Miami Condo Prices Rise Again in October as International Buyers Continue to Pay Cash

By Michael Gerrity

(MIAMI, FL) -- According to Miami Association of Realtors, sales of existing single-family homes in the Miami Metropolitan Statistical Area (MSA) rose 41 percent in October, from 546 to 769, compared to October 2010. Sales of existing condominiums increased 63 percent, from 739 to 1,202, compared to October 2010.

Statewide sales increased 13 percent to 13,755 for single-family homes and 12 percent to 6,132 for condominiums compared to October 2010.  Nationally, sales of existing single-family homes, townhomes, condominiums, and co-ops rose 1.4 percent from the previous month and were 13.5 percent above October 2010, according to the National Association of Realtors (NAR).

"We are encouraged by the record-breaking performance of the Miami real estate market this year," said Jack H. Levine, 2011 Chairman of the Board of the Miami Association of Realtors.  "Rising demand and limited supply is yielding higher average and median sales prices, and we expect to see double-digit price appreciation in 2012."

International Buyers Fuel Cash Transactions

The percentage of cash transactions rose to 64 percent, up one percent compared to the previous month.  Cash sales accounted for 43 percent of single-family and 77 percent of condominium closings.  Nearly 90 percent of international buyers in Florida purchase properties all cash.  Nationally, all-cash sales accounted for 29 percent of transactions, reflecting the stronger presence of international buyers in the Miami real estate market.

Condominium Prices Rise Again

The effect of short sales and foreclosures on the median and average sales prices for both single-family homes and condominiums has lessened particularly in some areas of the county.  In October, 57 percent of all closed residential sales in Miami-Dade County were distressed, including REOs (bank-owned properties) and short sales, compared to 61 percent in October 2010 and 60 percent the previous month.

In October, the median sales price for condominiums rose for the third consecutive month.  The median sales price of condominiums in October increased eight percent to $117,900. The median sales price of single-family homes decreased 12 percent to $174,600 from a year earlier.

"Miami is an enviable position, leading the nation in the real estate market recovery," said 2011 Miami Association of Realtors Residential President Ralph E. De Martino.  "International buyers continue to play a major role in fueling the local market strengthening.  Demand for local properties from domestic and foreign buyers will result in the local market outperforming the nation long into the future."

Statewide median sales prices decreased four percent to $131,200 for single-family homes and increased nine percent to $87,800 for condominiums.  The national median existing-home price for all housing types was $161,600 in October, down 5.8 percent from October 2010.

The average sales prices for single-family homes in Miami-Dade County increased 6.5 percent, from $266,726 in October 2010 to $282,947 in October 2011. The average sales price for condominiums increased 14.3 percent, from $197,811 in October 2010 to $226,151 last month.

Inventory Continues Sharp Decline

The inventory of residential listings in Miami-Dade County has dropped 38 percent, from 24,501 to 15,127 active listings, in the last year. Compared to the previous month, the total inventory of homes dropped one percent from 15,264.  Since August 2008, existing housing inventory has decreased more than 65 percent, down from 43,100.

Total housing inventory nationally fell 2.2 percent to million at the end of October compared to the previous month.

ARMs Hit New Record Lows in U.S. as 30-Year Fixed-Rate Mortgage Average 3.98%

David Barley

Frank Nothaft

Based on Freddie Mac's latest Primary Mortgage Market Survey (PMMS), fixed mortgage rates changing little and remaining near their historic lows while adjustable-rate mortgages averaged new record lows. The 30-year fixed has averaged at or below 4 percent for the fourth consecutive week.

Frank Nothaft, chief economist of Freddie Mac said, "Mortgage rates eased slightly this week with fixed-rate loans hovering above all-time lows and ARMs reaching a new nadir.  The high-degree of home-buyer affordability in recent months translated into a 1.4 percent pickup in existing home sales during October, according to the National Association of Realtors (NAR). The NAR also reported that contract cancellations were up in October as well, which restrained sales from achieving a stronger rebound."

The 30-year fixed-rate mortgage (FRM) averaged 3.98 percent with an average 0.7 point for the week ending November 23, 2011, down from last week when it averaged 4.00 percent. Last year at this time, the 30-year FRM averaged 4.40 percent.

