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Recent PostsBlogroll« How Appraisers are Using the 1004MC | Home | TAVMA accuses NAMB of waging a “smear campaign” » First price return increase in three years according to new housing reportBy AppraiserLoft Team | July 9, 2009 A new home data index market report has been released for the month of July, showing the first positive rolling quarter-over-quarter price returns since 2006. The market report contains a national and four-region overview, a metropolitan statistical area drilldown and a micro-market analysis. Find out how the report is put together here. Clear Capital, a provider of data and solutions for real estate asset valuation, investment and risk assessment, yesterday released its Home Data Index (HDI) Market Report for July, showing that the rolling quarter-over-quarter price returns for the country were positive for the first time since 2006. The price returns were most evident in the Midwest, Southern and Northeast regions, with an increase of 5.3 percent, 2 percent and 0.1 percent respectively. The only region to decline was the West, which posted a decrease of 0.7 percent. According to the report, though, this is still a “promising shift in the market.” In the Midwest, Ohio’s three largest cities all posted big quarter-over-quarter price gains. Cleveland saw a gain of 19.6 percent, Columbus 15.6 percent and Cincinnati 12.9 percent. Cleveland’s jump in price returns is attributed to seasonal springtime activity coupled with lower priced homes, which accounted for 50 percent of home sales. “Cleveland’s drawn a lot of attention because a lot of those low price homes only need to sell for a couple of thousand dollars over the prior sale to show appreciable gains,” said Clear Capital’s President Kevin Marshall. The biggest quarterly decline was in the Las Vegas market, with 12.4 percent. This was followed by Orlando, Fla. And Riverside/San Bernadino/Ontario, Calif. Between them, California and Florida accounted for six of the 15 lowest performing MSAs. The market report includes a national and four-region overview, metropolitan statistical area (MSA) drilldown and a special look at a particular market in its micro-market analysis. This month’s report features data compiled through June 25. “Our data is extremely recent,” Marshall told Valuation Review. “Since we have a lot of propriety data sources flowing into the company, we’re able to consider sales that closed as recently as last week, or even a couple of days ago. We don’t have that typical five-to-six week lag on numbers reporting that seems to cause a lot of frustration.” The data for the market report comes from a variety of sources, but mostly from the network of 50,000 brokers, agents, appraisers and real estate professionals that Clear Capital has built relationships with. “They provide us with statistics of what’s going on in their local markets,” Marshall said. He revealed that a lot of the sales coming in to the company in real time were closed sales used as comparables on broker price opinions. “We’re able to get that jumpstart and report on that data sooner rather than wait for it to come through the standard assessor and deed information roll,” he said. The market report is run on two pricing models, a paired repeat sales index model and a median price per square foot model and is designed to be as granular as possible. “If we have enough sales to come up with a statistically valid number, we can report down to the census block, which is about 500 housing units,” said Marshall. If the census block doesn’t have enough sales, Clear Capital widen the net to include 1200-1500 housing units, then the city, then the zip code, and finally the county. This cascading approach is designed to help customers make informed decisions. “If they’re purchasing or managing, it doesn’t force them to play the waiting game. A lot of our customers are making huge financial decisions based on data from six weeks ago in an extremely volatile market,” said Marshall. The HDI has the potential to run up to 300 unique models, including REO saturation, REO discounts, and a price tier system. “We look at the bottom 25 percent of homes, the middle 50 percent and the upper 25 percent, and then an aggregate of all three,” said Marshall. The HDI has to filter through a large amount of data to get the market report. “There’s a ton of processing in there. Our tech team loves being asked to build larger and larger stat clusters that suck an amazing amount of power and bandwidth,” said Marshall. Indeed, the index generates 25 gigabytes of data every time it is run, which is about once a week. The models themselves can be run in under 24 hours. A unique feature of Clear Capital’s market report is the micro market analysis, which looks at a particular MSA in great detail, giving a snapshot of an area that captures the essence of an ever-fluctuating local market. “You can’t paint a MSA as either positive or negative. You really have to be surgical in your pricing decisions and get into as a granular an area as possible,” said Marshall. “There’s great value in digging into a micro-market analysis. Every month we’re going to pick one MSA and really pull out some compelling stories.” In July, the micro market analysis is for the MSA of Miami, which showed a 36.8 percent decline for the year with both REO condominium and REO single family sales accounting for more than 40 percent of total sales in their respective classes. However, the Pembroke Pines submarket declined only 10.8 percent for the year, posting a small gain of 1.9 percent for the quarter. The HDI is released in a spreadsheet format as a kind of portfolio analysis tool, or as a PDF that is aimed more at individual review workflows. Currently, Clear Capital charge $2 for each report on a loan-by-loan basis, but they are working on developing a subscription model. Marshall wanted to release this report to help his customers make more informed decisions. “We recognize that in order for the housing markets and the economy to recover there needs to be secondary market capital flowing once again,” he said. “We’re excited to help people figure out how they can do that in a confident manner.”
Refer: http://tinyurl.com/mlrhuc Topics: General | 1 Comment » One Response to “First price return increase in three years according to new housing report”CommentsYou must be logged in to post a comment. |
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January 22nd, 2010 at 2:06 pm
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