July 2011. Month-to-month inventories have now fallen for 25 consecutive months.  A shrinking inventory is helping  home prices rise, but may also be limiting sales.  Given the current rate of sales, the average Months Supply is now 5.3, about two months lower than the 7.2 average seen in July 2011.  Very low Months Supply continues to be seen in San Francisco, CA  1.2,  Los Angeles, CA  1.8,  Denver, CO  2.4,  Orlando, FL  2.5, Phoenix, AZ  and Miami, FL 3.1

About the RE/MAX Network: RE/MAX was founded in 1973 by Dave and Gail Liniger, real estate industry visionaries who still lead the Denver-based global franchisor today. RE/MAX is recognized as a leading real estate franchisor with the most productive sales force in the industry and a global reach of more than 80 countries. With a passion for the communities in which its agents live and work, RE/MAX is proud to have raised more than $120 million for Children's Miracle Network Hospitals, Susan G. Komen for the Cure® and other charities. Nobody in the world sells more real estate than RE/MAX. Please visit www.remax.com or www.joinremax.com.

Description The RE/MAX National Housing Report is distributed each month on or about the 15^th. The first Report was distributed in August 2008. The Report is based on MLS data in approximately 54 metropolitan areas, includes all residential property types, and is not annualized. For maximum representation, many of the largest metro areas in the country are represented, and an attempt is made to include at least one metro from each state. Metro area definitions include the specific counties established by the U.S. Government's Office of Management and Budget, with some exceptions.

Definitions Transactions are the total number of closed residential transactions during the given month.  Month's Supply of Inventory is the total number of residential properties listed for sale at the end of the month (active inventory) divided by the number of sales contracts signed (pended) during the month.  Where "pended" data is unavailable, this calculation is made using closed transactions.  Days on Market is the number of days that pass from the time a property is listed until the property goes under contract for all residential properties sold during the month. Median Sales Price is the median price of all residential properties sold during the month.

MLS data is provided by contracted data aggregators, RE/MAX brokerages and regional offices. While MLS data is believed to be accurate, it cannot be guaranteed.  MLS data is constantly being updated, making any analysis a snapshot at a particular time.  Every month the RE/MAX National Housing Report re-calculates the previous period's data to ensure accuracy over time.  All raw data remains the intellectual property of each local MLS organization.

Housing starts continue to see annual gains in July

Housing starts, though dipping 1.1 percent in July from June, were up 14.2 percent on a year-over-year basis, continuing a steady upward trend.

July groundbreakings were at a seasonally adjusted annual rate of 746,000, down from June's adjusted rate of 754,000, but up from July 2011's rate of 614,000, according to the latest numbers from the Census Bureau.

Single-family housing starts were down 6.5 percent from June to July, to a seasonally adjusted rate of 502,000, but still a 17 percent increase from a year ago and 42 percent above their March 2009 bottom of 353,000.

July also saw the most single-family construction permits filed by builders (513,000) since August 2008, according to the National Association of Home Builders.

Housing starts have been rising on an annual basis since September 2011 and are now 56 percent above their trough in April 2009 -- 478,000 -- according to census records dating back to January 1959.

The sustained housing-start improvement over the last several months "confirms that recent previous increases are part of a sustained trend, not a temporary blip," said Jed Kolko, chief economist and head of analytics at real estate search portal Trulia.

Calculated Risk's Bill McBride credits the lack of new construction during the housing downturn with helping spur a recovery this year.

"The record low level of completions over the last four years -- and record low level of housing units added to the housing stock -- is an important reason for the budding recovery in housing," McBride wrote in a blog post.

"The last four years have seen record low completions, and 2012 will also be very low. This low level of completions means that a significant portion of the excess vacant housing supply has been absorbed. And completions in 2012 will still be very low even with the 20-plus percent increase in housing starts."

