home market news Archives - Page 4 of 5

Year End Housing Snapshot: Sales Declining Nationally, Knoxville Still Strong

February 1, 2019 By Troy Stavros

Nationally, at the end of 2018, pending home sales fell, possibly due to concerns about the economy and rising home prices, according to a recently released housing index from the National Association of REALTORS®.

Chief economist for NAR, Lawrence Yun said, “The stock market correction hurt consumer confidence, record high home prices cut into affordability, and mortgage rates were higher in October and November for consumers signing contracts in December.”

Compared to a year ago, all four major regions of the U.S. posted declines, with the South posting the largest decrease (the South also had the highest level of sales going in.)

Yun also said, ““The longer-term growth potential is high. The Federal Reserve announced a change in its stance on monetary policy. Rather than four rate hikes, there will likely be only one increase or even no increase at all. This has already spurred a noticeable fall in the 30-year, fixed-rate mortgages. As a result, the forecast for home transactions has greatly improved.”

That being said, one thing we know for certain is that while it’s good to look at what is happening nationally, real estate is local. Knoxville has fared better than what the information above would have you think. While the South showed the biggest decrease, that isn’t true everywhere as witnessed in the images below.

This first image relates to the national numbers:

This next image looks at the same timeline of December, comparing LOCAL Pending Sales and Median Sales Price by County (December 2018 vs. December 2017):

This last image looks at the year to date numbers comparing single family home sales and median sales price, locally by county 2018 vs 2017:

Wondering how your specific subdivision, neighborhood, or your personal home has fared? Just contact me, Troy Stavros with CornerStone Realty Associates and I’d be happy to go over those with you!

There Is No Bubble To Burst. Partly Thanks To New Lending Standards.

December 16, 2018 By Troy Stavros

Real estate is shifting to a more normal market; the days of national home appreciation topping 6% annually are over and inventories are increasing which is causing bidding wars to almost disappear. Some see these as signs that the market will soon come tumbling down as it did in 2008.

As it becomes easier for buyers to obtain mortgages, many are suggesting that this is definite proof that banks are repeating the same mistakes they made a decade ago. Today, we want to assure everyone that we are not heading to another housing “bubble & bust.”

Each month, the Mortgage Bankers’ Association (MBA) releases a measurement which indicates the availability of mortgage credit known as the Mortgage Credit Availability Index(MCAI). According to the MBA:

“The MCAI provides the only standardized quantitative index that is solely focused on mortgage credit. The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.).” *

The higher the measurement, the easier it is to get a mortgage. During the buildup to the last housing bubble, the measurement sat at around 400. In 2005 and 2006, the measurement more than doubled to over 800 and was still at almost 600 in 2007. When the market crashed in 2008, the index fell to just over 100.

Over the last decade, as credit began to ease, the index increased to where it is today at 186.7 – still less than half of what it was prior to the buildup of last decade and less than one-quarter of where it was during the bubble.

Here is a graph depicting this information (remember, the higher the index, the easier it was to get a mortgage):

Bottom Line

Though mortgage standards have loosened somewhat during the last few years, we are nowhere near the standards that helped create the housing crisis ten years ago.

*For more information on the MCAI, including methodology, FAQs, and other helpful resources, please click here.

Where Are Home Prices Headed Over The Next 5 Years?

August 15, 2016 By Troy Stavros

Today, many of my Knoxville real estate conversations center on housing prices and where they may be headed. That is why I like the Home Price Expectation Survey.

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts, and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey:

Home values will appreciate by 4.5% over the course of 2016, 3.6% in 2017 and about 3.2% in the next two years, and finally 2.9% in 2020 (as shown below). That means the average annual appreciation will be 3.5% over the next 5 years.

The prediction for cumulative appreciation increased slightly from 24.7% to 26.3% by 2020. The experts making up the most bearish quartile of the survey are still projecting a cumulative appreciation of 11.1%.

