Robert is a realtor in Bedford NY. He has been successfully working with buyers and sellers for years. His local area of expertise includes Bedford, Pound Ridge, Armonk, Lewisboro, Chappaqua and Katonah. When you have a local real estate question please call 914-325-5758.
Total housing starts posted a 12.3 percent increase in August (1.364 million units) compared to an upwardly revised July estimate of 1.215 million units, according to the joint data release from the Census Bureau and HUD. Relative to August 2018, total starts are 6.6 percent above the annual pace of 1.279 million units.
Single-family production in August posted a monthly increase of 4.4 percent to a seasonally adjusted annual rate of 919,000. Single-family starts in July were revised up to 880,000 units. The three-month moving average for single-family in August is 888,000 units.
On a year-to-date basis, single-family starts are 2.7 percent lower as of August relative to the first eight months of 2018. Single-family permits, a useful indicator of future construction activity, rose 4.5 percent in August (866,000 units) compared to July but have registered a 4.1 percent loss thus far in 2019 compared to last year.
Regional data show, on a year-to-date basis, positive conditions for single-family construction only in the South (+1.1 percent). Single-family construction is down 6.9 percent in the West, 4.8 percent in the Midwest, and 11.9 percent in the Northeast.
Multifamily starts (2+ unit production) registered an increase of 32.8 percent in August to a 445,000 annual rate compared to July. On a year-to-date basis, multifamily 5+ unit production is slightly up 0.4 percent thus far in 2019, while multifamily 5+ unit permitting is trending higher with an increase of 4.2 percent relative to the first eight months of 2018.
The average FICO score stands at 706, a record high, said Ethan Dornhelm, vice president of scores and predictive analytics at FICO. That compares with 686 at the 2009 end of the Great Recession and it eclipses the 690 at the 2006 height of the housing bubble.
The key drivers are U.S. economic expansion that has propelled job growth and an increase in consumer education about protecting and improving scores, Dornhelm said in a blog post. In addition, the passage of time is helping to remove the credit scars from events that happened during the financial crisis, he said.
“Consumers who suffered financial misfortune during the Great Recession have over the past few years had the associated missed payments from that time period purged from their credit file, in accordance with the Fair Credit Reporting Act,” he said.
Measuring different credit events, the biggest improvement between April 2009 and April 2019 was the timeliness of mortgage payments, Dornhelm said. A decade ago, 7.2% of the population had been 90 days or more late on a mortgage payment within the last two years. By April, it had dropped to 2.8%.
Also showing big improvement was the percentage of the population who had been 90 days or more past due on a credit card in the last two years. A decade ago, it was 13%, and in April it was 8.6%.
The jump in FICO scores was due to “score improvement, not score inflation,” Dornhelm said.
“Significant improvement in the overall population’s credit profile has been the key driver of the 20-point increase in national average FICO score over the past decade,” he said. “These improvements are reflective of improving consumer financial health, as would be expected during a period of economic expansion.”
Economic data signaling the chance of a looming recession has increased uncertainty in the credit-scoring realm, he said.
“The average FICO score will continue to change, but in what direction?” Dornhelm said. “Trade talks with China, the possibility of a `no-deal Brexit,’ and Fed interest rate decisions loom large as concerns of a recession persist.”
You ain’t dreaming. New York’s toniest buildings really are bigger on the inside than the outside.
For a small pool of New York buyers, a floor in the 90s is the new Park Avenue address — and developers are fudging numbers to accommodate them.
In 2013, Saudi retail magnate Fawaz Al Hokair signed an $87.7 million contract for a splendiferous privilege: owning the top floor of the Western Hemisphere’s tallest residential tower, 432 Park Ave. Al Hokair could boast that his 8,255-square-foot penthouse is on the 96th floor — six floors higher than billionaire Michael Dell’s then-record-breaking spread on the 90th floor of One57 (previously the city’s tallest residential tower).
