KCM and DPR Realty November 2021 National and Local AZ Housing Market Update, Shambreskis and Howard

Page 1

NOVEMBER 2021


ShowingTime’s Monthly Index Starting To Level Off

283.8 280.7

235.8

190.5

152.5

236.1 205.3

200 199.2

190

184.7 182.3

166.2

160.4

240.8

178.1 175.5

156.2 156

128.4

84.9

January 2020

F

M

A

M

J

J

A

S

O

N

D

January 2021

F

M

A

M

J

J

A

S

ShowingTime


ShowingTime Index Over the

Last 5 Septembers 111.3

106.9

112.2

2017

2018

2019

184.5

2020

175.5

2021 ShowingTime


“Sales non-seasonally adjusted (NSA) in September (548,000) were 2.7% below sales in September 2020 (563,000). Excluding last September (distorted by the delayed selling season), sales NSA were the strongest since 2005!” Bill McBride

Calculated Risk


HEADLINES DO MORE TO

TERRIFY THAN

CLARIFY


CLICKBAIT!!!


CLICKBAIT!!!


Do you think now is a good time buy a house? 70%

65%

32%

Feb 2020

Sept 2020

Sept 2021 Univ of Michigan Consumer Sentiment Index


2022 Housing Market Forecast


“Right now, we forecast mortgage rates to average 3.3 percent in 2022, which, though slightly higher than 2020 and 2021, by historical standards remains extremely low and supportive of mortgage demand and affordability.” Doug Duncan

Senior VP & Chief Economist, Fannie Mae


Mortgage Rates

5.0

Freddie Mac

4.5

30-Year Fixed Rate

4.0

Where Are They Going? 3.5

3.4

3.5

3.6

3.2 3.0

10/7

8/5 9/2

5/6 6/3 7/1

2021 2/4 3/4 4/1

11/5 12/3

8/6 9/3 10/1

5/7 6/4 7/2

2/6 3/5 4/2

11/7 12/5 2020

9/5 10/3

6/6 7/3 8/1

3/7 4/4 5/2

12/6 2019 1/31

9/6 10/4 11/1

6/7 7/5 8/2

4/5 5/3

2.5

2018 2/1 3/1

January 2018 – Today Actual Interest Rates 2021 Q4

2022 Q1

2022 Q2

2022 Q3

Freddie Mac


Home Price Forecasts 2022 7.4%

7.0% 5.1% Average of All Forecasts

5.2%

5.1%

3.0%

Fannie Mae

Freddie Mac

MBA

HPES

Zelman

2.8%

NAR


Home Sales Forecast To Increase This Year and Perform Well Again in 2022 7.5

Fannie Mae

7

6.7M

Freddie Mac

6.8M

6.8M

NAR

7.5M

MBA

6.9M

6.8M

6.8M

6.6M

6.5

6.5 Million Homes Sold in 2020 6

5.5

5

2021

2022


“2022 should be another strong year for the housing market.” Mike Fratantoni

Chief Economist & Senior Vice President for Research and Industry Technology, MBA



“Homeownership is regarded as causing an improvement in the quality of life of a typical family. It is the most common method for such a family to build wealth…that can be used for retirement or other needs, including helping the next generation. Such wealth creation therefore provides a major social as well as economic benefit.” Don Layton

Senior Industry Fellow Joint Center for Housing Studies Harvard University


Unison’s

2021 State of the

64%

American Homeowner

of American homeowners say living through a pandemic has made their home more important to them than ever

83%

91%

of homeowners say their home has kept them safe during the COVID-19 pandemic

of homeowners say they feel secure, stable or successful owning a home


“Last year, staying home became a necessity and that caused many homeowners to have renewed gratitude for the roof over their head.” The State of the American Homeowner 2021


Homeowners who feel emotionally attached to their home:

Pre-pandemic

58%

Now

70%


“Buying a home is not just a financial decision.

It's also a lifestyle decision.” Mark Fleming

Chief Economist First American


Winter 2022 Buyer & Seller Guides Coming Soon


Resources Slide

Slide Title

Link

2, 3

ShowingTime Monthly Index

https://showingindex.stats.showingtime.com/docs/lmu/x/UnitedStates?src=page https://www.showingtime.com/showingtime-showing-index/

4

McBride Quote

https://calculatedrisk.substack.com/p/existing-home-sales-increased-to-464?

