BOSTON -- Shares of Ryland Group Inc. were down 3% Wednesday morning ahead of the builder's second-quarter earnings report, which is expected to cross after the closing bell. "While most builders should post a fairly strong income statement this quarter, we believe Ryland will be usefully less robust, particularly on the cost side as gross margins remain quite subdued," wrote Ticonderoga Securities analyst Stephen East in an earnings preview this week. "Last quarter Ryland suffered from order declines and poor absorption rates, two trends that we believe could be virtually impossible to turn around in the second quarter given the tax credit expiration." The SPDR S&P Homebuilders ETF was down more than 1% at last check Wednesday.
Copyright © 2010 MarketWatch, Inc.
Wednesday, July 28, 2010
Monday, July 26, 2010
Pace of Orlando home sales remains strong in June
(July 12, 2010 – Orlando, FL) Strong homebuyer demand continued in June, elevating the level of home sales and increasing the area’s month-over-month median sales price for the sixth consecutive month. Members of the Orlando Regional REALTOR® Association reported completed sales on 2,834 homes in June, which is a 27.66 percent increase over the June 2009 mark of 2,220.
The number of new contracts filed in June 2010 (3,736) represents an increase of 1.36 percent more than were filed in June 2009 (3,686). The area’s pending sales statistic — also an indicator of future sales activity – is likewise remaining at a record high with 33.13 percent more homes (9,625) under contract and awaiting closing in June of this year than in June of last year (7,230).
And finally, the median price of all existing homes combined sold in June 2010 increased 0.87 percent to $116,000 from the $115,000 recorded in May 2010. June 2010’s median price is, however, a decrease of 11.57 percent compared to June 2009’s median of $131,175.
“Sales in June got a boost from the homebuyer tax credit, as buyers raced to close by the original deadline. The extended deadline of September 30, 2010 for closing tax credit eligible transactions will continue to increase sales in the next few months,” explains ORRA Chairman of the Board Kathleen Gallagher McIver, RE/MAX Town & Country Realty. “Even with the expiration of the homebuyer tax credit, buying conditions remain favorable. Affordability, historically low interest rates, and a great selection of homes make this an excellent time to buy a home in Orlando.”
June’s $116,000 median price encompasses all types of sales situations and home types. The median price for “normal” sales is $175,000 (up 9.38 percent from last month’s $160,000). The median price for bank-owned sales is $77,500 (down 4.32 percent from last month’s $81,000), and the median price for short sales is $115,526 (up 4.78 percent from last month’s $110,000).
Of the 2,834 sales in June, 911 “normal” sales accounted for 32.15 percent of all sales, while 1,211 bank-owned and 712 short sales made up 67.85 percent.
The Orlando affordability index decreased to 226.29 percent in June. (An affordability index of 99 percent means that buyers earning the state-reported median income are 1 percent short of the income necessary to purchase a median-priced home. Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.) Buyers who earn the reported median income of $53,105 can qualify to purchase one of 12,178 homes in Orange and Seminole counties currently listed in the local multiple listing service for $262,496 or less.
First-time homebuyer affordability in June decreased to 160.92 percent. First-time buyers who earn the reported median income of $36,111 can qualify to purchase one of 8,204 homes in Orange and Seminole counties currently listed in the local multiple listing service for $158,664 or less.
Homes of all types spent an average of 85 days on the market before coming under contract in June 2010, and the average home sold for 95.33 percent of its listing price. In June 2009 those numbers were 104 and 93.83 percent, respectively. The area’s average interest rate decreased in June to 4.84 percent.
Inventory
There are currently 16,304 homes available for purchase through the MLS. Inventory increased by 341 homes from May 2010, which means that 341 more homes entered the market than left the market. The June 2010 inventory level is 8.56 percent lower than it was in June 2009 (17,831). The current pace of sales translates into 5.75 months of supply; June 2009 recorded 8.03 months of supply.
There are 12,353 single-family homes currently listed in the MLS, a number that is 509 (3.96 percent) less than in June of last year. Condos currently make up 2,568 offerings in the MLS, while duplexes/town homes/villas make up the remaining 1,383.
Condos and Town Homes/Duplexes/Villas
The sales of condos in the Orlando area increased by 48.54 percent in June when compared to June of 2009 and decreased by 4.99 percent compared to May of this year. To date, condo sales are up 85.20 percent (3,328 condos sold to date in 2010, compared to 1,797 by this time in 2009).
The most (326) condos in a single price category that changed hands in June were yet again in the $1 - $50,000 price range, which accounted for 53.53 percent of all condo sales.
Orlando homebuyers purchased 291 duplexes, town homes, and villas in June 2010, which is a 59.02 percent increase from June 2009 when 183 of these alternative housing types were purchased. Fifty duplexes, town homes, and villas sold in June 2010 fell into the $100,000 - $120,000 price categories.
