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Monthly Market Report - December 2018 from Physicians Agent™ Network

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Monthly Market Report - December 2018 from Physicians Agent™ Network

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Monthly Market Report - December 2018 from Physicians Agent™ Network

  1. 1. DECEMBER 2018
  2. 2. 2019 Forecast
  3. 3. Will Home Prices Continue to Appreciate through 2019? projections of 105 economists, market analysts, and real estate experts 104 1 Yes No BY RAW NUMBERS Yes No BY PERCENTAGE 99%
  4. 4. “You can call it a bubble…but it's not the same. It's more placid. I don't expect a sharp turn in the housing market at this point.” Robert Shiller Nobel Prize Winner co-founder of the Case-Shiller Index
  5. 5. Source 2018 2019 2020 2021 2022 HPES +5.9 +4.2 +2.9 +2.6 +2.9 Zelman & Assoc. +5.5 +4.5 +4.1 N/A N/A MBA +5.8 +4.3 +2.9 +1.9 N/A Freddie Mac +5.1 +4.3 +2.9 N/A N/A NAR +4.7 +2.5 +3 N/A N/A Fannie Mae +5.4 +4.1 +2.2 N/A N/A AVERAGE +5.4 +3.9 +3 +2.3 +2.9 Projected Home Price % Appreciation Going Forward
  6. 6. CoreLogic Forecasted Year-Over-Year % Change in Price
  7. 7. 4.9 5.0 5.2 5.3 Freddie Mac 2019 Q1 Where Are They Going In 2019? January – Today Actual Interest Rates 2019 Q2 2019 Q3 2019 Q4Mortgage Rates Freddie Mac 30-Year Fixed Rate
  8. 8. CoreLogic $1,000 $1,259 $550 $730 $803 $922 $1,000 January 2000 June 2006 February 2012 October 2016 October 2017 Today Projected this time next year National Homebuyers’ “TYPICAL MORTGAGE PAYMENT” Inflation-Adjusted Monthly Mortgage Payment That Buyers Commit To *The typical mortgage payment used for this chart represents the inflation- adjusted monthly payment based on U.S. median sales price and assumes a 20% down payment, a fixed-rate 30-year mortgage and Freddie Mac’s average monthly rte. It does not include taxes or insurance.
  9. 9. 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Median Asking Census RENTsince 1988
  10. 10. $319,200 $6,710 Homeowner Renter Difference in 65+ Adults NET WORTH Homeowner vs. Renter Joint Center of Housing Studies at Harvard University $143,500 is in home equity Joint Center for Housing Studies at Harvard University
  11. 11. The Largest Number of Listings Expire on December 31st
  12. 12. Our House Didn’t Sell! Should We:  FSBO  Wait Until the Spring  List with a New Agent
  13. 13. 7 Reasons NOT to Sell Your Home as a FSBO 1. Hard to Price it Correctly 2. Having a Marketing Plan can be a Challenge 3. Inconvenience of Showing the Home Themselves 4. There is a Legal Liability 5. Be Careful of Scams! 6. Emotional Attachment to the House 7. FSBOs Sell for Less!
