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Realtor.com® April Housing Report

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The Required Household Income to Purchase a Home Exceeds $250,000 in Four California Metros According to the Realtor.com® April housing data, the national required household income to purchase the median priced home rose to $116,000, up $5,900 from a year ago, after accounting for the cost of tax and insurance. For hopeful buyers in California’s major metros of Los Angeles, San Diego, San Francisco and San Jose the household income required to purchase the median-priced home is over double the national figure. April 2024 Housing Metrics – National Metric Change over Apr 2023 Change over Apr 2019 Median listing price +0% (to $430,000) +36.5 % Active listings +30.4 % -35.4 % New listings +12.1 % -21.8 % Median days on market +1 days (to 47 days)  -7 days Share of active listings with pricereductions +3.2 percentage points(to 15.5%) +1.0 percentage points “California is a fascinating market not only because the income-required figures are an eye-popping quarter of a million dollars, but because it is a microcosm of the variety we’re seeing in housing markets nationally,” said Danielle Hale, Chief Economist, Realtor.com®. “In areas like San Francisco home prices have fallen enough to offset rising mortgage rates, and the income needed to buy a home has dropped. In other markets, like San Jose and Sacramento, home price declines have been more modest and rising mortgage rates have pushed required incomes higher despite lower home prices. And finally, the majority of major U.S. markets see trends like we’re seeing in Southern California. In Los Angeles, Riverside, and San Diego rising home prices and mortgage rates have combined to push required incomes higher—in some cases like in these California markets, up by double-digits compared to one year ago.” Buying in California Comes at a PriceSix metros across the country required a household income of over $200,000, with California’s largest metros leading the pack: San Jose (household income $361,000), Los Angeles (household income $298,000), San Diego (household income $259,000) and San Francisco (household income $256,000). The major East coast hubs of Boston (household income $226,000) and New York (household income $218,000) closely followed.  Counter to the larger household income required to purchase the median-priced home in the major coastal metros, there were 16 metro areas that required a household income of less than $100,000. The most affordable by this measure were Pittsburgh (household income $67,000), Detroit (household income $69,000), and Cleveland (household income $71,000). List of the 10 Metro Areas with Lowest Required Income to Purchase Median Home Fear Not, Affordable Inventory is Also on the RiseWhile the west coast state experienced a bit of a surge in household required income to purchase the median-priced home, in other parts of the country, affordable inventory is on the rise. The South has been largely driving the increase in availability of homes in the $200,000 to $350,000 price range, and the increase in availability of homes overall. More than half (56.6%) of available inventory in April 2024 was in the South, up from 52.0% last year and 47.7% in April 2019. A rise in homes available for purchase combined with population migration has paved the way for the South to lead the share of nationwide existing home sales, rising from 43.2% in March 2019 to 45.3% in March 2024. Across the country active inventory grew over the previous year with inventory in the South growing 43.0%, 27.4% in the West, 17.6% in the Midwest, and 4.0% in the Northeast. Interestingly, large Florida metros experienced inventory growth driven primarily by an increase in the availability of attached homes (condos, townhomes, or row homes). Median List Price Stays Stable, but Price per Square Foot Inches its Way UpBetween March 2024 and April 2024, the U.S. median list price increased from $424,900 to $430,000, while remaining stable compared to the same median list price in April of last year. This is likely attributed to the mix of homes hitting the market particularly in the South where sellers are listing smaller and more affordable homes. While median list price has remained relatively unchanged, the median list price grew 3.8% on an adjusted per-square-foot basis indicating that homes are retaining value even as inventory grows. Additional details and full analysis of the market inventory levels, income requirements, trends in listing prices and more can be found in the Realtor.com® April Monthly Housing Report. For buyers looking to gain more local-market insights to guide their decision making, visit realtor.com/research to access online tools and better understand ways to partner with an experienced buyer’s agent for help along the way. SOURCE Realtor.com

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INCREASING SHARE OF LOCAL COMMUNITY DEVELOPERS BUYING AT AUCTION EXPECT HOME PRICES AND RENTS TO DECLINE IN 2024

