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Supply of Homes For Sale Up Year Over Year in July 2018

Nation’s Months’ Supply of Homes For Sale Up Year Over Year in July 2018

SAN FRANCISCO METRO AREA HAD THE LOWEST MONTHS’ SUPPLY IN JULY

BY SHU CHEN HOUSING , REAL ESTATE


U.S. home prices have risen year-over-year by more than 6 percent since August 2017, fueled by strong demand and a lack of supply in many markets. However, due to rising mortgage interest rates and slowing sales nationally, the number of increased slightly to a 3.2 months’ supply[1] in July 2018, up from 3.1 months in July 2017.

Months Supply By Price Tier

Figure 1 breaks out the months’ supply into four price tiers: low price (0-75 percent of median list price), low to middle price (75-100 percent of median list price), middle to moderate price (100-125 percent of median list price) and high price (125 percent or more of median list price). Usually, the high price tier has the largest months’ supply and the low to middle price tier has the lowest months’ supply. The differences in the months’ supply among the four price tiers were greatest during the 2007-2009 crisis period when the high-price tier peaked at 20.2 months and the other tiers remained less than 15 months.

Here’s how each price tier’s months’ supply in July 2018 compares with its recent history:

  • The low-price tier had a 3.2-month supply, which was down 0.2 months from July 2017, and was less than a quarter of its peak at January 2008.
  • The low- to middle-price tier had a 2.5-month supply, down 0.1 months from July 2017. The July supply was about 18 percent of its January 2009 peak.
  • The middle- to moderate-price tier had a 2.7-month supply, up 0.2 months from July 2017. The July supply was also about 18 percent of its January 2009 peak.
  • The high-price tier had a 4-month supply, down 0.2 months from July 2017. The July supply was 20 percent of its January 2009 peak.

Sold in 30 Days

With demand strong and supply tight, many homes don’t spend long on the market in 2018. Figure 2 shows that over the past four years the share of homes selling within 30 days of the initial list date[2] has been at historical highs. In July 2018, the share selling within 30 days was 25.4 percent, which was almost double the pre-crisis peak in 2005 and more than triple the level during the February 2008 trough. Figure 3 shows the share of the for-sale inventory that was on the market for more than 180 days. In July 2018, that share was 19.9 percent, about 2.2 percentage points lower than the average in 2017 and half of the peak in March 2009.

Inventory on Market 180 Days

Figure 4 shows the months’ supplies in the U.S. (based on data for 65 CBSAs) and selected CBSAs in July 2018 and July 2017. The months’ supply in West Palm Beach and Honolulu increased 1.2 and 1.9 months, respectively, in July 2018 compared to a year earlier. San Francisco and Seattle had the lowest months’ supplies in July 2018: 2.0 months and 2.4 months, respectively.  Philadelphia showed the largest decline – 0.9 months – in July 2018 compared with a year earlier.

US and CBSA Month Supply

[1] The month’s supply is calculated as the ratio of the for-sale inventory at the end of the month to the number of homes sold during the same month and represents the number of months it would take to sell the inventory at that month’s sales pace. The U.S. statistics are based on data for 65 CBSAs.  To determine the price tier, the median list price was the median of homes listed in the 65 CBSAs for the given month.

Price Pressure Fueled by Limited Supply

 

 

 

CoreLogic Home Price Index (HPI®) has exceeded the pre-crisis peak and continues to grow with a strong and steady pace. With demand strong and inventory thin, the share of selling for the list price or more has also returned to pre-bust levels.

Share of SalesWith demand outweighing supply, homes are more likely to sell above the asking price. Figure 1 shows the share of homes that sold at a price above, equal to or below the list price. [1] The share of homes selling at or above list price has returned to mid-2005 levels. In Q2 2018 that share represented more than 40 percent of total sales – almost triple the level during the trough in January 2008. The share of homes selling for less than list price has made up the majority of sales over the past 10 years. Regardless of market conditions, there are always highly motivated sellers – including those who begin with unrealistic expectations – willing to drop their price.

