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Home prices rise across America

Posted in Real Estate News

Home Prices Rise Across U.S.

Bargain Hunting, Low Rates Drive First Gain in 3 Years; Double Dip Still Possible

BY NICK TIMIRAOS AND KELLY EVANS

Home prices in major U.S. cities registered the first monthly gain in nearly three years, according to a new report that provided fresh evidence that the severe U.S. housing downturn could be easing.

Standard & Poor’s Case-Shiller index, which tracks home prices in 20 metropolitan areas, rose 0.5% for the three-month period ending in May, compared with the three months ending in April. It marked the index’s first increase after 34 straight months of decline, and came after a variety of housing indicators has shown glimmers of hope for the past several months.

Bozeman ranks #8 in U.S. housing market

Posted in Real Estate News

Top 25 Forecast Housing Markets

Two states with reputations for being some of the coldest places in the country dominate the Housing Predictor Top 25 housing markets for 2009. Montana placed all of its five forecast markets on the list, and neighboring North Dakota had 4 markets make the top 25 forecast to have the highest appreciation in home values during the year.

The Housing Predictor Top 25 Markets are selected from the more than 250 local housing markets forecast, and are projected to have the best probability of hitting their forecast appreciation. Eleven markets are forecast to experience some level of appreciation in 2009, making the top 25 markets. Fourteen other markets round out the Top 25 forecast to experience lower deflation than the majority of the country.

Bloomington, Illinois grabbed the #1 position forecast to appreciate 2.3% in average home values in 2009. Bloomington is the home to Illinois State University and the home offices of State Farm Insurance. Homes are taking longer to sell these days in Bloomington, but the market should remain as one of the nation’s exceptions with appreciation in 2009.

With one of the strongest job markets in the country Billings, Montana placed second on the list followed by Fargo, North Dakota.

They’ve dodged the bullet in the nation’s housing depression in North Dakota and Montana. During the boom mortgage companies didn’t offer creative new loan programs in either state much, which has acted to protect their housing markets from major deflationary cycles experienced in the majority of the country.

Top 25 US Appreciating Real Estate Markets
Rank Real Estate Market 2009 Forecast
1. Bloomington, IL 2.3%
2. Billings, MT 2.1%
3. Fargo, ND 1.8%
4. Lander, WY 1.7%
5. Trenton, NJ 1.6%
6. Morgantown, WV 1.6%
7. Logan, UT 1.4%
8. Bozeman, MT 1.3%
9. Albany, GA 1.2%
10. Fairmont, WV 1.2%
11. Minot, ND 1.0%
12. Great Falls, MT −0.9%
13. Livingston, MT −0.8%
14. Bismarck, ND −0.8%
15. Missoula, MT −0.8%
16. Grand Forks, ND −1.1%
17. Paducah, KY −1.2%
18. Piedmont, SD −1.5%
19. Lawton, OK −2.1%
20. Black Hills, SD −2.1%
21. Edmond, OK −2.8%
22. Mobile, AL −2.8%
23. Oklahoma City, OK −2.9%
24. Lincoln, NE −3.0%
25. Amarillo, TX −3.9%

Big Sky River’s Act

Posted in Real Estate News

The Big Sky Rivers Act ensures that new buildings are set back a safe distance from the banks of 10 Big Sky rivers in order to protect people and property and the rivers’ outstanding economic, biological and recreational values (see map and list of rivers on reverse side). The Act creates 250-foot wide “streamside management areas” on either side of designated rivers within which the construction of new homes and commercial buildings, or the installation of septic tanks and drainfields, is prohibited. It also limits the removal of riparian vegetation within 150 feet of designated rivers in order to minimize erosion and protect water quality.  All but one of the Big Sky rivers cross county lines. Because unwise riverside development in upstream counties can have  profound impacts on property in downstream counties, it is appropriate for the Montana Legislature to set up a consistent system of streamside protections on these large and important rivers.

WHAT THE BIG SKY RIVERS ACT DOES:

  • It reduces costly flood and erosion damage by steering development away from known flood hazard areas;
  • It protects private property rights by ensuring that actions of upstream landowners do not harm downstream landowners;
  • It gives local governments control over the tools they need to manage their rivers;• It prevents water pollution from stormwater runoff, lawn chemicals, and individual wastewater systems;
  • It shields local governments from lawsuits brought by homeowners whose homes are damaged by flooding and erosion;
  • It preserves critical fish and wildlife habitat;
  • It ensures high-quality recreational opportunities for anglers and boaters who value scenery and solitude;
  • It includes a variance process to make sure no one loses the ability to build on an existing lot, and a grandfather clause to ensure that existing homes are not impacted.


