Black Friday Market Update, Nov. 2015.

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I hope this blog finds you well. I'll go over some thoughts on the national market, then the Lehigh Valley MLS and Zillow Report. Scroll to the bottom to see how many years you have to live in the Vally to own vs rent.

1. Some general thoughts about the National market:

T1: "A Fed rate hike in December is "pretty much in stone," said the head of strategy at RBS, adding the futures market is pricing in three rate hikes by the end of 2016, despite promises of a slow path higher." - CNBC.com, around Nov 17th.

T2:

 

T3:     Performance of the XLF index fund which tracks banks. The price is at 24.51, which is close to its 52 week high. It seems people are believing in the banks; it might be simple

Thoughts on the national Market:

2)MLS Lehigh Valley MLS

 a)

September 2015 Update

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As November begins, the Lehigh Valley Housing Market seems to be growing stronger. While we did not have a rate hike at the Federal Reserve last month; many, including Carl Icahn, think that it would be better if the economy had one. Oil prices have remained low and that is good for the stability of the American Consumer. 

The Market Update for the month of October has not been released yet, so these are the metrics from September.

I) As for the Lehigh Valley: The Lehigh Valley Association of Realtors Report indicates:

Recap:  Lower Inventory and increased Closed Sales. Median Sales Price had a bad month.

A) New Listings and Pended Sales

Reaction: I find it intriguing that the amount of listings are consistent from year to year. Pended Sales are up an outstanding 17.9% despite the amount of listed homes remaining impressively static.

September in particular furthered the pended listing momentum by  seeing pended sales up 20%

I do not expect to see such a large increase next year as I believe the market is hitting equilibrium.

B) Median Price:

Reaction: For the Month, Northampton and Lehigh County did poorly in terms of Median Price. Median Price is up 2.4% for the year -- I do not believe the monthly overview is much to worry about.

C) Days on Market

Reaction: Less is more in this case. I believe  the narrow range of DOM is likely a healthy indicator for the market.

D) Top 3 Performance by School district by average sales price Year To Date

1. Southern Lehigh +11.7%
2. Northampton 11.3 %
3. Allentown 7.3 %

II) Zillow:

In the below charts it seems that the Hanover twp and the Easton Area is leading the way in terms of YoY returns. The forecast is for another 1.6% price growth.

Conclusion: The Lehigh Valley seems to have steady and consistent growth. I hope to see this continue, I do not expect the pended sales to keep trending so dramatically

 

Monthly Market Update. August's Update, July's statistics.

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Heading into the end of 2015, and going toward 2016, I do wonder what will happen with Interest rates. I wonder how they will affect buyers. Will they even go up? With the Chinese Yuan being devalued last week that could delay a rate increase. I think they could temper Average Sales price; however Supply and Demand are important, and these metrics are pretty solid for the Lehigh Valley in recent months. I think the effects of higher rates will be interesting and I hope they will be mild.

I think a headwind that is not discussed enough with housing is wage growth. People cannot spend what they do not make and if wage growth remains stagnant it is an inherent headwind to home prices increasing. Maybe rising interest rates will signal higher wage growth?

Anyway, to the numbers,


I. The Lehigh Valley Association of Realtor's Report for July. Click Here to see the Full PDF

Reaction: Closed Sales are up  substantially. The inventory is down greatly. The number of Listings year over year has been consistent but the rate at which homes are selling has increased -- it seems to be furthering the momentum of the Lehigh Valley Housing Market.



1. Listings YTD for the past 3 years

Comments: The incoming supply of homes has been relatively flat year over year.


The nice part is in the next section:

2. Pending Sales:

Comments: Its hard to beat  a 19.6% increase in Pended sales. As this continues, it should strain prices higher.


3. Average Days on Market:

Comments: Despite the increase in buyers, the Days on market has remained stagnant. I'd like to see this decrease.