Bottom Line

Individual opinions make headlines. I believe the survey is a fairer depiction of future values. If you are interested in a quick estimate of what your home is worth right now CLICK HERE. For a pinpoint value or to talk about getting your home sold, contact me, Troy Stavros with Gables & Gates, REALTORS at 865-777-9191. I look forward to hearing from you!

Where Are Home Values Today Compared To The Peak in 2008?

August 10, 2016 By Troy Stavros

This housing market has many people talking about home values; where they are and where they are headed. It’s also interesting to look back and see how home prices compare to values prior to the housing crisis.

Every quarter, Freddie Mac releases their House Price Index. The index usually provides monthly home values for:

the nation as a whole
each of the 50 states
367 metropolitan statistical areas

This quarter, the report also included a look at today’s home values as compared to Pre-2008 values. Here is a graphic that breaks down the numbers on a state-by-state basis:

Interested in finding out how much your Knoxville area home is currently worth? CLICK HERE FOR AN INSTANT ESTIMATE. Want a pinpoint value or want to talk about getting your home on the market? Call me, Troy Stavros with Gables & Gates, REALTORS today at 865-777-9191 to schedule a time to talk.

Home Sales Are Up In All Price Ranges Above $100,000!

August 9, 2016 By Troy Stavros

The National Association of Realtors’ most recent Existing Home Sales Report revealed that home sales were up rather dramatically over last year in five of the six price ranges they measure.

Homes priced between $100-250K showed a modest increase at 3.4%. This not only points to the lower inventory of homes available for sale in this price range but also speaks to the overall strength of the housing market.

Sales of homes over $250,000 increased by double digit percentages with sales in the $750,000- $1 million range showing the largest increase, up 16.7%!

As prices in many markets continue to accelerate, it is no surprise to see the percentage of homes in the higher price ranges increasing.

Here is the breakdown:

What does that mean to you if you are selling?

Houses are definitely selling. If your house has been on the market for any length of time and has not yet sold, perhaps it is time to sit with your agent and see if it is priced appropriately to compete in today’s market. Have questions? Want to get your home on the market? Contact me, Troy Stavros with Gables & Gates, REALTORS at 865-777-9191 to setup a time to talk!

Home Sales Reportedly Dropped Last Month. Is That Accurate?

December 28, 2015 By Troy Stavros

Last week, the National Association of Realtors (NAR) released their latest Existing Home Sales Report which covered sales in November. The report revealed that sales:

“…fell 10.5 percent to a seasonally adjusted annual rate of 4.76 million in November (lowest since April 2014 at 4.75 million)…”

That report gave birth to a series of industry articles, some questioning whether the housing market was slowing. The truth is, there is one rather simple explanation to much of the falloff in sales last month. It is likely the implementation of the “Know Before You Owe” mortgage rule, commonly known as the TILA-RESPA Integrated Disclosure (TRID) rule, which went into effect on October 3. These regulations caused house closings to be delayed by an extra three days in November as shown in the graph below.

Three days might not sound like a big deal. However, since there are only aabout 20 days in a month that a closing would normally take place (Mondays through Fridays), losing three days constitutes well over 10% of all closings. These sales aren’t lost, they’ve just moved into the next month’s numbers. In a DS News article on the subject yesterday, Auction.com EVP Rick Sharga explained:

“The most likely cause for the weak sales numbers is a delay in processing loans due to the new TRID mortgage requirements imposed by the CFPB. This is the biggest change in mortgage document processing in many years, and there have been numerous reports within the industry of problems implementing the process and the new documentation that comes with it.”

So how is the housing market actually doing?

A better way to look at how well the housing market is doing, is to look at the Foot Traffic Report from NAR, which quantifies the number of prospective buyers that are actively looking for a home at the current time:

We can see immediately that demand to buy single family homes is increasing over the last few months – not decreasing.

What does this mean for you?

No matter what last month’s sales numbers show, the housing market is still doing well as demand remains strong.