Source: Calculated Risk  

Regionally, the West led the way in July with a 48.1 percent annual jump in housing starts, to 197,000. The Midwest followed with a 28.6 percent increase, to 117,000. The South had the biggest volume of housing starts by far last month, 355,000, up 16.8 percent from a year ago.

The Northeast was the only region to see housing starts decline on a yearly basis, by 10.5 percent to 77,000. 

For single-family housing starts, all regions except the Northeast showed year-over-year increases, led by the West (26.1 percent), then the South (20.9 percent), and Midwest (12 percent). In the Northeast, single-family housing starts fell 14.6 percent.

New condo boom under way in Florida

In another sign that a new Florida condo boom is under way, the Miami Herald last week reported that 45 new condo towers are in various stages of development for the Southeast Florida area, including about 1200 new units in the tiny beach town of Sunny Isles Beach, just north of Miami Beach.

Even more amazing, according to another report from Miami Condo Investments, three Miami projects that launched earlier this year, 1100 Millecento, BrickellHouse and MyBrickell, are already 97 percent sold out. Two of the three projects have not even broken ground yet. 

Florida's amusement parks and real estate are a lot alike—with peaks and valleys, dark tunnels and unexpected turns. In 2006, Florida condo prices hit record highs and people waited in line to buy pre-construction opportunities that were being sold out of aluminum trailers.

By 2010, many of those same buyers had walked away from their dreams losing thousands of dollars, and no-one else was waiting in line. The Sunshine State was awash with empty condos, and prices plummeted around 50 percent by 2011. New buildings that were completed in 2007 and 2008 sat empty; buyers were nowhere to be seen. Developers filed bankruptcy all over the state and slashed prices to try to sell the excess inventory. Experts said it would take years to liquidate the condo-bust nightmare.

Today, the glut of unsold, new condos in much of Florida is virtually gone. The Florida real estate recovery started in late 2010 and picked up a huge head of steam in 2011 and 2012. Walsh said there are still a few good bargains but most of the condo boom hangover has been purchased by investors, baby boomers and internationals.

Real estate in some parts of Florida is actually flourishing again. The Gold Coast area from Palm Beach to South Beach has seen a big increase in sales since early 2011. Apogee Beach is a luxury oceanfront building in Hollywood between Miami Beach and Fort Lauderdale that started construction late last year with 49 units priced in the $1 to $2 million range.

In a big departure from the boom days to discourage speculation, buyers have to pay 40 percent of the total price when they sign the initial contract. Nevertheless, most of the units have already sold. Another new project that launched in late 2011 was Barefoot Beach Villas in Pompano Beach. They were priced in the $300,000 to $400,000 range and sold out in just a few months – mostly to Canadian buyers.

Most US housing experts agree that Florida is in the early stages of a huge rebound. Almost 95 percent of the 49,000 new condos that were constructed in South Florida's seven biggest coastal markets during the boom are now sold and the inventory of new beachfront condos priced under $1 million is down to a handful. According to the Miami Herald, the housing market in much of South Florida is almost back to the peak boom years of 2005 and 2006.

TopTenRealEstateDeals.com is a real estate website that focuses on both entertainment (celebrity homes, cool beach homes, weird homes) and finding the best home and condominium bargains in the country. 

More accurate home price data on tap for Florida

A new index launching in September could be the first of its kind in the nation

Florida is believed to be the first in the nation to get its own home sales price index, a labor of love for the state real estate group’s chief economist and a more accurate measure of property values in the recovering market.

The index, which is similar to the widely trusted nationwide Standard & Poor’s/Case-Shiller report, is scheduled to launch in September with regional and countywide information that takes into account every residential parcel in the state.

Realtors have long complained the current method of reporting monthly median homes sales prices doesn’t offer a true measure of increasing and decreasing values. The median, which means half of homes sold above the price and half below, can be greatly influenced if a large number of either distressed properties or luxury homes sell in one month.