  14. 14. 5 7 9 11 13 15 17 19 21 1981 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 FSBOs as a Percentage of all Home Sales The percentage of homes selling as a FSBO has decreased to 7%, the lowest number recorded since 1981. 7%
  15. 15. 0 10 20 30 40 50 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Where Buyers Find the Homes They Purchase Over the Last 15 Years by percentage Newspapers Yard Signs The Internet
  16. 16. 87% 90% 85% 86% 84% 84% All purchasers 37 and younger 38 to 52 53 to 62 63 to 71 72 to 92 NAR Percentage of Home Buyers Who Used an Agent or Broker by age group
  17. 17. By FSBO By AGENT Typical Sold Price FSBO vs. Agent Source: NAR Studies have shown that people are more likely to FSBO in markets with lower price points. $200,000 $264,900 FSBOs Homes Sold by an Agent $
  18. 18. 1,460,000 1,520,000 1,580,000 1,640,000 1,800,000 1,870,000 1,930,000 December 2017 January 2018 February March April May June Inventory Levels this time last year NAR
  19. 19. Why Didn’t Our House Sell?  Condition of the House  Price (Over Priced?)  Marketing Plan  Lack of Communication with your Agent
  20. 20. 66% 18 - 34 73% 35 - 54 87% 55+ 76% All “Given a choice between spending a fixed amount of money on a down payment for a new home or fixing up their current home, most Americans choose renovation.” Zillow Share of Respondents who Choose Renovation by Age
  21. 21. http://www.mykcm.com/eguides This 9-page eGuide looks at expired listings from a whole new perspective. With this guide, you’ll gain a better understanding of the mindset of an expired listing, the 4 options these sellers now have and how to make sure that YOU sell this home before it ever expires again.
  22. 22. Winter Buyer & Seller Guides Launched Friday, November 30th
  23. 23. “Some websites offer a wide swath of information for consumers, but they lack depth. Today we have the power of data science at our fingertips — this is a game-changer. When real estate companies use this kind of information, it empowers consumers with insights they can trust.” Sean Black Forbes Real Estate Council
  24. 24. Resources Slide Slide Title Link 4, 6 Home Prices Appreciating in 2019, Home Price Projections pulsenomics.com, zelmanassociates.com, freddiemac.com, fanniemae.com, mba.org, nar.realtor, corelogic.com 5 Robert Shiller Quote https://www.cnbc.com/2018/10/26/robert-shiller-i-dont-expect-a-sharp-turn-in-the-housing-market.html 7 Forecasted YOY Prices http://www.corelogic.com/about-us/researchtrends/corelogic-home-price-insights.aspx 8 Freddie Mac Interest Rates http://www.freddiemac.com/research/forecast/20180924_economic_growth.html 9 Typical Mortgage Payment http://www.corelogic.com/about-us/researchtrends/the-marketpulse-report.aspx#.Wm9nR6aWzIU https://themreport.com/daily-dose/11-15-2018/going-up-and-up 10 Median Asking Rent http://www.census.gov/housing/hvs/files/currenthvspress.pdf 11 Net Worth of 65+ http://www.jchs.harvard.edu/housing-americas-older-adults-2018 15-16, 18 FSBO Slides https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers- and-sellers 17 Generations Use an Agent http://nar.realtor/reports/home-buyer-and-seller-generational-trends 19 Inventory Levels last year http://www.realtor.org/topics/existing-home-sales 21 Likelihood ofRenovation https://www.zillow.com/research/americans-prefer-renovations-21576 22 Find the Gold in Expired Listings http://www.mykcm.com/eguides 24 Sean Black Quote https://www.forbes.com/sites/forbesrealestatecouncil/2018/11/15/are-these-three-cs-the-key-to-the-real-estate- revolution/ KEEPINGCURRENTMATTERS.COM
