Reports: Housing Markets Showing Stability

Despite disappointing home sales reports over the past few months, other indicators suggest not only a housing markets stabilizing, many are hitting new peaks.  

Freddie Mac, McLean, Va., released its Multi-Indicator Market Index, showing the U.S. housing market continuing to slowly stabilize with one additional state, Rhode Island, and four additional metro areas entering their outer range of stable housing activity: Philadelphia and Harrisburg, Pa.; Phoenix, and Albany, N.Y.  

The national MiMi value stands at 81, indicating a housing market that is on its outer range of stable housing activity, while showing an improvement of +0.93% from June to July and a three-month improvement of +2.99%. On a year-over-year basis, the national MiMi value has improved +6.17%. Since its record low in October 2010, the national MiMi has rebounded 37%, but remains significantly off from its high of 121.7.  

Other report highlights:  

–Twenty-nine states plus the District of Columbia have MiMi values in a stable range, with the District of Columbia (103), North Dakota (97), Montana (93.7), Hawaii (93.5), and California and Utah tied at (90) and ranking in the top five.  

–Forty-six of the 100 metro areas have MiMi values in a stable range, with Fresno (98.9), Austin (96.4), Honolulu (94.1), and Salt Lake City and Los Angeles tied at (92.9) and ranking in the top five.  

–Most improving states month-over-month were Florida (+2.00%), Colorado (+1.99%), New Jersey (+1.83%), Connecticut (+1.80%) and Nevada (+1.48%). On a year-over-year basis, the most improving states were Florida (+14.35%), Oregon (+13.45%), Nevada (12.18%), Colorado (+11.65%) and Washington (+10.18%).  

–Most improving metro areas month-over-month were Orlando, Fla. (+2.60%), Greenville, S.C. (+2.55%), Cape Coral, Fla. (+2.51%), Tampa, Fla. (+2.19%) and Jacksonville, Fla. (+2.12%). On a year-over-year basis, the most improving metro areas were Orlando (+18.27%), Cape Coral (+17.75%), Tampa (+15.99%), Palm Bay, Fla. (+14.98%) and North Port, Fla. (+14.77%).  

–Forty-nine states and all of the top 100 metros were showing an improving three month trend. The same time last year, 20 of the 50 states plus the District of Columbia, and 59 of the top 100 metro areas were showing an improving three-month trend.  

“Florida has some of the most improving housing markets in the country, largely a reflection of more borrowers becoming current on their mortgage payments as the local employment picture improves and house prices rebound,” said Freddie Mac Chief Economist Len Kiefer. “However, we’ve started to see these housing markets turn around, especially in Pennsylvania, Connecticut, New Hampshire, Vermont and Maine. While many of the locals markets in the Northeast are still weak, they’re steadily trending in the right direction and their pace of improvement is accelerating.”  

In a separate report, RealtyTrac, Irvine, Calif., released its August U.S. Home Sales Report, which showed single-family home and condo sales through August were on pace for an eight-year high nationwide and in 110 out of 204 (54 percent) metropolitan statistical areas.  

The report said 1.947 million single-family homes and condos sold through August in 2015, up 5.4 percent from the same time period a year ago to the highest total for the first eight months of the year since 2007 (2.069 million). The 110 metro areas on pace for at least an eight-year high in home through August included Los Angeles, Phoenix, Dallas, Denver, Riverside-San Bernardino in Southern California, Detroit, Seattle, Tampa, Minneapolis and Portland.  

RealtyTrac said of 204 local markets, 58 (28 percent) were on pace through August to reach nine-year highs in home sales in 2015, while 22 (11 percent) were on pace through August to reach 10-year highs, including Denver, San Diego, Florida markets Sarasota, Naples, and Palm Bay, along with Grand Rapids, Mich. and Reno, Nev.  

“The continued strength in sales volume across a wide spectrum of markets in August indicates that shockwaves from recent global stock market instability have not weakened the housing recovery and in fact there is evidence that the instability has fueled more demand for U.S. real estate,” said Daren Blomquist, vice president of RealtyTrac. “The share of cash sales nationwide in August bounced back from a seven-year low in July, and the month-over-month increase in cash sales share was more pronounced in markets that have traditionally been magnets for foreign cash buyers, including Boston, Las Vegas, San Francisco, Seattle and New York.”  

RealtyTrac said all-cash sales accounted for 24.5 percent of all single-family home and condo sales in August, up from a seven-year low of 23.6 percent in July but still down from 26.7 percent of all sales a year ago and down from a peak of 39.6 percent of all sales in February 2013. Among metropolitan statistical areas with a population of at least 1 million, those with the highest share of cash sales were Miami (48.7 percent), New York (44.7 percent), Las Vegas (42.2 percent), Raleigh, N.C. (39.6 percent), and Tampa (37.6 percent).  

The share of buyers using FHA loans continued to increase in August, when 23.1 percent of all single family and condo sales were to FHA borrowers, up from 23.0 percent in July and up from 17.8 percent a year ago. Among metropolitan statistical areas with a population of at least 1 million, those with the highest share of FHA buyers were Las Vegas (39.0 percent), Riverside-San Bernardino in Southern California (36.5 percent), Baltimore (32.0 percent), Phoenix (31.8 percent) and Atlanta (30.9 percent).  

Among markets with at least 10,000 single-family home and condo sales in the first eight months of 2015, those with the biggest year-over-year increases were Salt Lake City (up 31.6 percent), Portland (up 22.2 percent), Minneapolis-St. Paul (up 19.2 percent), Jacksonville, Florida (up 16.6 percent) and Seattle (up 16.2 percent). Biggest year-over-year decreases among markets with at least 10,000 sales through August were in Cleveland (down 13.8 percent), Baltimore (down 12.1 percent), Cincinnati (down 11.8 percent), Chicago (down 10.4 percent) and New York (down 10.1 percent).  

Distressed sales accounted for 8.9 percent of all single-family home and condos in August, down from 9.3 percent in July and down from 12.2 percent a year ago to the lowest level going back as far as RealtyTrac has distressed sales data, January 2000. Among markets with a population of at least 1 million, those with the highest share of distressed sales were Chicago (16.4 percent), Milwaukee (16.1 percent), Tampa (15.4 percent), Orlando (15.4 percent) and Jacksonville (15.4 percent).  

Sales of homes to institutional investors accounted for 1.0 percent of all single-family home and condo sales in August, up from just 0.3 percent in July but down from 3.2 percent in August 2014. Among markets with a population of at least 1 million, those with the highest share of institutional investor purchases were Tampa (4.7 percent), Jacksonville, Florida (4.1 percent), Charlotte (3.3 percent), Buffalo (2.8 percent) and Orlando (2.7 percent).