Splendiferous, that is, if you ignore the fact that 432 Park is an 88-floor tower, eight floors less than advertised.
That’s not a fluke, it’s a power move. Nearly every new luxury condo in the city’s latest wave of super-tall construction mislabels floors to stroke buyers’ vanity.
“If you have the 95th floor in your address, that’s going to be impressive to pretty much everyone,” said Leonard Steinberg of Compass Real Estate. “Being on the 95th floor is unbelievable. In how many cities can you even live on the 95th floor?”
Like a short man in Cuban heels, One57 boasts a 90th-floor penthouse that is, technically, on the 75th floor. For more than a decade, billionaire developer Stephen Ross occupied the 80th-floor penthouse of his Time Warner Center, but has since moved up to the 92nd floor of his latest tower, 35 Hudson Yards. In reality, the Time Warner Center has 53 floors. His Hudson Yards building has 71.
“When [brokers] go see buildings under construction, we say, ‘Go to the top floor’ — which is often marketed as the 90th, but there will be a sign in the elevator that reads 63,” said broker Tristan Harper of Douglas Elliman.
This sleight of hand is achieved by developers in different ways, Harper and other experts explained. For one, most new residential skyscrapers have lobbies with tremendous ceiling heights. They might be counted as 10 or more stories. Many also have several floors of building mechanicals and amenity spaces that are counted.
Some — like One57 or 35 Hudson Yards — have hotels on the first couple dozen floors. Instead of counting from the first apartment, developers will divide building height by eight feet (the measure of a typical New York ceiling height) to get a total floor count that is higher than the actual number of residential floors. Or they count from the ground to determine on which floor an apartment would theoretically be.
That’s why residences at One57 start on the 22nd floor, while 35 Hudson Yards begins on the 53rd. In the industry, it’s known as marketing floors versus real floor, or “construction counting.”
“If we lived by the letter, buildings in New York would have a 13th floor — and I haven’t seen a 13th floor in a long time,” Steinberg said, adding that he considers the practice of embellishing floor numbers to be a mostly harmless example of “truthful hyperbole . . . Every developer wants to maximize value.”
Harry Macklowe is often credited with inventing vanity numbering with his Metropolitan Tower, which opened in 1985 on the south end of Central Park, now considered “Billionaires Row.” Macklowe advertised the building as having 78 floors, when it really has 66.
But it was Donald Trump who introduced 90th-floor fever. When Trump World Tower opened in 2001, he proclaimed it the “tallest residential building in the world” at 90 floors. (If you count them up, there are 72.)
While the city allows developers to label floors as they please, it requires that the real number be disclosed on official offering plans.
But experts agree that, in a market where higher floors equal higher prestige and higher dollars, the rubber ruler is here to stay.
“If you repeat something often enough, it becomes the new normal,” said Steinberg. “There was a moment when a Botoxed face looked really weird. Now a face without Botox looks weird. It’s like that with real estate.”
California is one step away from enacting statewide rent control after the state’s two legislative bodies both approved the measure.
The bill will cap annual rent increases by 5%, including the rate of inflation. In addition to the rent cap, a bill known as AB-1482, the Tenant Protection Act of 2019, will allow “just cause” eviction policies to qualified housing in California.
The bill was approved this week by the California State Senate and the California State Assembly.
The bill now moves to the desk of California Gov. Gavin Newsom, who is expected to sign the bill into law.
When Newsom signs the bill, the bill would make the state one of the few in the nation with statewide rent control.
California, one of the nation’s priciest housing markets, is following Oregon’s footsteps in enacting rent control. In March, Oregon approved a law placing an annual limit on rent increases of 7% plus inflation.
The bill appears to have Newsom’s support, as the governor tweeted that “The rent is too damn high — so we’re damn sure doing something about it” and “Because there should be a cap on how much you pay for rent…Because your landlord shouldn’t be able to evict you for no reason.”
