Posts

Existing-Home Sales Retreat 1.8 Percent in June

Existing-Home Sales Retreat 1.8 Percent in June

WASHINGTON (July 24, 2017) — Existing-home sales slipped in June as low supply kept selling at a near record pace but ultimately ended up muting overall activity, according to the National Association of Realtors®. Only the Midwest saw an increase in sales last month.

Total existing-home sales1, https://www.nar.realtor/topics/existing-home-sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, decreased 1.8 percent to a seasonally adjusted annual rate of 5.52 million in June from 5.62 million in May. Despite last month’s decline, June’s sales pace is 0.7 percent above a year ago, but is the second lowest of 2017 (February, 5.47 million).

Lawrence Yun, NAR chief economist, says the previous three-month lull in contract activity translated to a pullback in existing sales in June. “Closings were down in most of the country last month because interested buyers are being tripped up by supply that remains stuck at a meager level and price growth that’s straining their budget,” he said. “The demand for buying a home is as strong as it has been since before the Great Recession. Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines.”

Added Yun, “The good news is that sales are still running slightly above last year’s pace despite these persistent market challenges.”

The median existing-home price2 for all housing types in June was $263,800, up 6.5 percent from June 2016 ($247,600). Last month’s median sales price surpasses May as the new peak and is the 64th straight month of year-over-year gains.

Total housing inventory3 at the end of June declined 0.5 percent to 1.96 million existing homes available , and is now 7.1 percent lower than a year ago (2.11 million) and has fallen year-over-year for 25 consecutive months. Unsold inventory is at a 4.3-month supply at the current sales pace, which is down from 4.6 months a year ago.

First-time buyers were 32 percent of sales in June, which is down from 33 percent both in May and a year ago. NAR’s 2016 Profile of Home Buyers and Sellers – released in late 20164 – revealed that the annual share of first-time buyers was 35 percent.

“It’s shaping up to be another year of below average sales to first-time buyers despite a healthy that continues to create jobs,” said Yun. “Worsening supply and affordability conditions in many markets have unfortunately put a temporary hold on many aspiring buyers’ dreams of owning a home this year.”

According to Freddie Mac, the average commitment rate(link is external) for a 30-year, conventional, fixed-rate mortgage declined for the third consecutive month, dipping to 3.90 percent in June from 4.01 percent in May. The average commitment rate for all of 2016 was 3.65 percent.

Properties typically stayed on the market for 28 days in June, which is up from 27 days in May but down from 34 days a year ago. Short sales were on the market the longest at a median of 102 days in June, while foreclosures sold in 57 days and non-distressed homes took 27 days. Fifty-four percent of homes sold in June were on the market for less than a month.

Inventory data from realtor.com® reveals that the metropolitan statistical areas where listings stayed on the market the shortest amount of time in June were Seattle-Tacoma-Bellevue, Wash., 23 days; Salt Lake City, Utah, 26 days; San Jose-Sunnyvale-Santa Clara, Calif., 27 days; San Francisco-Oakland-Hayward, Calif., 29 days; and Denver-Aurora-Lakewood, Colo., at 30 days.

“Prospective buyers who postponed their home search this spring because of limited inventory may have better luck as the summer winds down,” said President William E. Brown, a Realtor® from Alamo, California. “The pool of buyers this time of year typically begins to shrink as households with children have likely closed on a home before school starts. Inventory remains extremely tight, but patience may pay off in coming months for those looking to buy.”

All-cash sales were 18 percent of transactions in June, down from 22 percent both in May and a year ago, and the lowest since June 2009 (13 percent). Individual investors, who account for many cash sales, purchased 13 percent of homes in June, down from 16 percent in May and unchanged from a year ago. Fifty-six percent of investors paid in cash in June.

Distressed sales5 – foreclosures and short sales – were 4 percent of sales in June, down from both May (5 percent) and a year ago (6 percent) and matching last September as the lowest share since NAR began tracking in October 2008. Three percent of June sales were foreclosures and 1 percent were short sales.

