Zillow has called the housing bottom in its latest Real Estate Market Report.
By Peter Ricci
Zillow joined the fray of optimism that has swept over real estate analysis the past few weeks with its latest Real Estate Market Report, stating that not only did housing values bottom in February of this year, but they have also risen for four consecutive months and posted their first annual increase in nearly than five years.
Stan Humphries, Zillow’s chief economist, said housing’s positive performance in the past four months suggests the market has turned for the better.
“After four months with rising home values and increasingly positive forecast data, it seems clear that the country has hit a bottom in home values,” Humphries said. “The housing recovery is holding together despite lower-than-expected job growth, indicating that it has some organic strength of its own.”
Curiously, Zillow did not track the home values in Houston when putting together it’s report, so we reached out to Donna Dagley, the vice president branch manager for Coldwell Banker United in Sugar Land, for some perspective – and what positive perspective it was!
“We are definitely in a great market,” Dagley said, and she had quite a few numbers to back that statement up, both from the Houston Association of Realtors (HAR) and Coldwell Banker United (CBU).
From June 2011 to June 2012, home sales in Houston, according to HAR, were up 13 percent, but for CBU, they were up 15 percent; sales volume, which went up 18 percent from HAR, was up 27 percent for CBU offices; and, perhaps the biggest difference of all, inventory dropped to 5.5-months supply for HAR, but for CBU, it was down to 4.5 months, and in Dagley’s markets of Sugar Land and Katy, she said inventory is down to less than three months.
All that activity, Dagley said, has drastically altered Houston’s housing landscape, and it’s up to agents to educate buyers that they can no longer demand anything and everything when buying a property.
“It is no longer a buyer’s market,” she said.
Nationwide, almost one-third of the 167 metros surveyed showed annual increases in home values, and going forward, two our of every five metro areas is expected to post increases in the coming year, with Phoenix (9.9 percent) and Miami (6.1 percent) leading the charge.
Though Humphries does expect values to taper off somewhat towards the end of 2012 (he expects a 1.1 percent national appreciation from June 2012 to June 2013), he is still optimistic for the market in 2012, even in its handling of distressed properties.
“[Foreclosures] will translate into more homes on the market by the end of the year, but we think demand will rise to absorb that, particularly in markets where there are acute inventory shortages now,” Humphries said.
Going forward, Dagley is pretty confident with Houston’s marketplace. In addition to foreclosures, which are down from last year, CBU’s average sale price is up 10 percent, and she said Houston’s “very, very strong job market” has propelled much of the post-boom pent-up demand into the market.