5th Annual Appraisal Summit

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Presentation by Christine M. Todd, CEO of NVAR, at the 5th Annual Appraisal Summit on June 16, 2010. This event took place at the NVAR Herndon Service Center

Presentation by Christine M. Todd, CEO of NVAR, at the 5th Annual Appraisal Summit on June 16, 2010. This event took place at the NVAR Herndon Service Center

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  • 1. Fifth Annual Appraisal Summit Special Presentation by : Christine M. Todd Chief Executive Officer NVAR June 16,2010
  • 2. Have We Hit Bottom? All indicators say" yes” Recovery slow and painful Not all sectors recovering at the same time First-time buyers and cash investors still driving h the recovery
  • 3. 2010: Year of the Comeback! Signs of Improving Local Market g p g Home prices stabilizing with small increases Interest rates on commercial mortgages and construction loans still affordable Investors purchasing inventory with cash I h i i ih h Job losses and unemployment show improvement in our region Economy will continue to expand in 2010 y p Source: Gerald L. Gordon ,PH.D President and CEO, Fairfax County Economic Development Authority
  • 4. Housing Outlook 2010 2008 2009 forecast Existing Home Sales 4.9 49m 5.2 52m 5.4 54m New Home Sales 485 k 375 k 400 k Home Price Growth -10% -13% 2% to 3% Mortgage Rate M t R t 6.1% 6 1% 5.1% 5 1% 5.3% 5 3% Consumer confidence Down Down Up about home buying Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 5. 500,000 500 000 2.1 illi 2 1 million new starts in VS In 2006 2010
  • 6. Future Housing Shortage? Year Y Housing Starts H i St t Historical Normal Hi t i l N l Cumulative C l ti Surplus/Deficit 2003 1.85 million 1.6 million + 0.25 million 2004 1.95 million 1.6 million + 0.60 million 2005 2.07 million 1.6 million + 1.07 million 2006 1.81 million 1.6 million + 1.28 million 2007 1.34 million 1.6 million +1.02 million 2008 0.90 million 1.6 million + 0.32 million 2009 0.55 million 1.6 million ‐ 0.73 million 2010 forecast 0.68 million 1.6 million ‐1.65 million 2011 forecast 0.95 million 1.6 million ‐ 2.30 million Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 7. 3 Factors Sustaining Foreclosures Ongoing Resets of Payment Terms Loss of Borrower Income L fB I Depressed Home Values
  • 8. Sample Markets with Price Increases % change from one year ago 16 14 12 10 8 6 4 2 0 San Diego Orange Cty Boston Houston Buffalo Washington Columbia Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 9. Recent National Pending Home Sales (year-over-year % change) Tax Credit Help to Sales Despite 3 7 million job losses 3.7 40 30 20 10 0 07 r 20 Ap r 20 Ap r ul 08 ul ul 20 Jan 20 Jan 20 Jan an t t t 20 Ap 20 Oc 20 Oc 20 Oc -10 -J -J -J -J - - - - - - - - - 08 09 07 08 09 07 07 08 09 09 10 20 20 20 20 -20 -30 Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 10. Road to Stabilization… Existing sales rose to 5.8 million annualized pace 58 PENDING SALES for April very strong (tax credit) New Home sales are up double-digit % last year
  • 11. PROCEED WITH CAUTION Temporary slump for May and June (no tax credit) Annualized sales pace may fall to 4.5 million 5.5 5 5 million unit sales needed for full recovery 7 million units were sold in 2005, record high 5.5 illi 5 5 million unit sales same as 2001 it l 4.9 in 2008 5.2 in 2009 Remember we are at 5.8 today
  • 12. PRICES starting to stabilize NVAR statistics on prices Record high $569,826 JUNE, 2007 Record low $376,669 JAN, 2009 2010 average sales price ¼ $429,605 May average sales price $460,828 $
  • 13. PENDING SALES APRIL 2010 3 011 3,011 MAY 2010 1 901 1,901 June and July contracts, critical data needed to project if recovery is i real! l!