8

Consumer Sentiment

https://data.sca.isr.umich.edu/fetchdoc.php?docid=68290

10

Duncan Quote

https://www.fanniemae.com/newsroom/fannie-mae-news/economic-growth-again-reviseddownward-due-supply-chain-and-inflation-concerns

11

Mortgage Rates

http://www.freddiemac.com/pmms/pmms_archives.html http://www.freddiemac.com/research/forecast/20211015_quarterly_economic_forecast.page?

Home Price Forecasts

https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-andcommentary https://cdn.nar.realtor/sites/default/files/documents/forecast-Q4-2021-us-economic-outlook10-28-2021.pdf https://www.fanniemae.com/research-and-insights/forecast http://www.freddiemac.com/research/forecast/index.page https://pulsenomics.com/surveys/#home-price-expectations

Home Sales Forecast

https://www.fanniemae.com/media/41126/display http://www.freddiemac.com/research/forecast/index.page https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-andcommentary https://cdn.nar.realtor/sites/default/files/documents/forecast-Q4-2021-us-economic-outlook10-28-2021.pdf

12

13


Resources Slide

Slide Title

Link

14

Fratontoni Quote

https://www.mba.org/2021-press-releases/october/mba-annual-forecast-purchaseoriginations-to-increase-9-percent-to-record-173-trillion-in-2022

16

Layton Quote

https://www.jchs.harvard.edu/blog/learning-history-homeownership-rate

17-19

State of the American Homeowner

https://contentimages.o-prod.unison.com/images/press/2021-Unison-SOTAH-Report.pdf

20

Fleming Quote

https://blog.firstam.com/economics/the-reconomy-podcast-what-is-the-fed-signaling-oninterest-rates




Resources Slide

Slide Title

Link

29, 49, 59

Confidence Index

https://www.nar.realtor/research-and-statistics/research-reports/realtors-confidenceindex

30-32, 40, 5054

Existing Home Sales

https://www.nar.realtor/topics/existing-home-sales

33-36

New Home Sales

http://www.census.gov/construction/nrs/pdf/newressales.pdf http://www.census.gov/newhomesales http://www.census.gov/construction/nrs/pdf/newressales.pdf

37

Total Home Sales

http://www.census.gov/construction/nrs/pdf/newressales.pdf https://www.nar.realtor/topics/existing-home-sales

38, 39

Pending Home Sales

https://www.nar.realtor/research-and-statistics/housing-statistics/pending-homesales

44-46

Case Shiller

https://www.spglobal.com/spdji/en/indices/indicators/sp-corelogic-case-shiller-20city-composite-home-price-nsa-index/#news-research

47

CoreLogic Forecasted YOY % Change in Price

https://www.corelogic.com/intelligence/u-s-home-price-insights/

50-56

Inventory

https://www.nar.realtor/topics/existing-home-sales http://www.census.gov/construction/nrs/pdf/newressales.pdf


Resources Slide

Slide Title

Link

58

Showing Activity

https://www.showingtime.com/blog/september-2021-showing-index-results/

61, 62, 64, 65

Mortgage Rates

http://www.freddiemac.com/pmms/pmms_archives.html http://www.freddiemac.com/research/forecast/

63

Mortgage Rate Projections

http://www.freddiemac.com/research/forecast/ http://www.fanniemae.com/portal/research-insights/forecast.html https://www.mba.org/news-research-and-resources/research-andeconomics/forecasts-and-commentary https://www.nar.realtor/research-and-statistics

67, 68

Mortgage Credit Availability

https://www.mba.org/news-research-and-resources/newsroom https://www.mba.org/news-research-and-resources/research-and-economics/singlefamily-research/mortgage-credit-availability-index

69-73

Days To Close, FICO Scores, DTI

https://www.icemortgagetechnology.com/mortgage-data/origination-insight-reports



Average Days on the Market

NAR


EXISTING Home Sales

Since January 2014 Jan…

Jan…

Jan…

Jan…

Jan…

Jan…

Jan…

Jan…

NAR


U.S.