Florida’s new index, created by the Florida Realtors, is considered a “repeat sales index” that will combine Florida Department of Revenue data with prices of individual properties sold over time. The index will be released quarterly with data going back to 1995.

“This is definitely the thing we’ve been waiting for and it will be much more reflective of what prices are doing,” said Bill Richardson, district sales manager at The Keyes Co. in Boca Raton and a past president of the Realtors Association of the Palm Beaches. “It’s truly something we’ve needed.”

National Association of Realtors spokesman Walter Moloney said he’s not aware of another state that has its own price index. California releases an “affordability index” that measures the percentage of all households that can afford to purchase a single-family home, but its sale prices are still reported as a median.

Similar to Case-Shiller, the Florida home price index will measure sales as compared with January 2000. But Case-Shiller’s Florida data only includes Tampa and South Florida, which combines Palm Beach, Broward and Miami-Dade counties.

“All of the measures have strengths and weaknesses, but a repeat sales index is probably better than a median price on an aggregate basis,” Moloney said. “We’re looking at developing one on a national level but it’s not quite ready for prime time yet.”

Finding better ways to measure Florida real estate sales has been a goal of Florida Realtors Chief Economist John Tuccillo since he was hired last year to lead the group’s new data and analysis department. Tuccillo is the former chief economist for the National Association of Realtors and has led his own Sarasota-based consultant’s firm.

In January, he oversaw a statewide change in how sales and prices are reported which allows Realtors and homebuyers easier access to statistics by ZIP code.

Tuccillo said he’s not ready to release details of the index, but that he’s generally found that for the past two years prices in Florida have “essentially bottomed out.”

“As a colleague said to me, we’re now moving along a cobblestone road, flat with bumps,” Tuccillo said.

While the general public may prefer a median sales price that reports an actual dollar figure to an index, which is a mathematical calculation designed to normalize time-series data, the index is considered more accurate.

“This is really the first of its kind in the nation,” Tuccillo said about the index. “We’re pretty proud of it.”

Real estate market changes for better

Faster turnaround means more mobility, which also could mean more sales for agents, businesses.

When Bobbie Cochran went to sell her three-bedroom, two-bath house in Gateway, she expected what others had experienced in recent years: a long, difficult process.

Much to her surprise, Cochran, 88, a retiree from Wisconsin who’d lived in the house 14 years, sold in a week for $330,000 — $25,000 more than the appraised value.

“Because property wasn’t moving that great, I figured it would take a little longer than that,” she said. “But the first people who looked at it bought it.”

Now she’s renting temporarily while she waits for the villa she purchased to be built.

Until recently, Cochran’s experience was something not seen much in Lee County since the boom, said Denny Grimes of Denny Grimes & Co. at Royal Shell Real Estate, who represented Cochran in the sale.

The change in climate is the result of a slow but steady improvement in the affordability of homes in Southwest Florida with prices still low and the economy on the mend, he said. And the better market is helping to boost sales at some area businesses.

The numbers bear that out: According to the Realtor Association of Greater Fort Myers and the Beach, the inventory of single-family homes on the market fell to 13,897 in June from 15,834 a year earlier. Meanwhile the median sales price increased to $127,000 from $101,500 in the same period.

The same trend held for Collier County, where the median price increased from $175,000 to $190,000 and the inventory fell from 7,208 to 6,310 in the same period, according to the Naples Area Board of Realtors.

With fewer choices and prices on the rise, “The stick has been taken out of the buyer’s hands,” Grimes said, noting that appraised values are sometimes below true value because they’re based mainly on comparable sales from two months ago or longer when prices were significantly lower.

The trend is helping home builders as well, said Brad Hunter, chief economist for Metrostudy, which tracks sales in Southwest Florida and other areas.

“That’s a big factor and that’s helping the new-home market,” he said. “Partially as a result of that we’re seeing builders busier than they’ve been for years” with new-home inventory down as well.

