LARGEST HOME EQUITY INCREASE IN 60 YEARS
LARGEST HOME EQUITY INCREASE IN 60 YEARS
Bloomberg, a major global provider of financial news and information, reported that home equity in this country increased to $ 6.7 trillion, the highest level since 2008, a 7.3 percent gain. This is the largest gain in over 60 years. Bloomberg attributes this gain to the fact that homeowners are taking advantage of the record-low borrowing costs to refinance their homes and the fact that many homeowners brought cash to the signing table to pay down principal. Bloomberg arrived at this conclusion by analyzing Federal Reserve Data.
They conclude that this is “the strongest sign yet that Americans’ home-loan debt burden is beginning to ease after the record borrowing that created, and ultimately popped, the housing bubble.”
Half of the mortgages refinanced in the forth quarter of 2011 reduced loan size, a record according to Freddie Mac.
Residential debt peaked in 2007 at $10.6 trillion, doubling in six years. Since then it has fallen 7 percent.
Not only are Americans bringing money to the table to reduce principal, many are choosing to shorten the term of their loans. The average loan term tell to 27 years in April, down from 29 years in February.
Richard DeKaser, deputy chief economist at the Parthenon Group LLC based in Boston, attributes the reduction in mortgage debt to a “fear factor.” He went on to say that, a lackluster recovery that still has one of every 15 people unemployed has persuaded some borrowers of the wisdom of thriftiness.
The overall report is positive for the housing market and yet another indication that most of the associated problems are behind us. As long as interest rates remain as low as they are at present, the housing market recovery will continue and more areas will see market values increase.
Select this link to read the complete Bloomberg report:
This is good news for El Dorado Hills Real Estate.
BANK OWNED (FORECLOSURE/REO) HOME SALES DATA FOR EDH, CA – MAY 2012
BANK OWNED (FORECLOSURE/REO) HOME SALES DATA FOR EDH, CA – MAY 2012
This is the latest monthly report of our more than four-year study of bank owned (foreclosure/REO) home sales in EDH, CA. This report covers May 2012.
There were 12 bank owned (foreclosure/REO) homes sold in EDH in May, one more than in the previous month.
There were three bank owned (foreclosure/REO) homes that sold in May that will skew the statistics. We will address those home sales before going on to our normal monthly report.
The first, item number three in the chart below sold for 129% of the asking price. ($ 74,100 over asking price) The reason for this seems to be that the original price for a 3640 square foot home was extremely low. The listing agent may have been trying to set up a buyer bidding war. If so, it was successful.
The second, item number 4 in the chart below, sold for 136.5% of the asking price. ($ 91,000 over asking price) The home was small and unimpressive; however, it sits on a 10.5-acre parcel, a much larger parcel than normal. Perhaps a developer has plans for that parcel.
The third, item number 12 below, had been on the market for 802 days, started with an asking price of $ 1,115,400 and finally sold for $ 735,000. Not many buyers are interested in a home with 8,486 square feet. Therefore, it sold for 65.9% of the original asking price.
All three of these homes sold with statistics far outside the norm.
The average days on market increased from 49 in April to 108 in May (thanks to the last home on the list), yet 34% of the bank owned (foreclosure/REO) homes sold in two weeks or less.
The 12 bank owned (Foreclosure/REO) homes that sold represent only 14% of ALL homes sold in El Dorado Hills this month, a smaller segment than normal.
The available inventory of bank owned (Foreclosure/REO) homes in El Dorado Hills dropped to a .5-month supply in May, down from a 0.6.0-month supply in April. This inventory level has only been above a two-month supply one month in the past fifteen.
The inventory for ALL homes available in El Dorado Hills dropped to a 1.7-month supply in May, down from a 1.9-month supply the previous month. Pundits tell us that a 6-month supply is a neutral market, so we continue to have a strong seller’s market for ALL homes in El Dorado Hills, both bank owned and non-bank owned.
The average cost-per-square-foot for Bank Owned (Foreclosure/REO) homes dropped to $ 127 in May, down from $ 131 the previous month. The average cost-per-square-foot for ALL homes sold in El Dorado Hills in May was $ 155, up two dollars from April. In fact, that is the highest cost per square foot for any month since May of 2011.
The overall sales price for bank owned homes was 104.5% of the final asking price and 98.5% of the original asking price, largely due to the 2 home sales mentioned above. Forty-two percent of the buyers paid the full asking price or more in May for their bank owned (foreclosure/REO) home, a slightly larger segment than normal.
When based on the cost-per-square-foot for ALL homes sold, bank owned homebuyers paid 18% less in May. That is a $ 28 pre-square-foot savings. When applied to a 2500 square foot home, that represents a savings of $ 70,000, a substantial sum.
If you have any questions about purchasing any home in El Dorado Hills, an El Dorado Hills Bank Owned Home, or a Bank Owned Home anywhere in the area, feel free to give us a call (916) 337-0658.
The data follows:
BANK OWNED (Foreclosure/REO) HOME SALES DATA FOR FOLSOM, CA – MAY 2012
BANK OWNED (Foreclosure/REO) HOME SALES DATA FOR FOLSOM, CA – MAY 2012
This is the latest monthly report of our more than four-year study of bank owned (Foreclosure/REO) home sales in Folsom, CA. This report covers May of 2012.
There were 10 Bank Owned (Foreclosure/REO) homes sold in Folsom this month, exactly the same number as in the previous two months.