Single-family and Condo/Co-op Sales

Single-family home sales dipped 2.0 percent to a seasonally adjusted annual rate of 4.88 million in June from 4.98 million in May, but are still 0.6 percent above the 4.85 million pace a year ago. The median existing single-family home price was $266,200 in June, up 6.6 percent from June 2016.

Existing condominium and co-op sales were at a seasonally adjusted annual rate of 640,000 units in June (unchanged from May), and are 1.6 percent higher than a year ago. The median existing condo price was $245,900 in June, which is 6.5 percent above a year ago.

Regional Breakdown

June existing-home sales in the Northeast fell 2.6 percent to an annual rate of 760,000, but are still 1.3 percent above a year ago. The median price in the Northeast was $296,300, which is 4.1 percent above June 2016.

In the Midwest, existing-home sales rose 3.1 percent to an annual rate of 1.32 million in June (unchanged from June 2016). The median price in the Midwest was $213,000, up 7.7 percent from a year ago.

Existing-home sales in the South decreased 4.7 percent to an annual rate of 2.23 million (unchanged from a year ago). The median price in the South was $231,300, up 6.2 percent from a year ago.

Existing-home sales in the West declined 0.8 percent to an annual rate of 1.21 million in June, but remain 2.5 percent above a year ago. The median price in the West was $378,100, up 7.4 percent from June 2016.

State OKs new 100-bed UCF Lake Nona

The University of Central Florida and HCA Healthcare will start building a new 100-bed teaching hospital adjacent ‘s 50-acre College of Medicine campus in southeast Orlando’s Lake Nona community within 18 months. The campus currently has two facilities for classrooms and research.

The state’s Agency for Health Care Administration this week gave final approval for a hospital that’s expected to open for patients by the end of 2020.

The Florida Board of Governors, which oversees the state’s 12 public universities, approved the public/private hospital in March after the state had given the facility preliminary approval. That approval allows UCF to grow the hospital to up to 500 beds without further approval from that board. The planned new hospital will:

  • Train third- and fourth-year medical students from Day One.
  • Allow the UCF medical school to expand its clinical research mission. The university-based teaching hospital is expected to help lure more grants to fund research.
  • Provide more opportunities for medical residency programs.
  • Be a living-learning lab for training medical, nursing, physical therapy, pharmacy and social work students in teamwork skills and communication.

Building the new hospital also will bring opportunities for designers, builders and vendors, as well as new permanent, high-wage jobs.

Nashville-based HCA’s North Florida Division will contribute $175 million to build and begin operating the hospital, called UCF Lake Nona Medical Center. UCF will provide the land and its academic brand. No state dollars will be used to build the facility. “Together with our partners at HCA, we look forward to strengthening our community’s health, training more doctors and powering economic growth through research,” said UCF President John C. Hitt in a prepared statement.

He has described building the hospital as one of the university’s most important decisions of this decade.

A hospital to advance teaching and clinical research programs has been a UCF priority since the university opened its medical school in 2009. “This hospital and its research mission are part of the economic impact we promised the community when the medical school was built,” said Dr. Deborah German, founding dean of the College of Medicine and vice president for medical affairs, in a prepared statement. (See the photo gallery for a look inside the medical school.) “In the United States and around the world, the best health systems have an academic component at their heart and the best medical schools have teaching hospitals. UCF Lake Nona Medical Center will help Central Florida become a national, then global health care destination that will benefit all of our partners and our community

Central Florida home sales up 8.8% in May

More and townhomes/condos sold and the median sale price increased in the Orlando-Kissimmee-Sanford area in May when compared to the year-ago period, according to the latest housing data released by Realtors. In May, 3,428 homes and 983 townhomes/condos sold in metro Orlando. The number of homes sold was up 8.8 percent from May 2016, while the number of townhomes/condos sold rose 17.6%.