“In this year’s State of the State address, I asked the Legislature to send me a strong renter protection package. Today, they sent me the strongest package in America,” Newsom said in a statement after the Assembly passed the bill. “These anti-gouging and eviction protections will help families afford to keep a roof over their heads, and they will provide California with important new tools to combat our state’s broader housing and affordability crisis. I would like to thank Assembly Speaker Rendon, Senate President pro Tempore Atkins, Assembly member Chiu and the bill’s co-authors for passing this legislation, as well as the broad coalition of stakeholders whose persistence allowed this bill to move forward.”
The move is a reversal from what happened in the state nearly a year ago. In the November 2018 election, California voters shot down a previous rent control initiative, Proposition 10. The proposal would have to capped annual rent increases to prevent unjust evictions.
Proposition 10 was aimed to repeal the Costa-Hawkins Rental Housing Act. In 1995, California passed the Costa-Hawkins Rental Housing Act, limiting the use of rent control and prohibiting local governments from imposing caps on single-family homes and condos.
According to the California Secretary of State, 61.7% of voters were against repealing the Costa-Hawkins Rental Housing Act, while a mere 38.3% voted for it.
17VIEW GALLERYLocation: Irvington, N.Y.Price: $4.5 millionSize: 11,653 square feet, 8 bedrooms, 10 full and 2 half bathrooms
Though it barely qualifies as what most financial mortals might consider downsizing, Hollywood veterans Michael Douglas and Catherine Zeta-Jones have slightly reduced their considerable residential footprint in New York State’s fancy-pants Bedford. Selling a more than 15,000 sq. ft. Bedford Corners mansion for almost $20.5 million and concurrently snapping up a not quite 12,000 sq. ft. Gatsby-esque manor house about 20 miles away, in Irvington, for exactly $4.5 million.
Douglas and Zeta-Jones bought the more than 13-acre Bedford Corners spread about five years ago for $11.25 million. They sold it in what appears to have been a clandestine, off-market deal to a mysterious corporate entity. It links back to the impossibly posh Sherry Netherland building on Manhattan’s Fifth Avenue. Situated in the coveted Guard Hill area, the palatial estate is anchored by a stately 26-room residence that dates to the late 1800s. At the time of their purchase, it offered eight bedrooms and 18 bathrooms plus an extensive spa facility with not just one but two indoor swimming pools. The property additionally included a two-unit cottage for guests or staff, a car collector’s garage and a full array of equestrian facilities.
The lavish living couple’s only somewhat smaller but far less expensive new digs, dubbed Long Meadow, meanders over 12 bucolic and largely wooded acres that roll down to the Hudson River. Just 25 miles outside Manhattan and built in the early 1930s, the 22-room stone-accented red brick Georgian mansion sits at the head of a long, gated driveway with eight bedrooms and 10 full and two half bathrooms. Listing details disclose the baronial three-story behemoth also has a total of seven fireplaces, an 11-zone heating and cooling system, a four-car garage and annual taxes that top $150,000.
An elegant columned portico leads to gracefully proportioned and intricately detailed living spaces that include a formal and living and dining rooms, both with an antique limestone fireplace and the latter sporting candy apple red lacquered walls that reflect light tossed off from a delicate crystal chandelier. There’s also double-height wood-paneled library flooded with natural light through massive arched windows, a casual lounge with wet bar and a fully updated center island kitchen with commercial-grade appliances and marble countertops. A stone-floored loggia opens to a massive stone-paved terrace that is partly shaded by a black and white striped awning and offers a stunning tree-framed view across the Hudson River, while the mansion’s eight bedrooms include a two-bedroom guest suite and a spacious owners suite that comprises a large bedroom and separate sitting room, a dressing room and a glitzy bathroom with a jetted tub next to a white marble fireplace.
