New Home Sales Numbers Are In: July SOARS to 8 Year High

A recent new home sales report for July showed that sales of newly built homes increased 12.4 percent since June, and rose 31.3 percent year-over-year. This surge marks the highest point in almost eight years.

“New homes are being purchased at a furious pace, and it could give the housing market the added push it’s been waiting for,” says Quicken Loans vice president Bill Banfield. “With more new homes purchased by move-up buyers, it provides an increase in housing choice for first time buyers looking for their starter house.”

Data released found that the new home sales seasonally adjusted annualized rate for July was 654,000, the highest pace of sales since October 2007. Actual new homes sold so far this year are up 13 percent over the first seven months of 2015. This July’s new home supply remains tight at 4.3 months of supply.

The median sales price of new houses sold in July 2016 was $294,600; the average sales price was $355,800. The seasonally adjusted estimate of new houses for sale at the end of July was 233,000. This represents a supply of 4.3 months at the current sales rate.

“It’s great to see evidence of much-needed growth and a shift toward more affordable prices in July’s report,” says realtor.com Chief Economist Jonathan Smoke. “It’s also good news that we are finally seeing builders shifting toward more affordable price points. And given the limited number of homes currently for sale, we can be confident that the decline in new home prices is a result of market shift and not discounting by builders.”

Source: RISMedia

August Scorches the Market Most in a Decade Says Realtor.com

A record-breaking summer for the residential real estate market continued in August, according to new monthly data on for-sale housing inventory and demand on Realtor.com®. Homes for sale on the site in August are moving two percent more quickly than last year as prices continue to reach new record highs.

“Summer 2017 was one of most competitive buying seasons that we have ever witnessed, fueled by historically low mortgage rates and inventory shortages that resulted in record-high prices, said Jonathan Smoke, chief economist for Realtor.com. “With the school year starting now in most of the country, we’re seeing some drop-off in demand, which may provide some relief for buyers weary from battling it out against other buyers all summer.”

The median age of for-sale listings on Realtor.com in August is expected to be 72 days, which indicates properties are selling two days faster than this time last year but four days slower than last month. In August most markets begin to slow down in response to the start of the school year, with inventory levels and market velocity moving away from peaks and sales beginning to decline.

The median home was listed for $250,000, eight percent higher than one year ago and virtually the same as last month. That extends this summer’s trend of record high prices and is a new peak for August.

For-sale housing inventory reached its apex last month and August now reflects the usual seasonal shift with the first monthly decline since January. Even with an estimated 475,000 new listings coming onto the market in August, the total inventory remains considerably lower than one year ago.

The median age of inventory in August is expected to be 72 days, down three percent from last year and up six percent from last month. The median listing price for August should reach a record high of $250,000, an eight percent increase year-over-year and flat compared to July.

The listing inventory in August should show a one percent decrease from July. Additionally, inventory should still show a decrease of eight percent year-over-year.

Realtor.com’s Hottest Markets received from 1.4 to 4.5 times the number of views per listing compared to the national average. In terms of supply, these markets saw inventory move from 21 to 39 days more quickly than the rest of the U.S. The hottest markets saw inventory movement slow down slightly as the median age increased by two days on average from July.

RDC_Hotness_Index_Aug

Key Takeaways from Realtor.com’s® August Hotness Index

California again dominated the list with 11 markets, but seven other states were represented (Texas, Colorado, Indiana, Ohio, Michigan, Washington and Tennessee).

  • Vallejo-Fairfield, Calif., continues its streak of 4 straight months atop the hottest markets.
  • The new entrants to the top 20 in August were Kennewick-Richland, Wash. and Waco, Texas.
  • The biggest gainer beyond the new entrants was Detroit, which moved up four spots and into the top ten.

Source: Realtor.com

Florida Realtors Assoc. Releases 2Q Wrap Up Data

ORLANDO, Fla. – Aug. 10, 2016 – Florida’s housing market reported more new listings, higher median prices and fewer days to a sales contract during the second quarter of 2016, according to the latest housing data released by Florida Realtors®. Closed sales of single-family homes statewide totaled 76,748 in 2Q 2016, up 1.4 percent over the 2Q 2015 figure.