Share of Sales

Housing markets are different across the nation. Therefore, sales and listing patterns also vary geographically. Figure 2 shows the share of homes that sold at, above, or below their list prices in 20 CBSAs during July 2018. San Francisco had the largest share of homes – 81 percent – that sold for at least the list price. Seattle and Minneapolis followed with 65 and 58 percent selling for the list price or more, respectively. Houston and Miami had the lowest share – 27 and 20 percent – of homes selling at or above the list price in July 2018. San Francisco was one of the metros with the highest home price growth in the U.S. in July. According to the CoreLogic HPI, home prices in San Francisco increased 11 percent year over year in July. On the other hand, Miami had a moderate annual home price increase of 4.6 percent in July.

Months Supply vs Service Premium

Price pressures rapidly increase as supply drops below 3 months. Figure 3 shows the price premium or discount and months’ supply for over 200 CBSAs in July 2018. In San Francisco and San Jose, where months’ supply was at 2 and 2.2, respectively, home buyers had to pay 9.7 and 5.4 percent more than the asking price on average. On the other hand, markets like Miami and Naples, where months’ supply are sufficient at 10 and 12, home buyers were able to negotiate below asking prices, with average discounts of 6.5 and 7.5 percent, respectively, in July 2018.

Note: The U.S. statistics are based on data for 65 CBSAs. Each of these CBSAs has at least 50 percent coverage since 2000. CoreLogic MLS data coverage usually increases over time, which might also contribute to inventory increases.

[1] Figures 1 and 2 use 65 CBSAs to aggregate national level statistics. The inventory has not been adjusted for growth in the number of households over time. As the number of households increases over time, the ‘equivalent’ level of inventory should rise as well.

© 2018 CoreLogic, Inc. All rights reserved.

Chick-fil-A -slated Lake Nona

By   – Staff Writer, Orlando Journal
 Updated 

A 75,000-square-foot retail development soon could be home to ‘s first Chick-fil-A.

College Park, Ga.-based Chick-fil-A Inc. is in talks for signing a lease at Tyson’s Corner, a retail development at the northeast corner of Narcoossee and Tyson Road, sources told Orlando Business Journal. It would be the first Chick-fil-A location in Lake Nona.

A Chick-fil-A spokeswoman said the company hopes to have more to confirm about a Lake Nona location in the weeks to come. “We would very much like to have a new location in the Lake Nona area, but we have no new locations to confirm at this time,” spokeswoman Jessica Ferrell told OBJ.

Meanwhile, several other tenants either have signed leases or are in talks for space inside Tyson’s Corner. Click through the slideshow below to see which tenants could be coming to the retail center.

SRS brokered the purchase for the 9.69-acre Tyson’s Corner property on June 15, according to Orange County records. Entities related to Clearwater-based Epic Development Co. bought the property for $9 million from entity Lake Nona Holdings LLC. “We like the demographics and the growth,” said Epic Development Managing Member Andrew Hupp, who declined to confirm tenant interest in Tyson’s Corner.

The site may break ground in February with potential tenants moving in by summer 2019, said Hupp. Holiday-based FWH Architects Inc. is the architect, and Palm Harbor-based AVID Group is the engineer. Epic typically handles the general contracting itself, but Hupp said it was too early to start accepting subcontracting bids.

The property, which is next to Lake Nona High School, adds to new retail in Lake Nona. The largest retail project is the $300 million piece of Lake Nona Town Center, which is expected to make a big retail and splash for the growing southeast Orlando community, which already boasts more than 11,000 residents, 5,000 employees and 14,000-plus students at its schools.

Lake Nona to land big biotech facility

By   – Staff Writer, Journal

Before dirt even has been tossed, a future biotech manufacturing plant in ’s 650-acre is dreaming up expansion plans.

The 18-acre site — likely slated for Cranbury, N.J.-based global tech and biopharmaceutical company Amicus TherapeuticsInc. (Nasdaq: FOLD) — already is being considered for a planned development with manufacturing, office and warehouse space.

And it may include a future phase to accommodate additional parking, office space and a lab area, city of Orlando project planner Wes Shaffer said at a Sept. 13 meeting.

Amicus executives haven’t responded to requests for comment. However, an unnamed company behind “Project Olympus” this month received a city committee approval to build a 200,700-square-foot development at the southwest corner of Laureate Boulevard and Medical City Drive. Real estate sources said Amicus likely is the company behind Project Olympus.