4. Average Sales Price.

This is a good thing :)

5. And this is better. Inventory of homes have declined.

Top Five Risers in Average Sales Price by school District:

1. Northampton
2. Southern Lehigh
3.  Bangor
4. Allentown
5. Easton

II.             Zillow's Report

Comments: Zillow's report is Negative compared to LVAR's report. Zillow ascribes a Zestimate to each home and it updates differently than the Realtors report. Zillow Explanation of Zestimates.

July 2015 Lehigh Valley Market Update

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The Lehigh Valley is continuing its positive momentum at a healthy pace: as rhythmic as a John Bonham drum beat.

Lehigh Valley Association of Realtor Report.

 All of these metrics are good -- lets delve deeper.

a) The Amount of Closed Sales: Up 12.7% YTD compared to last year -- month over month 15.6%

b) There are more homes settling for more

Reaction: Average Sale Price for the year went down a little from this month as compared to last month. However, more homes settled so there is a larger pie being shared. I think the price increase is a healthy amount and it helps people continue to dig out of their negative equity.

c) Pended Sales: The future looks good.

Reactions: Look out below its a huge tower of Under Contract homes.

School Districts: Top Three Risers In Average Sales Price-

1) Northampton up 22.8%
2) Southern Lehigh 13.4 %
3) Bangor 9.2%


Zillow Update.

This report is slower to update than the LVAR report. For May 2015 -- the numbers continue to improve. Negative equity continues to decrease and average sales price keeps growing.

Market Update June 2015

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This month the only report I have to cite is the Lehigh Valley Association of Realtors version. Zillow did not provide their report for Allentown at the time of this post.


May was like the American Pharaoh of months, May had a perfect sweep of the metrics like the Triple Crown winner had a perfect sweep of the races.

May was an awesome month for the housing market.

I. Lehigh Valley Association of Realtors -- Report.

1. The Main Metrics

a) New Listings

Reaction: Buyer's have less choices for homes at the moment. As this trend continues, this puts pressure on prices to go up. The percent decrease is a healthy one in my opinion as its not too dramatic.


b) Closed Sales

Reaction: The amount of sales are up 10.5 % for the year but down -2.8% Month to Month. The month over month number does not trouble me because the Pended Sales are doing quite well.

c) Pended Sales.

Reaction: Pended sales are the best indicator of the future numbers. Both the month over month and year to date pended sales are compelling.

d) Average Sales Price

 

Reaction: People are making money on their homes MoM and YoY. That is awesome.

E) Months Supply

Reaction: Supply is down. This bodes well for the future of home prices.

2. School Districts

Three top performers In Average Sales Price:

a) Allentown School District (+7.9%)
b) Southern Lehigh (+11.8%)
c) Northampton (+31.7%)

Some performance that needs some work.

a) Catty: -15.1 %
b) Wilson: -8
c) Northwestern Lehigh ( -7.7 %)

-Stephen

Market Update for May 2015

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 Find the whole report here:

1)

 

Reaction: The Lehigh Valley is sustaining its growth on a healthy path. A reduction in closed Sales and an increase in Median Sales price is precisely what one should want to see.  Lets delve deeper!

2) New Listings and Average Sales Price

Reaction: There was a pervasive thought that the market would suffer from a backlog of listings once the average price increased. Seeing a market that is up 6.5% in average sales price and only has a 1.1% increase the amount of listing is great, it seems to stymie this thought.

3) The Momentum continues.

Reaction: The Pended Sales being up 20.6% bodes well for the future. The percent change over the past 12 months has been up 10% per month. Impressive.


Zillow Report:

Zillow Report Link

From the peak of home values, we are now 19.3%. I like this report because it tells you how many foreclosures there are per 10,000 (4.4) and negative equity there is in the respective counties. Feel free to compare and contrast the results. Zillow is more bearish in the Lehigh Valley than the Realtor report.


I hope you enjoy the reports and numbers.

thanks!

