Foreclosures fall in 62% of US cities

Source: CNNMoney

Foreclosures fell in nearly two-thirds of the nation’s largest metro areas during the third quarter, according to RealtyTrac Thursday. The recent data suggests the housing market is beginning to rebound. Photo: Robyn Beck/APP/Getty Images

Foreclosures fell in nearly two-thirds of the nation’s largest metro areas during the third quarter, according to RealtyTrac Thursday.

With 62% of the nation’s 212 largest markets seeing foreclosure activity shrink during the latest quarter, the ongoing decline is yet another sign that the housing market is starting to stabilize.

During September, foreclosure activity in 58% of the major metro markets had even dropped below September 2007 levels.

The numbers indicate that “most of the nation’s housing markets are past the worst of the foreclosure problem,” Daren Blomquist, RealtyTrac’s vice president said in the report.

Major cities like San Francisco, Detroit, Los Angeles, Phoenix and San Diego saw foreclosures fall by double-digit percentages of 26% or more.

Stockton, Calif., which saw a 21% decline in foreclosures, still managed to claim the nation’s highest foreclosure rate, however. “That foreclosures there are still the highest in the country speaks to how severe the problem was,” said Blomquist.

Other California cities in the top 10, all posted year-over-year declines of between 22% and 34%.

Yet, there are still some trouble spots, particularly in Florida.

Blomquist attributed Florida’s problems to the after effects of the robo-signing scandal. Florida is a “judicial state,” where foreclosures get processed through the courts. Lenders hesitated to bring foreclosure cases before a judge until they were confident their paperwork would stand up to the stepped-up scrutiny that followed the scandal. But now that new rules have been put in place through the $25 billion mortgage settlement, they are playing catch-up.

Of the metro areas with the 20 highest foreclosure rates, all are still in California, Arizona, Nevada and Florida, with two notable exceptions. Chicago saw a 34% jump from a year-ago, and had the ninth highest foreclosure rate. Atlanta had the 15th highest rate. The good news there: Foreclosures fell 20% year-over-year.

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Why Home Prices are Rising from the Wall Street Journal

Nick Timiraos of The Wall Street Journal Developments blog recent post titled, Five Questions: Why Home Prices Are Rising, is a great read concerning real estate today. Success in real estate varies by each local market, but the three points below apply to the current market in Atlanta.

Prices in July were 1.2% above their year-ago levels. Photo credit: Associated Press

Home prices through July posted their largest year-to-date rise since 2005, according to the S&P/Case-Shiller index covering 20 major metropolitan areas.

Prices rose by 5.9% from the end of last year, according to the index, compared with a 0.4% gain for the same period last year and a 2.1% gain in 2010, when tax credits fueled a burst of home sales activity.

Are price gains limited to one segment of the market—say, foreclosed properties?

Not really. Data from real-estate firm CoreLogic show that the increases are being felt across all segments of the market. Overall median home prices in August were up by 12% from one year ago, as are median prices of existing homes that aren’t distressed sales.

Median prices of bank-owned foreclosures were up by 3%, while median prices were flat on short sales, where banks approve the sale of a house for less than the mortgage-debt that’s owed. Median prices of new homes, meanwhile, are up by 6%.

There are still a lot of foreclosures. How could prices be rising?

While foreclosures are still high by historic standards, the share of bank-owned foreclosures that are selling is down sharply over the past few years. Listings of foreclosed properties are down by 24% from one year ago and by more than 45% from two years ago.

While sales of foreclosed properties, which typically sell at a discount, have fallen by about 20% from one year ago, sales of traditional homes are up by 16% from one year ago, according to Ivy Zelman, chief executive at research firm Zelman & Associates. Prices, then, are rising not only because supplies of homes for sale are down, but demand is up.

Are banks strategically holding properties off of the market?

There’s little evidence that banks have seen an increase of marketable, or ready-for-sale, foreclosed properties sitting on their books. It’s true that there are still millions of properties that are in the foreclosure process or where borrowers have missed a couple of mortgage payments, and it’s unclear when or how aggressively banks will move those properties through the foreclosure process. In many cases, lenders and other mortgage companies that handle foreclosures have struggled to meet certain state requirements governing foreclosures. But the actual volumes of foreclosed properties that are sitting on banks books are down by around 24% from one year ago.

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‘Normal’ Home Sales Soar

While sales of distressed properties – foreclosures and short sales – have shrunk since the first of the year, a surge in sales of “normal” non-distressed properties has pushed total home sales through June 4.5 percent higher than last year even though buyers face tight credit and low inventories.