15-year FRM this week averaged 3.30 percent with an average 0.7 point, down from last week when it averaged 3.31 percent. A year ago at this time, the 15-year FRM averaged 3.77 percent.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.91 percent this week, with an average 0.6 point, down from last week when it averaged 2.97 percent. A year ago, the 5-year ARM averaged 3.45 percent.

1-year Treasury-indexed ARM averaged 2.79 percent this week with an average 0.6 point, down from last week when it averaged 2.98 percent. At this time last year, the 1-year ARM averaged 3.23 percent.

Nothaft further commented, "The Bureau of Economic Analysis revised third quarter GDP growth downward from an initial estimate of 2.5 percent to 2.0 percent. In addition, the Federal Reserve announced weaker business activity for November in its Philadelphia and Chicago districts."

Existing Home Sales Rise in U.S. During October as Inventory Declines Further

By Michael Garrity

Lawrence Yun

According to the National Association of Realtors (NAR), existing-home sales improved in October while the number of homes on the market continued to decline.

Total existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 1.4 percent to a seasonally adjusted annual rate of 4.97 million in October from a downwardly revised 4.90 million in September, and are 13.5 percent above the 4.38 million unit level in October 2010.

Lawrence Yun, NAR chief economist, said the market has been fairly steady but at a lower than desired level.  "Home sales have been stuck in a narrow range despite several improving factors that generally lead to higher home sales such as job creation, rising rents and high affordability conditions.  Many people who are attempting to buy homes are thwarted in the process," he said.

"A higher rate of contract failures has held back a sales recovery.  Contract failures reported by NAR members jumped to 33 percent in October from 18 percent in September, and were only 8 percent a year ago, so we should be seeing stronger sales," Yun added.

Contract failures are cancellations caused by declined mortgage applications, failures in loan underwriting from appraised values coming in below the negotiated price, or other problems including home inspections and employment losses.  "Other recent factors include disruption in the National Flood Insurance Program, and lower loan limits for conventional mortgages, which paradoxically force some of the most creditworthy consumers to pay unnecessarily higher interest rates," Yun said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.07 percent in October from 4.11 percent in September; the rate was 4.23 percent in October 2010.

Moe Veissi

NAR President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami, said consumers can increase their odds of obtaining a mortgage by being aware of how credit scores are determined.  "If you want to get a mortgage, don't buy a car or take on new installment debt or credit cards," he said.

"Pay all your bills on time, maintain old credit lines and don't use more than 30 percent of your credit limit.  Realtors can help you understand the issues surrounding access to affordable credit, in addition to helping you find the right home and negotiate terms," Veissi said.

An ongoing positive trend is a steady decline in the number of homes on the market.  Total housing inventory at the end of October fell 2.2 percent to 3.33 million existing homes available for sale, which represents an 8.0-month supply at the current sales pace, down from an 8.3-month supply in September.  Inventories have been trending gradually down since setting a record of 4.58 million in July 2008.

The national median existing-home price for all housing types was $162,500 in October, which is 4.7 percent below October 2010.  Distressed homes - foreclosures and short sales typically sold at deep discounts - slipped to 28 percent of sales in October from 30 percent in September (17 percent were foreclosures and 11 percent were short sales); they were 34 percent in October 2010.

"In some areas we're hearing about shortages of foreclosure inventory in the lower price ranges with multiple bidding on the more desirable properties," Yun said.  "Realtors in such areas are calling for a faster process of getting foreclosure inventory into the market because they have ready buyers.  In addition, extending credit to responsible investors would help to absorb inventory at an even faster pace, which would go a long way toward restoring market balance."

All-cash sales accounted for 29 percent of purchases in October, little changed from 30 percent in September and 29 percent in October 2010; investors make up the bulk of cash transactions.

Investors purchased 18 percent of homes in October, compared with 19 percent in September and 19 percent in October 2010.  First-time buyers accounted for 34 percent of transactions in October, up from 32 percent in September; they were 32 percent in October 2010.