Along with an increase in units sold in the Central Florida area, median sales prices also were up. Last month, the median home sale price in the area grew 7 percent to $240,788 and the median townhome/condo sale price increased 12.1 percent to $150,000.

These year over year increases are no surprise to President of the Orlando Regional Realtor Association, Bruce Elliott. “Orlando has strong job growth and a great quality of life that makes this area a great place to live. There have been a lot of third-party sources, from Forbes magazine to WalletHub, showing a variety of different statistics about how good Orlando is.”

Along with higher numbers in metro Orlando, the state also saw an increase in the number of homes and townhomes/condos sold in last month when compared to May 2016.

“Closed sales of existing homes in the Sunshine State not only rebounded from a relatively flat April, they positively surged to record highs in May of 2017,” said Florida Realtors Chief Economist Brad O’Connor. “To be more specific, May’s sale totals of 27,850 existing single-family homes and 11,538 existing condos and townhomes were the most ever recorded [by Florida Realtors] for a single month in either property type category. In both cases, these totals were also markedly higher than the very strong number of sales racked up in May of 2016.”

The median sale prices also rose when compared to last year. Last month, the median sale price for a home in Florida grew 7.7 percent to $239,000 and the median sale price for a townhome/condo rose 8.1 percent to $178,000 when compared to the year-ago period.

New York Real Estate

Tavistock preps plans for 2 new Lake Nona apartment projects

Tavistock Development Co. LLC has plans in the works to bring two new multifamily projects — including one it’s calling “micro apartments” — to southeast ’s booming Lake Nona community.

Early planning is underway for a second multifamily development in the Lake Nona Town Center, temporarily being called The Distillery, which would be 11 stories high and include a mix of uses within it, according to documents.

The most unique part about the project is the residential units themselves, which is something Tavistock plans to experiment with by making them about 10-15 percent smaller than what’s now available in Orlando, Vice President of Development Operations Ralph Ireland told Orlando Business Journal.

The plan is to test out six “truly micro” units, at about 375 square feet each, Ireland said. If that’s successful, Tavistock may try to do some in its next apartment project.

“Because we’re always trying to innovate, we want to do things in Lake Nona that haven’t been done elsewhere in Central Florida,” Ireland told OBJ. “Of course, we can’t just roll out 150 micro units because we don’t know how it’s going to work. But we’re trying to get something more efficient. And they will be well amenitized within the units and in the common areas.”

Tavistock already has secured a foundation permit for this project, and is seeking city staff approval on a final plat. is expected to start in May or June next year.

Kimley-Horn & Associates Inc. in Orlando is the civil engineer, the project architects are Silver Springs, Md.-based Torti Gallas & Partners Inc. and Columbus, Ohio-based M+A Architects, and the landscape architect is Dix.Hite + Partners LLC.

What to Consider in a Remodel

The kitchen should reflect your lifestyle. It should accommodate your cooking needs, provide the type of space you need for dining and offer plenty of storage. Its décor should complement your home’s architecture and set the tone for gatherings that happen there. A lot of factors play into kitchen design, but the first step before choosing appliances or visiting a cabinet showroom is to set some goals for your space.
Start by reflecting on why you’re remodeling and what you really need to get out of it. A kitchen remodel is not an easy task, so why are you doing it? Download and complete the Day in the Life of Your Kitchen Questionnaire and Kitchen Goals Worksheet. Your answers to these questions will help you create a remodeling checklist and budget.
When Deborah Pierce, principal, Pierce Lamb Architects, West Newton, Mass, works with clients, she works through an organic process that involves addressing each of these key variables:
  • Size of the space
  • Orientation of sunlight
  • Connection of kitchen to adjacent rooms
  • Homeowner’s lifestyle
  • Budget
  • Condition of the building