  • 14. FUTURE HOME PRICES Dr. Yun Dr Yun, NAR Chief Economist Over next 5 years sales to rise 2% annually Fueled b F l d by second-home market dh k t PRICES “at best price appreciation will be beat CPI inflation by 1% point”
  • 15. Distressed Home Sales Foreclosed 35 30 25 20 15 10 Short-Sale 5 0 Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 16. April Metro Area Single Family Home Sales and Prices All data reported here is unadjusted for seasonality % Change from 1  Median Price Year Ago # MSA Apr‐09 Apr‐10 Price Sales 1 Atlanta 112,500 120,800 7.4% 6.0% 2 Baltimore 242,200 245,900 1.5% 33.9% 3 Boston 319,000 340,600 6.8% 41.8% 4 Cincinnati 120,000 129,400 7.8% 33.7% 5 Dallas 139,400 150,300 7.8% 29.1% 6 Houston 149,400 153,800 2.9% 26.6% 7 Indianapolis 106,400 124,600 17.1% 22.2% 8 Kansas City 133,600 143,300 7.3% 32.8% 9 Miami/Ft. Lauderdale / 196,000 , 225,000 , 14.8% 16.2% 10 Minneapolis 153,000 169,800 11.0% 17.1% 11 New Orleans 152,900 156,900 2.6% 16.4% 12 New York 370,800 381,200 2.8% 39.6% 13 Philadelphia p 210,700 , 215,200 , 2.1% 34.1% 14 Phoenix 124,500 144,700 16.2% ‐0.7% 15 Pittsburgh 119,500 122,500 2.5% 42.2% 16 Portland 245,500 245,300 ‐0.1% 49.2% 17 San Antonio San Antonio 149,200 143,300 ‐4.0% 4.0% 17.2% 18 San Diego 336,700 388,400 15.4% ‐6.9% 19 St. Louis 121,100 134,300 10.9% 7.8% 20 Washington DC 296,100 * 318,300 7.5% 18.2%
  • 17. Dr. Yun’s predictions “Over the next 12 months, I will O th t th ill be watching Lexington, KY and Lexington Washington, DC to outperform the rest of the country”!
  • 18. Commercial Real Estate…Lagging Lagging behind economic recovery Investment activity still down (where did it go?) Credit i ill i h C di is still tight High vacancy rates keep rents competitive NOTE: lowest multi-family vacancy rates will be in multi family San Jose, Pittsburg and Washington, DC.
  • 19. MRIS Introduces Market Watch Videos Visit the statistic page on MRIS com and look at the map of the MRIS MRIS.com service region. Simply click on the area of the map for which you want to see the video, and a viewer will appear.
  • 20. Fairfax County, Fairfax City, Arlington County, Alexandria & Falls Church Statistics as of May, 2010 2010 2009 % Change Sold Volume: $901,840,808 $781,162,490 15.45% Avg. Sold Price: $460,828 $433,257 6.36% Median Sold Price: $404,000 $375,000 7.73% Total Units Sold: 1,957 1,803 8.54% Avg. Days on Market: g y 40 76 -47.37% Avg.List Price Solds: $479,219 $467,995 2.40% Avg. Sale Price/List: 96.16% 92.58% Total Month Contract 1901 2637 Total NEW listings 2482 2857 Active Listings 7710 8050
  • 21. NVAR.COM NVAR COM Market Statistics Monthly Reports Quarterly Rental S i i Q l R l Statistics Annual Sales Summary y Year-End Report Quarterly T d i H i P bli ti Q t l Trends in Housing Publication
  • 22. Monthly Average Sold Price (Northern Virginia) $600,000 $550,000 Avg. Sold Price 2000 Avg. Sold Price 2001 $500,000 Avg. Sold Price 2002 $450,000 Avg. Sold Price 2003 g Avg. Sold Price 2004 $400,000 Avg. Sold Price 2005 $350,000 Avg. Sold Price 2006 g Avg. Sold Price 2007 $300,000 Avg. Sold Price 2008 $250,000 Avg. Sold Price 2009 Avg. Sold Price 2010 $200,000
  • 23. Prince William County, Manassas City &Manassas Park City Statistics as of May, 2010 2010 2009 % change Sold Dollar Volume:  $191,632,409  $198,361,135  ‐3.39% Average Sold Price:  $268,393 $226,698 18.39% Median Sold Price:  $240,000 $190,000  26.32% Total Units Sold:  714 875 ‐18.40% Avg. Days on Market:  32 78 ‐58.97% Avg. List Price Solds:  $276,768  $242,551 14.11% g / Avg Sale Price/List:  96.97% 93.46% Total Month Contract 726 1290 Total NEW listings  Total NEW listings 889 1096 Active listings 2947 3128
  • 24. Loudoun County Statistics as of May 10,2010 2010 2009 % Change Sold Volume: $194,055,307 $160,436,664 20.95% Average Sold P i A S ld Price: $416,428 $416 428 $366,294 $366 294 13.69% 13 69% Median Sold Price: $365,000 $324,500 12.48% Total Units Sold: 466 438 6.39% Avg.Days on Market: 44 86 -48.84% Avg. List Price Solds: $438,245 $394,569 11.07% Avg Sale Price/List g / 95.02% 92.83% Total Month Contract: 455 663 Total NEW listings 706 714 Active listings 2373 2338
