2019 Forecast - u.realgeeks.media · National Homebuyers’ “TYPICAL MORTGAGE PAYMENT”...
Transcript of 2019 Forecast - u.realgeeks.media · National Homebuyers’ “TYPICAL MORTGAGE PAYMENT”...
DECEMBER 2018
2019 Forecast
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%
“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
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
CoreLogic
Forecasted Year-Over-Year % Change in Price
4.95.0
5.25.3
Freddie Mac
2019 Q1
Where Are They Going In 2019?
January – Today Actual Interest Rates
2019 Q2
2019 Q3
2019 Q4Mortgage RatesFreddie Mac30-Year Fixed Rate
CoreLogic
$1,000
$1,259
$550
$730 $803
$922 $1,000
January 2000 June 2006 February 2012 October 2016 October 2017 Today Projected thistime 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.
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
$319,200
$6,710
Homeowner Renter
Difference in 65+ Adults
NET WORTH Homeowner vs. RenterJoint Center of Housing Studies at Harvard University
$143,500 is in home equity
Joint Center for Housing Studies at Harvard University
The Largest Number of
Listings Expire on December
31st
Our House Didn’t Sell! Should We:
❑ FSBO❑ Wait Until the Spring❑ List with a New Agent
7 Reasons NOT to Sell Your Home as a FSBO
1. Hard to Price it Correctly2. Having a Marketing Plan can be a Challenge3. Inconvenience of Showing the Home Themselves4. There is a Legal Liability5. Be Careful of Scams!6. Emotional Attachment to the House7. FSBOs Sell for Less!
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 Percentageof all Home Sales
The percentage of homes selling as a FSBO hasdecreased to 7%, the lowest number recorded since 1981.
7%
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 PurchaseOver the Last 15 Yearsby percentage
Newspapers
Yard Signs
The Internet
87% 90%85% 86% 84% 84%
All purchasers 37 and younger 38 to 52 53 to 62 63 to 71 72 to 92NAR
Percentage of Home Buyers Who Used an Agent or Broker by age group
By FSBO By AGENT
Typical Sold PriceFSBO 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
$
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
Why Didn’t Our House Sell?
❑ Condition of the House❑ Price (Over Priced?)❑ Marketing Plan❑ Lack of Communication
with your Agent
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
DECEMBER 2018
Winter Buyer & Seller GuidesLaunched Friday, November 30th
“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 BlackForbes Real Estate Council
ResourcesSlide Slide Title Link
4, 6Home 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 Paymenthttp://www.corelogic.com/about-us/researchtrends/the-marketpulse-report.aspx#.Wm9nR6aWzIUhttps://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 Slideshttps://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 Quotehttps://www.forbes.com/sites/forbesrealestatecouncil/2018/11/15/are-these-three-cs-the-key-to-the-real-estate-revolution/
KEEPINGCURRENTMATTERS.COM
ResourcesSlide Slide Title Link
28, 49, 59Average 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 Saleshttp://www.census.gov/construction/nrs/pdf/newressales.pdfhttp://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.htmlhttp://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_112018.pdfhttps://www.mba.org/Documents/Research/Mtg%20Fin%20Forecast%20Nov%202018.pdfhttps://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
Average Days on the Market
NAR
Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018
Since January 2014
EXISTINGHome Sales
NAR 12/2018
-2.6%
-4.7%
-0.9%
0.6%
-8.7%
U.S. Northeast Midwest West
Y-O-Y by region
EXISTINGHome Sales
NAR 12/2018
South
Existing Home Sales in thousands
Census & NAR
January February March April May June July August September October November December
2017 2018
Census & NAR
January February March April May June July August September October November December
2017 2018
New Home Sales in thousands
Jun-14 Jan-15 Jan-16 Jan-17 Jan-18
Census
New Home Salesannualized in thousands
6%8%
36%
23%
12%
9%7%
Under $150K $150-$199K $200-299K $300-$399K $400-$499K $500-$749K Over $750KCensus
New Home Sales% of sales by price range
3.23.3
3.2
3.4
3.63.7