Single-family home sales increased 1.6 percent to a seasonally adjusted annual rate of 4.38 million in October from 4.31 million in September, and are 13.8 percent higher than the 3.85 million-unit pace one year ago.  The median existing single-family home price was $161,600 in October, which is 5.8 percent below October 2010.

Existing condominium and co-op sales were unchanged at a seasonally adjusted annual rate of 590,000 in October but are 10.5 percent above the 534,000-unit level in October 2010.  The median existing condo price was $160,300 in October, down 1.5 percent from a year ago.

Regionally, existing-home sales in the Northeast fell 5.1 percent to an annual level of 750,000 in October but are 1.4 percent above October 2010.  The median price in the Northeast was $224,400, down 5.5 percent from a year ago.

Existing-home sales in the Midwest rose 2.8 percent in October to a pace of 1.10 million and are 19.6 percent higher than October 2010.  The median price in the Midwest was $132,800, which is 4.7 percent below a year ago.

In the South, existing-home sales increased 2.1 percent to an annual level of 1.94 million in October and are 14.1 percent above a year ago.  The median price in the South was $145,700, down 1.6 percent from October 2010.

Existing-home sales in the West rose 4.4 percent to an annual pace of 1.19 million in October and are 15.5 percent higher than October 2010.  The median price in the West was $207,500, which is 1.6 percent below a year ago.

Real Estate Report: Miamians Want to Move to Other Parts of Florida, New Yorkers Want to Move to Miami

By Kyle Munzenrieder 

 

​Real estate listing supersite Trulia has compiled its first Metro Movers Report, based on data culled from page views of its site. The report shows where Americans are looking to move and where they're looking to leave.

Apparently Miamians have no intention of departing our warm weather, but they would like to explore other Florida options. Meanwhile, not many other Floridians would like to move to Miami, but New Yorkers sure would.

The Metro Mover Index shows that for every Miamian looking at out-of-town listings on Trulia, only 0.82 out-of-towners are checking out real estate in Miami. That's not a good indication for future growth and is considerably lower than most other markets in Florida, but Trulia notes it's a better index than most major metro areas.

Here are the top ten for both metro areas with people looking to move to Miami, and metro areas where Miamians are thinking about moving to.

​So where are Miamians considering moving to? Apparently not too far away. Fort Lauderdale, West Palm Beach, Port St. Lucie, and Orlando top the list. (Ugh, why would you do that to yourselves?) The only non-Florida areas in the top ten are the NYC area, Atlanta, and L.A.

Oddly, for as much as Miamians might want to live in other parts of Florida, most Floridians do not want to move to Miami. Except for Fort Lauderdalians and Palm Beachers, that is, but they've always been wannabe Miamians anyway. Two-thirds of people searching for homes in Miami through the site currently live more than 500 miles away.

Miami is apparently known as the sixth borough for a reason. We're the second most popular search option for New Yorkers looking to move out of their region, only behind L.A
.

Delinquencies Decrease, Foreclosures Rise in U.S. During Third Quarter

By Michael Garrity

According to the Mortgage Bankers Association's National Delinquency Survey, the seasonally adjusted delinquency rate for mortgage loans on one-to-four-unit residential properties fell to 7.99 percent in the third quarter of 2011. This is the lowest level recorded since the fourth quarter of 2008.

The third quarter seasonally adjusted rate of 7.99 percent is a decrease of 45 basis points from the second quarter of 2011, and a decrease of 114 basis points from one year ago. The non-seasonally adjusted delinquency rate increased nine basis points to 8.20 percent this quarter from 8.11 percent last quarter.

The percentage of loans on which foreclosure actions were started during the third quarter was 1.08 percent, up 12 basis points from last quarter and down 26 basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.43 percent, unchanged from the second quarter and four basis points higher than one year ago.

The serious delinquency rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 7.89 percent, an increase of four basis points from last quarter, and a decrease of 81 basis points from the third quarter of last year.

The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure. The combined percentage of loans at least one payment past due or in foreclosure was 12.63 percent on a non-seasonally adjusted basis, a nine basis point increase from last quarter, but was 115 basis points lower than a year ago.

