December 2024 – REI INK

National House Prices Hover Near Historical Norms, According to First American Data & Analytics Monthly Home Price Index Report

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Steady, single-digit house price growth signals a return to normal following the pandemic-to-post-pandemic roller-coaster ride, says Chief Economist Mark Fleming First American Data & Analytics, a leading national provider of property-centric information, risk management and valuation solutions and a division of First American Financial Corporation (NYSE: FAF), released its November 2024 Home Price Index (HPI) report. The report tracks home price changes less than four weeks behind real time at the national, state and metropolitan (Core-Based Statistical Area) levels and includes metropolitan price tiers that segment sale transactions into starter, mid and luxury tiers. The full report can be found here. Chief Economist Analysis: “After a nearly year-long slow down, national house prices re-accelerated modestly for the first time since December 2023 on an annualized basis, but remain in line with historical norms,” said Mark Fleming, chief economist at First American. “As the housing market adjusts to the new normal of higher mortgage rates, buyers and sellers are gradually returning, supported by a healthy labor market and more homes for sale compared to last year. The result is steady, single-digit house price growth, reflecting a market returning to normal following the pandemic-to-post-pandemic roller-coaster ride.” November 2024 Local Market Price Tier Highlights The First American Data & Analytics HPI segments home price changes at the metropolitan level into three price tiers based on local market sales data: starter tier, which represents home sales prices at the bottom third of the market price distribution; mid-tier, which represents home sales prices in the middle third of the market price distribution; and the luxury tier, which represents home sales prices in the top third of the market price distribution. “While some may have expected sustained higher mortgage rates to drive widespread house price declines, prices have proven resilient, falling in only two markets year over year last month,” said Fleming. “House prices tend to be ‘downside sticky’ because home sellers would rather withdraw from the market than sell at a discount.” November 2024 First American Data & Analytics Price Tier HPI Highlights Core-Based Statistical Areas (CBSAs) Ranked by Greatest Year-Over-Year Increases in Starter Tier HPI CBSA Change in Starter Tier HPI Change in Mid-Tier HPI Change in Luxury Tier HPI New York +7.9 percent +8.2 percent +2.3 percent Pittsburgh +6.2 percent +3.0 percent +1.8 percent Warren, Mich. +6.1 percent +5.8 percent +6.2 percent Washington +5.7 percent +5.8 percent +5.6 percent Cambridge, Mass. +5.5 percent +6.3 percent +6.0 percent Additional November 2024 First American Data & Analytics HPI Highlights Core-Based Statistical Areas (CBSAs) with Greatest Year-Over-Year Increases in HPI CBSA Change in HPI Anaheim, Calif. +7.7 percent Cambridge, Mass. +5.4 percent New York +5.3 percent Warren, Mich. +5.1 percent Washington +5.0 percent Core-Based Statistical Areas (CBSAs) with a Year-Over-Year Decease in HPI Tampa, Fla. -3.3 percent Oakland, Calif. -0.3 percent HPI data for all 50 states and the largest 30 CBSAs by population is available here. Visit the First American Economic Center for more research on housing market dynamics.

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Home sales are up 28% year over year in Portland, OR—the biggest gain of any major U.S. metro. Next come San Jose, Seattle and San Francisco, which also saw double-digit increases. In Portland, OR, home sales jumped 27.6% year over year in November—the biggest increase among the 50 most populous U.S. metropolitan areas, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. It was followed by five other pricey West Coast metros: San Jose, CA (26.2%), Seattle (19.5%), San Francisco (17.7%), Sacramento, CA (17.6%) and San Diego (15.2%). By comparison, nationwide home sales rose just 4.8%. All the aforementioned markets have median sale prices above the national median of $430,107. Early-stage homebuying activity has been picking up across the country since the election. But some West Coast markets may be gaining steam especially quickly in part because a shortage of homes for sale is keeping competition afloat. New listings in Portland, for example, were down 20.3% from a year earlier in November—a bigger decline than any other metro but Austin, TX. By comparison, nationwide new listings were down just 6.6%. New listings in Oakland, San Jose and Sacramento also fell more than they did nationwide. “There’s low inventory, so if a house checks all the boxes, it’s selling very quickly with multiple offers,” said Bay Area Redfin Premier real estate agent Josh Felder. “Even homes in the $1 million to $3 million range are getting five to seven offers if they are move-in ready and in the right neighborhood with the right schools—and they can sell for anywhere between 10% and 14% over the asking price. There is a lot of money in Silicon Valley. You’d think there would be a finite supply of people who have $3.5-$5 million dollars for a home, but apparently not. They just keep coming.” Over Half of Homes in the Bay Area Are Selling for More Than Their Asking Price The Bay Area—the most expensive housing market in the country—is also home to three of the five U.S. metropolitan areas where houses are most likely to sell for more than their asking price. In San Jose, 58.6% of homes that sold in November went for above their list price—the highest among the 50 most populous U.S. metros in Redfin’s analysis aside from Newark, NJ (64.8%). In third place is Nassau County, NY (54.1%), followed by two other Bay Area metros: Oakland (53.6%) and San Francisco (52.9%). In both San Jose and San Francisco, the share of homes selling above their list price was at the highest level for November since 2021, and in Newark and Nassau County, it was at the highest level for any November on record. Nationwide, just over one-quarter (26.6%) of homes that sold during November went for more than their list price. San Jose and San Francisco are the most expensive housing markets in the country, both with median sale prices of $1.5 million. To view the report, please visit: https://www.redfin.com/news/west-coast-home-sales-2024/

