The National Association of Home Builders (NAHB) and Wells Fargo released their latest Housing Opportunity Index (HOI) – an index that measures the percent of all new and existing homes sold that are affordable to families earning the national median income, currently $64,400.
The latest HOI (Q4 2010) hit 73.9 percent and indicates that housing affordability is at its highest level in the twenty years since it’s been measured. See the report: Housing Affordability Rises to Highest Level in Two Decades
In another report from last week – this one by the Mortgage Bankers Association – short-term delinquencies are now at their lowest level since the end of 2008. See Short-term Delinquencies Fall to Pre-Recession Levels
From the report: “The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 8.22 percent of all loans outstanding as of the end of the fourth quarter of 2010, a decrease of 91 basis points from the third quarter of 2010, and a decrease of 125 basis points from one year ago, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey.”
skeptical
Housing affordability is the single issue that should give cheer to the optimists out there.
Negative factors for Reno?:
– Unemployment
– Shadow inventory
– Huge percentages of upside down properties
– The general local economy
What one factor might actually counter much of the above? Affordability. And, I would argue homes are more affordable in Reno than most other places in the US, outside of the rust belt.
I think unemployment will remain above 10% for a long, long time around here. However, there may be enough investors and wage earners out there that can afford a $160k house to keep the market from dropping further. Now, if you are in the top end of the market, with houses above $500k……well……it ain’t looking too good.
I would say that within the next 3 or so years, there’ll be some mighty good deals at the very high end. FWIW….
Carlin
The top end of the market is $500K? $500K is now, and has been for quite some time, the extreme outer edge of the market.
How about $300K? 92% of all houses that sell are for $300K or less. The $500K and over segment is less than 5% of the market.
MikeZ
I think unemployment will remain above 10% for a long, long time around here.
I’d go even further out on that limb: I think the local (and perhaps national) economy is going to degenerate.
There are no reliable signs yet of local or national improvement. The BLS official unemployment figure of 9% is almost certainly dead wrong, off by a good 2-2.5M jobs. GDP growth can’t be taken at face value as long as the federal economic stimuli are active.
While credit has indeed loosened, and corporate productivity is up, there’s been no significant trickle-down into jobs or wages. We’re still losing ground, creating fewer jobs than new graduates.
And by the way is anyone else experiencing frequent Firefox crashes from RRB?
Sully
And by the way is anyone else experiencing frequent Firefox crashes from RRB
not a crash, but sometimes real long load times, also sometimes just simply can’t connect.
bob_c
11 of the 20 markets set fresh after crash lows in the last quarter per case-schiller
dropping 3.9% in the quarter of what is now being called a double dip by many.
reno seems to be right on that trend.
Sully
The National Association of Realtors, which issues the monthly existing home sales report that is closely watched by economists and financial markets, may have over-counted home sales dating as far back as 2007, the newspaper said in an article posted to its web site.
http://www.reuters.com/article/2011/02/22/usa-economy-housing-idUSN2124656720110222
skeptical
NAR issuing overly optimistic numbers in an attempt to juice sales and convince buyers the worst is over? NAR not being an objective source of data to guide markets and potential buyers/sellers? Say it ain’t so!
NAR has a single objective — support realtors. If they have to bend the data a bit to get that done — no worries. Anybody who uses the NAR as an objective source is misguided.
NAR pays the politicians to pursue policies that the NAR believes is good for the NAR — like the $8k tax credit (and the extension thereof). Unfortunately, those policies have been good for nothing. All the tax credit did was temporarily juice the markets and set us up for the double dip that is occurring right now.
Rubiconer
The SOLE purpose of the NAR is to convince people to buy houses thus generating commissions for its members. David Lereah, its former “chief economist” has been so thoroughly discredited as a lying shill that he has disappeared from public view. Lawrence Yun, the current “chief economist” has no credibility and thus receives little media attention. Still, some realtors, like Guy’s colleague at the Tahoe office, still cite Yun’s drivel as authority in press releases. Whenever I see that a realtor cites the NAR or Yun as authority for anything, I immediatlely discount that realtor’s credibility by 120%.
Carney
The median price of a SFR in Las Vegas last month was $109,000. LV is back to 1990 prices.
Sully
FWIW, the entire article regarding LV is:
http://www.lasvegassun.com/news/2011/feb/22/price-existing-homes-drops-20-year-low-las-vegas/
Skippy
Thanks for the article Sully/Carney. So the median price in Las Vegas is currently $109,000 vs. Reno’s “shocking” $159,950? That puts it into perspective how much lower we can go.
Phil
Nah, it won’t go that low here in Reno. It’s different here. Reno is more special than Las Vegas. Really. It won’t happen here. Really, it won’t.
Not in Reno. No, not here. Really, it won’t.
Really.
Cornell
So the Montage has a new owner, again. Is this owner 3 or 4?
Yawn.
Zen
For as long as I can remember, Reno housing has been more expensive then in Vegas. If Reno ever hits $109K median, Vegas will be that much cheaper. Maybe they need another multi-billion dollar casino? What do they say about putting all your eggs in one basket?
Opie
Yes the Montage has a new owner. Yawn.
Here’s another Yawn. The GSR has a new owner.
As if anything will be different.
Double Yawn.