PrintAs of February 10, new listings tracked by Altos Research have ticked upwards for five consecutive weeks, suggesting the spring home buyer season will bring the strongest prices the nagtion has seen since the tax credit briefly stimulated demand two years ago.
At the end of January, most metro markets saw stable pricing and several are ticking up, as inventory dropped for the beginning of the year. Stable pricing in January, when prices can be expected to seasonally drop, points to a bullish start in the new year, Altos said. At the end of January, the national median home price as measured by the Altos 20-City Composite remained basically unchanged at $354,408 from $354,896 in December 2011. Altos Research uses metrics from active residential property listings.
Looking at the slower-turning 90-day rolling average, four markets saw an increase in price in January. The two markets with the largest increase include, Miami/Fort Lauderdale/Miami Beach and Phoenix/Mesa/Scottsdale, both with an increase of 2.5 percent.
In both December 2011 and January, 14 markets experienced a decrease in price. The biggest price decreases were seen in San Jose/Sunnyvale/Santa Clara (-2.6 percent), Cleveland/Elyria/Mentor (-2.5 percent), and San Diego/Carlsbad/San Marcos (-2.4 percent).
Four markets saw an increase in price in January, typically the weakest month for home prices. Broadly the Altos-20 City Composite national view was unchanged from December. The Miami/Fort Lauderdale/Miami Beach market has seen prices trending up. Prices were up 4.8 percent in December 2011 and 2.5 percent in January. The Las Vegas/Paradise market has seen similar movement. Prices have not increased at a rate as fast as in Miami/Fort Lauderdale/Miami Beach, but inventory has decreased significantly. January saw a 14.8 percent decrease from the prior month and between November and December 2011, inventory levels dropped a staggering 27.8 percent.
In January, as to be expected, inventory levels fall across the board. In many markets, tight inventory of quality properties is another contributing factor keeping a floor on home prices thisspring.
March 7th, 2012 at 11:02 am
Already read that post by Henry Blodget a couple of days ago, and raiseltically much of that data is old news. This post goes along with the logic I subscribe to, which is contrary to the roaring back mentality. That’s mainly where my criticisms were with your post the March growth is not an indicator that prices are rising and we’re past bottom and it certainly would not be sustainable if we were at the bottom, otherwise we’d be back to our current debacle.I’d be interested to see the data you come up with for average price/sqft. In fairness, much of the data I’ve seen for larger houses are concentrated in naturally higher priced areas, whereas smaller houses are sold around North Pasadena. But to me, it just shows more the point of some of the inherent flaws of medians and averages, including your argument that median home price is somehow a more accurate indicator.As for unemployment, I’m sure this won’t ever make it in to the equation, but housing is rarely a cash transaction. It relies on credit, credit relies on ability to pay the money back. Less employed people means the pool of potential buyers goes down. Further, the more underemployed, the smaller the income, the smaller the loan.Then finally, is 4.5% cheap enough at today’s prices? Maybe, maybe not. Despite the irrational exuberance in bank earnings reports, there is a lot more turmoil to come. Defaults in prime borrowers have been rising, lending activity has been falling with no indication of it picking up as banks try to shore up capital reserves. More, it seems banks are still adjusting the definition of credit worthy and DTI, maybe to the point of where traditional lending used to be: 3-4 times income and 28/36 DTI. At a $500K median, how many Pasadena residents is that? I think no one’s come up with a solution because there’s more to it than just lower interest rates.