"While the delinquency picture changed for the better in the third quarter, the foreclosure data indicated that we are not out of the woods yet and that the issues continue to vary by geography.  A closer look shows that there are different trends driving these results. The increase in the foreclosure starts rate this quarter was driven by large increases from just a few servicers, concentrated in certain 'hardest hit' states.  For most servicers, the foreclosure starts rate was little changed over the quarter.   In these 'hardest hit' states, the few large changes reflects the progression of delinquent loans through the foreclosure process. Outside of these states, improvement has continued, although at a slow pace due to the still-weak job market," said Michael Fratantoni, MBA's Vice President of Research and Economics.

"The thirty day delinquency rate, the measure of early stage delinquency, reached its lowest level since the second quarter of 2007, a sign that new mortgage delinquencies have slowed.  Foreclosure starts, however, increased this quarter, the first increase in a year after declining for three straight quarters, and is now back up to  the levels of the first quarter of 2011. This is largely driven by loans leaving the loss mitigation process and the ending of state remediation programs and foreclosure moratoria.

"Twelve states saw an unchanged or lower foreclosure starts rate for the quarter. Among those states, New Jersey, Arkansas and Washington had significant decreases across all loan types, an implication that there might have been state specific factors causing what might be a temporary stop on the initiation of the foreclosure process. These states also saw significant increases in the percentage of loans that are 90+ days delinquent.

"The percentage of loans in the foreclosure process was unchanged but up from the third quarter of last year. The foreclosure inventory rate remains quite elevated, but is at the lowest point since last year. Similar to last quarter, the top five states in terms of the number of loans in foreclosure make up more than 52 percent of the national total. The disparity in loans in foreclosure between the judicial and non-judicial states continues to widen as backlogs continue with more new foreclosures entering the pipeline."

Change from last quarter (second quarter of 2011)

On a seasonally adjusted basis, the overall delinquency rate decreased for all loan types. The seasonally adjusted delinquency rate decreased 42 basis points to 4.32 percent for prime fixed loans and decreased 103 basis points to 10.73 percent for prime ARM loans. For subprime loans, the delinquency rate decreased 138 basis points to 21.24 percent for subprime fixed loans and decreased 211 basis points to 25.07 percent for subprime ARM loans. FHA and VA loans also saw declines, with the delinquency rate decreasing 53 basis points to 12.09 percent for FHA loans and decreasing 47 basis points to 6.58 percent for VA loans.

The percent of loans in foreclosure, also known as the foreclosure inventory rate, remained unchanged from last quarter at 4.43 percent. The foreclosure inventory rate for prime fixed loans remained unchanged at 2.56 percent. The rate for prime ARM loans decreased 11 basis points from last quarter to 9.05 percent. The rate for subprime ARM loans increased 50 basis points to 22.73 percent and the rate for FHA loans increased three basis points to 3.27 percent. The rate for VA loans decreased five basis points to 2.25 percent. Subprime fixed loans saw a decrease of 19 basis points to 10.82 percent.

The non-seasonally adjusted foreclosure starts rate increased seven basis points for prime fixed loans to 0.69 percent, 34 basis points for prime ARM loans to 2.16 percent, six basis points for subprime fixed to 2.50 percent and 103 basis points for subprime ARMs to 4.65 percent. The foreclosure starts rate increased five basis points for FHA loans to 0.78 percent and one basis point for VA loans to 0.56 percent. 

Change from last year (third quarter of 2010)

Given the challenges in interpreting the true seasonal effects in these data when comparing quarter to quarter changes, it is important to highlight the year over year changes of the non-seasonally adjusted results.

Compared with the third quarter of 2010, the foreclosure inventory rate decreased 100 basis points for prime ARM loans, while the foreclosure inventory rate increased 11 basis points for prime fixed loans, 194 basis points for subprime fixed, 95 basis points for subprime ARM loans, five basis points for FHA loans and 11 basis points for VA loans.

Over the past year, the non-seasonally adjusted foreclosure starts rate decreased 24 basis points for prime fixed loans, 20 basis points for prime ARM loans, 28 basis points for subprime fixed, 46 basis points for FHA loans and 30 basis points for VA loans. The foreclosure starts rate increased 56 basis points for subprime ARM loans.