  25. 25. Resources Slide Slide Title Link 28, 49, 59 Average Days on Market, Buyer & Seller Traffic Maps https://www.nar.realtor/reports/realtors-confidence-index 29-30, 39-42, 50-55 Existing Home Sales Report http://nar.realtor/ 31-32, 36 Freddie Mac Home Sales http://www.census.gov/construction/nrs/pdf/newressales.pdf http://nar.realtor/ 33-35, 56-57 New Home Sales, Inventory http://www.census.gov/construction/nrs/pdf/newressales.pdf 37-38 Pending Home Sales Report http://nar.realtor/ 43-45 Case Shiller Price Index http://us.spindices.com/indices/real-estate/sp-case-shiller-20-city-composite-home-price-index 46 Forecasted Change in Price http://www.corelogic.com/about-us/researchtrends/corelogic-home-price-insights.aspx 47 Appraisal Challenge https://www.quickenloans.com/press-room/2018/10/09/quicken-loans-study-home-value-perceptions-stable-as-summer-ends/ 60-62 Foot Traffic http://nar.realtor/ 64-65, 67-68 Freddie Mac Rates http://www.freddiemac.com/pmms 66 Mortgage Rate Projections http://www.freddiemac.com/research/forecast/20181127_economic_growth.html http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_112018.pdf https://www.mba.org/Documents/Research/Mtg%20Fin%20Forecast%20Nov%202018.pdf https://www.nar.realtor/sites/default/files/documents/forecast-11-2018-us-economic-outlook-11-02-2018.pdf 70-71 Mortgage Credit Availability https://www.mba.org/news-research-and-resources/research-and-economics/single-family-research/mortgage-credit-availability-index 72-76 Ellie Mae Report https://assets.contentstack.io/v3/assets/blt47a327ac368e22cd/bltdcb07859e9e60e83/5bc68d9eedb71a1476d18676/EM_OIR_SEPTEMBER2018.pdf KEEPINGCURRENTMATTERS.COM
  26. 26. Average Days on the Market NAR
  27. 27. Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Since January 2014 EXISTING Home Sales NAR 12/2018
  28. 28. -2.6% -4.7% -0.9% 0.6% -8.7% U.S. Northeast Midwest West Y-O-Y by region EXISTIN G Home Sales NAR 12/2018 South
  29. 29. Existing Home Sales in thousands Census & NAR January February March April May June July August September October November December 2017 2018
  30. 30. Census & NAR January February March April May June July August September October November December 2017 2018 New Home Sales in thousands
  31. 31. Jun-14 Jan-15 Jan-16 Jan-17 Jan-18 Census New Home Sales annualized in thousands
  32. 32. 6% 8% 36% 23% 12% 9% 7% Under $150K $150-$199K $200-299K $300-$399K $400-$499K $500-$749K Over $750K Census New Home Sales % of sales by price range
  33. 33. 3.2 3.3 3.2 3.4 3.6 3.7 3.1 2.9 2.8 3.1 3.2 3.2 3.4 3.2 3.3 3.7 3.9 3.8 3.7 3.3 3.2 2.9 2.9 2.7 Nov Dec Jan-17 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-18 Feb Mar Apr May Jun Jul Aug Sep Oct Census New Homes Selling Fast (median months from completion to sold)
  34. 34. Census & NAR 364 366 516 503 612 656 561 580 512 507 475 472 361 373 500 521 597 626 575 585 461 January February March April May June July August September October November December 2017 2018 Total Home Sales in thousands