Additionally, Amicus reportedly also was considering other cities for a new facility, but the Orlando City Council approved a nearly $380,000 incentive deal Aug. 20 to attract the company to Central Florida.

The facility would be the first biologic drug substance manufacturing plant with associated research and development in Lake Nona. It’s a major win not only for Orlando but also for Lake Nona, which already is home to the Orlando VA Medical Center, Nemours Children’s Hospital and the University of Central Florida medical school, among others.

“The fact that an innovative business such as Amicus is considering Orlando to build the first biologic drug substance manufacturing plant solidifies Medical City’s ability to attract new and innovative companies,” city spokeswoman Jessica Garcia said.

The new facility would add to a bevy of industrial activity nearby as part of the airport/Lake Nona submarket, one of the largest in the Orlando area.

Sports facility company shoots for next location,Lake Nona

By   – Staff Writer, Journal

An Orlando-based sports facility operator has scored a new location in Central Florida as it gears up for another.

XL Soccer World expects to build a $7 million, 50,000-square-foot facility in and open it next summer, CEO Ciaran McArdle told Orlando Business Journal. The company operates about eight facilities in the U.S, including one at 825 Courtland St. near the intersection of Lee Road and Interstate 4. That facility opened in 2011.

McArdle, a Lake Nona resident, hopes to attract soccer players and fans from Lake Nona and surrounding communities such as Kissimmee and St. Cloud. “We’ve seen tremendous success and popularity with what we do.”

The new facility will feature four fields for indoor soccer and futsal, a different version of soccer, among other uses. The facility will spread across roughly four acres off Narcoossee Road less than one mile south of State Road 417. XL Soccer World’s Xl Soccer World Orlando II LLC bought the 3.8-acre site from Narcoossee Land Holding Two Inc. for $571,400 on Aug. 27, according to Orange County records.

XL Sports Group

A contractor is expected to be announced soon. The architect is Orlando-based Butler Moore Architects LLC. Subcontractor opportunities likely will be available. A groundbreaking is expected before the end of the year.

McArdle declined to say where XL Soccer World’s next Central Florida facility will be, but he said it likely will be built in northwest Orlando.

XL Soccer World is the latest in a string of new sports companies to open facilities in Lake Nona. The $100 million U.S. Tennis Association National Campus opened its 100-court facility in 2016, and Drive Shack (NYSE: DS) opened its $25 million concept this spring.

Property Man – Bob Massi Features Lake Nona and Orlando

features in a recent episode… Not only is Lake Nona and one of the fastest growing cities across the nation, but the here is perfect for . Orlando is used as a meter for the real estate market because of the booming economy and the constant influx of new residents and visitors. In this episode, Bob Massi answers why Orlando is so successful and features Lake Nona and as one of the fasted growing community across the nation. Bob takes a tour around Orlando and Lake Nona to see why the market is so successful. The most important message to take away about Orlando is, as most cities across the nation feel the ups and downs of the economic rollercoaster, Orlando is the first to recover and last to feel the pinch.

Watch as Bob Massi uncovers the reasons why Orlando truly is the city beautiful…

As always… comment, like and share. Your feedback helps us know how to help you better!

-The Maycumber Team of WeKnowOrlando.com

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Orlando OKs conditional plan for $107M Creative Village apartment complex

The City Commission today helped move forward two pieces of the planned $1 billion, 68-acre, mixed-used Creative Village in downtown.

The commissioners voted unanimously during the Sept. 4 city council meeting to give conditional approval of a $107 million, 390-unit apartment complex. The Creative Village Design Review Committee still wants to review certain aspects of the apartment project such as the streetscape, parking, architecture, and appearance, before it gets full approval.

The commissioners also gave full approval for a 9,221-square-foot central cooling system building for the planned Downtown, a campus that will be shared by the University of Central Florida and  College The UCF energy plant building will include condenser water pumps and cooling towers located outside the building. The structure will be the only plant for the downtown campus.

The apartment complex is a joint venture between Orlando-based Ustler Development Inc. — whose related Creative Village Development LLC is the master developer of Creative Village — and Coral Gables-based apartment developer The Allen Morris Co. The project is slated for a 1.6-acre site on the southwest corner of Amelia Street and Terry Avenue, which is known as “parcel M,” according to city documents.