Northeast

Midwest

South

-0.4%

West

-2.2%

-2.7%

-3.4%

EXISTING Home Sales Y-O-Y by region

-9.2%

NAR


Existing Home Sales in thousands

January

February

March

April

May

June

2019

July

2020

August

September October November December

2021 NAR


New Home Sales in thousands

January

February

March

April

May

June

2019

July

2020

August

2021

September

October

November December

Census


New Home Sales annualized in thousands

jun-14

Jan-15

Jan-16

Jan-17

Jan-18

Jan-19

Jan 2020

Jan 2021

Census


New Home Sales % of distribution by price range

24%

24%

22%

19%

9% 2%

* Under $150K $150-$199K

$200-299K

* Less than 500 units or less than 0.5 percent

$300-$399K

$400-$499K

$500-$749K

Over $750K Census


New Homes Selling Fast (median months from completion to sold)

5.1 4.9 4.5

4.54.5 4.3 4.2

4.1

4.0

3.9 3.8 3.7 3.7 3.3

4.2

3.63.6

3.6 3.5 3.4 3.4

3.3

3.23.2

3.1 2.92.9

3.0

3.5

3.2

3.6 3.43.43.4 3.3

3.2 3.1 3.0

4.4

3.6

3.7

3.6

3.2

3.2

2.7

Census


Total Home Sales in thousands 676

567

January

647

641 633

586

640

651 613

601 554

475

443 376

593

587

682

436

426

398

February

March

April

436

May

June 2020

July

August

September October November December

2021 Census & NAR


PENDING Home Sales since 2014

100 = Historically Healthy Level

January 2014

January 2015

January 2016

January 2017

January 2018

January 2019

January 2020

January 2021

NAR


Pending Home Sales Year-Over-Year By Region U.S.

Northeast

Midwest

-5.8% -8.0%

South

West

-7.2% -9.2%

-18.5% NAR


35%

Percentage of Distressed Property Sales Distressed sales – foreclosures and short sales – represented less than 1% of sales in September.

4%

January 2012 - Today Jan 2012

Jan 2013

Jan 2014

Jan 2015

Jan 2016

Jan 2017

Jan 2018

Jan 2019

1% Jan 2020

Jan 2021

NAR


Home Prices


EXISTING Home Prices Y-O-Y by region

14.8% 13.3%

U.S.

9.2%

9.1%

Northeast

Midwest

8.3%

South

West NAR


% Change in Sales from last year by Price Range

26.6%

30.5%

21.4%

3.0%

-21.2%

%

$0-100K -21.2%

-22.7%

$100-250K -22.7%

$250-500K 3.0%

$500-750K 21.4%

$750K-1M 26.6%

$1M+ 30.5% NAR


Case Shiller

0.2

Year-Over-Year

0.18

PRICE

0.16 0.14

CHANGES

0.12 0.1 0.08 0.06 0.04 0.02 0

Jun 2012

Jan 2013

Jan 2014

Jan 2015

Jan 2016

Jan 2017

Jan 2018

Jan 2019

Jan 2020

Jan 2021

S&P Case Shiller


25.0%

20.0%

Case Shiller Year-Over-Year PRICE CHANGES 20 City Composite

15.0%

10.0%

5.0%

0.0%

Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul Sept Nov Jan Mar May Jul 2014 2015 2016 2017 2018 2019 2020 2021

S&P Case Shiller


Case Shiller

19.1%

Year-Over-Year PRICE CHANGES 20 City Composite

20.0% 19.7%

17.1% 15.0% 13.4%

9.2%

10.2%

11.1%

12.0%

8.0% 6.6%

Sept

Oct

Nov

Dec

Jan 2021

Feb

Mar

Apr

May

June

July

Aug S&P Case Shiller


18.0%

Year-Over-Year % Change in Price

1.9% Current

Forecast CoreLogic


HOUSING INVENTORY


Seller Traffic Index

NAR


10.5

Months Inventory of HOMES FOR SALE

9.5

8.5

7.5

2011 - Today

6.5

5.5

4.5

3.5

2.5

1.5

January 2011

January 2012

January 2013

January 2014

January 2015

January 2016

January 2017

January 2018

January 2019

January 2020

January 2021

NAR


Months Inventory of HOMES FOR SALE Since 2019 4.6 4.2

4.3 4.3

4.2 4.0 4.0

3.8

3.8

4.0

3.9

3.9

3.7

3.6

3.3 3.0

3.1 3.1

3.1

3.0 2.7 2.5

2.4

2.3 1.9 1.9

Jan-19 Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec Jan-21 Feb

Mar

Apr

May

June

July

Aug

sept

Oct

Nov

2.0

Dec Jan-21 Feb

2.5 2.5

2.6 2.6 2.4

2.1

Mar

Apr

May

June

July

Aug

Sept

NAR


6 5.8 5.6 5.4 5.2 5 4.8 4.6 4.4 4.2 4 3.8 3.6 3.4 3.2 3 2.8 2.6 2.4 2.2 2 1.8 1.6 1.4 1.2 1

