New sales record and double digit price growth in Miami real estate market in 2012

Monday, 28 January 2013

Homes sales in Miami set a new record in 2012 and prices saw double digit growth, boosted by overseas buyers, according to the latest data from the Miami Association of Realtors. Year end sales of single-family homes in Miami-Dade County rose 7.9% compared to 2011 and condo sales were up 1.2%. ‘The Miami real estate market continues to exceed expectations and generate optimism. While we expected the surge in demand to drive price appreciation, we did not expect prices to increase as soon and as strong as they did,’ said Natascha Tello, chairman of the board of the Miami Association of Realtors. But she added that the housing shortage experienced last year, the association is not expecting to set another sales record this year. Overall sales increased 12.5% in December compared to a year earlier. The sales of existing single family homes in Miami-Dade increased 16.4% while sales of existing condos increased 9.8%. In Florida as a whole sales of existing single family homes in creased 15.8% in December compared to a year ago.  Condo sales in the state were up 8.6%. In terms of prices there has now been 13 consecutive months of appreciation for both single family homes and condos.  The median sales price of Miami-Dade condo, which has increased each of the last 18 months, rose 25.4% to $163,000 compared to a year earlier and 3.2% compared to the previous month. The median sales price of single family homes rose 18.9% to $214,060 year on year and 10% compared to the previous month.  While year end median sales prices increased 11% to $188,000 for single family homes and 34% to $147,000 for condos. In December the average sales price for single family homes in Miami-Dade County increased 49.1% to $482,761. The average sales price for condominiums increased 36% to $358,856. State wide median sales prices in December increased 14.1% to $154,000 for single family homes and 26.3% to $117,500 for condos, according to data from Florida Realtors Industry Data and Analysis department and vendor partner 10K Research and Marketing. ‘We expect the Miami market to continue to strengthen in 2013 as demand for local housing intensifies,’ said Fernando Martinez, residential president of the Miami Association of Realtors. ‘In addition to being a top market for foreign and vacation home buyers and investors, Miami continues to attract global attention on many fronts, including business, banking, fine arts, and entertainment. Such activities generate demand for housing, as evidenced by our strong rental market and lack of inventory available for sale,’ he added. The data also shows that active listings at the end of December were 24% below what they were in December 2011. Inventory of single family homes dropped 28% while that of condos decreased 21%. Currently, there are 5.2 months of supply of single family homes and 5.7 months of supply of condominiums in Miami-Dade, representing drops of 33% and 22% respectively. Strong demand for bank owned (REO) properties and improved processing of short sales continues to yield absorption of distressed listings and to contribute to price appreciation. In December, 41.1% of all closed residential sales in Miami-Dade County were distressed, including REOs and short sales, compared to 54.4% in December 2011 and 47.4% the previous month. There are indications that the number of international buyers are increasing. Some 65% of total closed sales in December were all cash sales, compared to 63% in December 2011 and 63% the previous month. Cash sales accounted for 49% of single family and 76% of condo closings. Nearly 90% of foreign buyers in Florida purchase properties all cash. This reflects the much stronger presence of international buyers in the Miami real estate market. By comparison all cash sales nationally accounted for 29% of transactions in December, down from 30% the previous month and 31% in December 2011.

Home Prices Rise for 10th Straight Month

Home prices across the US had a better showing this past November than they’d managed the month prior, S&P Dow Jones Indices said Tuesday., January 29, 2013. 
The S&P/Case-Shiller Home Price Indices showed that the price tags rose 4.5% for the 10-City Composite and 5.5% for the 20-City Composite in the 12 months that ended Nov. 30, 2012, a better year-over-year gain than the previous month’s showing. 

The year-over-year increases marked the 10th consecutive month of gains in prices for homes ranging from single-family houses to condominiums and co-ops.
“Housing is clearly recovering,” says David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, in a release. 

“Prices are rising as are both new and existing home sales.”
The sole exception among the cities in the 20-city composite was New York City, where prices dipped 1.1% year-over-year. Speaking on Bloomberg TV, Karl Case, cofounder of the Case-Shiller indices, blamed a dip in Wall Street bonuses for the falling-off in New York City prices.