WHAT THE BIG SKY RIVERS ACT DOES NOT DO:

  • It does NOT take away the authority of local governments to create their own streamside development standards;
  • It does NOT deprive riverfront landowners of the opportunity to build on their lots if their entire lot is located within a streamside management area;
  • It does NOT apply within incorporated cities, towns or sanitary sewer districts;
  • It does NOT prohibit property owners from rebuilding their home if it is destroyed by causes other than flooding;
  • It does NOT grant public access to private property;
  • It does NOT affect agricultural-related buildings.


MONTANA’S BIG SKY RIVERS
WHAT ABOUT THE ISSUE OF LOCAl CONTROL?
Section 9 of this bill provides local control options in two important ways:

  • If local governments want to increase or decrease the size of the streamside management area on designated rivers, the legislation outlines a process for them to use. Local streamside management areas would replace the state streamside management areas in the bill.
  • If local governments want to protect streams or rivers not named in the bill, the legislation outlines a process that local governments can use—at the local government level—to establish streamside management areas.

It will be up to individual county governments to decide which staff or department can best administer designated rivers within their jurisdiction. For example, they could be administered by the county floodplain manager, health department, or planning office. If a county issues building permits, the permit could include a new section that ensures the provisions of the Big Sky Rivers Act are upheld. Or, a county could develop a permit system for buildings planned near rivers that they designated.

Please support House Bill 455.

Existing-Home Sales Show Surprising Gain

Posted in Real Estate News

Daily Real Estate News  |  January 27, 2009  |
Existing-home sales rose unexpectedly while inventory declined, led by a surge of sales in the West, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – jumped 6.5 percent to a seasonally adjusted annual rate of 4.74 million units in December. The number compares to a downwardly revised pace of 4.45 million units in November, but 3.5 percent below the 4.91 million-unit pace in December 2007.

For all of 2008, there were about 4.9 million existing-home sales — 13.1 percent below the 5.65 million transactions recorded in 2007. This is the lowest volume since 1997 when there were 4,371,000 sales.

Lawrence Yun, NAR chief economist, said home prices continue to fall significantly.

“It appears some buyers are taking advantage of much lower home prices,” he said. “The higher monthly sales gain and falling inventory are steps in the right direction, but the market is still far from normal balanced conditions. Buyers will continue to have an edge over sellers for the foreseeable future.”

Total housing inventory at the end of December fell 11.7 percent to 3.68 million existing homes available for sale, which represents a 9.3-month supply at the current sales pace, down from a 11.2-month supply in November.

Yun said the market is underperforming and hurting the broader economy.

“We’ve added 25 million people to our population over the past decade and housing affordability conditions are the best we’ve seen since 1973, but household formation is much lower than expected,” he said. “Consequently, there is a pent-up demand which could be unleashed with the right stimulus, including a non-repayable home buyer tax credit. The Obama administration and Congress need to move fast to stimulate a spring sales upturn which will help to stabilize home prices and set the foundation for a sustainable economic recovery.”

Housing Stats

National median existing-home price: (for all housing types) was $175,400 in December, which is 15.3 percent below December 2007 when the median was $207,000. There remains a significant downward distortion in the current median from a large number of distress sales at discounted prices, currently 45 percent of transactions; the median is where half of the homes sold for more and half sold for less. For all of 2008, the median price was $198,600, down 9.3 percent from $219,000 in 2007.

Single-family home sales: rose 7 percent to a seasonally adjusted annual rate of 4.26 million in December from a level of 3.98 million in November, but are 1.4 percent below a 4.32 million-unit pace in December 2007. For all of 2008, single-family sales fell 11.9 percent to 4,349,000.

Median existing single-family home price: dropped to $174,700 in December, down 14.8 percent from a year ago. For all of 2008, the single-family median was $197,100, which is 9.5 percent below 2007.

Existing condominium and co-op sales: increased 2.1 percent to a seasonally adjusted annual rate of 480,000 units in December from 470,000 in November, but are 18.4 percent below the 588,000-unit level a year ago. For all of 2008, condo sales dropped 21.0 percent to 563,000 units.

Median existing condo price: slipped to $181,400 in December, down 18.3 percent from December 2007. For all of 2008, the median condo price was $210,000, which is 7.2 percent below 2007.