Florida Markets Dominate REALTOR.com Top Ten Turnaround Report

Though the past four years have seen many cities suffering from large numbers of foreclosures and a loss in home values, ten of these real estate markets are now leading the nation towards a general recovery and stability of the housing sector.

Realtor.com’s Top 10 Turnaround Town Report, based on third quarter 2011 data, includes six Florida markets: Miami, Orlando, Fort Myers-Cape Coral, Fort Lauderdale, Sarasota-Bradenton, and Lakeland-Winter Haven.

Each of these markets has experienced positive year-over-year median price appreciation, reductions in year-over-year median age of inventory and inventory counts, while also experiencing lower unemployment rates on a year-over-year basis. Florida’s success can also be tied to foreign buyers; the number of foreign buyers purchasing homes there increased from 10 percent in 2007 to 31 percent in 2011.

Let’s take a closer look:

Miami, FL: The number one town on the report, Miami has gone from being one of the first victims of the subprime crash to having a healthy inventory that is only half the size from a year ago. Today, Miami is only reporting one foreclosure for every 407 homes, compared to the national rate of one per every 213. And, condo sales have increased 79 percent in the first five months of this year, largely due to an influx of foreign investors.

Orlando, FL: Ranked second on the report, Orlando leads the nation in the ratio of Realtor.com searches to listings. Inventory has also obtained a balance with demand. Foreclosures hurt the market in 2007-08, but foreclosures in Orlando were down 58 percent in September, compared to last year.

Fort Myers-Cape Coral, FL: Median prices in Fort Myers-Cape Coral have increased almost 33% year-over-year, according to Realtor.com’s October 2011 Real Estate Trend Data. In addition, foreclosures are down–only one in 313 homes in September–while inventory has been reduced and foreign buyers have been attracted to the area’s real estate prices. The metro ranked third on the turnaround report.

Fort Lauderdale: FL: A decrease in inventory coupled with an uptick in prices earns Fort Lauderdale the number five spot on the report. Inventory decreased almost 38 percent year-over-year, according to Realtor.com’s October data report. Prices have fallen about 46 percent since 2006, but are now going up.

Sarasota-Bradenton, FL: A total of 11 percent of all foreign buyers in Florida are in Sarasota-Bradenton specifically. Number six on the turnaround report, the market has seen a list prices increase of more than 17 percent year-0ver-year and a decrease of inventory of 32 percent according to the Realtor.com October data. The market still has a long way to go, after losing more than 55 percent of home values from 2006 to the second quarter of 2011 due to foreclosures.

Lakeland-Winter Haven, FL: A year ago, Lakeland-Winter Haven topped national foreclosure filing lists, but now the area’s distressed sale market share has decreased 46 percent. The area–ranked 7th on the turnaround list–has seen total listings decreased more than 36 percent year-over-year and median age of inventory decrease more than 17 percent, according to Realtor.com’s October data. Prices are also up 12 percent compared to last October.

Realtor.com’s Top Ten Turnaround Town Report is compiled using a formula based on price appreciation, changes in inventory, median age of inventory, searches by Realtor.com visitors, and unemployment data.

Check back in tomorrow for a closer look at the remaining four markets!

Related posts:

Read more: Florida Markets Dominate REALTOR.com Top Ten Turnaround Report | REALTOR.com® Blogs 

Lawmakers Agree to Increase FHA Loan Limits

U.S. lawmakers reached an agreement to boost the maximum size of home loans backed by the Federal Housing Administration over opposition from some House Republicans and free-market interest groups.

House and Senate lawmakers drafting language to reconcile a package of spending bills agreed to apply a higher limit of $729,750 to FHA-insured loans, while leaving the limit on loans backed by mortgage companies Fannie Mae and Freddie Mac at the current level of $625,500, according to the proposal released tonight. The Senate measure originally included an increase for loans backed by both the FHA and the government-sponsored enterprises, or GSEs, which have been under government conservatorship since September 2008.

The agreement on the loan limits will require House leaders to put the provision on the House floor against the wishes of lawmakers including House Financial Services Chairman Spencer Bachus, an Alabama Republican, and Representative Jeb Hensarling of Texas, the committee’s vice chairman and the chairman of the House Republican Conference.