The average days-on-market decreased dramatically from 30 the previous month to 14 in May, the lowest days-on-market number we have seen in the four years of our study.
One of the homes sold was on the market for 35 days. All of the others were on the market for a shorter period. A full 70% of the homes sold were on the market for two weeks or less. This too is a record for our study.
The 10 Bank Owned (Foreclosure/REO) homes that sold represent only 12% of all homes sold in Folsom this month. The very low bank owned home inventory continues to be the reason this segment of the market is so small and it seems to be shrinking.
The available inventory of bank owned (Foreclosure/REO) homes in Folsom decreased from a 1.0-month supply last month, to a 0.2-month supply this month. That inventory level has not exceeded a two-month supply for over a year.
The available inventory for ALL homes available dropped from a 1.0-month supply last month to a 0.8-month supply in May. Pundits tell us that a 6.0-month supply is neutral market, so Folsom remains a strong seller’s market for both bank owned homes and all other homes on the market.
The Folsom market reflects what is happening in the rest of California and the western U.S. Inventory levels are very low. This factor is starting to have an impact on housing prices.
The average cost-per-square-foot for bank owned (Foreclosure/REO) homes was $ 172 in May, up considerably from $ 131 in April and one of the highest in years. The average cost-per-square-foot for ALL homes sold in Folsom in May was $ 158, up from $153 in April. This is the first time in our four-year study that the cost-per-square-foot for bank owned (Foreclosure/REO) homes exceeded the number for all homes sold. As a result, those who purchased a bank owned (REO/Foreclosure) home in Folsom in May did not save anything by doing so.
The overall sales price for REO homes was 100.2% of the final asking price and 99.5% of the original asking price. In addition, 60% of the buyers paid the asking price, or more, for their Folsom bank owned (Foreclosure/REO) home in May.
Given the overall data, it is obvious that homeowners who do not have to sell are keeping their homes, rather than accepting current market value offers. However, the market is changing rapidly and as prices rise, more homes will be placed on the market.
If you have any questions about purchasing a home in Folsom, a Folsom Foreclosure, or an REO anywhere in the area, feel free to give us a call (916) 337-0658.
The data follows:
EL DORADO HILLS, CA HOME SALES DATA – MAY 2012
EL DORADO HILLS, CA HOME SALES DATA – MAY 2012
The purpose of this post is to provide those interested in the El Dorado Hills, CA housing market data about that market. This report covers May 2012, and the fourteen previous months.
The first chart lists the cost-per-square-foot for all homes sold in El Dorado Hills by month. Although there is a slight fluctuation from month to month, the viewer can see that there is no downward trend. In fact, the opposite seems to be true. When we look at year-over-year prices, May of 2011, was the same as May of 2012. We submit that the market is bumping along at the much-touted “bottom.” Those potential buyers who decided to remain on the fence, “until prices hit bottom” no longer have a reason to wait.
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The second chart shows the level of inventory, (the number of homes for sale divided by the number of homes sold each month). The May inventory level dropped to a 1.7-month supply, down from a 1.9-month supply in April. Pundits tell us that a six-month inventory is a neutral market.
We can see that the El Dorado Hills market is, and has been for some time, a seller’s market. We have been bumping along in the two to four month range for the past year.
The media is finally starting to realize that the market has changed.
Over a year ago, we posted an article warning about the pending housing shortage. We continue to stand behind that prediction. All you have to do is ask those actively looking for a home.
It is going to get worse. The demand will result in price increases and with those increases; more homeowners will put their homes on the market. Unfortunately, without any new home construction in the past five years or more, we will still be short of inventory.
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If you would like to see this data for other cities and towns in our area, feel free to contact us at (916)337-0658 or e-mail Mike@BuyYourVilla.com.
To use the very best Internet property search tool go to www.BuyYourVilla.com.
FOLSOM, CA HOME SALES DATA – MAY 2012
FOLSOM, CA HOME SALES DATA – MAY 2012
The purpose of this post is to provide those interested in the Folsom, CA housing market data about that market. The data presented covers May 2012, and the preceding fourteen months.
The first chart lists the cost-per-square-foot for all homes sold in Folsom by month.
Although there is a very slight fluctuation from month to month, the viewer can see that there is little change in over the period covered. The May number is the highest since July of 2011 and two dollars higher than in May of 2011. With each passing month we feel more strongly that we are at the bottom of the market and headed back up. Those potential buyers who decided to remain on the fence, “until prices hit bottom” no longer have a reason to wait. In fact, they may have already missed the boat! The challenge will be to find any home that they can buy.
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The second chart shows the number of months of inventory available (the number of homes for sale divided by the number of homes sold each month). The inventory level dropped to a 0.8-month supply in May, the lowest in the past fifteen months. Pundits tell us that a six-month inventory is a neutral market. Therefore, we can see that the Folsom market has been a seller’s market during the entire period this report covers. There has been a shortage if inventory for many months and the trend is for an even smaller number of homes to be available.
The media is finally starting to realize that the housing market has changed.
Over a year ago, we posted an article warning about the pending housing shortage. Obviously, we were correct. All you have to do is ask those actively looking for a home.
It is going to get worse. The demand will result in price increases and with those increases; more homeowners may put their homes on the market. Unfortunately, without any new home construction in the past five years or more, we will still be short of inventory.
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.
If you would like to see this data for other cities and towns in our area feel free to contact us at (916)337-0658 or e-mail Mike@BuyYourVilla.com.
To use the very best Internet property search tool go to www.BuyYourVilla.com.