With attention focused on extraordinarily tight inventories that have restricted sales during the past six months, marketshare of non-distressed homes are at their highest level since August 2008, a sign of strengthening demand from buyers realizing their time has come to act before prices increase further due to a slowly improving employment picture and greater consumer confidence.

Walk to everything from this sought after street in Virginia Highlands. 890 Drewry Street has been totally renovated with an addition to include a beautiful master suite with large walk-in closet and master bath. Click on the image for more photos and information from Atlanta Fine Homes Sotheby’s International Realty.

During the January to June period, the number of non-distressed sales is up 15 percent over the same period last year, according to CoreLogic.

The increase in non-distressed sales is strengthening prices. Excluding distressed sales, home prices nationwide increased on a year-over-year basis by 3.2 percent in June 2012 compared to June 2011. On a month-over-month basis excluding distressed sales, home prices increased 2.0 percent in June 2012 compared to May 2012, the fifth consecutive month-over-month increase., according to the National Association of REALTORS®.

Both supply and demand are playing a role in the decline of distressed sales and the increase in normal sales. In June, the distressed share of sales fell to 21 percent, the lowest level in almost four years. The months’ supply of distressed properties has been steadily decreasing over the first half of the year and now stands below seven months, equaling the same level of the supply of active listings.

Increased competition for the limited inventory of non-distressed property listings helped push the average home sales-to-listing price ratio to 95.6 percent in June, the highest in three years, according to the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey.

HousingPulse reports that median time on market to sell a non-distressed listing fell sharply in June to 11.7 weeks, a drop of a full week from the May reading of 12.7 weeks. As recently as March, the non-distressed property time on market had been 14.0 weeks. The June 2012 time on market for non-distressed listings is the lowest in over two years and substantially below the June 2011 reading of 15.0 weeks.

Source: RISMedia

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Metro Atlanta’s home bidding wars return

Prices are low, but so is inventory — catching some buyers unaware.

Bidding wars are occurring with desirable homes that feature good public schools, nearby amenities and competitive prices. This home in Milton’s White Columns neighborhood is currently listed by Andrea Cueny for $559,000. Click on the image for more photos and information.

In an age of high foreclosures and rock-bottom home prices, bidding wars are breaking out for some metro Atlanta homes.

The hot competition is spurred by shrinking inventory and a run on homes with one or more desirable traits, such as good public schools, nearby amenities and competitive prices. Buyers also want homes in fully developed subdivisions and in locations that have maintained values, such as Buckhead, south Forsyth County and trendy intown neighborhoods.

Those seeking such homes have been caught unaware.

The competition for homes started in early winter as homes sales rose, and the bidding peaked in March, though multiple bids are still happening.

Source: Atlanta Journal Constitution

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Sellers’ Asking Prices Jumped in May

Source: Wall Street Journal

Median asking prices hit their highest level in 2½ years in May, the latest sign that sellers are feeling brighter about their prospects amid slimmer pickings of homes listed for sale.

Median asking prices rose to $194,400, up 1.9% from April and 3.2% from one year ago, according to data released Wednesday by Realtor.com. Meanwhile, home listings increased by 2% from April, a slower-than-normal seasonal jump, and they stood 20% below their levels of year ago.

Reduced competition for sellers is making it easy for them to push the envelope on price. Compare May’s report with that of one year ago, when median asking prices in May 2011 fell by 1.6% from April 2011.

Meanwhile, the median amount of time that homes listed for sale had been on the market fell to 83 days, down by 9.8% from one year ago.

Here’s a closer look at the report:

Inventory: The number of homes for sale fell in all but two of the 146 markets tracked by Realtor.com on an annual basis, with inventory rising by 5% in Philadelphia and by 19% in Shreveport, La.

Nearly half of all markets saw a 20% year-over-year drop in the number of homes listed for sale, led by Oakland, Calif. (down 56.6%); Fresno, Calif. (48.8%); Bakersfield, Calif. (48.6%); Phoenix (44.7%) and Seattle (42.7%).

On a monthly basis, around three quarters of markets say inventories rise in May.

Prices: On an annual basis, asking prices fell in 24 markets, led by Reading, Pa. (down 5.4%); Allentown, Pa. (5.3%); and Milwaukee, Wis. (5.2%). The largest year-over-year jumps in median asking prices were reported in Phoenix (up 32.6%), Santa Barbara, Calif. (30.1%), and Chattanooga, Tenn. (up 24.1%). Median prices can overstate big swings because they may instead reflect a change in the mix of sales.