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40% expect home prices to decline in 2024, up from 32% in 2023 and 17% in 2022 29% expect rents to decline in 2024, up from 16 percent in 2023 49% describe their local real estate market as “overvalued with correction possible” 60% still expect to increase investment property purchases in 2024 Auction.com, the nation’s leading distressed real estate marketplace, released its 2024 Buyer Insights report, which shows that an increasing share of local community developers buying distressed properties at auction expect home prices and rents to decline in their local market. Forty percent of buyers surveyed said they expect home prices to decline in 2024, up from 32 percent in a 2023 survey and up from 17 percent in a 2022 survey. Buyers in the Southeast were most bearish on home prices (46 percent expecting a decline), and buyers in the West were least bearish (35 percent expecting a decline). Nearly half of buyers (49 percent) described their local market as “overvalued with correction possible.” Nearly three in 10 buyers surveyed (29 percent) said they expect rents to decrease in the coming year, up from 16 percent of buyers surveyed in 2023. Buyers in the West were most bearish about rents (35 percent expecting a decline), and buyers in the in the Northeast were least bearish (25 percent expecting a decline). Buyers Still Bullish on Acquisitions Despite being increasingly bearish on retail home price appreciation and rents, buyers were increasingly bullish on property acquisitions. Sixty percent of buyers surveyed said they expect to increase property purchases in 2024, up from 54 percent who expected to increase property purchases in 2023. Most buyers aren’t expecting to lower their maximum bids at auction in 2024. More than half (56 percent) plan to keep their maximum bid calculation relative to property value the same while 21 percent said they plan to increase their maximum bid calculation. The 2024 Buyer Insights Report is based on a January 2024 survey of more than 400 Auction.com buyers from across the country. More than nine in 10 buyers surveyed described themselves as local community developers who purchased fewer than 10 properties in 2023. Other survey findings in the report: To view the full report: https://www.auction.com/lp/in-the-news/2024-buyer-insights-report/ About Auction.com Auction.com is the nation’s leading online marketplace for the disposition of distressed residential properties. The company goes beyond traditional disposition programs, offering tools and services that stabilize neighborhoods, expand homeownership, maximize sales, shorten the sales cycle, yield higher returns, mitigate risks and elevate results. Our seller strategy includes customized and flexible programs, data intelligence and buyer insights, and pioneering technology. This includes Remote Bid®, which expands the buyer base nationwide by letting buyers bid on and win select foreclosure sales from anywhere, and Portfolio Interact™, featuring Bid Interact™. The national footprint for online and in-person auctions includes all 50 states, as well as Washington, DC, and Puerto Rico. Auction.com is headquartered in Irvine, CA, with offices in key markets nationwide. Contact Daren BlomquistAuction.com Tel.949.355.3371 Email: dblomquist@auction.com

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NRHC Applauds Governor Kemp for Signing the “Georgia Squatter Reform Act”

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The National Rental Home Council (NRHC) commends Georgia Governor, Brian Kemp, for signing into law House Bill 1017, the “Georgia Squatter Reform Act,” legislation providing legal protections and recourse for homeowners in the event of the illegal occupation of their properties. Passed with overwhelming bipartisan support in both houses of the Georgia legislature, HB 1017 codifies and reinforces basic, foundational rights and responsibilities of homeowners throughout the state. “NRHC commends Governor Kemp for signing this important legislation, in the process supporting the rights of homeowners throughout the state of Georgia,” said David Howard, CEO of NRHC. “Beyond the obvious property rights issues involved, this legislation will enhance the safety and security of communities and neighborhoods and will make housing more accessible and attainable.” NRHC also thanks the following state representatives for their sponsorship of HB 1017: Devan Seabaugh, Matt Reeves, James Burchett, Clint Crowe, Deborah Silcox, and Bill Yearta. About NRHC The National Rental Home Council (NRHC) is the nonprofit trade association representing the single-family rental home industry. NRHC members provide families and individuals with access to high-quality, single-family rental homes that contribute to the vitality and vibrancy of neighborhoods and communities. For more information on NRHC or the single-family rental home industry visit www.rentalhomecouncil.org For more information contact: press@rentalhomecouncil.org

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Home Prices Stagnate in Florida and Texas as Supply Soars