  • 25. Springfield Zip Code 22150 Statistics as of May ,2010 2010 2009 % Change Sold Volume: $8,629,703 $11,829,501 -27.05% Average Sold P i A S ld Price: $308,204 $308 204 $303,321 $303 321 1.61% 1 61% Median Sold Price: $315,000 $270,000 16.67% Total Units Sold: 28 39 -28.21% Avg.Days on Market: 31 93 -66.67% Avg. List Price Solds: $313,330 $326,982 -4.18% Avg Sale Price/List g / 98.36% 92.76% Total Month Contract: 29 54 Total T l NEW listings li i 24 38 Active listings 86 54
  • 26. 2010 2009 % Change Sold Volume: $12,752,500 $18,700,720 -31.81% Avg.Sold Price: $289,830 $316,961 -8.56% Median Sold Price: $265,000 $282,000 -6.03% Total Units Sold: 44 59 -25.42% Avg.Days on Market: 34 67 -49.25% Avg.List Price for Solds: $301,952 $333,897 -9.57% Avg Sale Price/List 95.99% 94.93% Total Month Contract: 38 88 Total NEW listings: 52 85 Active Listing 172 242
  • 27. 10,000 8,733 7,688 8,000 8 000 7,205 , 5,659 5,421 6,000 4,000 2,000 0 2005 2006 2007 2008 2009
  • 28. 2010 Active Listings May 14,000 14 000 11,554 12,000 10,240 10,757 10,000 8,050 7,710 8,000 6,000 3,395 4,000 2,000 0 2005 2006 2007 2008 2009 2010
  • 29. SUPPLY and DEMAND ACTIVE LISTINGS for MAY 2010 7,710 2009 8,050 2006 11,554 (record hi h) 11 554 ( d high) 2004 2,877 (record low) , ( )
  • 30. 2010 Sold Listings May 3,500 3,045 2,894 3,000 3 000 2,500 2,069 2,000 1 816 1,724 1 803 1,957 1,816 1,803 , 1,500 1,000 500 0 2004 2005 2006 2007 2008 2009 2010
  • 31. 2010: Under Contracts (May) 3,000 2,637 2,500 2,149 2,043 2,166 1,901 2,000 1,500 1,000 500 0 2006 2007 2008 2009 2010
  • 32. 2010 Average Sales Price (NVAR) May Record High- $578,689 (Ju e 2006) eco d g $5 8,689 (June 006) Record Low- $376,669 (January 2009) 600,000 $553,618 $549,197 $478,672 $460,828 500,000 $433,257 400,000 300,000 200,000 100,000 0 2006 2007 2008 2009 2010
  • 33. Tax Credit was Huge Success 1 million additional buyers y 1 million fewer inventory Reduced months supply by 2 to 2.5 months 25 Correspond to price impact of 5% to 8% points Preserved Housing Wealth (mostly middle-class) P d H i W lth ( tl iddl l ) by nearly $1 trillion Limit future foreclosures Source: Lawrence Yun, Ph.D.,Chief Economist and Senior Vice-President of NAR
  • 34. Total Sold Volume(in billions) 18 15.7 16 14 12 $11.0 $11 0 $9.7 10 $8.0 $8.2 8 6 4 2 0 2005 2006 2007 2008 2009
  • 35. Benefits of Living in Fairfax County Unemployment rate is only 4.5% U l t t i l 4 5% Our h l O schools provide a quality workforce id lit kf Our area has the highest median family income in g y the U.S. Major companies relocated here, VW, Hilton, CSC, j p SAIC……… Listed as one of the safest communities in America Source: Jerry Gordon, President and CEO of the Fairfax EDA
  • 36. Job Change by Sector (Jan 2009 – Jan 2010) Washington MSA (000s) Total ota - 29,200 9, 00 Govt. sector grew more than expected Prof. & Bus. Svcs -5 Federal Govt. 17 Educ & Health Svcs 3 State & Local Govt -7 7 Retail Trade -2 Leisure & Hosp. 1 Construction -13 13 Other Services -2 Financial -6 Information -6 6 Manufacturing -4 Wlse Trade -3 Transp. & Util. -3 -20 -15 -10 -5 0 5 10 15 20 Source: BLS March 2010 Benchmark, GMU Center for Regional Analysis
  • 37. 50% 45% Northern Virginia 40% 35% Suburban MD 30% District Sub. MD. 25% N. Virginia 20% D.C D C. 15% 10% 1970 1975 1980 1985 1990 1995 2000 2005 Source: GMU Center for Regional Analysis
  • 38. Well –Intended Policy Gone Bad Appraiser getting paid less Appraiser not familiar with properties Consumers paying higher fee Home b H buyers wanting to buy but cannot ti t b b t t NAR working with GSEs on appraisal policies
  • 39. NAR Influence A new consumer-protection agency-armed with broad powers to rein in bad mortgage products and predatory lending practice d t d d t l di ti anywhere in the country is now a certainty Uniform minimum standards for mortgages and underwriting practices.