  35. 35. January… January… January… January… January… 100 = Historically Healthy Level PENDING Home Sales since 2014 NAR 12/2018
  36. 36. -6.7% -2.9% -4.9% -4.6% -15.3% U.S. Northeast Midwest South West PENDING Home Sales Year-Over-Year By Region NAR 12/2018
  37. 37. Jan 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Percentage of Distressed Property Sales 35% January 2012 - Today 3% 4% NAR 12/2018
  38. 38. Home Prices
  39. 39. 3.8% 3.0% 2.4% 3.8% 1.9% U.S. Northeast Midwest South West Y-O-Y by region EXISTING Home Prices NAR 12/2018
  40. 40. -10.6% -1.9% 4.6% 0.5% 7.5% 6.5% $0-100K $100-250K $250-500K $500-750K $750K-1M $1M+ % -10.6% -1.9% 4.6% 0.5% 7.5% 6.5% % Change in Sales from last year by Price Range NAR 12/2018
  41. 41. June 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Year-Over- Year PRIC E CHANGE S Case Shiller S&P Case Shiller 12/2018
  42. 42. Year-Over-Year PRICE CHANGES 20 City Composite S&P Case Shiller 12/2018 Case Shiller
  43. 43. 6.3% 6.4% 6.3% 6.4% 6.3% 6.7% 6.7% 6.5% 6.2% 6.0% 5.7% 5.5% Oct Nov Dec Jan 2018 Feb Mar Apr May Jun Jul Aug Sep Year-Over-Year PRICE CHANGES 20CityComposite Case Shiller S&P Case Shiller 12/2018
  44. 44. CoreLogic Forecasted Year-Over-Year % Change in Price
  45. 45. -0.67 -0.50 -0.60 -0.53 -0.36 -0.33 -0.34 -0.25 -0.28 -0.28 -0.29 -0.28 Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov % -0.67 -0.5 -0.6 -0.53 -0.36 -0.33 -0.34 -0.25 -0.28 -0.28 -0.29 -0.28 Quicken Loans Appraiser Home Value Opinions Compared to Homeowner Estimates Last 12 Months
  46. 46. HOUSING INVENTORY
  47. 47. NAR Seller Traffic
  48. 48. Januar y 2011 Januar y 2012 Januar y 2013 Januar y 2014 Januar y 2015 Januar y 2016 Januar y 2017 Januar y 2018 Months Inventory of HOMES FOR SALE 2011 - Today NAR 12/2018
  49. 49. Nov Dec Jan-17 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-18 Feb Mar Apr May Jun Jul Aug Sep Oct Months Inventory of HOMES FOR SALE last 2 years NAR 12/2018
  50. 50. 3.5 3.2 3.4 3.4 3.6 4.0 4.1 4.3 4.3 4.3 4.4 4.3 Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct NAR 12/2018 Months Inventory of HOMES FOR SALELast 12 Months
  51. 51. January 2014 January 2015 January 2016 January 2017 January 2018 % 7.3 5.3 3.2 6.5 6.0 5.5 5.8 4.5 6.0 5.2 5.0 -0. -0. -0. 2.0 -0. 1.8 0.4 -4. -1. -3. -4. -1. -3. -2. -1. -1. -3. -9. -5. -5. -10 -6. -10 -9. -6. -7. -6. -6. -9. -8. -7. -9. -6. -6. -10 -9. -11 -9. -8. -7. -6. -6. 0.5 0.0 2.7 1.1 2.8 Year-over-Year Inventory Levels NAR 12/2018
  52. 52. Jan Feb Mar Apr May Jun Jul AugSep Oct NovDec Jan Feb Mar Apr May Jun Jul AugSep Oct NovDec Jan Feb Mar Apr May Jun Jul AugSep Oct NovDec Jan Feb Mar Apr May Jun Jul AugSep Oct NovDec Jan Feb Mar Apr May Jun Jul AugSep Oct NovDec Jan Feb Mar Apr May Jun Jul AugSep Oct % -24 -20 -16 -14 -13 -7. -5% -6. 1.8 0.9 5.0 1.6 7.3 5.3 3.2 6.5 6% 5.5 5.8 4.5 6% 5.2 5% -0. -0. -0. 2.0 -0. 1.8 0.4 -4. -1. -3. -4. -1. -3. -2. -1. -1. -3. -9. -5. -5. -10 -6. -10 -9. -6. -7. -6. -6. -9. -8. -7. -9. -6. -6. -10 -9. -11 -9. -8. -7. -6. -6. 0.5 0.0 2.7 1.1 2.8 Year-over-Year Inventory Levels NAR 12/2018
  53. 53. HOUSING SUPPLY Year-Over-Year -9.7% -11.1% -9.5% -8.1% -7.2% -6.3% -6.1% 0.5% 0.0% 2.7% 1.1% 2.8% Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct NAR 12/2018 Last 12 Months Jun Jul Aug Sep Oct