Months Inventory of HOMES FOR SALE Last 12 Months

2.5

Oct

2.3

Nov

1.9

1.9

Dec

Jan-21

2.0

Feb

2.1

Mar

2.4

Apr

2.5

2.5

May

June

2.6

2.6

July

Aug

2.4

Sept NAR


Year-over-Year Inventory Levels January 2014

January 2015

January 2016

January 2017

January 2018

January 2019

January 2020

January 2021

% 7 5 3 6 6 5 5 4 6 5 5 - - - 2 - 1 0 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 0 0 2 1 2 4 6 4 2 2 1 2 0 - - - - - - - - - - - - - - - - - - - - - - - - - - -

NAR


HOUSING SUPPLY Year-Over-Year

Oct

Nov

Dec

Jan 2021

Feb

Mar

Apr

May

June

July

-14.9%

Aug

-13.8%

Sept

-13.0%

-18.8%

-19.8%

-20.5%

-22.0%

-20.6%

-23.8% -25.7%

Last 12 Months

-29.5%

-28.2%

NAR


New Home Inventory

months supply Last 12 Months

Seasonally adjusted

6.5 6.1

6.2 5.7

5.4 4.8 4.5 4.0

3.8

3.5 Oct

Nov

Dec

4.2

3.6 Jan 21

Feb

Mar

Apr

May

Jun

Jul

Aug

Sept Census


New Home Inventory months supply

2020

Non-Seasonally adjusted

6.7

6.1 5.6

5.8

5.6 5.1 4.8 4.4 3.9

5

4.8

4.8

4.3 3.8

3.7

feb

5.9

5.8

3.4 ene

2021

mar

abr

mayo

jun

jul

3.5 ago

3.7

sept

3.7

oct

nov

dic Census


BUYER DEMAND


“In fall months, the ShowingTime Showing Index has been shown to be a leading indicator of the spring market for the coming year… In 2020, fall was incredibly competitive for buyers, while this year we’re seeing slightly lower numbers. This hints at a gradual easing of the inventory shortage coming into next year. A notable exception is the South Region, which came in at 1.3 percent above last year’s September values.” - Michael Lane, President of Showing Time

U.S.

Northeast

Midwest

-4.3%

-5.0% -7.5%

1.3% South

West

-5.1% Year-Over-Year Increase in Showing Activity


Buyer Traffic Index

NAR


INTEREST RATES


2.50

3.50

10/7 11/4

8/5 9/2

5/6 6/3 7/1

1/7 2/4 3/4 4/1

11/5 12/3

8/6 9/3 10/1

5/7 6/4 7/2

2/6 3/5 4/2

11/7 12/5 1/2

9/5 10/3

6/6 7/3 8/1

3/7 4/4 5/2

12/6 1/3 1/31

9/6 10/4 11/1

6/7 7/5 8/2

4/5 5/3

1/4 2/1 3/1

5.00

Mortgage Rates Freddie Mac 30-Year Fixed Rate

4.50

4.00

3.09%

3.00

Freddie Mac


2.50 10/7 11/4

3.50

8/5 9/2

5/6 6/3 7/1

1/7/2021 2/4 3/4 4/1

11/5 12/3

8/6 9/3 10/1

5/7 6/4 7/2

2/6 3/5 4/2

11/7 12/5 1/2/2020

4.50

9/5 10/3

6/6 7/3 8/1

3/7 4/4 5/2

12/6 1/3/2019 1/31

9/6 10/4 11/1

6/7 7/5 8/2

4/5 5/4

1/5/2017 2/2 3/2 3/30 4/27 5/25 6/22 7/20 8/17 9/14 10/12 11/9 12/7 1/4/2018 2/1 3/1