Psychology plays a role as well, Hunter said. “The fact that home prices are now going up in that market (Lee County) makes people feel more encouraged about buying. They don’t want to get into a market that’s going down.”

He said that “The other thing that’s happening that’s boosting demand is that people have been doubling up, taking roommates or moving in with mom and dad.”

As people get back on their feet financially and become able to afford their own place, Hunter said, housing demand will accelerate further.

Larry Norris, owner of Fort Myers-based Norris Furniture, said his business has been getting a boost as people are able to move more readily. “I’m seeing a little uptick in business from last summer.”

Most people either redecorate completely when they move or at least pick up a few items such as rugs and lamps even if they hadn’t planned on it, he said.

“We have some people who bring furniture down from up north and I hear they regret that,” Norris said with a chuckle.

Lenders look for alternatives to repossessing homes

The number of homes that received an initial notice of default — first step in the foreclosure process — was 6% higher in July than last year, foreclosure listing firm RealtyTrac said Thursday. Filings of initial default notices have increased on an annual basis three months in a row.

The trend comes as banks work to make up for time lost last year as the mortgage-lending industry grappled with allegations that it had processed foreclosures without verifying documents.

The increase in homes entering the process raises the possibility that more properties could end up being foreclosed in coming months.

But of late, banks have been dialing back home repossessions and increasingly letting borrowers sell homes in a short sale. That's when the bank agrees to accept less than the seller owes on the mortgage.

Banks took back 21% fewer homes last month than in July last year, RealtyTrac said. Repossessions were down 1% from June. They've been down on an annual basis every month going back nearly two years.

"Lenders are much less likely now than they were even a year ago or two years ago to repossess a property after they've started the foreclosure process," says Daren Blomquist, a vice president at RealtyTrac.

Completing the foreclosure process can potentially open banks to liability if they're accused of improper procedures. And short sales, on average, sell for $25,000 more than a bank-owned property, Blomquist said.

As a result, lenders are much more likely to look for alternatives, such as a short sale, a loan modification or refinancing.

So far this year, home repossessions have averaged about 57,000 a month. That puts the nation on track for just under 700,000 completed foreclosures this year, below the 800,000 recorded in 2011.

The latest crop of homes entering the foreclosure process does not signal that there is a fresh wave of homeowners in distress and missing payments. The majority of the loans entering foreclosure are mortgages that date back to the housing bubble years, Blomquist said.

On average, 104,000 homes have entered the foreclosure process each month going back to May. That's well below the 178,000 per-month average in 2009, the year with the highest monthly average, RealtyTrac said.

Even so, the increase in foreclosure-starts could boost the number of homes that end up on the market at a sharp discount to other properties. That means, barring another outcome, many of the homes that entered the foreclosure pipeline in recent months could end up weighing down the values of nearby homes when they hit the market.

A stronger housing market could mitigate the impact of future foreclosures on home prices, and home sales are expected to end up ahead of last year. But many economists still say the market is years away from a full recovery.

The number of homes receiving foreclosure-related notices last month increased generally in states where the courts play a role in the foreclosure process. Among them:New Jersey, Florida, Ohio and Illinois.

Many homes on the foreclosure path were left in limbo in those states last year, while mortgage lenders sorted out the foreclosure abuse allegations.

In contrast, foreclosure activity was down sharply in Arizona and California — foreclosure hotbeds throughout the housing downturn, but states where the court does not factor into the foreclosure process.

That didn't keep California from posting the nation's highest foreclosure rate last month. One in every 325 households reported a foreclosure-related notice in July, more than twice the national average.

Realty report says Reno now considered a boom town

Reno’s depressed real estate market is getting healthier, and the city is being called a boom town now, according to a new Realtor.com report. During the second quarter, Reno was ranked No. 38 in market recovery, according to the Top Turnaround Town Report released today by the Relator.com.