Existing-Home Sales By Region

* Northeast: slipped 1.4 percent to an annual pace of 720,000 in December, and are 14.3 percent below December 2007. The median price in the Northeast was $235,000, which is 7.8 percent lower than a year ago.

* Midwest: increased 4.0 percent in December to a level of 1.04 million but are 10.3 percent below a year ago. The median price in the Midwest was $140,800, down 11.4 percent from December 2007.

* South: rose 7.4 percent to an annual pace of 1.74 million in December, but are 11.2 percent lower than December 2007. The median price in the South was $158,600, which is down 8 percent from a year ago.

* West: jumped 13.6 percent to an annual rate of 1.25 million in December and are 31.6 percent higher than a year ago. The median price in the West was $213,100, down 31.5 percent from December 2007.

A Good Time to Buy

NAR President Charles McMillan said it’s an excellent time for first-time home buyers with good jobs.

“The typical buyer plans to stay in their home for 10 years, which is the correct approach in today’s market,” he said. “With historically low mortgage interest rates, flexible sellers, a large inventory, and homes that are selling for less than replacement construction costs in much of the country, buyers who’ve been on the fence should take a closer look at today’s market.”

McMillan added that first-time buyers may want to consider an FHA loan, which offers downpayments of 3.5 percent on a safe 30-year fixed-rate mortgage.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.29 percent in December from 6.09 percent in November; the rate was 6.10 percent in December 2007. Last week, Freddie Mac reported the 30-year rate was 5.12 percent.

Source: National Association of Realtors

Bozeman in Top 25 Housing Markets in 2009

Posted in Real Estate News

January 21, 2009:

Housing Predictor, a national online real estate research firm, is forecasting that Bozeman and four other Montana cities will be among the top 25 U.S. housing markets in 2009.

The firm predicts — based on things like income levels, employment trends, school enrollment and housing markets — that home values in Bozeman will increase slightly, by 1.8 percent, this year.

It forecasts Billings will lead the state with a 3.1 percent home appreciation rate, followed by Great Falls (1.4 percent), Livingston (1.3 percent) and Missoula (1.2 percent).

Such increases are modest, but look great compared to more than 36 states, from California to Florida, where the company projects double-digit deflation in home values.

Nationally, Housing Predictor forecasts turbulence in real estate markets in 2009 and an increase in foreclosures as adjustable-rate mortgages reset to higher interest rates.

Montana, North Dakota and Colorado will be exceptions to the worst economy since the Great Depression, it predicted, “illustrating the fact that real estate markets are normally driven by local market dynamics.”

Mike Basile, broker-owner of Prudential Montana Real Estate and a 28-year veteran of the Bozeman housing market, said, “I would agree we’d see appreciation from 2008,” a year when prices declined slightly.

“I do think we’ll see a slow, moderate rebound,” Basile said. “We’re seeing a large number of buyers. … not to the degree we did two years ago, but still there are buyers buying. … They’re bargain-hunting, they’re seeing the value of low interest rates.”

With mortgage rates below 5 percent, Basile said, this is an “amazing time to buy.” Buyers also feel optimistic because there’s a new U.S. president and a federal incentive of $7,500 for first-time homebuyers.

Robyn Erlenbush, broker-owner of ERA Landmark Real Estate, said she wasn’t familiar with Housing Predictor or its track record. But she, too, agreed there are reasons for optimism.

“I’m very hopeful 2009 will be equal to or slightly better than ’08,” Erlenbush said.

In 2008, the average sale price for a single-family home in Bozeman declined from $337,683 in 2007 to $320,342, she said, while the average sale price for condos went down from $234,936 to $215,730. Those decreases work out to 5 percent for houses and 8 percent for condos.

The main reason for her optimism, Erlenbush said, is that the inventory of houses on the market is starting to stabilize or shrink. Home builders aren’t starting new houses or “spec” homes, so homeowners selling existing homes don’t face as much competition.

Every month there seems to be some news that ranks Montana or Bozeman favorably, like the recent ranking of Montana as 46th lowest state in foreclosure rates, she added. And people still want to move to Bozeman.

Housing Predictor does research on 250 local housing markets in all 50 states. Its Web site (housingpredictor.com) claims to have predicted the national real estate recession in 2007 and to have been “the first research firm to forecast the foreclosure epidemic.”

It describes Bozeman as one of the country’s most livable cities, with lots of entrepreneurs, outdoor activities, and a resort vacation market “that may hold its own.” Foreclosures have crept up.

Still, it said, “Montana is turning in a star performance.”

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