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The number of homes for sale in Cape Coral, FL and North Port, FL surged roughly 50% from a year earlier in March—more than anywhere else in the country. And in McAllen, TX, supply jumped 25%. On the west coast of Florida, housing supply is surging, sellers are cutting their asking prices and the time it takes to sell a home is soaring—all at a faster rate than anywhere else in the U.S. The story is similar in parts of Texas. That is according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Here’s how these trends showed up in U.S. housing-market data for March, which covers 85 major metropolitan areas: Florida and Texas have been building more homes than anywhere else in the country, partly to accommodate the flood of newcomers that showed up during the pandemic homebuying boom. But the boom is over, in part because many people have been priced out. Now, homes are sitting on the market and price growth is stagnating. “Out-of-town homebuyers no longer see Florida as a place to get amazing value. Now they’re moving to North Carolina or Tennessee to get a good deal. Many local blue-collar workers have been priced out of homeownership, too,” said Eric Auciello, a local Redfin sales manager. “Two years ago, the North Port metro was one of the most competitive housing markets in the country because it was affordable for remote workers and there was a shortage of homes for sale, but none of those things are true today. Sarasota, in particular, has been overvalued for decades, and the chickens have finally come to roost. The Tampa metro has been faring a bit better.” Individual home sellers are having a tough time attracting buyers in part because builders are offering concessions that are hard for buyers to refuse. As a result, listings from regular sellers are sitting on the market. But homes are also sitting because many sellers are pricing their properties too high, and then being forced to cut later, Auciello said. “The sharp ascent in Florida housing prices in recent years has driven a lot of homeowners to cash in on their equity, but some of them are having a hard time adjusting to the fact that it’s a buyer’s market,” Auciello said. “My advice to sellers is to price your home fairly; the comps from six months ago don’t exist now. And if you’re a buyer, know that the odds of getting an offer accepted below market value are pretty high.” The insurance crisis in Florida is also throwing a wrench into home purchases and in some cases delaying deals. Nearly three-quarters of Florida homeowners say they or the area they live in has been affected by rising home insurance costs or changes in coverage, a recent Redfin survey found. “One of our agents is representing a buyer who thought he’d be able to get insurance for $2,000 per year—the rate the existing homeowner has. But he found out at the eleventh hour that his insurance will be $4,000 because the house has had water damage. We’re seeing sellers offer a lot of concessions to hold deals together,” said Auciello, whose own home insurance is now $14,000 a year all in, up from around $8,000 two years ago. “We’re at an inflection point. A hefty insurance bill isn’t always a big deal for a luxury buyer, but it can be a really big issue for someone buying a waterfront home on a smaller budget.” Connie Durnal, a Redfin Premier real estate agent in Dallas, said her market has also been sluggish. “Last year was by far the slowest market I’ve seen in my 20 years as a real estate agent,” Durnal said. “Move-up buyers are almost nonexistent. Even though a lot of homeowners have built up a ton of equity, many don’t want to sell because their monthly payment would double or triple due to high mortgage rates.” Nationwide, New Listings Slowed in March and Prices Rose From a Year Earlier New listings dropped 6% month over month in March—the largest decline on a seasonally adjusted basis since January 2022. They rose 6% from a year earlier, but that marks a deceleration from the 14% annual gain in February. New listings may have slowed because mortgage rates are staying higher longer than expected, which is exacerbating the lock-in effect. The average 30-year-fixed mortgage rate in March was 6.82%—the highest since December—and the Federal Reserve has warned that elevated inflation will probably delay the interest-rate cuts they had been planning this year. Prices continued to rise, in part because there’s still a shortage of homes for sale. The median U.S. home sale price rose 5% year over year in March to $420,357, just 3% below the record high of $432,496 set in May 2022. Home sales were roughly flat compared with a month earlier on a seasonally adjusted basis, and were down 3% from a year earlier. March 2024 Highlights: United States   March 2024 Month-Over-Month Change Year-Over-Year Change Median sale price $420,357 2.1% 4.8% Homes sold, seasonally adjusted 423,273 -0.2% -2.6% New listings, seasonally adjusted 509,405 -6.3% 6.1% All homes for sale, seasonally adjusted (active listings) 1,600,310 0.6% 4.3% Months of supply 2.4 -0.5 0.3 Median days on market 40 -8 -4 Share of for-sale homes with a price drop 16.3% 1.1 ppts 2.8 ppts Share of homes sold above final list price 30.0% 3.8 ppts 1.6 ppts Average sale-to-final-list-price ratio 99.2% 0.5 ppts 0.4 ppts Average 30-year fixed mortgage rate 6.82% 0.04 ppts 0.28 ppts