“In the second quarter of 2016, Florida continued to add new jobs, which attracts new residents, encourages economic growth and strengthens the housing market,” says 2016 Florida Realtors President Matey H. Veissi. “Traditional housing sales increased statewide over the three-month period, while sales of distressed properties continued to decline. In another positive sign, new listings for single-family homes over the three-month-period rose 2.9 percent year-over-year, while new condo-townhouse listings rose 3.3 percent.”

The statewide median sales price for single-family existing homes in 2Q 2016 was $220,000, up 10 percent from the same time a year ago, according to data from Florida Realtors research department in partnership with local Realtor boards/associations. The statewide median price for condo-townhouse properties during the quarter was $163,000, up 5.2 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

Looking at Florida’s condo-townhouse market, statewide closed sales totaled 31,699 during 2Q 2016, down 2.7 percent compared to 2Q 2015. The closed sales data reflected fewer short sales – and rising traditional sales – over the three-month period: Short sales for condo-townhouse properties declined 42.2 percent while short sales for single-family homes dropped 36.7 percent. Meanwhile, traditional sales for condo-townhouse units rose 6.9 percent and traditional sales for single-family homes increased 14.4 percent year-over-year. Closed sales typically occur 30 to 90 days after sales contracts are written.

“Existing home sale prices throughout most of Florida’s metro areas are continuing to exhibit robust year-over-year growth,” says Florida Realtors Chief Economist Dr. Brad O’Connor. “This growth is attributable to simple economics, which is to say that demand is strong and supply is currently limited. The inventory of homes for sale at the more affordable end of the price spectrum – which includes the vast majority of distressed properties – continues to decline significantly, and new construction has not come close to making up the difference.”

In 2Q 2016, the median time to a contract (the midpoint of the number of days it took for a property to receive a sales contract during that time) was 42 days for single-family homes and 50 days for condo-townhouse properties.

Inventory was at a 4.3-months’ supply in the second quarter for single-family homes and at a 6-months’ supply for condo-townhouse properties, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.59 percent for 2Q 2016, significantly lower than the 3.96 percent average recorded during the same quarter a year earlier.

Source: Florida Realtors

May Report: Broward Prices Pick up the Pace

While much of South Florida’s housing market has struggled through a rough spring, May proved to be a bright spot for Broward County.

Sales for both homes and condos spiked year-over-year, all while inventory held mostly steady, according to a new report from the Greater Fort Lauderdale Realtors association. A total of 1,671 single-family homes were sold in May, up 9.5 percent from the 1,526 sales made during May 2015. Sales for townhomes and condos also jumped by 9.5 percent, from 1,434 closed deals a year ago to 1,570 this May.

Those spikes in numbers are also a considerable improvement from April, which saw the pace of home sales slow year-over-year in both Broward and South Florida in general.

Despite the recent market volatility, prices are still rising at a steady clip. The median price to pick up a Broward condo or townhouse hit $145,000 in May, which grew by $10,000 from a year ago. Median prices for a single-family home also rose by $22,000, from $290,000 per home to $312,000.

Meanwhile, sellers took a breather during May, with only a slight rise in inventory for both sectors compared to last year. Listing inventory for single-family homes stood at 2,177 in May, an increase of only 1.2 percent year-over-year, while condo inventory showed even less growth with a 0.2 percent bump to 2,113 listings.

Fewer properties hitting the market and a faster sales pace could be a sign that Broward’s housing market is tightening, though it’s too early to tell if that trend will continue through the year.

To the south, Miami-Dade County has been hammered by declining sales and a surplus of inventory as homeowners look to cash in on ever-rising prices. Some analysts have said this will likely lead to a correction in the market and sellers start adopting more realistic pricing.

Source: The Real Deal

A Tale of Two Cities: Broward County Steady, While Miami Struggles

The first half of 2016 has been a regular slugfest for Miami’s housing market, but the grass seems a bit greener for its neighbor to the north.