Creative Village is expected to attract 8,000 faculty, staff and students when UCF Downtown opens in fall 2019 — two to three times more people than initially anticipated, according to Ustler Development Inc. President Craig Ustler. The number of apartment units was increased from 250 in the previous plan to 390 in July due to that increased demand.

The apartment complex, which could open by mid-2020, will feature mostly studio and one-bedroom units, each with a washer and dryer. The ground floor has a 6,500-square-foot commercial space that may house a food and a social hall. The project also will include a 570-space parking garage, a public courtyard, and a beer garden, said Ustler.

  • Dallas-based Mill Creek Residential Trust plans to build an estimated $59 million-$90 million, 250- to 300-unit market-rate apartment complex on the east side of Central Park.
  • Ustler Development and Development Ventures Group Inc. are underway on a 15-story, $105 million student-housing project with 600 beds and 105,000 square feet of educational space leased to UCF and Valencia College.
  • Winter Park-based Atlantic Housing Partners LLLP is building the $60 million, 256-unit Amelia Court at Creative Village mixed-income community.

These projects add to the boom in apartment in the region. Orlando reported a 3.2 percent vacancy rate in the multifamily sector, which is among the lowest for Southeastern cities, according to the most recent report by Charlotte, N.C.-based Real Data Inc. There are more than 11,700 apartments in Central Florida’s construction pipeline, and roughly 30 percent of those units are being built in downtown Orlando.

The average monthly apartment rent for the central submarket, which includes downtown Orlando, is $1,499, up from $1,381 a year ago, Real Data reported. Occupancy rates are expected to remain higher than 95 percent over the next year, well above average among Southeastern cities, which should trigger even more rent growth, according to the report.

UCF Downtown also is expected to bring a major economic impact to the area. The campus is forecast to generate 2,000 jobs and a $205 million economic impact in the next few decades. “There’s a lot of different facets — certainly there’s the economic development aspect of growing our downtown and having the university campus there,” Orlando Mayor Buddy Dyer told Orlando Journal. “It’s good for UCF and the students who will have internships and be closer to businesses that are in their majors.”

Orlando Developer Starts plans for Large Development

 

 

Unicorp ’s most prominent developer is pursuing its latest $200 million projects in an area that’s heating up for retail developers — and that represents a major shift in the market.

That’s according to Jorge Rodriguez, executive managing director at Colliers International Central , who is representing Orlando-based Unicorp National Developments Inc. in the purchase of a roughly 150-acre site in Daytona Beach’s fast-developing area of Interstate 95 and LPGA Boulevard.

“[Historically], all the retail was along International Speedway Boulevard,” Rodriguez said. “What’s happening is Daytona’s gotten to the point where there’s no more land to be developed there … It’s jumped north to LPGA and I-95.”

New projects in that area likely will be more attractive to consumers, added John Albright, president, and CEO of Consolidated-Tomoka Land Co. (NYSE: CTO), Daytona Beach’s largest landowner and soon-to-be seller of the site Unicorp has under contract.

In fact, developers have been buying up chunks of land from Consolidated-Tomoka for years, creating a massive economic impact for the community. The largest land sale was to Minto Communities, which partnered with Margaritaville HoldingsInc. to build the $1 billion Jimmy Buffett-themed Latitude Margaritaville — a massive active-adult, the mixed-use community now under .

Additionally, the $91 million, 350,000-square-foot Tanger Outlets opened in 2016, and North American Development Group is anticipating a fall opening of its estimated $80 million, 400,000-square-foot Tomoka Town Center featuring T.J. Maxx, Hobby Lobby, Academy Sports + Outdoors and more.

Since 2011, Consolidated-Tomoka’s land sales in this area have resulted in $1.5 billion in total capital investment in Daytona Beach, adding more than 3,500 jobs, according to company documents.

“You have a large influx of new population, and a great regional draw as far as the interstate and LPGA [Boulevard],” Albright said. “It’s all coming together.”

Meanwhile, Unicorp plans to start construction on its new project in first-quarter 2019. The first 23-acre phase, dubbed Shoppes at Williamson Crossing, will feature about 100,000 square feet of un-anchored shops and restaurants. No tenants have been signed, but Unicorp President Chuck Whittall said his company is in talks with about 30 potential tenants.