Median list prices fell on a monthly basis in just 17 markets, led by Daytona Beach, Fla., and Asheville, N.C. (down 1.4%), and were unchanged in another 35. They rose from April’s levels by 19% in Santa Barbara, Calif., and by 10% in Oakland.

The Realtor.com figures include sale listings from more than 900 multiple-listing services across the country. They don’t cover all homes for sale, including those that are “for sale by owner” and newly constructed homes that aren’t always listed by the services.

Click here to use the Wall Street Journal interactive graphs in order to compare figures for metro areas throughout the US.

In Metro Atlanta

FMLS recently released the May 2012 active inventory data for Metro Atlanta.

Active inventory level for Residential Single Family Detached continues to drop with 22,142 active listings as of the end of May 2012 vs. 33,860 active Residential Single Family Detached listings as of the end of May 2011. This represents drop in active inventory for Residential Single Family Detached of 35%.

Active inventory level for Residential Single Family Attached continues to drop with 3,883 active listings as of the end of May 2012 vs. 6,477 active Residential Single Family Attached listings as of the end of May 2011. This represents drop in active inventory for Residential Single Family Attached of 40%.

There were 11,466 new listings entered for all property types in May 2012 vs. 12,895 new listings entered for all property types in YTD May 2011. Total new listings entered for all property types in YTD 2012 was 58,081 vs. 65,216 new listings entered for all property types in YTD 2011.

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Shortage of homes for sale creates fierce competition

With housing inventory at a low, would-be buyers are scrambling to bid on homes before they’re even listed, and real estate agents are vying to represent the few sellers that do exist.

The newest problem for the slowly improving housing market isn’t a shortage of serious buyers, it’s a shortage of good homes.

Only blocks from Atlanta/Midtown’s Piedmont Park, this renovated home located at 356 6th Street has beautiful hardwood floors and an exposed hardwood ceiling in this cozy living room. No longer on the market, it was offered at $415,000 by Andrea Cueny of Atlanta Fine Homes Sotheby’s International Realty. Click on the image to search for homes for sale in Atlanta’s intown neighborhoods.

Would-be buyers are packing open houses and scrambling to make offers on properties before they are even listed. Bidding wars are erupting. And real estate agents are vying fiercely to represent the few sellers that do exist.

Housing inventory has sunk to levels not seen since the bubble years. The number of American homes with a “for sale” sign hit 2.5 million in April, the lowest number for an April since 2006, according to the National Assn. of Realtors.

David Dennick, who lives in Echo Park and works as a television editor, has been searching for a home with his wife, Denise, for about two months. The couple have already bid on three properties. They are hoping to find a home for less than $525,000, which is $25,000 more than they originally had hoped to spend.

“It is much more competitive than we thought,” said Dennick, standing in the entrance of an Eagle Rock open house on a recent Sunday. “It is just frustrating because we thought we would really be able to buy a house; we are a middle-class family.”

The sharp drop in inventory along with rock-bottom interest rates have helped stabilize even some of the hardest-hit markets, including the Southland, Las Vegas, Phoenix and Miami. Some real estate professionals are concerned that the lack of inventory might turn off potential buyers, stifling the recent recovery.

Located in ideal Alpharetta swim/tennis neighborhood with award winning schools, this renovated home located at 4210 Breckenridge Court has beautiful hardwood floors and a dream kitchen. No longer on the market.Click here to search for homes for sale in Alpharetta. 

The much-predicted foreclosure wave that was expected to dump more homes onto the market has not materialized. Fewer borrowers are entering default, and banks are better managing the properties they do have on their books.

In addition, professional investors bankrolled by private equity firms and hedge funds are pouncing on bank-owned homes, often turning them into rentals.

A dearth of new construction also is constraining supply. In April — the most recent month for which figures are available — the number of completed new single-family homes available for sale stood at 46,000, the lowest level since the Census Bureau began keeping track in 1973. Some 70,000 were under construction, also near historic lows.

The inventory problem has been exacerbated by the plunge in home prices since the go-go years. Many people who bought at the top of the cycle are so deeply underwater, they can’t get the price they need to sell and are therefore not bothering to put their homes on the market.

Source: Los Angeles Times

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10 US Metros with Greatest Drop in For Sale Inventory

U.S. housing market trends tracked by Realtor.com show a trifecta of promise: a shrinking number of homes on the market, fresher inventory, and an increase in median list price.