10/6 11/3 12/1

7/7 8/4 9/1

4/7 5/5 6/2

1/7/16 2/4 3/3

5.00

30-Year Fixed Rate Mortgages from Freddie Mac

4.00

3.09%

3.00

Freddie Mac


Mortgage Rate Projections Quarter

Freddie Mac

Fannie Mae

MBA

NAR

Average of All Four

2021 4Q

3.2

3.1

3.1

3.1

3.12%

2022 1Q

3.4

3.2

3.3

3.3

3.30%

2022 2Q

3.5

3.2

3.5

3.5

3.42%

2022 3Q

3.6

3.3

3.7

3.6

3.55%


Mortgage Rates 2018 Freddie Mac

- Actual - Projected

2019 30-Year Fixed Rate 2017 2020

2016

2022 2021

2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2020 2020 2021 2021 2021 2021 2022 2022 2022 2022 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Rate 3.7 3.6 3.5 3.8 4.2 4.0 3.9 3.9 4.3 4.5 4.6 4.8 4.4

4

3.7 3.7 3.5 3.2 3.0 2.8 2.9 3.0 2.9 3.2 3.4 3.5 3.6 3.7

Freddie Mac


Mortgage Rates

5.0

Freddie Mac

4.5

30-Year Fixed Rate

Where Are They Going?

4.0

3.5

3.4

3.5

3.6

3.2 3.0

10/7 11/4

8/5 9/2

5/6 6/3 7/1

2021 2/4 3/4 4/1

11/5 12/3

8/6 9/3 10/1

5/7 6/4 7/2

2/6 3/5 4/2

11/7 12/5 2020

9/5 10/3

6/6 7/3 8/1

3/7 4/4 5/2

12/6 1/3 2019

9/6 10/4 11/1

6/7 7/5 8/2

4/5 5/3

2018 2/1 3/1

2.5

January 2018 – Today Actual Interest Rates 2021 Q4

2022 Q1

2022 Q2

2022 Q3 Freddie Mac


Mortgage Credit Availability YES

NO

MAYBE


Mortgage Credit Availability

Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association Apr 2013

Jan 2014

Jan 2015

Jan 2016

Jan 2017

Jan 2018

Jan 2019

Jan 2020

Jan 2021 MBA


900

800

Historic Data for the

700

MORTGAGE CREDIT AVAILABILITY INDEX

600

500

(a report from the Mortgage Bankers Association) 400

300

200

100

0

June 2004 June 2005 June 2006

June 2007 June 2008 June 2009 June 2010 June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 June 2017 June 2018 June 2019 June 2020 June 2021 Sept 2021

MBA


Average Days To Close A Loan

Last 12 Months

58 58

55 54

53 52 53 51

51

Sept

Oct

Nov

Dec

21-Jan

Feb

Mar

Apr

May

49 48

June

July

46

Aug

All Closed Loans as per ICE Mortgage Technology


® FICO

Score Requirements

Last 12 months

753 753 752 753 751 751 752

Sept

Oct

Nov

Dec

Jan 21

Feb

Mar

747

Apr

744 743

May

June

740 741

July

Aug

All Closed Loans as per ICE Mortgage Technology


® FICO

Score

39.15%

Distribution

23.02% 16.63%

14.47%

6.40% 0.01%

0.31%

500-549

550-599

600-649

46.37%

650-699

700-749

750-799

800+

All Closed Loans as per ICE Mortgage Technology


Average 741

755

® FICO

Score

for Closed Purchase Loans by Loan Type

721 676

All Loans

Conventional

FHA

VA All Closed Loans as per ICE Mortgage Technology


Average Back End DTI for Closed Purchase Loans by Loan Type

43 36

35

All Loans*

Conventional

FHA

41

VA All Closed Loans as per ICE Mortgage Technology


Housing Market Statistics for Northeast Valley Single Family Homes in Carefree, Cave Creek, Fort McDowell, Fountain Hills, Paradise Valley, Rio Verde and Scottsdale, Arizona


Average Price per Sq Ft

for Sold Northeast Valley Single Family Homes


Average Days on Market

for Sold Northeast Valley Single Family Homes


Number of Active Listings for Northeast Valley Single Family Homes


Average Price per Sq Ft for Active Northeast Valley Listings


CONTACT US TO DISCUSS YOUR LOCAL ARIZONA REAL ESTATE MARKET

Peter Shambreskis, REALTOR®, ABR, CRS, GRI, SFR 480-229-6468 Corinne Howard, REALTOR®, ePRO, GRI, SFR, SRS 480-229-6467 info@ShambreskisAndHoward.com www.ShowScottsdaleHomes.com DPR Realty, LLC