The number of new contracts filed in June 2010 (3,736) represents an increase of 1.36 percent more than were filed in June 2009 (3,686). The area’s pending sales statistic — also an indicator of future sales activity – is likewise remaining at a record high with 33.13 percent more homes (9,625) under contract and awaiting closing in June of this year than in June of last year (7,230).
And finally, the median price of all existing homes combined sold in June 2010 increased 0.87 percent to $116,000 from the $115,000 recorded in May 2010. June 2010’s median price is, however, a decrease of 11.57 percent compared to June 2009’s median of $131,175.
“Sales in June got a boost from the homebuyer tax credit, as buyers raced to close by the original deadline. The extended deadline of September 30, 2010 for closing tax credit eligible transactions will continue to increase sales in the next few months,” explains ORRA Chairman of the Board Kathleen Gallagher McIver, RE/MAX Town & Country Realty. “Even with the expiration of the homebuyer tax credit, buying conditions remain favorable. Affordability, historically low interest rates, and a great selection of homes make this an excellent time to buy a home in Orlando.”
June’s $116,000 median price encompasses all types of sales situations and home types. The median price for “normal” sales is $175,000 (up 9.38 percent from last month’s $160,000). The median price for bank-owned sales is $77,500 (down 4.32 percent from last month’s $81,000), and the median price for short sales is $115,526 (up 4.78 percent from last month’s $110,000).
Of the 2,834 sales in June, 911 “normal” sales accounted for 32.15 percent of all sales, while 1,211 bank-owned and 712 short sales made up 67.85 percent.
The Orlando affordability index decreased to 226.29 percent in June. (An affordability index of 99 percent means that buyers earning the state-reported median income are 1 percent short of the income necessary to purchase a median-priced home. Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.) Buyers who earn the reported median income of $53,105 can qualify to purchase one of 12,178 homes in Orange and Seminole counties currently listed in the local multiple listing service for $262,496 or less.
First-time homebuyer affordability in June decreased to 160.92 percent. First-time buyers who earn the reported median income of $36,111 can qualify to purchase one of 8,204 homes in Orange and Seminole counties currently listed in the local multiple listing service for $158,664 or less.
Homes of all types spent an average of 85 days on the market before coming under contract in June 2010, and the average home sold for 95.33 percent of its listing price. In June 2009 those numbers were 104 and 93.83 percent, respectively. The area’s average interest rate decreased in June to 4.84 percent.
Inventory
There are currently 16,304 homes available for purchase through the MLS. Inventory increased by 341 homes from May 2010, which means that 341 more homes entered the market than left the market. The June 2010 inventory level is 8.56 percent lower than it was in June 2009 (17,831). The current pace of sales translates into 5.75 months of supply; June 2009 recorded 8.03 months of supply.
There are 12,353 single-family homes currently listed in the MLS, a number that is 509 (3.96 percent) less than in June of last year. Condos currently make up 2,568 offerings in the MLS, while duplexes/town homes/villas make up the remaining 1,383.
Condos and Town Homes/Duplexes/Villas
The sales of condos in the Orlando area increased by 48.54 percent in June when compared to June of 2009 and decreased by 4.99 percent compared to May of this year. To date, condo sales are up 85.20 percent (3,328 condos sold to date in 2010, compared to 1,797 by this time in 2009).
The most (326) condos in a single price category that changed hands in June were yet again in the $1 - $50,000 price range, which accounted for 53.53 percent of all condo sales.
Orlando homebuyers purchased 291 duplexes, town homes, and villas in June 2010, which is a 59.02 percent increase from June 2009 when 183 of these alternative housing types were purchased. Fifty duplexes, town homes, and villas sold in June 2010 fell into the $100,000 - $120,000 price categories.
Tuesday, July 6, 2010
Homebuyer Traffic Tumbled in May as First-Time Homebuyer Shopping Stalled
Homebuyer traffic nationwide tumbled in May, according to the latest
Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market
Conditions. Most of the decline was attributable to first-time homebuyers who
sharply reduced their home shopping last month.
The survey's first-time homebuyer traffic index, which measures home shopping activity on a scale of 1 to 100, registered an anemic 35.1 in May. This was down from an index of 63.5 in April. Since September 2009, the index had never been below 50, which represents a flat, or neutral, condition in home purchase activity.
“The decline of first-time homebuyer traffic is undoubtedly related to the expiration of the federal homebuyer tax credit,” stated Thomas Popik, research
director for Campbell Surveys. “Homebuyers had until April 30 to sign a purchase and sale agreement and receive the credit. Once we entered the month of May, the government stimulus disappeared.”
Thanks to its own tax break, California fared better than the country overall in
terms of first-time homebuyer activity, the survey found. The California index for first-time homebuyer traffic jumped to 63.1 in April, but still managed to stay relatively flat in May at 49.4, California enacted its own $10,000 credit for first-time homebuyers on May 1, the day after expiration of the federal tax credit.