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PROFITS FOR U.S. HOME SELLERS DECLINE AGAIN IN FIRST QUARTER OF 2024 AS PRICES FALL

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Profit Margins on Typical Home Sales Nationwide Decrease to 55 Percent; Returns Slip Downward as Median U.S. Home Price Slumps 4 percent ATTOM, a leading curator of land, property, and real estate data, released its first-quarter 2024 U.S. Home Sales Report, which shows that profit margins on median-priced single-family home and condo sales in the United States decreased to 55.3 percent in the first quarter – the smallest level in more than two years. The decline in typical profit margins, from 57.1 percent in the fourth quarter of 2023 and from 56.5 percent a year ago, came as the median nationwide home price went down quarterly by 4.3 percent, to $330,000. While prices often fall back during the slower Winter home-selling season each year, the latest decrease marked one of the largest quarterly declines over the past 10 years. At the same time, investment returns for sellers decreased for the second straight quarter after several increases last year, hitting the low point since mid-2021. Still, even as seller returns slipped, they remained higher than during most of the housing market boom that has continued throughout the nation over the past decade. The same was true in the early months of 2024 for the typical $120,500 gross profit on typical home sales across the country. “The latest price and profit numbers show notably downward trends, which raises new questions about whether the housing-market boom is indeed ebbing, or even ending, after so many years of improvement,” said Rob Barber, CEO for ATTOM. “But due caution is needed in looking at the first-quarter data and what the patterns mean. We saw a similar downward pattern from late 2022 into early 2023, and then the market surged. Plus, profits and profit margins still are very high by historical measures. Amid all that, the Spring buying season will be a huge barometer for whether the market still has steam in its engine.” The drop-off in prices and profits comes as a mix of powerful forces is putting both upward and downward pressure on the U.S. housing market. On the upside, historically low supplies of homes could push prices higher this Spring as buyers compete for a relatively small stock of properties for sale. The recent surge in the stock market also helps by providing more resources for down payments. At the same time, though, mortgage rates have crept back above 7 percent for a 30-year fixed loan and inflation remains near 4 percent. Those factors are pushing up ownership costs during a time when home affordability already is a stretch for average workers across the country, according to a separate ATTOM analysis. Profit margins decline quarterly and annually in more than half the countryTypical profit margins – the percent difference between median purchase and resale prices – decreased from the fourth quarter of 2023 to the first quarter of 2024 in 89 (66 percent) of the 134 metropolitan statistical areas around the U.S. with sufficient data to analyze. They also were down annually in 71, or 53 percent, of those metros. That happened as median first-quarter home prices declined more, or went up less, compared to changes that recent sellers were seeing when they originally bought their homes. Those trends, from the point of purchase to the point of resale, translated into lower profit margins in a majority of the country. Metro areas were included if they had sufficient data and at least 1,000 single-family home and condo sales in the first quarter of 2024. The biggest year-over-year decreases in typical profit margins came in the metro areas of Lake Havasu City, AZ (margin down from 102.4 percent in the first quarter of 2023 to 76.3 percent in the first quarter of 2024); Naples, FL (down from 88.4 percent to 62.9 percent); Hilo, HI (down from 82.3 percent to 57.8 percent); Crestview-Fort Walton Beach, FL (down from 68 percent to 47.3 percent) and Port St. Luce, FL (down from 92.8 percent to 72.3 percent). The biggest annual profit-margin decreases in metro areas with a population of at least 1 million in the first quarter of 2024 were in Honolulu, HI (return down from 57.2 percent to 41.3 percent); Birmingham, AL (down from 36.5 percent to 21.7 percent); Austin, TX (down from 49.3 percent to 37.5 percent); San Antonio, TX (down from 35 percent to 25.7 percent) and Salt Lake City, UT (down from 50.7 percent to 42.2 percent). Typical profit margins increased annually in 63 of the 134 metro areas analyzed (47 percent). The biggest annual improvements were in Peoria, IL (margin up from 32.6 percent in the first quarter of 2023 to 52.8 percent in the first quarter of 2024); Scranton, PA (up from 88.1 percent to 106.5 percent); Oxnard, CA (up from 55.1 percent to 71.2 percent); Rochester, NY (up from 50.4 percent to 65.2 percent) and San Jose, CA (up from 85.8 percent to 100 percent).  Aside from Rochester and San Jose, the largest annual increases in profit margins among metro areas with a population of at least 1 million came in San Diego, CA (up from 65.3 percent to 73.8 percent); Tucson, AZ (up from 49.8 percent to 57.4 percent) and New York, NY (up from 55.7 percent to 62.7 percent). Prices down quarterly in most of nation although still up annuallyNationwide, the median price of single-family homes and condos declined quarterly to $330,000, down from $345,000 in the fourth quarter of 2023 (a record hit several times over the past two years). The typical home sale decreased quarterly in 112 (84 percent) of the 134 metro areas around the country with enough data to analyze, However, latest median prices remained 3.1 percent higher than the $320,000 level in the first quarter of 2023, rising annually in 103 of the metros reviewed (77 percent). Metro areas with the biggest decreases in median home prices from the fourth quarter of 2023 to the first quarter of 2024 were Pittsburgh, PA (down 11.5 percent); Flint, MI (down 10.7 percent); Memphis, TN (down 10.7 percent); Birmingham, AL (down 10.2 percent) and Montgomery, AL (down 9.7 percent). Aside from Pittsburgh, Memphis and Birmingham, the largest quarterly median-price decreases in metro areas with a population of at least 1 million were in St. Louis, MO (down 8.1 percent) and Indianapolis, IN (down 7.4 percent). Metro areas with a population of at least 1 million where the median home price remained up most from the first