While sales in Miami-Dade continue their downward slope, Broward County saw a moderate uptick for both closed sales and prices during June, according to a new report from the Greater Fort Lauderdale Realtors association.

A total of 1,635 condos and townhomes were sold in Broward last month, marking a 4.4 percent jump in closed deals year-over-year. Single-family homes saw a slightly higher 4.8 percent jump in sales, coming out to 1,805 properties sold.

Although the numbers are by no means earth shattering, they’re a far cry from the market woes in Miami and Miami Beach. A second quarter report from brokerage Douglas Elliman showed sales fell as much as 24 percent, year-over-year in certain areas, signaling a market correction could be on its way.

Back in Broward, housing prices continued their steady rise during June. The median price for condos and townhouses hit $149,250 last month, spiking by 10.4 percent year-over-year. Single-family homes had a more moderate price increase of 7.3 percent, standing at a median of $325,000 in June.

And the inventory pile-up that’s slowing down Miami-Dade was nowhere to be seen in Broward. Active inventory for single-family homes fell 10 percent to 5,490 properties in June, while condos saw a slight inventory uptick of 1.8 percent to 8,641 units. The past 12 months have been a constant squeeze on single-family housing inventory, according to the association, while new condos entering the market are starting to level out year-over-year after a significant influx that started in February.

While both sectors of the market grew during June, the association’s figures show Broward’s true strength is in its single-family homes. Dollar volume for home sales hit $682 million in June, more than double that of condo’s $307.8 million. And for the past 12 months, year-over-year home sales haven’t fallen once — something Broward’s more volatile condo market can’t boast.

Source: The Real Deal

Top Buyers of U.S. Real Estate are Chinese for 4th Year

Chinese buyers were the top foreign purchasers of U.S. real estate for the fourth year in a row, a survey released Wednesday showed.

The National Association of Realtors reported that Chinese buyers bought 29,195 properties worth $27.3 billion in the 12 months ending March 2016. At a median price of $542,084, the typical Chinese purchase was more than double the median U.S. existing-home price of $223,058, showing that the acquisitions were made by the burgeoning Chinese elite.

Chinese purchases were more than triple that of the number-two nation, Canada, which had $8.9 billion of U.S. properties. India ranked third with $6.1 billion of purchases, and Mexico fourth at $4.8 billion.

That said, foreign purchases of U.S. real estate actually declined slightly, by 1.3% to $102.6 billion of residential property. The NAR said that decline came due to a stronger U.S. dollar and a weak global economy, as well as rising U.S. house prices.

Even the Chinese purchases fell, by 4.5%.

Lawrence Yun, chief economist of the NAR, said British purchases may subside after the vote to leave the European Union, which has sent the pound GBPUSD, -0.9906% down sharply. Britain accounted for $5.5 billion worth of purchases in this survey, ranking fifth-highest.

Latin Americans, Europeans and Canadians mostly sought properties in Florida and Arizona. California and New York drew the most Asian buyers, the NAR said.

Source: Marketwatch

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FED: Vulnerable Commercial RE Sector May Take Hits

The Federal Reserve warned that prices in the commercial real-estate market may have run up too far too fast.

Valuations in commercial real estate “appear increasingly vulnerable to negative shocks, as CRE prices have continued to outpace rental income,” the Fed said in its semiannual Monetary Policy Report to Congress. The Fed noted that prices exceed their pre-crisis peaks by some measures.

The Fed included a special section on financial stability risks in the report, which accompanies Chair Janet Yellen’s testimony. The report said that even given “moderate’’ financial vulnerabilities, risks of external shocks, such as the U.K.’s possible exit from the European Union, pose stability risks.
The report also highlighted issues related to credit exposures to the energy sector, money-market mutual funds and stock valuations.

The central bank said price-to-earnings ratios on a forward-looking basis for stocks have increased to a level “well above” their median for the past 30 years.