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Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data, reports the following “first look” at November 2024 month-end mortgage performance statistics derived from its loan-level database representing the majority of the national mortgage market. Data as of Nov. 30, 2024Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 3.74%Month-over-month change: 8.38%Year-over-year change: 10.46% Total U.S. foreclosure pre-sale inventory rate: 0.34%Month-over-month change: -2.09%Year-over-year change: -15.96% Total U.S. foreclosure starts: 21,000Month-over-month change -29.15%Year-over-year change: -29.22% Monthly prepayment rate (SMM): 0.63%Month-over-month change: -25.02%Year-over-year change: 71.20% Foreclosure sales: 5,300Month-over-month change: -8.43%Year-over-year change: -17.65% Number of properties that are 30 or more days past due, but not in foreclosure: 2,027,000Month-over-month change: 159,000Year-over-year change: 224,000 Number of properties that are 90 or more days past due, but not in foreclosure: 512,000Month-over-month change: 32,000Year-over-year change: 53,000 Number of properties in foreclosure pre-sale inventory: 185,000Month-over-month change: -4,000Year-over-year change: -31,000 Number of properties that are 30 or more days past due or in foreclosure: 2,213,000Month-over-month change: 155,000Year-over-year change: 192,000 Top 5 States by Non-Current Percentage Louisiana: 8.60% Mississippi: 8.48% Alabama: 6.23% Indiana: 5.68% Arkansas: 5.55% Bottom 5 States by Non-Current Percentage Washington: 2.16% Idaho: 2.19% Colorado: 2.21% Montana: 2.25% California: 2.30% Top 5 States by 90+ Days Delinquent Percentage Mississippi: 2.30% Louisiana: 2.26% Alabama: 1.63% Arkansas: 1.42% Georgia: 1.35% Top 5 States by 12-Month Change in Non-Current Percentage Hawaii: -9.59% New York: -5.86% Massachusetts: -2.24% Rhode Island: -0.80% Pennsylvania: 0.05% Bottom 5 States by 12-Month Change in Non-Current Percentage Florida 28.13% North Carolina: 20.39% South Carolina: 17.59% Arizona: 15.65% Georgia: 12.76% NOTE: Due to the holidays ICE Mortgage Monitor will not publish a report in January. Reports for previous months are available online at mortgagetech.ice.com/resources/data-reports. The next ICE Mortgage Monitor will publish February 3, 2025. For more information about gaining access to ICE’s loan-level database, please send an email to Mortgage.Monitor@bkfs.com. Source: Intercontinental Exchange

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New listings posted their second-biggest annual increase since early summer this week, and pending home sales continue to rise New listings of homes for sale are up 7.6%, the biggest year-over-year increase since June (except the four weeks ending November 24, when the increase was inflated due to Thanksgiving), according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. This is based on data from the four weeks ending December 15. There are several reasons more sellers are putting their homes on the market. One, home prices are high; the median U.S. home sale price is up 6% year over year, the second-biggest increase since October 2022. Two, consumer confidence rose to a 16-month high after November’s election, motivating more sellers to make the major financial decision to list their homes. And finally, some sellers are hoping to take advantage of the increased homebuying demand Redfin has seen over the last month. The latest demand signals show it is continuing to strengthen. Redfin’s Homebuyer Demand Index—a seasonally adjusted measure of tours and other buying services from Redfin agents—is up 9% year over year, and is sitting near its highest level since August 2023. Mortgage-purchase applications are up 18% month over month, and pending home sales are up 4.1%, similar to the increases Redfin has seen over the last few months. Like sellers, many homebuyers are feeling more confident about making a big financial move after the summer and early fall slump. Declining mortgage rates are another reason more buyers are coming off the fence: The weekly average rate has declined for three weeks in a row to a two-month low of 6.6%. It’s worth noting that mortgage rates may have bottomed out for the time being; daily average rates rose above 7% on December 18 after the Fed signaled it will cut interest rates twice in 2025, instead of four times. “We’re having a busier winter than usual; I have a handful of listings ready to hit the market right after the new year. This time last year, it was crickets,” said David Palmer, a Redfin Premier agent in the Seattle area. “Buyers are coming out of the woodwork because they’ve accepted that rates in the 6% to 7% range are the new normal, and they know that if they wait to buy, mortgage rates will probably stay the same but prices will be higher.” For Redfin economists’ takes on the housing market, please visit Redfin’s “From Our Economists” page. To view the full report, including charts, please visit:https://www.redfin.com/news/housing-market-update-more-new-listings-demand