Market Update For March 2015

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With all of that out of the way, lets get to analyzing the market!


1. March 2015 Association of Realtors Report:  Click here.

a)

--Good Market Vs Bad Market: I believe that Real Estate is often reactionary. A hot market and a cold market happen suddenly. More precisely, it goes from one to the other quickly.  The numbers above are a stark improvement to the upside. It is an encouraging sign. Will it continue? I believe so.

b) Listings have decreased

c) Under Contract homes -- They were the Super Star statistic of the month

d) Average Sale price of homes are up 5% year over year

Broken down by school district:

3 Decliners in Average Sale Price: Catasaqua, Salisbury and Wilson.

-Thoughts: These three school Districts have a smaller sample size so their declines in average sales price is likley due to chance rather than a momentum issue.

3 Risers: Allentown, Parkland and Northampton (up 33%)



e) Lender Mediated activity: 9.8% of homes on the market are lender Mediated

Please use Realty Trac.com to see more information on Foreclosure rates.

2. Zillow Report: This report is from February -- Zillow is a bit more cautious on optimism than the Realtor report. I like the Zillow report primarily for its Negative Equity Indicator and its "change from the peak" metric. Click here for the report.

Richard Quest: A Net Zero Energy Home.

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A Green Energy Home -- 

Thoughts: Green Energy homes have a lot of momentum, its nice to see the virtual family Mr. Quest is referencing using the property as a stereotypical family might use a home. With Green Energy homes, I feel functionality and amenities are compromised for energy savings. Its nice to see a substantial investment being made for a pragmatic use of a traditional home.

Pended Sales in the LV are up 41%, to 1111 for the Year, Make a Wish!

I hope this update finds you well. If you know anybody who needs  home Buying or Selling consulting, let me know! Referrals are my lifeblood in Real Estate! Check out my Facebook business page here.

I can make my commission work with 501c3 charities, which I'll get into more detail about upon

1. Lehigh Valley Market Update from the Association of Realtors:

Reaction: I believe these numbers are awesome. February was a difficult month in respect to snow showers and bitter cold. Yet, the market still had growth. Below is the amount of new listings in Feb 2015 vs previous years.

In 2013, the idea of a shadow inventory of homes was prevalent. Meaning, bank owned proprieties and home sellers that just could not move before would create a backlog of listings once home prices went up. I am not sure how true, or untrue this is; however, seeing a decline in available listings from then is a positive indicator that this shadow inventory is not a prevalent theme in my opinion.

Looking at Feb 2015, there was a year over year increase in listings but also an increase in competition for listings because of strong buyer demand.

5.6 months of supply means if buyers keep buying at the same pace they did last month (Feb), there would be no homes to buy in 5.6 months. That is considered a normal market, while 6.5 is not a bad number from Feb 2014, its still considered a sellers market.

When pended sales are up over 41% year over year in Feb, that is probably a very good thing.


 2. Zillow Market Report Jan 2015:

This is the same as last month's Zillow Update. They lag behind, which is fine. I just thought I'd provide a link to you.

Feb 2015 Lehigh Valley Housing Update

I hope this post finds you well. I hope you'll like my Facebook page and keep me in mind if you need any Real Estate help.      Stephen.Weinstein@foxroach.com

This year, 2015, I am still offering to make my commission split with my brokerage work with a 501c3 charity of your choice. Please contact me for details, there is legal jumbo and its not an option anybody has to undertake.

Alright, with all of that out of the way.

Market Update From the Association of Realtors:

Key Points for the Month: Click here for the full report.

1.

 Reaction: While the Median Sale price is down, the rest of the metric numbers are pretty good for January. Increased closed sales and a lower inventory of sales are great indicators. The Median Sale price declining is interesting, my guess is that in January lower priced home sold faster than homes at the top end of the range.

So what does the future of have in store. The glaring metric of the month is the amount of pended sales that occurred in January. Sales are up 51%. That is staggering.

