Real Estate News for North Pinellas County

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Tampa Bay, nation show some rallying in real estate prices

Every few months, people who are interested in the real estate market turn their attention to the S&P/Case-Shiller Home Price Indices, the most reliable measurement of home prices in the nation. 

standard & poor 2That quarterly report came out today, and it contains some encouraging news – home prices were up in the second quarter of 2011. According to the Case-Shiller report, the U.S. National Home Price Index went up 3.6 per cent in the second quarter. In the previous quarter, the one ended at the end of March, the Home Price Index was down 4.1 percent. 

Any bad news in this report? Well, while the second quarter was up from the first quarter, it was down 5.9 percent when compared to the second quarter of 2010, one year ago. 

Nationally, home prices are about where they were in early 2003. 

Case-Shiller comes up with its national figures by keeping track of home prices in 20 metropolitan areas. One of those areas is Tampa Bay. Pinellas County real estate is not considered on its own, but the Tampa Bay real estate numbers should be very close to our own here in Pinellas County. 

Tampa Bay has taken a worse-than-average hit when it comes to home values for the quarter. Values are down seven per cent in this most recent quarter when compared to a year ago. That’s more than a percentage point more than the national average. 

Not as bad as such places as Minneapolis or Portland, Ore. or Phoenix, but worse than such cities as New York, Boston or Washington DC. 

“This month’s report showed mixed signals for recovery in home prices,” said David M. Blitzer, chairman of the Index Committee at S&P Indices. “No cities made new lows in June 2011, and the majority of cities are seeing improved annual rates.” 

Blitzer said the numbers show that regional markets have to be considered as separate entities – the national housing market is not rising or falling as one. So don’t simply go by whatever national real estate figures you see in the newspaper — remember that values of Pinellas County real estate may be quite different.

You can see the Case-Shiller news release here.

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July home index leaves little to smile about


Every month, real estate people, financing professionals, homebuilders and many others wait with great anticipation for release of the monthly Case-Schiller home price index from Standard & Poor. 

 The index keeps track, on a month-by-month basis, of home prices across the country.

standard & PoorThe most recent index report was released this week. And while everyone was hoping for a healthy uptick in home sales, what they got instead was more of the same.

Home prices in May (measured in 20 major cities) were down 4.5 percent from the same month a year ago. When compared to the previous month of this year, April, home prices were virtually unchanged.

 So what we have is a market that continues to sort of limp along at the same slow pace. No big drops to indicate additional troubles in the area of home prices; but no indications of additional market recovery, either.

Taken market-by-market, prices were up a bit in nine cities, and down a bit in 11 others. Unfortunately for those of us in this part of the country, homes prices were down 1.5 percent in Tampa Bay.

Why aren’t we seeing more recovery after such a long period of market weakness? Here’s a few possible reasons:

  • The battle in Washington over raising the debt ceiling, and the inability of lawmakers to come up with some sort of strategy or plan – any plan – doesn’t do anything to inspire confidence.
  • Because so many problems result from lax lending standards, the current lending standards are much tighter than before, and that keeps some buyers (even qualified buyers) out of the market.
  • High unemployment rates (9.2 percent nationally) means thousands of people don’t have the incomes necessary for home purchases.
  • The bad economy prevents the formation of new households. People forming new households are people in need of new housing.

 I posted a story a few days ago about the increase in cancelled real estate sales contracts. There are a number of reasons for cancelled contracts (tighter credit standards, tougher appraisals, general nervousness in the market), but whatever the reason, fewer executed contracts obviously means fewer sales.

Were you hoping for a little more optimism in this month’s Case-Schiller home price index? Okay, here are a couple of bright spots: 

  • The inventory of homes for sale was 164,000 units, a little more than a six-month supply. That’s the lowest that home inventories have been in a long time. Once we fight through all this stagnant inventory of homes for sale, we’ll see a re-ignition of the new-home construction business, and that will mean new jobs and some good stimulation for the economy.
  • The median home sales price for the month of June was up 7.2% for new single-family homes. That could be an indication that homes in the higher price ranges are starting to sell.

If you are a glass-half-full kind of person, the new monthly index figures are a little encouraging. If you are more of a glass-half-empty sort, then the index just means more of the same.

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