Kitchen Remodeling Considerations

As you start planning your remodel, consider these factors:
Size (Square Footage). “Every inch of space is important, especially in a small kitchen,” Pierce emphasizes. The size of your kitchen will dictate the layout: Is there room for an island? Does space allow for a prep sink? Where can you squeeze in extra storage?
Will you knock out a wall or extend the kitchen by adding on to your home? How much space can you conceivably add to your kitchen layout? These are questions to consider with a kitchen designer or architect, who can help you devise a solid plan.
Existing Layout. Don’t feel married to your kitchen’s existing footprint. “Windows and doors are seldom in the place you want them,” Pierce says. “They might be on the wrong wall, or in the wrong place entirely.” If you must maintain the windows/doors of your kitchen, you may be locked in to your layout—but there are always ways to modify. For instance, you can add a peninsula to an L-shaped kitchen and create a horseshoe layout that offers more counter space and efficiency. Learn about different kitchen layouts.
As you consider kitchen layout, take time to think about what you like about your current kitchen:
  • How do you move in the space?
  • Does the workflow accommodate your cooking routine?
  • Can you easily move from the range to the sink?
  • How effective is your kitchen when more than one person is cooking?
These are just some of the questions you should be asking yourself as you begin to plan your kitchen remodel. To see a complete list of questions you’ll need to consider, download the Day in the Life of Your Kitchen Questionnaire.
Infrastructure. Depending on the age of your kitchen, you might confront electrical or plumbing concerns as you remodel. Work with an architect-engineer team to ensure that the “guts” of your kitchen can accommodate the technology (appliances, lighting, etc.) you will install.
“In an older house, you may find yourself with sagging floors that need to be addressed or crooked walls that need to be straightened out,” Pierce says, pointing to a couple of budget busters that many homeowners do not plan for. “Keep an open mind at the start of the process,” she continues. “Understand your needs, but recognize the variables that a designer or builder might need to deal with during the process.”
Lifestyle. How will you use the kitchen? What type of cook are you? How do you entertain? Answer the questions in the Day in the Life of Your Kitchen Questionnaire as you prioritize features for your new kitchen. Peterson likes to keep the conversation general when first identifying kitchen likes/dislikes, “identifying problems rather than solutions, and wishes rather than details,” she says. “This is because the design will evolve as all variables are considered, and locking on to a specific feature at the start may solve one problem but preclude a better design that solves five other problems.”
For example, choosing professional appliances that take up 80 percent of the space may not allow enough room for cabinetry storage or area to expand a window to let more light into the kitchen.
Budget. For a more detailed discussion, visit our Budgeting Your Project section. As Roberta Bauer-Kravette, LEED AP, AKBD and director of Nieuw Amsterdam Kitchens in New York, N.Y., says, “The fastest way to go over your budget is to change your mind on materials and finishes.”
Decide where to save and where to splurge. Set a realistic budget, figuring between 6 and 10 percent of your home value for a complete kitchen remodel. Brad Burgin, Burgin Construction Inc. in North Tustin, Calif., says his clients that spend about 10 percent of their overall home value realize a return on their investment at resale. View and download our budget worksheet to help you decide where to spend your budget.

Mortgage rates again fall lower

U.S. mortgage rates again ticked down this week, according to Freddie Mac.

The 30-year fixed mortgage averaged 3.94 percent for the week ending June 1, down from 3.95 percent the previous week.

Favorable mortgage rates aided U.S. home sales, and the booming refinance market.

“In a short week following Memorial Day, the 10-year Treasury yield fell 4 basis points,” said Sean Becketti, chief economist at Freddie Mac. “The 30-year mortgage rate remained relatively flat, falling 1 basis point to 3.94 percent and once again hitting a new 2017 low.”

The historic low for 30-year rates was 3.31 percent in November 2012.

Here on the local front, home prices, including distressed sales, increased by 7.5 percent in March 2017 in the Orlando metro area compared with March 2016, according to CoreLogic.

4 High-Return Updates for the Home

Exclusive: Construction tees up for $25M Lake Nona golf attraction

It’s official: ’s & Performance District is adding a new golf and entertainment element to the mix.