Sales of previously owned US Homes update

US HOME SALES DROP TO 2 YEAR LOW
Sales of previously owned U.S. unexpectedly slumped for a fourth month to the weakest in more than two years, signaling higher prices and tight supplies continue to squeeze demand, a National Association of Realtors report showed Wednesday.
HIGHLIGHTS OF EXISTING-HOME SALES (JULY)
• Contract closings fell 0.7% m/m to a 5.34m annual rate (est. 5.4m), the slowest pace since Feb. 2016, after unrevised 5.38m
• Median sales price increased 4.5% y/y to $269,600
• Inventory of available properties unchanged y/y at 1.92mKey Takeaways
The report adds to other recent signs of cooling in real estate markets. Prospective home buyers are increasingly discouraged by rising borrowing costs and property-price increases that are outpacing wage growth. The share of Americans who say it’s a good time to buy a home fell in August to 63 percent, the smallest since 2008, the University of Michigan consumer sentiment survey showed on Friday.

Continuing declines in purchases of single-family homes and cheaper properties suggest that the market is being supported by an increasing concentration of activity among those with higher income and financial assets.

The slump was led by an 8.3 percent decline in the Northeast, while the South and Midwest also decreased. Sales rose in the West.

Official’s Views
The decline in sales “has been a slow drip, and the is the same story, where we’re lacking inventory,” Lawrence Yun, NAR’s chief economist, said at a press briefing accompanying the report.

Other Details
• At the current pace, it would take 4.3 months to sell the homes on the market, unchanged from the prior month; Realtors group considers less than five months’ supply consistent with a tight market
• Single-family home sales fell 0.2 percent to an annual rate of 4.75 million
• Purchases of condominium and co-op units dropped 4.8 percent to a 590,000 pace
• First-time buyers made up 32 percent of all sales, compared with 31 percent in the prior month
• Homes were on the market for an average 27 days, compared with 26 days in June
• 55 percent of homes sold in July were on market for less than a month, NAR said
• Existing home sales account for 90 percent of the market and are calculated when a contract closes; new home sales, considered a timelier indicator though their share is only about 10 percent, are tabulated when contracts get signed

BY: Jeff Kearns and Katia Dmitrieva

Lake Nona global biotech firm to build facility, create 300+ high-wage jobs

City Council approved a nearly $380,000 incentive deal Aug. 20 for a Biotech and biopharmaceutical firm to build a major manufacturing plant in .

Cranbury, N.J.-based Amicus Therapeutics Inc. (Nasdaq: FOLD) wants to build a 190,690-square-foot facility — its first biologic drug substance manufacturing plant with associated research and development in Lake Nona. The company will create 316 jobs in Orlando by Dec. 31, 2024. The jobs will pay an average annual wage of $69,670.

Amicus’s total capital investment is $148.85 million to $180 million in and equipment, according to Orlando city council documents. Under ‘s Qualified Target Industry program, the state will provide a total of $1.9 million to Amicus. Orlando will provide 20 percent of the full amount over an eight-year period.

However, the project is not a done deal, yet. In addition to Orlando, the company is considering other states for this project, but the incentives help sweeten the pot for Amicus to choose this area. Orange County also may kick in funding for the project and will decide whether or not to today, Aug. 21, during its commissioners’ meeting.

District 1 City Commissioner Jim Gray agreed that getting Amicus would be a good move for the city. “We are thrilled to welcome Amicus to the southeast part of town,” Gray said during the Aug. 20 city council meeting. “This is exactly what we are trying to attract — an established company with a great reputation bringing some talented smart people and paying them a lot to do their job.”

Tavistock Development Co.’s Lake Nona is a fast-growing southeast Orlando community that already employs about 5,000 people in its 650-acre life sciences hub. Lake Nona notched the No. 15 spot among the nation’s top-selling master-planned communities with 523 home sales in 2017, John Burns Real Estate Consulting reported.

In addition, Lake Nona’s daytime population continues to grow with its Medical City life sciences hub and future developments such as New York-based audit giant KPMG LLP’s $430 million, 55-acre training facility being built on Lake Nona Boulevard. The community already boasts more than 11,000 residents, 5,000 employees and more than 11,000 students at its schools.