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Natural language search reveals insights into how people searched for homes this year From barns to laser tag, Zillow® AI-powered natural language search revealed 2024’s unique home-search trends, offering a window into what Americans wanted in their next home. This year, Zillow enhanced its natural language search feature, allowing home shoppers to search for their next home as naturally as they would speak to family or friends. Buyers and renters can use everyday language instead of preset filters to search by commute time, affordability and nearby schools or points of interest. This new feature showed what Americans were prioritizing in their home search this year. Most-searched-for home attributesThis year’s top home-search trends highlighted a preference for variety and character in housing. Ranch and ranch-style homes led the way for their charm and single-story convenience, while modern and Mid-Century Modern designs also made an appearance farther down the list. Scenic escapes, like lakeside retreats and cabins, along with unique options, like “barndominiums” and horse properties, weren’t far behind. There has been growing interest in flexible living spaces, with duplexes and lofts rising in popularity. Typical features like garages and patios continued to be in high demand, showing that homeowners have been blending practicality with personal style. Check out the most-searched home attributes: Top search terms by state showed home shoppers everywhere had a lot in common …The top home-search terms by state indicated how geography, lifestyle and climate shaped what people wanted in their homes, and also how many home shoppers shared priorities. In states like California, Florida and Texas, “pool” topped the list. Meanwhile, practical features like “garage” or “ranch” homes were the most-searched terms in colder or more rural states, like Alaska, North Dakota and Wyoming. “Pool” was among the three most common searches in 38 states this year, while “garage” made the list in 46 states. Alabama, Connecticut, South Carolina and Tennessee all shared the same top three search terms: “pool,” “garage” and “lake,” in that order. Coastal California and Indiana saw the most shoppers seeking places that “allow small dogs.” Still, home shoppers in some states had distinct preferences. Maine was the only state where “farms” cracked the top three in search criteria; it was the same with “backyard” for Mississippi shoppers. … but some were seeking a more fun and customized home to buySome searches trekked off the beaten path. One Colorado home shopper looked for a “roller coaster,” while another in Michigan was keen on a home with “laser tag.” If the home shopper who searched all over the country for a “party barn” found what they were looking for, their house could be the place to be in 2025. And for those embracing the eerie, at least one shopper in each of 22 states was hunting for a “haunted” home, while home shoppers in Illinois, Ohio and Oregon opted for something less intense — a “spooky” house. Locations for every lifestyleThe desire for theme park rides and ghostly roommates might be rare, but there are lifestyle trends that pull plenty of people together — and to certain areas of the country. Top point-of-interest searchesThis year, home shoppers gravitated toward scenic retreats and waterfront destinations as their top points of interest. Myrtle Beach, South Carolina; Lake Tahoe, Nevada; and Long Island, New York, topped the list, along with lakeside favorites Lake Minnetonka, Minnesota; Lake of the Ozarks, Missouri; and Smith Mountain Lake, Virginia. Other popular spots included Flathead Lake, Montana; Lake Oconee, Georgia; and Amelia Island, Florida. SOURCE Zillow, Inc.

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Gray Capital, a multifamily investment firm, has published their “2025 Multifamily Forecast” report, which covers the major trends in the housing market and economy that will impact the apartment market next year. Along with these broader trends, the new report includes data on apartment supply and demand, capital markets, and specific predictions for rent growth in 2025. “Multifamily is on the precipice of an inflection point. 2025 should see significantly more sales activity, but there is potential for additional volatility depending on the path of inflation and interest rates,” says Spencer Gray, President and CEO of Gray Capital. Gray Capital’s forecast report builds on previous research on loan maturities as an element of the multifamily investment market worth watching in 2025. This earlier research expanded on the effects of extend-and-pretend practices in pushing loan maturities forward into 2025, and Gray Capital’s new forecast highlights loan maturities as a potential catalyst for greater sales activity next year. “Multifamily sales volumes dropped to roughly half of the pre-pandemic average for the past two years, but if banks are less willing to provide workouts and extensions compared to 2023, loan maturities could lead to more deals coming onto the market and more sales activity in 2025,” says Matt Bastnagel, Director of Communications and Marketing at Gray Capital. Gray Capital expects a further balance between supply and demand in 2025, but supply levels will continue to be elevated in specific markets, with rent growth in many Sunbelt markets expected to be lower than markets in the Northeast and Midwest. Persistently high housing and apartment demand support the solid long-term investment prospects for multifamily assets, and Gray Capital anticipates a favorable investment environment in 2025 that aligns with recent improvements in investor sentiment. For additional information on the multifamily market in 2025, download the complete report or watch the webinar on the topic. To learn more about Gray Capital, visit www.graycapitalllc.com or follow Gray Capital on LinkedIn, Instagram, and YouTube. SOURCE Gray Capital