3.1
2.92.8
3.13.2 3.2
3.4
3.23.3
3.7
3.93.8
3.7
3.33.2
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)
Census & NAR
364 366
516503
612
656
561580
512 507
475 472
361 373
500521
597626
575 585
461
January February March April May June July August September October November December
2017 2018
Total Home Sales in thousands
January… January… January… January… January…
100 = Historically Healthy Level
PENDING Home Salessince 2014
NAR 12/2018
-6.7%
-2.9%
-4.9% -4.6%
-15.3%
U.S. Northeast Midwest South West
PENDING Home SalesYear-Over-Year By Region
NAR 12/2018
Jan 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018
Percentage ofDistressed Property
Sales
35%
January 2012 - Today3%
4%
NAR 12/2018
Home Prices
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
-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 Salesfrom last year by Price Range
NAR 12/2018
June 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018
Year-Over-Year
PRICECHANGES
Case Shiller
S&P Case Shiller 12/2018
Year-Over-Year PRICE CHANGES20 City Composite
S&P Case Shiller 12/2018
Case Shiller
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 CHANGES20 City Composite
Case Shiller
S&P Case Shiller 12/2018
CoreLogic
Forecasted Year-Over-Year % Change in Price
-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
HOUSINGINVENTORY
NAR
Seller Traffic
January 2011
January 2012
January 2013
January 2014
January 2015
January 2016
January 2017
January 2018
Months Inventory ofHOMES FOR SALE
2011 - Today
NAR 12/2018
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
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
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
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul AugSep Oct Nov Dec Jan Feb Mar Apr May Jun Jul AugSep Oct Nov Dec Jan Feb Mar Apr May Jun Jul AugSep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 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
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
5.25.1
5.0
5.4 5.45.3
6.0 6.0
5.3
5.6
4.9
5.55.6
5.45.3
5.75.5
6.06.2
6.46.5
7.4
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
2017
2018
Census
New Home Inventorymonths supply
4.9
5.5 5.65.4 5.3
5.75.5
6.06.2
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
BUYERDEMAND
Jul 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018
Foot Trafficindicator of future sales
NAR 11/2018
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Foot Trafficindicator of future sales
Last 12 Months
NAR 11/2018
January February March April May June July August September October November December
2017
2018
Foot Trafficindicator of future sales
NAR 11/2018
NAR
Buyer Traffic
INTERESTRATES
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 RatesFreddie Mac 30-Year Fixed Rate
3.95%
4.81%
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
3/3
0
4/2
7
5/2
5
6/2
2
7/2
0
8/1
7
9/1
4
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 FixedRate Mortgages
from Freddie Mac
4.81
3.97
Freddie Mac 12/2018
Mortgage Rate Projections
12/2018
QuarterFreddie
MacFannie Mae
MBA NARAverage
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
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
2018Q3
2018Q4
2019Q1
2019Q2
2019Q3
2019Q4
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 RatesFreddie Mac 30-Year Fixed Rate
- Actual- Projected
2015 2016 2017 2018 2019
4.95.0
5.25.3
Freddie Mac
2019 Q1
Where Are They Going In 2019?
January – Today Actual Interest Rates
2019 Q2
2019 Q3
2019 Q4Mortgage RatesFreddie Mac30-Year Fixed Rate
Mortgage Credit Availability
YES NO MAYBE
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
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
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
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 RequirementsLast 12 months
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
Average FICO® Scorefor Closed Purchase Loans
by Loan Type
All Closed Loans as per Ellie Mae
727751
676
709
All Loans Conventional FHA VA
39 37
44 43
All Loans* Conventional FHA VA
Average Back End DTIfor Closed Purchase Loans by Loan Type
All Closed Loans as per Ellie Mae