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Naea 08-13
The document is a collection of slides from a presentation on the US housing market in July 2013. It includes data and forecasts from various surveys and analysts on topics like home price appreciation trends, mortgage rates, housing inventory levels, and home sales. Several slides provide projections that the housing recovery will continue in the coming years, supported by falling foreclosure rates and home price gains expected to outpace inflation.
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Naea 08-13
- 2. KCM Divided intoThree Sections
- 4. Home Price Expectation Survey A nationwidepanel of over one hundred economists, real estate experts and investment & market strategists.
- 5. 3.6% 7.9% -5.8% 4.7% 4.7% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% Pre-Bubble (1987-1999) Bubble (Jan '00-May'07) Bust (June '07-Oct'11) Recovery to Date (Nov '11-June'13 ) Expectations (2013-2017) Average Annual Appreciation Home Price Expectation Survey 7/2013
- 6. Projected Percentage Increase HomePrice Expectation Survey Home Price Expectation Survey 7/2013
- 7. Cumulative Appreciation by2017 Home Price Expectation Survey 7/2013
- 8. Percentage Appreciation bySurvey Home Price Expectation Survey 7/2013
- 9. Distressed Property NumbersDiving Distressed inventories have fallen 14.4% so far this year Completed foreclosures are down 20% from last year National foreclosure inventory is down 28% from last year Seriously delinquent loans are down 23.7% from a year ago -14.4% -20% -28% -23.7% CoreLogic 7/2013
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- 13. “Rising home priceshave swept the country…However, these runaway price gains won’t last: both rising mortgage rates and slowly growing inventories should start tapping the brakes on home prices, preventing them from rising back into bubble territory.” Jed Kolko Trulia’s Chief Economist Trulia 7/2013
- 14. 6.00 $ 1,079$ 1,109 $ 1,139 $ 1,169 $ 1,199 5.75 $ 1,050 $ 1,080 $ 1,109 $ 1,138 $ 1,167 5.50 $ 1,022 $ 1,050 $ 1,079 $ 1,107 $ 1,136 5.25 $ 994 $ 1,022 $ 1,049 $ 1,077 $ 1,104 5.00 $ 966 $ 993 $ 1,020 $ 1,047 $ 1,074 4.75 $ 939 $ 965 $ 991 $ 1,017 $ 1,043 4.50 $ 912 $ 937 $ 963 $ 988 $ 1,013 $ 180,000 $ 185,000 $ 190,000 $ 195,000 $ 200,000 -10% -7.5% -5% -2.5% Buyer’s Purchasing PowerRATE Principal and Interest Payments rounded to the nearest dollar amount.
- 15. Buyer’s Purchasing Power 6.00$ 2,158 $ 2,218 $ 2,278 $ 2,338 $ 2,398 5.75 $ 2,100 $ 2,160 $ 2,218 $ 2,276 $ 2,334 5.50 $ 2,044 $ 2,100 $ 2,158 $ 2,214 $ 2,272 5.25 $ 1,988 $ 2,044 $ 2,098 $ 2,154 $ 2,208 5.00 $ 1,932 $ 1,986 $ 2,040 $ 2,094 $ 2,148 4.75 $ 1,878 $ 1,930 $ 1,982 $ 2,034 $ 2,086 4.50 $ 1,824 $ 1,874 $ 1,926 $ 1,976 $ 2,026 $ 360,000 $ 370,000 $ 380,000 $ 390,000 $ 400,000 -10% -7.5% -5% -2.5% RATE Principal and Interest Payments rounded to the nearest dollar amount.
- 16. Buyer’s Purchasing Power 6.00$ 3,237 $ 3,328 $ 3,417 $ 3,507 $ 3,597 5.75 $ 3,151 $ 3,239 $ 3,326 $ 3,414 $ 3,501 5.50 $ 3,066 $ 3,151 $ 3,236 $ 3,322 $ 3,407 5.25 $ 2,982 $ 3,065 $ 3,148 $ 3,230 $ 3,313 5.00 $ 2,899 $ 2,979 $ 3,060 $ 3,140 $ 3,221 4.75 $ 2,817 $ 2,895 $ 2,973 $ 3,052 $ 3,130 4.50 $ 2,736 $ 2,812 $ 2,888 $ 2,964 $ 3,040 $ 540,000 $ 555,000 $ 570,000 $ 585,000 $ 600,000 -10% -7.5% -5% -2.5% RATE Principal and Interest Payments rounded to the nearest dollar amount.
- 17. Buyer’s Purchasing Power 6.00$ 4,317 $ 4,437 $ 4,557 $ 4,676 $ 4,796 5.75 $ 4,201 $ 4,318 $ 4,435 $ 4,552 $ 4,669 5.50 $ 4,088 $ 4,202 $ 4,315 $ 4,429 $ 4,542 5.25 $ 3,976 $ 4,086 $ 4,197 $ 4,307 $ 4,418 5.00 $ 3,865 $ 3,972 $ 4,080 $ 4,187 $ 4,295 4.75 $ 3,756 $ 3,860 $ 3,965 $ 4,069 $ 4,173 4.50 $ 3,648 $ 3,749 $ 3,851 $ 3,952 $ 4,053 $ 720,000 $ 740,000 $ 760,000 $ 780,000 $ 800,000 -10% -7.5% -5% -2.5% RATE Principal and Interest Payments rounded to the nearest dollar amount.
