A New Year - But What About The Old One?
We hope your 2013 is starting off well. So how did 2012’s real estate market finish? Here are a few stories from the last couple of weeks detailing areas of the market we have been following:
S&P reports home prices rise in October Data through October 2012, released last week by S&P Dow Jones Indices for its S&P/Case-Shiller Home Price Indices showed home prices rose 4.3% in the 12 months ending in October in the 20-City Composite, out-distancing analysts’ forecasts.
Anticipated seasonal weakness appeared as 12 of the 20 cities and both Composites posted monthly declines in home prices in October. The 10- and 20-City Composites recorded respective annual returns of 3.4% and +4.3% in October 2012 – larger than the 2.1% and 3% annual rates posted for September 2012. In 19 of the 20 cities, annual returns in October were higher than September. Chicago and New York were the only two cities with negative annual returns in October. Phoenix home prices rose for the 13th month in a row. San Diego was second best with nine consecutive monthly gains.
New home sales rise 4.4 percent in November Sales of newly constructed homes rose 4.4% in November from the month before, providing fresh evidence that the country's housing sector is in recovery. Newly built single-family homes sold at a seasonally adjusted annual rate of 377,000 units in November, the Commerce Department reported Thursday. That was a 15.3% rise over November 2011.
The increase indicates a continuation of the housing recovery that began earlier this year. Housing has become a leading source of strength for the long-sluggish American economic recovery as more people compete to buy fewer homes – pushing up prices.
Completed foreclosures down in November
There were 55,000 completed foreclosures in the United States in November 2012, down from 72,000 in November 2011, a year-over-year decrease of 23%, according to CoreLogic’s National Foreclosure Report.
About 1.5% of California’s homes with a mortgage were in the foreclosure inventory as of November 2012, down 1.2% from one year ago. In San Diego, about 1.2% of homes with a mortgage were in the foreclosure inventory, down 1.0% from a year ago. There were 6,218 completed foreclosures in San Diego in the 12 months ending in November 2012, and 102,142 completed foreclosures statewide.
Supply of “shadow inventory” homes declines again
A new report by Santa Ana firm CoreLogic shows pending home supply declined again in October. This shadow inventory (as defined by CoreLogic as the supply of homes that are seriously delinquent, in foreclosure or held by lenders and not currently on the market) fell 12.3% from the year prior to stand at 2.6 million units, or a supply of about seven months.
The housing recovery that began last year was spurred by tight inventory and strong demand from investors and buyers motivated by record-low mortgage-interest rates. Those factors have helped push up prices in recent months. In a news release announcing the new data, CoreLogic analysts said that given the strong demand from investors, and others, the current shadow supply is unlikely to drag down the market in 2013.
Both measures of foreclosure fall for 2012
San Diego County ended 2012 with 25% fewer notices of default and 41.1% fewer trustee deeds filed than in 2011.
Notice of default - The first step in the foreclosure process, filed when a borrower is at least 3 months behind on their mortgage payments. There were 16,597 notices of default filed in all of 2012, down 25% from 2011, when there were 22,101 notices of default filed, according to the San Diego County Assessor's Office.
Trustee deed – The final step in the foreclosure process, transferring ownership of a property from a borrower to a lender or third party. There were 7,195 trustee deeds recorded in all of 2012, down 41.1% from 2011, when there were 12,215 trustee deeds recorded.
We will see more reports in the coming weeks on prices for the end of 2012. We expect to see further price appreciation across the nation, in California, and here in San Diego.
If the start of 2013 is any indication, we should also expect to see price appreciation for January. We are still seeing a tight supply of inventory and steady traffic at our listings. We will see if this momentum can continue.
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