“The better annual price changes also point to seasonal weakness rather than a reversal in the housing market,” Blitzer says. “Further evidence that the weakness is seasonal is seen in the seasonally adjusted figures: only New York saw prices fall on a seasonally adjusted basis, while Cleveland was flat.” Moreover, 10 cities in the 20-city composite saw monthly price increases in November, compared to seven in October.
The indices show shifts in regional patterns, as well. The Southwest cities of Las Vegas and Phoenix are staging “a strong comeback,” with Miami and Tampa, FL close behind. The Sun Belt states and California are also coming on strong, while the Northeast and Midwest are lagging somewhat. New York City, Boston and Chicago have suffered monthly declines in six of the past 12 months, according to a release.

GlobeSt.com Jan 29, 2013

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US Housing Market will be even stronger in 2013

US Housing Market will be even stronger in 2013 according to
top economists speaking at Florida Realtors® 2013 Real Estate and Economic Forecast Conference in Orlando. 

Led by Texas, Colorado, California, Arizona and Florida. 

Rest of US on the same trend. 

 

Latest data from Florida (October 2012) shows 44 percent of closed sales were paid in cash, signifying strong demand from investors
• Foreign buyers make up 19 percent of closed sales in Florida (October 2012)

 

Full Article: 

 

ORLANDO, Fla. – Dec. 12, 2012 – Florida’s residential real estate market will continue its upward trend into 2013, though the pace of recovery may be slower than the U.S. as a whole, according to leading U.S. economists speaking today at Florida Realtors® 2013 Real Estate and Economic Forecast Conference in Orlando.

“Florida’s housing market is back, with great possibilities for the future – but those possibilities are only beginning to be realized,” said Dr. John Tuccillo, chief economist for Florida Realtors.

Along with Tuccillo, conference speakers included Doug Duncan, senior vice president and chief economist for Fannie Mae; Leslie Appleton-Young, vice president and chief economist for the California Association of Realtors (CAR); and Pat Reass, a state-certified residential real estate appraiser at Appraisal Group MidFlorida LLC in Winter Haven.

Fannie Mae Chief Economist Doug Duncan said, “We believe the housing market is on firm footing. … Most of the improvement we’ve seen has come from the supply side of housing. Distressed properties are coming down from about 5 million to more like 3 million.”

Mortgage rates should remain low and not change much in 2013, he added, while banks likely will continue to maintain high lending standards and a tight credit environment.

“The trend has been established for the housing recovery, but robust growth awaits more jobs and a stronger economy,” Duncan said. “Three years into the recovery, the current economic expansion is the weakest since World War II. Just over half of the jobs lost in the Great Recession have been recovered.”

The real estate market “bottomed out in late 2008,” Tuccillo said, according to Florida Realtors’ market data, data from the National Association of Realtors (NAR) and other market research sources.  “Since the beginning of 2009, we’ve clearly seen a regrouping and a recovery underway,” he said.

Median sales prices are consistently rising for both existing single-family homes and condo-townhome units across Florida. However, he noted the state’s active distressed property (foreclosures and short sales) market is putting pressure on prices, resulting in smaller gains and a slower rate than what is being seen in California and the U.S. as a whole.

Other signs of Florida’s steadily improving residential market, according to Tuccillo:

• Months’ supply of single-family homes is below 6 months
• Latest data (October 2012) shows 44 percent of closed sales were paid in cash, signifying strong demand from investors
• Foreign buyers make up 19 percent of closed sales in Florida (October 2012)
• Traditional (non-distressed) sales now make up over 50 percent of Florida’s closed sales
• Closed sales include fewer REOs (real estate-owned) and more short sales
• Shadow inventory has been declining since 2009, though it remains a key factor in the state’s housing market going forward since Florida is a judicial foreclosure state (meaning foreclosures go through a court process)

Comparing Florida’s residential market to California’s and to the U.S. as a whole, CAR Chief Economist Leslie Appleton-Young agreed that the nationwide housing market is back.

“The latest NAR data shows very strong closed sales and rising prices,” she said. “Low inventory is currently a challenge for the nation, for California and also for Florida in many areas. There’s just not enough property for sale, particularly with investors buying properties for cash (29 percent of the market in California; 25 percent of the U.S. market). For California, we’re calling 2012 the return of the traditional seller to the marketplace – in October 2012, 63.4 percent of our total sales were from equity or traditional sales.”

In California, the current months’ supply of existing single-family homes is 3.1 months, Appleton-Young noted. While the state is still dealing with lender issues such as tight credit, problems are being resolved at a faster pace, she said, and home prices are rising as a result.