“Further expanding the federal government’s role in the secondary mortgage market is not necessary,” Bachus, Hensarling and five other Financial Services subcommittee chairmen, wrote in a Nov. 7 letter to lawmakers on the conference committee responsible for reconciling the differences between the House and Senate spending bills. The House bill did not include the provision increasing the limits.

The limits, which vary by locale, currently apply to loans backed by the FHA and Fannie Mae and Freddie Mac, which together buy or guarantee about 90 percent of all residential home loans.

Bipartisan Support

Should lawmakers pass the final measure, the FHA limit would be raised a little more than a month after it was automatically reduced to $625,500.

The Senate in October backed the increase to FHA and GSE limits with bipartisan support. The resulting debate has split housing and financial services industry trade groups and has brought the opposition of groups like the Club for Growth and Americans for Prosperity.

Lawmakers who back the higher limits are concerned that any withdrawal of federal support could undermine the frail housing market. They made their case to House and Senate appropriators, who spent last week meeting in private to hash out details of the $182 billion spending bill that includes the mortgage provision.

Senators Robert Menendez, a New Jersey Democrat, and Johnny Isakson, a Georgia Republican, sponsored the Senate provision, which would raise the limits for all three housing agencies until Dec. 31, 2013.

—from businessweek.com

Trump Hollywood Continues Sales Success

By Michael Gerrity

Trump Hollywood

(HOLLYWOOD, FL) -- Building upon its remarkable success, Trump Hollywood, one of the newest luxury oceanfront condominium in Hollywood Beach, surpassed a significant milestone in August as more than half of the tower's 200 residences now have been sold.  Since its January re-launch, sales at Trump Hollywood have reached 97 units and $128 million, with overall sales since the project's inception now at 117 residences.

In addition, Greg Freedman, partner in BH3, the property's new owner and developer, said 92 Trump Hollywood residences have already closed, with several more closings scheduled throughout the fall.

BH3 is particularly impressed with the overwhelming response from purchasers to Trump Hollywood's custom-designed model residences from Interiors by Steven G.  In fact, the designer is debuting three new model residences this month alone, as all the previously created models were sold within a few weeks of their completion.  Freedman said a Trump Hollywood Sky Residence designed by Steven G sold less than a week after its June debut and has already closed.  Two additional models that were completed in the last two weeks have also been contracted.

Edgardo Defortuna

"Steven G and his team truly understand Trump Hollywood's high-caliber purchasers and the desires and expectations they have for their residences," said Freedman.  He added that Steven G recently opened a Design Center within the tower to enable purchasers to "touch and feel" the myriad options available when finishing their units.

"The design team continues to provide us with a wonderful showcase," said Fortune International President Edgardo Defortuna.  "We look forward to sharing the new models with prospective Trump Hollywood buyers."

Trump Hollywood is ideally located between Miami and Fort Lauderdale, just minutes from such renowned destinations as Bal Harbour Shops, Aventura Mall, Las Olas Boulevard and South Beach and a short stroll from the Hollywood Broadwalk.

Trump Hollywood - residence living room

Designed by celebrated architect Robert M. Swedroe, the 41-story contemporary glass tower fronts 240 feet of pristine beachfront and features 200 expansive residences, each with private elevator access and floor-to-ceiling windows providing spectacular Atlantic Ocean, Intracoastal and city views.  Two-, three-, and five-bedroom residences range in size from 2,100 to more than 5,000 square feet, plus expansive terraces. 

A modern twist on classic Miami, Trump Hollywood's interiors were created by world-renowned design firm Yabu Pushelberg.  Amenities include a wine cellar and tasting salon; cigar room; interactive club room; library/private dining area ideal for board meetings, conferences and private dinners; elevated pool deck overlooking the Atlantic Ocean; and 4,000-square-foot, state-of-the-art spa and fitness center featuring a yoga studio and treatment rooms.

Trump Hollywood was acquired in late 2010 by BH3, a successful South Florida-based real estate firm, and King Street Capital, a $20 billion New York-based global alternative investment management firm.