“Although equity valuations do not appear to be rich relative to Treasury yields, equity prices are vulnerable to rises in term premiums to more normal levels, especially if a reversion was not motivated by positive news about economic growth,” the Fed said.

The Fed said “some structural vulnerabilities are expected to persist” in money-market mutual funds even after Securities and Exchange Commission reforms go fully into effect in October.
“Leverage for the non-financial corporate sector has stayed elevated and indicators of corporate credit quality, though still solid overall, continued to show signs of deterioration for lower-rated firms, especially in the energy sector,” the Fed said in its report.

Strong U.S. bank capital positions contributed to the resilience of the financial system, the Fed said.

Source: Bloomberg

Sumitomo Re-enters Boldly the Miami Market with $220M Icon

The U.S. arm of Japanese trade conglomerate Sumitomo Corp. recently paid $220 million for the iconic Miami Tower office building.

The purchase marked one of Miami’s biggest investment deals so far this year, as well as a surprising display of optimism in the U.S. commercial real estate market from Sumitomo, which only has a handful of marquis properties stateside.

The company has a long history developing and investing in real estate, both within its home country Japan and abroad. Data from Real Capital Analytics shows the company has interests in 63 properties worldwide with an estimated value of $4.9 billion. Most of those properties are office buildings in large Japanese cities like Tokyo, though a smattering of development sites, retail and industrial buildings are also included.

Within the last decade, Sumitomo has acquired interest in $2.4 billion worth of property and sold another $2.3 billion, according to the data. For its real estate dealings in the U.S., however, Sumitomo seems to take a much more calculated approach. Before its purchase of Miami Tower, the company’s stateside office holdings included only two office towers, both occupying premium locations in their cities’ respective central business districts. Sumitomo owns the Class A office tower at 203 North LaSalle Street in Chicago, for which it paid $111.5 million in 2014, and the tower at 450 B Street in San Diego, which it acquired for $73 million in 2013.

This purchase smacks of Sumitomo’s previous and first foray into Miami back in 2008, when it made a splash in the office market with its $260 million purchase of the 34-story Miami Center building. Four years later, the company sold Miami Center to Crocker Partners for a mere $5.2 million more than what it paid.

As recently as a few years ago, “South Florida wasn’t viewed as a long-term investment; it was opportunistic,” Krasnow said. “Now, Miami is viewed from the capital perspective. It is much more of a strategic investment.

In the past year, institutional buyers like insurer Prudential Financial and TIAA have swallowed up large swaths of office product in suburban markets like Coral Gables and the business parks surrounding the Miami International Airport.

Though Sumitomo has been tight-lipped about its most recent acquisition of Miami Tower — sources say those involved in the sale are under confidentiality agreements — a statement from Robert Obringer, the company’s vice president, illustrates Sumitomo’s motivation for paying such a premium for a piece of Miami iconography.

As part of our constant management of assets, we are always looking for opportunities that will maximize return on investment, and this property offers a strong upside potential for in-place cash flow and the opportunity to increase value,” Obringer said in the statement.

Source: The Real Deal

An Exciting Month for RIVA Fort Lauderdale

What an exciting month. RIVA hosted four great community events, beginning with a festive, after-hours networking reception for community leaders and members of the Greater Lauderdale Chamber of Commerce’s Gay & Lesbian Business Exchange Council.

Daniel de la Vega President of ONE S.IR. SPEAKING

Daniel de la Vega President of ONE S.IR. SPEAKING

RIVA also hosted The Leadership Broward Foundation’s 2016 Profiles in Leadership honorees. In addition, RIVA was an exclusive sponsor of the annual Waterway Soirée, one of Fort Lauderdale’s must-attend, signature fundraising events, which benefits the Children’s Diagnostic & Treatment Center, hosting a five-star dinner aboard a luxurious, private yacht for 20 VIP guests.

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The new and elegant RIVA building capped the month with a VIP Rooftop Party, this past Wednesday May 25th at the new Audi Fort Lauderdale location, where more than 400 guests attended the sunset bash with a bird’s eye view of the construction progress.

More information about RIVA