Looking ahead to 2013, Appleton-Young said, “There is a tremendous amount of pent-up demand for housing. The number of new units is improving, but it’s still low and isn’t enough to meet pent-up demand. The housing recovery is gaining strength, but the long-term viability of the market and its recovery depends on jobs.”

Where will Florida be in 2013? Assuming that the national fiscal problems are not resolved but are “postponed,” Tuccillo said he expects employment in the state to grow by 10 percent in 2013; residential sales to increase by 10 percent; prices (same sales index) to rise by 5 percent; commercial activity to revive; and inventory to grow as the market improves.

“I think the improvement in the market and rising prices will bring more potential sellers back into the market,” he said. “Signs point to a better year in 2013.”

 

http://www.floridarealtors.org/NewsAndEvents/article.cfm?id=284687&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+floridarealtors+%28Florida+Realtors%29

Goldman Sachs to sell €1.4bn German Property Portfolio

Goldman to start German property roadshow

By James Wilson in Frankfurt and Ed Hammond in London

Goldman Sachs will on Monday begin a roadshow to sell €1.4bn of shares in a huge German property portfolio, kick-starting what will be one of the biggest initial public offerings in the European property sector in recent years.
Goldman intends to sell 57.5 per cent of LEG Immobilien, which owns 91,000 homes in North Rhine-Westphalia – Germany’s most populous state – at a time of strong investor interest in the country’s housing market.

The rented German residential property market has become one of the most sought after real estate asset classes during the downturn. 
A combination of low vacancy rates along with stable rents and income streams has attracted pension funds, insurers and other long-term investors.
The IPO would be the largest in Germany since  
Telefónica’s German unit raised €1.45bn in October.

Goldman’s Whitehall property funds own 89 per cent of LEG, with the rest held by Perry Corp, the hedge fund. Goldman has set a price range of between €41 and €47 per share for LEG, hoping to raise between €1.25bn and €1.43bn if shares are fully taken up.
Whitehall and a number of other foreign investors took substantial holdings of German residential property in the years leading up to the financial crisis, often buying portfolios of tens of thousands of flats at a time.
Some foreign investors’ hopes for the German market were not realised over the past decade, with flats proving difficult to sell to tenants and rents and maintenance contracts closely regulated. But rising property values in Germany, particularly in larger urban areas, have tempted many investors back into the market.
More than €10bn was spent on German residential portfolios last year, a 46 per cent rise on 2011 and the highest amount since 2007. Shares in the handful of listed homeowners also performed strongly in last year.
The state of North Rhine-Westphalia has some growing cities such as Düsseldorf, but also some of Germany’s most depressed areas. While its population is set to fall by more than 6 per cent between 2009 and 2030, its number of households is forecast to grow by almost 3 per cent over the same period.
Following the IPO Goldman’s Whitehall will hold 33 per cent and Perry 9 per cent. The shares are expected to list on February 1.
The net asset value of the LEG portfolio according to measures used by the European Public Real Estate Association was €2.4bn at the end of September, the sale prospectus says, while the company generated rental and lease income of €244m in 2011. LEG has said it is considering more acquisitions.
The planned partial exit from LEG for Goldman comes after its Whitehall unit in December said it would divest part of its German commercial property portfolio, agreeing a €1.1bn deal to sell 17 department stores to an Austrian investor.
Last year, Terra Firma, the private equity group controlled by veteran investor Guy Hands, announced plans to refinance the €4.3bn of loans secured against its portfolio of 180,000 apartments. The refinancing paves the way for what is likely to be the largest stock market flotation of a German residential property business.

New Russian Property Portal to cover all of Russian Market

Carlo Wather, the former head of Rightmove, the UK Overseas RE listing site, is spearheading the launch of new private-equity backed Russian property portal.
Idinaidi.ru which launches officially at the end of January 2013 (currently on line in Russian only during test phase) will aim to exploit what is now the largest internet market in Europe, after Germany.

Internet penetration is rising rapidly in Russia and the property portal market is still fragmented without one dominant player such as Rightmove in the UK. The site has been more than two years in development and Wather claims the company has built the first truly national tool for the Russian market.
“Real estate is always about finding listings and connecting Professionals and Clients, and we have built the first comprehensive national tool to do this in Russia”.