  54. 54. 5.2 5.1 5.0 5.4 5.4 5.3 6.0 6.0 5.3 5.6 4.9 5.5 5.6 5.4 5.3 5.7 5.5 6.0 6.2 6.4 6.5 7.4 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2017 2018 Census New Home Inventory months supply
  55. 55. 4.9 5.5 5.6 5.4 5.3 5.7 5.5 6.0 6.2 6.4 6.5 7.4 Nov Dec Jan-18 Feb Mar Apr May Jun Jul Aug Sep Oct Census New Home Inventory months supply Last 12 Months
  56. 56. BUYER DEMAND
  57. 57. Jul 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Foot Trafficindicator of future sales NAR 11/2018
  58. 58. Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Foot Traffic indicator of future sales Last 12 Months NAR 11/2018
  59. 59. January February March April May June July August September October November December 2017 2018 Foot Trafficindicator of future sales NAR 11/2018
  60. 60. NAR Buyer Traffic
  61. 61. INTEREST RATES
  62. 62. 1/4 2/1 3/1 4/5 5/3 6/7 7/5 8/2 9/6 10/4 11/1 Freddie Mac 12/2018 Mortgage Rates Freddie Mac 30-Year Fixed Rate 3.95% 4.81%
  63. 63. 1/7/16 2/4 3/3 4/7 5/5 6/2 7/7 8/4 9/1 10/6 11/3 12/1 1/5/17 2/2 3/2 3/30 4/27 5/25 6/22 7/20 8/17 9/14 10/12 11/9 12/7 1/4/18 2/1 3/1 4/5 5/4 6/7 7/5 8/2 9/6 10/4 11/1 30-Year Fixed Rate Mortgages from Freddie Mac 4.81 3.97 Freddie Mac 12/2018
  64. 64. Mortgage Rate Projections 12/2018 Quarter Freddie Mac Fannie Mae MBA NAR Average of All Four 2019 1Q 4.9 4.9 5.0 5.0 4.95 2019 2Q 5.0 4.9 5.1 5.1 5.03 2019 3Q 5.2 5.0 5.1 5.2 5.13 2019 4Q 5.3 5.0 5.1 5.3 5.18
  65. 65. 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 Rate 3.7 3.8 4.0 3.9 3.7 3.6 3.5 3.8 4.2 4.0 3.9 3.9 4.3 4.6 4.6 4.8 4.9 5 5.2 5.3 Freddie Mac Mortgage Rates Freddie Mac 30-Year Fixed Rate - Actual - Projected 2015 2016 2017 2018 2019
  66. 66. 4.9 5.0 5.2 5.3 Freddie Mac 2019 Q1 Where Are They Going In 2019? January – Today Actual Interest Rates 2019 Q2 2019 Q3 2019 Q4Mortgage Rates Freddie Mac 30-Year Fixed Rate
  67. 67. Mortgage Credit Availability YES NO MAYBE
  68. 68. Apr 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 MBA Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association Mortgage Credit Availability
  69. 69. 0 100 200 300 400 500 600 700 800 900 June 2004 June 2005June 2006 June 2007 June 2008 June 2009 June 2010 June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 June 2017 June 2018 Oct 2018 Historic Data for the MORTGAGE CREDIT AVAILABILITY INDEX (a report from the Mortgage Bankers Association) MBA
  70. 70. 45 46 47 45 43 42 43 44 44 45 45 46 Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Average Days To Close A Loan All Closed Loans as per Ellie Mae Last 12 Months
  71. 71. 722 722 721 721 722 723 724 726 725 724 727 727 Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct All Closed Loans as per Ellie Mae FICO® Score Requirements Last 12 months
  72. 72. 0.07% 0.8% 8.7% 18.7% 23.9% 34.5% 13.4% 500-549 550-599 600-649 650-699 700-749 750-799 800+ FICO® Score Distribution 51.3% All Closed Loans as per Ellie Mae
  73. 73. Average FICO® Score for Closed Purchase Loans by Loan Type All Closed Loans as per Ellie Mae 727 751 676 709 All Loans Conventional FHA VA
  74. 74. 39 37 44 43 All Loans* Conventional FHA VA Average Back End DTI for Closed Purchase Loans by Loan Type All Closed Loans as per Ellie Mae

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