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Hot Economy, Inflation Likely to Keep Rates ‘Higher for Longer’

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Rise in New Home Listings Projected to Boost Sales Despite Recent Run-up in Mortgage Rates Stronger-than-expected economic and inflation data have pushed interest rates higher and financial markets to price in fewer Federal Reserve rate cuts this year, according to the April 2024 commentary from the Fannie Mae Economic and Strategic Research (ESR) Group. While higher mortgage rates present renewed headwinds to the expected recovery in home sales this year, as well as homebuyer affordability more generally, the ESR Group notes that new listings of homes available for sale have continued to rise. While the ESR Group is forecasting existing home sales to rise modestly over the course of the year, it expects the flow of new listings to outpace home sales, which should help gradually thaw housing inventory and contribute to decelerating home price growth. However, based on incoming home price data, which continue to come in strong, the ESR Group expects home prices to rise 4.8 percent in 2024, up 1.6 percentage points from last quarter’s projection, and then another 1.5 percent in 2025. While interest rate cuts appear to be on hold due to the recent mix of strong economic data and hot inflation reports, the ESR Group continues to forecast slowing employment and economic growth, as well as progress toward 2-percent inflation over its forecast horizon. However, recent data have caused a reassessment of the pace of decelerating inflation, and the ESR Group now expects the Consumer Price Index to end 2024 at a 3.1 percent annual rate, compared to the 2.5 percent previously projected.     “Financial markets rapidly repriced their interest rate expectations following hotter-than-expected inflation reports and ongoing strong payroll employment gains,” said Hamilton Fout, Fannie Mae Vice President, Economic and Strategic Research. “While we still expect economic growth and inflation to moderate going forward – and, thus, for mortgage rates to drift downward – interest rates existing in a ‘higher for longer’ state seems to be an increasingly real possibility in the eyes of market participants, as well as some homebuyers and sellers. While we’ve recently seen evidence that some potential home sellers are becoming more acclimated to the higher mortgage rate environment and putting their homes on the market, the recent move upward in rates is yet another headwind to the recovery of home sales, and it intensifies longstanding affordability challenges for consumers.” Visit the Economic & Strategic Research site at fanniemae.com to read the full April 2024 Economic Outlook, including the Economic Developments Commentary, Economic Forecast, Housing Forecast, and Multifamily Market Commentary. To receive e-mail updates with other housing market research from Fannie Mae’s Economic & Strategic Research Group, please click here. SOURCE Fannie Mae

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