“What we noticed this time was that there was a variety of markets, and Reno being one of them, we considered boom towns,” said Julie Reyolds, vice president of Realtor.com. “What that means, it’s one of the (146 markets that we have been watching) that zoomed to significantly higher ranking, based on those key metrics.”

The rankings are based on year-over-year median sales price, inventory and unemployment rate. The city jumped 40 positions from No. 78 in the first quarter. In the last quarter of 2011, it started at No. 131. The real estate website monitors about 146 markets across the nation. Reno is expected to continue the rise, according to Realtor.com.

“All the signs point to a healthy market for Reno,” she said. The housing market is showing signs of recovery across the nation with limited existing home inventory and rising homes sales prices, including in Reno.

Florida, one of the hardest hit states during the foreclosure crisis, experience the revitalization last year, which now is moving to the West Coast. Growth has slowed, but Florida’s real estate market has steadied. “Stabilization is good for any market,” Reynolds said. “… Overall, if you look at Florida as a state, there’s a lot more stability. There are more healthy markets than there were last year.”

Reno and Nevada still are burdened with high unemployment rates and foreclosure rates, which could stall the local recovery. Atlanta also was selected as the other boom town, jumping 23 places to No. 15 in the second quarter.

The top turnaround town was Phoeniz-Mesa, Ariz., followed by Oakland, Calif., and Miami during the second quarter.

S. Florida lags on housing rebound

California communities dominate US recovery

While South Florida housing markets are improving, they're losing ground as "turnaround towns."

California communities dominate Realtor.com's top 10 metro areas with the most impressive recoveries from the housing collapse.

AlthoughMiami-Dade Countyranks third, it's the only Florida metro to crack the quarterly list, dropping from No. 2 in the first quarter.

The list is based on a handful of factors, including recent price increases and the decline in the number of homes for sale. As the housing recovery broadens nationwide, the turnaround towns list becomes harder to make.

"It doesn't mean that Florida isn't in a good spot," said Jill Kipnis, a spokeswoman for Realtor.com. "It just means that some of these markets out west are seeing larger signs of a recovery, so they're higher on the list this time."

Phoenix ranked first, and the other metros in the top 10 are: Oakland; Boise City, Idaho; San Jose; Seattle; Bakersfield; San Francisco; Fresno and Santa Barbara.

In the first quarter, seven Florida markets made the top 10. The real estate website began compiling the list last fall.

Prices in South Florida started falling in 2006, ushering in an economic recession, and the declines continued for the next several years. Sales slowed dramatically as buyers were hesitant to enter a falling market.

But eventually prices reached a level of affordability that was too good to ignore. With sales increasing, values began to stabilize last year. The glut of homes for sale subsided, and now buyers complain that they don't have enough choices.

Real estate agents and some analysts say that the region's housing market has hit bottom. Bidding wars are common as competition among buyers intensifies.

"I'm working with three buyers, and I can't find them a flippin' house," said Marisa DiLenge, an agent with Better Homes & Gardens in Broward.

Jim Heidisch, a broker with Campbell & Rosemurgy in Pompano Beach, said Tuesday that single-family homes priced at $500,000 and less are especially in demand. "The phone rings off the hook for showings, and in some cases there are multiple offers," he said.

Still, some industry observers aren't ready to declare an end to the region's housing woes.

Tens of thousands of South Florida homeowners are unable to sell because they owe more than the properties are worth, said Jack McCabe, a Deerfield Beach analyst.

It could be a decade or more before values rise enough for these "underwater" borrowers to break even in a sale. Meanwhile, they're at risk of foreclosure.

The three-county area still has roughly 130,000 open foreclosure cases, while 190,000 homeowners are at least 90 days late and have yet to enter the foreclosure process, McCabe said.

McCabe said he's "befuddled" that lenders have not inundated the market with foreclosed homes.

"A lot of people have just forgotten about these pending foreclosures," he said. "They're not going away. They'll have to be dealt with."