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Consumer Confidence in Housing Market Up: Fannie Mae

The Fannie Mae (FNMA/OTCQB) Home Purchase Sentiment Index® (HPSI) increased 4.5 points in May to 67.5, building slightly after nearing its all-time survey low in April. Four of the six HPSI components increased month over month, with consumers reporting a somewhat more optimistic view of homebuying conditions and, to a lesser extent, home-selling conditions. Moreover, fewer consumers reported expectations that mortgage rates will go up over the next 12 months. Year over year, the HPSI is down 24.5 points.

“Although the HPSI’s precipitous declines of March and April did not continue in May, Americans’ financial, economic, and housing market concerns remain substantially elevated compared to survey history,” said Doug Duncan, Senior Vice President and Chief Economist. “Low mortgage rates have helped cushion some of the impact of the pandemic on consumer sentiment regarding whether it’s a good time to buy a home, which picked back up this month to late-2018 levels. Although weakened income perceptions and continuing job loss concerns, particularly among renters, are likely weighing on many would-be buyers, purchase mortgage applications have returned to mid-March levels when pandemic response measures began ramping up. Home-selling sentiment remains severely dampened due primarily to economic concerns, though increased purchase activity may improve the confidence of some potential sellers. As lockdown restrictions begin to ease across the country, we expect economic recovery to be largely shaped by consumers’ decisions regarding when and how to reengage in the economy. We believe this month's HPSI results and Friday's unexpectedly favorable labor market report to be encouraging signs for the months ahead.”

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Office Market Sector Expected to See Negative Absorption Rates Until Late 2021: NAIOP

By Scott Baltic

National economic upheaval and surging unemployment will push U.S. office market absorption into negative territory through the second quarter of next year. That’s according to the NAIOP Research Foundation’s Office Space Demand Forecast for the second quarter.

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Mortgage Rates Up as Homebuyers Re-enter Market; Selection Still Limited: Freddie Mac

Mortgage rates moved up slightly during the past week as prospective homebuyers re-entered the market, Freddie Mac reported June 4 in its Primary Mortgage Market Survey. While the economy slowly rebounds, signs indicate that home sales are picking up nicely even as the supply of available homes remains limited.

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‘Uncertainties’ in Valuations Worry CRE Investors: Survey

By Dean Boerner

As public equities-laden pension funds reel from massive hits leveled by stock market volatility this year, commercial real estate will likely continue growing in importance for institutional investors in the long term, experts say.

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Coronavirus and the CRE Effect

By Michael Tucker

The real estate impact of coronavirus will likely be limited in the short-term, but it could grow should the virus aggressively spread, analysts said.

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Wide Range of Big-Box Values Raises Concerns: The Appraisal Journal

Courts, market participants and valuation professionals have expressed widespread concern about the broad range in real estate values presented by opposing litigation experts regarding single-tenant, big-box properties, according to an article published this week in The Appraisal Journal.

The Appraisal Journal is the quarterly technical and academic publication of the Appraisal Institute, the nation’s largest professional association of real estate appraisers. The materials presented in the publication represent the opinions and views of the authors and not necessarily those of the Appraisal Institute.

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Industrial Sector’s Big Box Segment Sees Strong First Half, Colliers Data Reveals

By Barbra Murray

The first half of 2019 proved to be yet another strong period in the big-box segment of the industrial sector, and despite certain challenges, more of the same is the likely scenario for the remainder of the year, according to Colliers’ 2019 midyear big-box market report.

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Residential Real Estate Prices Up; Homeownership Tenure Reaches New Peak: Data

 ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), today released its Q2 2019 U.S. Home Sales Report, which shows that U.S. single family homes and condos sold for a median price of $266,000 in the second quarter, up 10.8 percent from the previous quarter and up 6.4 percent from a year ago — reaching a new median home price peak.

Meanwhile, the report also shows that homeowners who sold in the second quarter had owned an average of 8.09 years, reaching a new peak, up 3 percent from last quarter and up 4 percent from Q2 2018. Homeownership tenure averaged 4.21 years nationwide between Q1 2000 and Q3 2007, prior to the Great Recession.

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Multifamily Buildings Getting Bigger, Middle of the Market is Missing: Census Bureau

Last year, developers in the U.S. completed 211,000 new housing units in buildings of 50 units or more, the biggest number on record. The total number of new apartments constructed didn’t come close to setting any records, though.

These numbers are from Characteristics of New Housing, an annual Census Bureau data release that is so chock-full of interesting information (for example: 88% of apartments completed in 2018 had in-unit laundry facilities) that I briefly contemplated interrupting my vacation to write about it when it came out two weeks ago. I resisted then, but now I’m back at my desk and the new numbers don’t seem to have gotten much attention. They should!