Of interest, Southern Lehigh School District saw an increased pended home sales from last year of 283% and Whitehall at 200% -- Those are some pretty gaudy numbers.

Zillow Report: Click Here for the Report

I really like the Zillow report for its analysis on the Negative Equity Market. This is of course about how many home owners are still under water on their mortgage in Lehigh and Northampton Counties.

If you look at the last column you can see the break down for each county. While the Lehigh Valley still lags the national of average  at 16.9 to a local average of 18.3-22.3. This number has been trending down and is making for a de-leveraging housing market.

Come Decide the Fate of Wehr's Dam. March 18th.

On March 18th the fate of Wehr's Dam will be decided. I believe the Morning Call has had some interesting converage on this topic.

My View: The Dam is certainly a gathering place for the community but I am not sure the cost to the ecosystem is worth it. The commissioners choice is not exactly about that, the choice is whether it is worth renovating the Dam so that it can continue to work in the capacity it does now. Its a mixture of aesthetics, feelings, environmental impact and economics.

I do believe if you have an opinion you should go to the meeting, which I am promoting on my blog here and for paid for advertising on Facebook.

#Democracy

Lehigh County Taxes Staying the same in 2016

Morning Call Report by Kevin Duffy

In a report by the MorningCall and Kevin Duffy, it seems that county taxes will be remaining static for 2016.

Some Highlights:

1. "As examples, he noted the Valley's 5.2 percent unemployment rate and the relocation of major companies such as Ocean Spray and Taizhou Fuling Plastics, both to Upper Macungie."

2.  "the re-establishment of the county's Aa1 rating from Moody's and upgrade from Standard & Poor's and the erasing of the $7.8 million deficit in 2014."

3. "He said the tax rate is lower in 2015 than it was 12 years ago by an average $668 per taxpayer."

Going Forward: Lehigh County has a lot of financial growth and is doing a great job with working on its debt and letting future generations deal with it. This puts the future of Lehigh County in the hands of its constituents and not debtors.

One thing I appreciated about Commissioner Muller's address is that he speaks directly and I believe that is the general tone of Lehigh Valley politics: to the point, and (hopefully) productive.  I am not exactly sure if Tom's name is just Tom or Thomas, but, I think its interesting that Kevin Duffy referred to the commissioner as Tom in his introduction in the article. I believe its indicative of a less decisive political scene.

Maybe I am looking at this for what I want to see.

-Stephen

Home Values NEED Starbucks? What? #Zillowtalk

This content was taken from Starbucks Twitter account. All Rights are theirs.

 

Reaction: The CEO of Zillow (Spencer Rascoff) and Zillow's top Economist (Stan Humphries), wrote a book Called #ZillowTalk. They mailed it to me as I am a Premier Agent with Zillow and its been great read through the first half of the book.

The Huffington Post did a precise job of summarizing the chapter but omitted how specific the radius Zillow used for their Starbucks hypothesis. There was a difference in price accretion between properties located .25 miles away and .5. The further away a property was from a Starbucks, the less the price accretion.

Starbucks Twitter Profile States: "Inspiring and nurturing the human spirit -- one person, one cup, one neighborhood at a time."

Who knew the last clause was as much a reality as much of a mission statement.

I believe Rascoff and Humphries' information is pretty cool, the authors do a great job of explaining this point further and its very convincing.  

Arbitrary Point. By my office on Hamilton Blvd a Starbucks closed a few years ago. I guess it helps Real Estate everywhere except the shopping center at Mill Creek and Hamilton. However, I think they were just early to the area, it seems the shopping center has a lot of anchor stores that have been there for a while. More than anything, the store itself had less sqf than most Starbucks I have been too,  I do not quite think it fit their model. I mean as nothing more than an anecdote. 

The Starbucks Real Estate team is interviewed in Zillow Talk and they do not pretend to be perfect with site location by any means.

-Stephen