- 18. Buyer’s Purchasing Power 6.00$ 5,396 $ 5,546 $ 5,696 $ 5,846 $ 5,996 5.75 $ 5,252 $ 5,398 $ 5,544 $ 5,690 $ 5,836 5.50 $ 5,110 $ 5,252 $ 5,394 $ 5,536 $ 5,678 5.25 $ 4,970 $ 5,108 $ 5,246 $ 5,384 $ 5,522 5.00 $ 4,831 $ 4,966 $ 5,100 $ 5,234 $ 5,368 4.75 $ 4,695 $ 4,825 $ 4,956 $ 5,086 $ 5,216 4.50 $ 4,560 $ 4,687 $ 4,814 $ 4,940 $ 5,067 $ 900,000 $ 925,000 $ 950,000 $ 975,000 $ 1,000,000 -10% -7.5% -5% -2.5% RATE Principal and Interest Payments rounded to the nearest dollar amount.
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- 20. 30 Year FixedRate Mortgage History 1/2012 – 7/2013 Federal Reserve 7/2013
- 22. Mortgage Rate Projections AnalystProjected Rate 3Q 2014 Fannie Mae 5.0% National Assoc of Realtors 4.8% Freddie Mac 5.1% Mortgage Bankers Assoc 4.9% 7/2013
- 23. Date Price Interest Rate P&I Last Year$400,000 3.5% $1,796.18 This Year $420,000 4.5% $2,128.08 Difference in Payment - $331.90 The Cost of Waiting a Year
- 24. Rate $100,000 $200,000$300,000 $400,000 $500,000 6.00 599.55 1,199.10 1,798.65 2,398.20 2,997.75 5.75 583.57 1,167.15 1,750.72 2,334.29 2,917.86 5.50 567.79 1,135.58 1,703.37 2,271.16 2,838.95 5.25 552.20 1,104.41 1,656.61 2,208.81 2,761.02 5.00 536.82 1,073.64 1,610.46 2,147.29 2,684.11 4.75 521.65 1,043.29 1,564.94 2,086.59 2,608.24 4.50 506.69 1,013.37 1,520.06 2,026.74 2,533.43 Mortgage Payment Differences
- 25. $2,812.47 $1,715.63 $1,471.66 $1,266.71 1983 1993 2003 2013 Monthly payment ona $250,000 MORTGAGE (Principal & Interest)
- 26. Number of BUYERSout of 100 WILLING TO bid OVER asking price 1-5%over asking price 10+%6-10%over asking price over asking price Trulia 7/2013
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- 29. 41.7 20.9 -7.9 56.1 -30 0 30 60 Dow S&P NASDAQReal Estate January 2000 – July 2013 MSN Money, Case Shiller 7/2013 Return on Investment
- 30. 90 95 100 105 110 115 Jan Feb MarApr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May June Pending Home Sales NAR 7/2013 100 = Historically Healthy Level
- 31. 80 90 100 110 120 Jan Feb MarApr May Jun Jul Aug Sep Oct Nov Dec 2013 2012 2011 January 2012 – December 2012 100 = Historically Healthy Level Pending Home Sales NAR 7/2013
- 32. NAR 7/2013 10% 15% 20% 25% 30% 35% Jan FebMar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Percentage of Distressed Property Sales 35% 15%
- 33. Months Inventory ofHomes for Sale 4.0 5.0 6.0 7.0 8.0 9.0 10.0 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May NAR 7/2013 5-6 Months = Normal Market Inventory
- 34. S&P Case Shiller7/2013 S&P Case-Shiller Home Price Indices
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- 37. RETURN ON INVESTMENT January2000 – July 2013 41.7% 20.9% -7.9% 56.1% Dow Jones S&P NASDAQ Real Estate MSN Money, Case Shiller
- 38. 3.6% 7.9% 4.7%4.7% Average Annual APPRECIATION -5.8% Pre-BUBBLE BUBBLERECOVERY TO DATE PROJECTED NOW to 2017 BUST Home Price Expectation Survey 7/2013
- 39. Home Price ExpectationSurvey 7/2013 Cumulative House Appreciation by 2017 19.4% 35% 23.7% 13.1% Pre-Bubble Trend Bulls BearsAll Projections
- 40. Home Price ExpectationSurvey 7/2013 PROJECTED Percentage Appreciation 6.7% 4.2% 3.6% 3.5% 2013 3.4% 2014 2015 2016 2017
- 41. “The housing market hasbottomed. It's not too late to get involved. I still think buying a home is the best investment any individual can make. Affordability is still at an all-time high. Buy a home and, if you can, buy a second home.” John Paulson
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- 48. Resources KEEPINGCURRENTMATTERS.COM Slide Slide TitleLink 4-8 Home Price Expectation Survey, Average Annual Appreciation, Cumulative Appreciation by 2017, Percentage Appreciation by Survey https://pulsenomics.com/Q2_2013_HPE_Survey.php 9 Distressed Property Numbers Diving http://www.corelogic.com/research/foreclosure-report/national-foreclosure-report-june-2013.pdf 10 Foreclosure Inventory by State http://www.corelogic.com/research/foreclosure-report/national-foreclosure-report-june-2013.pdf 11 What Housing