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Economic Growth to Slow, Housing to Improve: Fannie Mae

By Matthew Classick

The Fannie Mae Economic and Strategic Research (ESR) Group downgraded its projections for full-year 2019 and 2020 U.S. economic growth to 2.1 percent and 1.5 percent, respectively, due to expected weakness in business fixed investment and softening global economic conditions. The ESR Group had previously forecast growth of 2.3 percent in 2019 and 1.8 percent in 2020. The ESR Group now projects that the Federal Reserve will cut the federal funds rate by 25 basis points at the September meeting of its Federal Open Market Committee to fend off greater deceleration in domestic growth.

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Housing Market on the Move as 1 in 5 Americans to Relocate within a Year, Fed Says

By Kathleen Howley

About 19% of American households surveyed in May expected to move in the next 12 months, according to the Survey of Consumer Expectations report from the Federal Reserve Bank of New York published Monday. That was the highest May reading in two years.

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Properties Located in Opportunity Zones Show Sales Growth: Real Capital Analytics

By Erika Morphy

The general consensus about Opportunity Zones has been that while interest in these areas is intense, there has been little activity. Most of the capital poised to invest in Opportunity Zones, so the theory goes, is waiting on the sidelines until the Treasury Department clarifies more regulations. Indeed, a recent report by Reonomy found that investment levels and prices in Opportunity Zones are actually declining, as investors wait for more clarity.

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U.S. Home Flipping Rate Reaches a Nine-Year High in Q1 2019

ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), today released its Q1 2019 U.S. Home Flipping Report, which shows that 49,059 U.S. single family homes and condos were flipped in the first quarter of 2019, down 2 percent from the previous quarter and down 8 percent from a year ago to a three-year low.

The 49,059 homes flipped in the first quarter represented 7.2 percent of all home sales during the quarter, up from 5.9 percent in the previous quarter and up from 6.7 percent a year ago — the highest home flipping rate since Q1 2010.

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Commercial Real Estate Price Growth Led by Industrial Sector: Real Capital Analytics

By Michael Tucker

U.S. commercial real estate prices rose 0.8 percent in April, led by industrial property price growth, reported Real Capital Analytics, New York.

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US Office Sector Steady During First Quarter, Bodes Well for New Construction: JLL

By Patricia Kirk

U.S. office market performance in the first quarter of 2019 showed resilience, with roughly 14 million sq. ft. of absorption and dropping vacancy, despite increasingly cautious economic sentiment, reports real estate services firm JLL.

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Industrial and Office Property Values On the Rise, Retail Headed Down, Survey Reveals

By Barbra Murray

The future still bodes well for the office and industrial sectors, according to the Royal Institution of Chartered Surveyors 2019 Q1 U.S. Commercial Property Monitor report. However, survey participants indicate that more downward movement is on tap for the retail sector.

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Food-and-Beverage Real Estate Expected to See an Increase in Occupancy: CBRE

By Erika Morphy

A significant shift is underway for the US restaurants and grocery industries and the real estate these operators occupy, according to a new CBRE analysis. These changes include a greater push for convenient, prepared foods, a growing millennial influence, and the emergence of inner-ring suburbs as the industry’s hottest market. 

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Appraisal Institute Releases Annual Report Highlighting 2018 Accomplishments

The Appraisal Institute on April 17 announced that its 2018 Annual Report is available. The report highlights AI's accomplishments during the previous year in education, professional services, international activities, government relations, meetings, financial performance, professional practice and other areas.

View the report.

In-Depth Scrutiny of Published Data Improves Property Market Understanding: The Appraisal Journal

A detailed analysis of population and employment data, along with the use of fair share comparisons, increases the accuracy of assumptions made by appraisers when completing commercial valuation assignments, according to a study published this week in The Appraisal Journal.

The Appraisal Journal is the quarterly technical and academic publication of the Appraisal Institute, the nation’s largest professional association of real estate appraisers. The materials presented in the publication represent the opinions and views of the authors and not necessarily those of the Appraisal Institute.

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Vast Majority Think 2019 First Quarter is Good Time to Buy Home, says Realtor® Survey

New findings from a National Association of Realtors® survey show that more Americans believe that now is a good time to purchase a home. Consumer opinions about home buying bounced back in the first quarter of 2019, with 37 percent stating that they strongly believe now is a good time to buy, up from 34 percent in the last quarter of 2018 but down from 38 percent one year ago. Only 35 percent of respondents said that now is not a good time to buy a home, compared to 37 percent in 2018's fourth quarter.

NAR's first quarter Housing Opportunities and Market Experience (HOME) survey 1also found that a majority of those polled, 53 percent, said that the economy is improving – down slightly from 59 percent at the end of last year. In 2019, optimism is the greatest among those who earn $100,000 or more and those who reside in rural areas. Fifty percent of Generation X said the economy is improving, while 42 percent of urban area residents reported the same.

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