  • 40. NAR Influence Real estate appraisal improvements, Terminate HVCC
  • 41. Increase “Call To Action” participation p p “Preserve the wealth of the Middle Class” Team up with NAHB ea Verify money spent on each new home purchase helping the economy y Target legislatures in states hardest hit by housing recession
  • 42. NAR Urges Senate to Pass present home-buyer tax credit extension closing deadline to Sept. 30. NAR Praises House Passage of FHA Reform Bill th t would allow R f that ld ll the Federal Housing Administration to adjust monthly premiums on mortgage insurance. dj hl i i
  • 43. Did you pay your fair share? y p yy Agent- $40 Broker- $99
  • 44. Realtors® Federal Credit Union www.realtorsfcu.org
  • 45. Health Insurance Realtors® Core Health Insurance Plan Gua a eed acceptance Guaranteed accep a ce Low cost starting at $70.69 per month Choose any provider www.RealtorsCoreHealthInsurance.com/AE www RealtorsCoreHealthInsurance com/AE
  • 46. HouseLogic.com Save Money Go Green Engage Maintain your home Mortgage Interest Deduction D d ti Taxes & Incentives Insurance Blog /Articles
  • 47. NAR Realtor Appraisal NAR website offers information and resources to Appraisers such as Appraisal Foundation Appraisal Essentials Appraisal Dashboard How to find an Appraiser FAQ for appraisers about the REALTORS® Guidelines for hiring Appraisers NAR Member Benefits for Appraisers To access more information please visit information, the Realtor Appraisal Site at Realtor.org/Appraisal/ Realtor org/Appraisal/
  • 48. Center for Realtor Technology Releases Appraisal Dashboard NAR’s Center for Realtor Technology (CRT) recently released an Appraisal Dashboard. CRT takes ideas that come from the field and tries to make useful technology applications from those ideas. The CRT blog indicates that this tool came from an idea that an appraiser had and took to the Minneapolis MLS; their main tech person then took this idea to CRT who helped h l d create the application. t th li ti The Appraisal Dashboard is a PHP based web application that connects to live MLS data that provides a graphical search and display interface. You can then export the data into the Uniform Residential Appraisal Report or p pp p MISMO format. It is a free NAR member benefit and the software can be downloaded at http://www.crt.realtors.org/cms/project/appraisal-dash
  • 49. Get Insights Without Looking Have Real Estate INSIGHTS delivered to your e-mail box as soon as new content is posted each month. It's free to members as well as non-members! Subscribe in the "My Account" section of Realtor.org. y g There s There’s always more “INSIGHT-”full info. We will continue INSIGHT full over the next several months to upgrade and update Real Estate INSIGHTS. In the meantime, remember to click on the special “For more info” arrow icons throughout this p g issue. By clicking on this icon when reading INSIGHTS, you can automatically link to another web site for more detailed information. http://www.realtor.org/research/reinsights
  • 50. The median age of Realtors® is 54. The majority of members are women with college education. The typical member has been in the business for 10 years.
  • 51. Where do our members work? Non-franchised Franchised subsidiary subsidiary of a F hi d b idi Other of a national or national or regional corporation 1% regional corporation 9% 4% Independent, non- franchised company Independent, franchised 54% company 32%
  • 52. Where to Find Your Copy? Who are REALTORS®? Economic, demographic, education , tenure, agency relationship and compensation of REALTORS® are p broken down. In addition, this report takes an in-depth look at office affiliation, type of firm, as well as the use of the Internet and ll h f h d technology. Please visit Realtor.org/store for more information
  • 53. NVAR’s New GREEN Building
  • 54. Thank You! Please attend: • Annual Economic Summit 1 • September 16 (8:30 am to 12:30PM) • Northern Virginia Community College 2 • Annual Convention & Trade Show • October 12 (7:30 am to 5:00 PM) • Northern Virginia Community College