San Francisco Chronicle
Shortage of California homes up for sale After years of having too many homes and not enough buyers, real estate agents in California now have the opposite problem – too many buyers and not enough homes for sale.
Making sense of the story
- The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported Monday that its statewide inventory of unsold homes index for existing, single-family detached homes fell to 3.2 months in August from 3.5 months in July and 5.2 months in August 2011.
- The index reflects the number of months needed to sell the supply of homes on the market at the current sales rate. A six- to seven-month supply is considered normal. When the number goes higher, inventory is plentiful and it’s considered a buyer’s market. When the number goes lower, the advantage goes to the seller.
- Declining inventory helps explain why the statewide median price of an existing, single-family detached home rose to $343,820 in August, up 3 percent from July and up 15.5 percent from August 2011, according to C.A.R.
- Nationwide, the inventory of homes for sale also has declined. In July, there was a 6.4-month supply of homes compared with 9.3 months in July 2011. The current number is in line with the long-term average, according to the NATIONAL ASSOCIATION OF REALTORS®. However, NAR also acknowledges there are “acute shortages” in places such as California, Arizona, Nevada, and parts of Florida.
- Also constraining supply is the fact that so many homeowners are underwater – or owe more than their homes are worth – and unable to sell without taking a loss. As prices rise, more homes will increase in value, but it’s going to take time. Meanwhile, there are still a lot of homes that are not likely to come onto the market.
- At some point, the balance will tip, but it’s hard to predict when. When banks decide prices are high enough, they will start unloading houses they have been sitting on, according to the chief economist for Trulia.
Los Angeles Times Two-thirds of Americans with mortgages pay 5 percent interest or higher Rougly 69 percent of American homeowners with mortgages at the end of the second quarter had rates of 5 percent or higher and about 33 percent of them had rates above 6 percent, according to mortgage data by CoreLogic.
The Wall Street Journal
For-sale listings drop again, led by California cities Inventories fell in August by 1.2 percent from July, bucking a seasonal pattern of a slight uptick before the summer season ends. Listings were down by 18.7 percent from one year ago and 34.1 percent from two years ago, according to a report from Realtor.com.
Housing recovery blossoms The Census Bureau said housing starts and permits rose substantially in August. Separately, sales of previously occupied homes climbed 7.8 percent from a year ago, according to the NATIONAL ASSOCIATION OF REALTORS®.
Survey finds most investors will increase or maintain activity A joint survey by BiggerPockets.com and Memphis Invest found that 65 percent of active real estate investors plan to buy as many or more residential properties in the next 12 months as they did in the past. The percentage translates to 4.5 million investors.
The New York Times
Life after bankruptcy Many people who file for bankruptcy think that it will be many years before they can obtain a mortgage or refinance an existing home loan, if they ever can – perhaps because notice of a bankruptcy filing typically stays on a credit report for seven to 10 years. In reality, they could become eligibile in as little as one year, as long as they work diligently to improve their financial picture.
Mortgage rates at record low again Freddie Mac’s weekly survey of mortgage rates showed the average 30-year fixed-rate mortgage fell to 3.49 percent from 3.55 percent the previous week. That matched the previous record low set in July. The fixed-rate 15-year mortgage reached a new record low of 2.77 percent, down from 2.85 percent a week earlier.