Bubble? http://www.dsnews.com/articles/experts-see-risk-of-housing-bubble-resulting-from-fed-policies-2013-0 13 Jed Kolko Quote http://info.trulia.com/trulia-price-and-rent-monitors-jun-2013 19 Dramatic Mortgage Rate Increases http://www.calculatedriskblog.com/2013/07/house-prices-and-mortgage-rates.html 20, 21 30 Year Fixed Rate Mortgage History, Recent Rate Movement http://www.freddiemac.com/pmms 22 Mortgage Rate Projections http://www.mortgagebankers.org/files/Bulletin/InternalResource/84813_.pdf http://www.freddiemac.com/news/finance/docs/Jun_2013_public_outlook.pdf http://www.realtor.org/sites/default/files/reports/2013/embargoes/phs-6-27-hgbfjnv/july-2013-outlook-2 http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_061313.pdf 25 Monthly Payment on a $250,000 Mortgage http://www.bankrate.com
- 49. Resources Slide Slide TitleLink 26 Buyers Willing to Bid Over Asking Price http://info.trulia.com/american-dream-survey-summer-2013 27 Migration Patterns http://www.forbes.com/special-report/2011/migration.html 29 Return on Investment http://www.spindices.com/index-family/real-estate/sp-case-shiller 30, 31, 32, 33 Pending Home Sales, Percentage of Distressed Property Sales, Months Inventory of Homes for Sale http://www.realtor.org 34 S&P Case-Shiller Home Price Indices https://www.spice-indices.com/idpfiles/spice- assets/resources/public/documents/19529_cshomeprice-release-0730.pdf 37 Return on Investment http://www.spindices.com/index-family/real-estate/sp-case-shiller 39, 40 Cumulative House Appreciation by 2017, Projected Percentage Appreciation https://pulsenomics.com/Q2_2013_HPE_Survey.php 41 John Paulson Quote http://www.cnbc.com/id/100893817 42 Seattle First Home Buyers https://www.facebook.com/SeattleFirstTimeHomeBuyers 43 Shaun Farrell Real Estate https://www.facebook.com/ShaunFarrellRealEstate 44 YourNaperville.com Blog Post http://yournaperville.com/mortgage-rates-and-impact-on-buying-a-naperville-home-july-2013 KEEPINGCURRENTMATTERS.COM
- 50. The key to success isdeveloping TRUST
Editor's Notes
- #5 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #6 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #7 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #8 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #9 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #10 http://www.corelogic.com/research/foreclosure-report/national-foreclosure-report-june-2013.pdf
- #11 http://www.corelogic.com/research/foreclosure-report/national-foreclosure-report-june-2013.pdf
- #12 http://www.dsnews.com/articles/experts-see-risk-of-housing-bubble-resulting-from-fed-policies-2013-05-07
- #14 http://info.trulia.com/trulia-price-and-rent-monitors-jun-2013
- #20 http://www.calculatedriskblog.com/2013/07/house-prices-and-mortgage-rates.html
- #21 http://www.freddiemac.com/pmms
- #22 http://www.freddiemac.com/pmms
- #23 http://www.mortgagebankers.org/files/Bulletin/InternalResource/84813_.pdf http://www.freddiemac.com/news/finance/docs/Jun_2013_public_outlook.pdf http://www.realtor.org/sites/default/files/reports/2013/embargoes/phs-6-27-hgbfjnv/july-2013-outlook-2013-6-27.pdf http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_061313.pdf
- #26 http://www.bankrate.com
- #27 http://info.trulia.com/american-dream-survey-summer-2013
- #28 http://www.forbes.com/special-report/2011/migration.html
- #30 http://www.spindices.com/index-family/real-estate/sp-case-shiller
- #31 http://www.realtor.org
- #32 http://www.realtor.org
- #33 http://www.realtor.org
- #34 http://www.realtor.org
- #35 https://www.spice-indices.com/idpfiles/spice-assets/resources/public/documents/19529_cshomeprice-release-0730.pdf
- #38 http://www.spindices.com/index-family/real-estate/sp-case-shiller
- #40 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #41 https://pulsenomics.com/Q2_2013_HPE_Survey.php
- #42 http://www.cnbc.com/id/100893817
- #43 https://www.facebook.com/SeattleFirstTimeHomeBuyers
- #44 https://www.facebook.com/ShaunFarrellRealEstate
- #45 http://yournaperville.com/mortgage-rates-and-impact-on-buying-a-naperville-home-july-2013