In 146 metros tracked by Realtor.com, the number of for-sale listings was down 21 percent in March compared to a year ago. All but two markets — Philadelphia and Hartford, Conn. — saw listing inventory decline, and 78 markets registered declines of 20 percent or more.

Nationwide, the median number of days a home had been on the market was down nearly 20 percent, to 89 days, and median list price was up 5.6 percent, to $189,900.

1. Oakland, CA
2. Bakersfield, CA
3. Phoenix-Mesa, AZ
4. Fresno, CA
5. Miami, FL
6. Fort Lauderdale, FL
7. Seattle-Bellevue-Everett, WA
8. Atlanta, GA

9. Orlando, FL
10. Portland, OR and Vancouver, WA

Data collected and analyzed by Realtor.com through March 2012. Includes single-family homes, condos, townhomes and co-ops. Source: InmanNews

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Stabilizing Metro Atlanta Areas

Scott Murphy, Atlanta Apprasier

I recently consulted with Scott Murphy, appraiser with D.S. Murphy & Associates, as I have clients relocating here that are looking for newer construction in a family friendly neighborhood with amenities and superb public schools. I knew that Scott would know of any areas outside of North Fulton and South Forsyth, where we had already been hunting. Scott shared the information below with me:

Andrea,

Always a pleasure to be in your office and thanks for  your questions!

You are right on point. The only areas we are seeing steady stabilization is north Fulton and south Forsyth. We do a lot of foreclosure appraisal and pre-foreclosure appraisals – 30-40% are in Stone Mountain/Lithonia; 20% in south Fulton; 10% in Gwinnett. These areas are still very unstable and will continue to see far more foreclosures. We see very few pre-foreclosure orders in North Fulton and South Forsyth.

Most new construction in areas other than North Fulton and South Forsyth is existing inventory. Very few of the new construction neighborhoods in these area are moving forward. In contrast, North Fulton and South Forsyth have seen more building permits than any other areas.  Perfect example is Ashton Woods Madison Park – they sold out in a matter of months – selling 20+/month.

Just look at the map of where Ashton Woods is building – there is good reason why they are not building east, west or south of Atlanta.

http://www.ashtonwoodshomes.com/georgia/atlanta/homes-for-sale-in-atlanta.php#

This may sound a little drastic but people from outside Georgia moving in need to realize how bad schools are in Georgia compared to other states. Schools in North Fulton and South Forsyth are excellent and compare favorably with schools around the country but some schools are at bottom of the barrel across the country – look at Clayton County who lost their accreditation a few years ago.

Hope this helps.

Thanks,

Scott

In all, Scott’s information confirmed my thoughts about the stabilizing market, particularly in North Fulton. Education, affordable housing, and job opportunities help drive this stabilization and the increase in new construction.

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Metro Atlanta real estate appraisals: good news for market stabilization (Part 1)

Scott Murphy, Atlanta Apprasier

This is the first post in my four-part series on metro Atlanta real estate appraisals in 2011. Please check back soon to see posts on:  changing regulations, low appraisals on arm’s length purchases, and consultation appraisals.

Valuing real estate has never been an easy task for an appraiser. In the past it was difficult keeping up with steadily increasing value and today it is staying on top of every sale, dissecting it to determine if it is arms length, weeding through REO, Short Sales and other various distressed properties.

Since sales seem to be fewer than in the “glory days” of 2006 and 2007,  (and so many sales are from homes in a “situation”) it is often impossible to arrive at a truly meaningful and supportable value. Adding to the current market conditions, federal appraisal guidelines have changed a lot and the appraisal process is more challenging than ever.

Scott Murphy, appraiser, is seeing a housing stabilization in inventory and foreclosure levels in Atlanta.

The good news is that we are seeing some stabilization in the Metro Atlanta real estate market. The inventory of homes for sale has dropped and the number of foreclosed properties has leveled off a bit. New home construction is happening again.

Atlanta’s real estate market stabilization is due to the huge drop in existing inventory of new homes and the unprecedented decline in the value of vacant land and developed lots. (It is not uncommon to see lots selling for $5,000-10,000 which just 2-3 years ago where selling for $60,000 – 80,000. This drop is just enough to allow a builder to be profitable when building a new home.)

The new homes we are seeing going up are somewhat more modest than those of recent past. Builders are reluctant to build enormous houses on speculation and buyers have had a dose of reality and are looking for smaller, less flashy homes. I feel this sector of the market, new home construction, will grow the quickest over the next 12 months. This should increase jobs which will bolster the economy as well as the real estate market.

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