Real estate agents responding to the survey commented on the decrease in homebuyer traffic in May, which ultimately will produce fewer closed transactions later in the summer. “The expiration of the tax credit caused a significant decline in buyer activity in May, with buyers who didn't get a suitable house in time for the tax credit opting to wait and see what happens to prices without the vailability of thell/Inside Mortgage tax credit. I expect to see a significant decrease in July's closed transactions,” commented an agent in Arizona.
“We have noticed a substantial decrease in activity since April 30th. There are a lot less Purchase and Sales Agreements being typed and other agents are complaining it's slow again,” stated an agent in Massachusetts. “I got no signed purchase agreements in May. I think the number of closed transactions in July will be very low,” added an agent in Indiana.
Traffic among current homeowners seeking to upsize or downsize also softened in the month of May, but to a lesser degree, the latest survey found. The nationwide index for current homebuyer traffic registered 45.5 in May, down from 55.2 in April. Expiration of the homebuyer tax credit for current homeowners was less of a factor because the tax credit dollar incentive was lower, both on an absolute basis and on a percent of transaction basis.
Interestingly, the proportion of closed transactions for first-time homebuyers also declined in May, furthering a trend first observed in April. In March, first-time homebuyers accounted for 48.2% of home purchases; by April their proportion had declined to 43.4%.
The trend continued in May, with first-time homebuyers accounting for 42.0% of home purchases. This decline is surprising since first-time homebuyers have until the end of June to close transactions and receive the federal tax credit.
A significant number of agents responding to the survey believe that transactions will rebound as homebuyers waiting out the end of the tax credit come back into a housing market that has fewer people bidding up the price of properties. “We saw a drop in activity for 3-4 weeks and now it is back to a more normal summer market. I anticipate that it will continue to increase and pick up after school gets out,” stated an agent in Minnesota.
“The first-time homebuyer tax credit, originally due to expire last November and then extended through the first half of 2010, appears to have depleted the pool of willing buyers earlier than expected,” commented Popik. “Whether this depletion is temporary or whether the market will rebound won’t be known until we measure traffic in June and July.”
Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market
Conditions. Most of the decline was attributable to first-time homebuyers who
sharply reduced their home shopping last month.
The survey's first-time homebuyer traffic index, which measures home shopping activity on a scale of 1 to 100, registered an anemic 35.1 in May. This was down from an index of 63.5 in April. Since September 2009, the index had never been below 50, which represents a flat, or neutral, condition in home purchase activity.
“The decline of first-time homebuyer traffic is undoubtedly related to the expiration of the federal homebuyer tax credit,” stated Thomas Popik, research
director for Campbell Surveys. “Homebuyers had until April 30 to sign a purchase and sale agreement and receive the credit. Once we entered the month of May, the government stimulus disappeared.”
Thanks to its own tax break, California fared better than the country overall in
terms of first-time homebuyer activity, the survey found. The California index for first-time homebuyer traffic jumped to 63.1 in April, but still managed to stay relatively flat in May at 49.4, California enacted its own $10,000 credit for first-time homebuyers on May 1, the day after expiration of the federal tax credit.
Real estate agents responding to the survey commented on the decrease in homebuyer traffic in May, which ultimately will produce fewer closed transactions later in the summer. “The expiration of the tax credit caused a significant decline in buyer activity in May, with buyers who didn't get a suitable house in time for the tax credit opting to wait and see what happens to prices without the vailability of thell/Inside Mortgage tax credit. I expect to see a significant decrease in July's closed transactions,” commented an agent in Arizona.
“We have noticed a substantial decrease in activity since April 30th. There are a lot less Purchase and Sales Agreements being typed and other agents are complaining it's slow again,” stated an agent in Massachusetts. “I got no signed purchase agreements in May. I think the number of closed transactions in July will be very low,” added an agent in Indiana.
Traffic among current homeowners seeking to upsize or downsize also softened in the month of May, but to a lesser degree, the latest survey found. The nationwide index for current homebuyer traffic registered 45.5 in May, down from 55.2 in April. Expiration of the homebuyer tax credit for current homeowners was less of a factor because the tax credit dollar incentive was lower, both on an absolute basis and on a percent of transaction basis.
Interestingly, the proportion of closed transactions for first-time homebuyers also declined in May, furthering a trend first observed in April. In March, first-time homebuyers accounted for 48.2% of home purchases; by April their proportion had declined to 43.4%.
The trend continued in May, with first-time homebuyers accounting for 42.0% of home purchases. This decline is surprising since first-time homebuyers have until the end of June to close transactions and receive the federal tax credit.
A significant number of agents responding to the survey believe that transactions will rebound as homebuyers waiting out the end of the tax credit come back into a housing market that has fewer people bidding up the price of properties. “We saw a drop in activity for 3-4 weeks and now it is back to a more normal summer market. I anticipate that it will continue to increase and pick up after school gets out,” stated an agent in Minnesota.
“The first-time homebuyer tax credit, originally due to expire last November and then extended through the first half of 2010, appears to have depleted the pool of willing buyers earlier than expected,” commented Popik. “Whether this depletion is temporary or whether the market will rebound won’t be known until we measure traffic in June and July.”
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