Franklin, Tenn.-based The Parkes Cos. last week was issued a permit valued at $10 million to begin work on Drive Shack, the new complex at 7675 Lake Nona Blvd., according to city of documents.

The project includes a three-story, 57,000-square-foot driving range entertainment facility that includes a restaurant, lounge, bar, hitting bays and meeting spaces, according to Orange County permitting documents. It will be built on a 15-acre site on the northwest quadrant of State Road 417 and Lake Nona Boulevard, as previously reported by Orlando Business Journal. It will be similar to Topgolf, which plans to open an Orlando site on International Drive this fall.

A project manager at The Parkes Cos. wasn’t available for comment and it appears Drive Shack Orlando’s Facebook page hasn’t been updated since September, as of the morning of May 22.

However, New York-based Drive Shack Inc. (NYSE: DS) is a new global golf entertainment company as announced last November by New York-based real estate investment trust Newcastle Investment Corp., which is managed by an affiliate of real estate firm Fortress Investment Group LLC (NYSE: FIG).

The Lake Nona site is the parent company’s first Drive Shack location and another one is in the works, Drive Shack CEO and President Sarah Watterson said during the company’s May 5 first-quarter earnings call. Here’s more on what Watterson had to say about the project during that call:

“On the entertainment golf business, we continue to be very excited and make strides in developing our global network of Drive Shack venues. In Orlando, we’re in the midst of constructing our first venue, with the goal being open in first-quarter 2018. We’re also very excited to announce that our second Drive Shack venue will be developed in Richmond, Va. … Our venues feature multiple stories of hitting suites, whether friends, family, coworkers or complete strangers are able to compete in various technologically-enhanced golf games while using TaylorMade clubs. Consumers who are seeking a good time, but maybe not looking to participate in the game, are able to enjoy food and beverage options from one of our many entertainment, restaurant or lounge areas.”

Each Drive Shack site is expected to cost $15 million-$25 million to build, and would generate about $3 million-$6 million of earnings before interest, taxes, depreciation and amortization, a December 2016 investor presentation showed.

Kansas City, Mo.-based Populous is the project architect; Walter P. Moore is the structural engineer; ME Engineers is handling mechanical, electrical and plumbing; and Howe Engineers is the code engineer.

Meanwhile, Drive Shack in Lake Nona is the next piece of the 300-acre Sports & Performance District, which boasts the now operating $100 million U.S. Tennis Association National Campus; the soon-to-debut $1.4 million USTA Florida headquarters and U.S. Professional Tennis Association complex; and the $20 million Orlando City Soccer Club training facility.

Elsewhere in Lake Nona, global audit giant KPMG LLP is hosting a May 22 groundbreaking on its new $430 million Lake Nona training center and Lake Nona developer Tavistock Development Co. LLC expects big things for the next $300 million phase of its Lake Nona Town Center.

7 things to know today and housing market nears 2006 price peak

Good morning, Orlando!

We all have been watching the Orlando-area housing market with great interest in the past year, as sales and median prices continue to increase, and inventory shrinks.

Now, a new CoreLogic report sheds some light on exactly how much activity is taking place not only here in Central Florida, but nationwide as well.

U.S. home prices are up 7.1% in March, data from analytics company CoreLogic shows. And home prices, including distressed sales, increased by 7.5%t in March 2017 in the Orlando metro area compared with March 2016.

Nationwide, home prices will increase by 4.9% year-over-year from March 2017 to March 2018, CoreLogic forecast. The property data provider said its Home Price Index is only 2.8% away from its 2006 peak. The index is expected to reach the previous peak during the second half of this year with a forecasted increase of almost 5% over the next 12 months.

Prices in more than half the country already have surpassed their previous peaks, and almost 20%t of metropolitan areas are now at their price peaks, according to CoreLogic.

Strong job gains, household formation, population growth and still-attractive mortgage rates in the face of tight inventories are fueling a continuing surge in home prices across the U.S., said Frank D. Martell, CoreLogic president and CEO..