The mansion’s lowest level opens the estate’s rolling grounds and contains an indoor swimming pool, fitness room, recreation/games lounge and, outside, a summer kitchen. Marketing materials indicate the estate offers “enormous untapped potential” to add an outdoor swimming pool and cabana, tennis court and guest cottage. As noted by The Hudson Independent, Houlihan Lawrence Realtors had both sides of the deal.
The Douglas-Zeta-Joneses have long and famously presided over an international portfolio of luxury homes that have made them regular fodder for property gossip columns around the globe. In addition to a sprawling co-operative apartment in a prestigious apartment house overlooking Central Park on New York City’s Central Park West and a large house in Zeta-Jones’ hometown of Swansea, Wales, the couple have long owned a walled compound in Bermuda that came up for sale earlier this year at $19 million but is no longer listed on the open market, although it’s unclear if it’s been sold. The couple’s 10-bedroom compound on the Spanish island of Majorca, which is co-owned by Douglas’s ex-wife Diandra Douglas, was also set out for sale earlier this year and is still available at a whopping $32.5 million.
Startups are racing to fix the construction productivity problem at large. VCs poured $3.1 billion into Construction Tech in 2018. Most of this money went towards modular housing companies or software that promises to optimize current processes such as project management and communication. Yet neither of these buckets addresses the labor shortage head-on. Many startups claim that robots might.
Over the last year, I have been looking into the startups trying to plug this gap with construction robotics.
With such an acute labor shortage, felt deeply by contractors and developers, are robots really the next best thing? What tasks can they accomplish on site today? Most importantly, will the customer— real-life, historically risk-averse contractors and developers—adopt robotics with open arms? If so, when?
The Construction Robotic Landscape
The robotics companies that currently exist take on the shape of a subcontractor. They use robotics to accomplish a vertical task on site like excavation, drywall installation, painting, and roofing. Some companies are inserting their autonomous software into pre-existing construction machinery. While other start-ups are adapting manufacturing robotics and small self-driving vehicles to do construction tasks.
Most construction robotics companies promise to reduce construction costs by 1) cutting down on labor expenses, 2) taking less time to accomplish a task by working longer shifts and into the night, and 3) performing tasks faster—not by actually working faster than a human, but by shortening downtime between sub-tasks.
It’s important to note that many of the companies I spoke to are in their pilot phase. They are testing their technologies on live construction sites for the first time and require additional engineering oversight to get the job done. If these pilots (which may take six-plus months) run successfully, these construction robotics companies will most likely be ready for commercial use in one-and-a-half to two years. The biggest technological hurdles for robotic construction technology at the moment are 1) seamlessly integrating into an already-complicated construction site, 2) working off of plans and maps that evolve as they work, 3) being able to execute the task as well as a contractor.
However, the biggest challenge of all remains whether developers and contractors will adopt the technology at large.
The Customer: Curious, Risk-averse, & Cost-aware
Even though the labor shortage is real, one can’t help but wonder: if the construction industry has been hesitant to adopt technology in the past, will they adopt robotics today?
Unlike in manufacturing, where a single owner is incentivized to operate as efficiently as possible and invests in large capital expenditure projects that pay off over time, construction managers are motivated to turn around a single project as cost-effectively as possible while delivering to the architect’s specifications. They only work on a handful of projects each year, so they have a low willingness to experiment.
From speaking to contractors, I found that they would be willing to adopt technology or hire a robotics sub-contractor if there was proof that the robotic option could drastically reduce costs on their project.
To understand the biggest opportunity for cost savings, I set out to understand what costs the most on a construction site. While this data is challenging to obtain and costs are extremely variable site-to-site, through conversations with contractors, I have seen some patterns emerge, which I plot in the accompanying graph. Costs tend to be held up in a few key verticals, and then widely distributed across most other tasks.
% of Overall Cost CREDIT: JULIETTE CILIA
Of the verticals that tend to cost the most today (structural support [i.e., concrete and steel] and mechanical and plumbing), not many can be automated because of the complexity of the task or we have yet to uncover companies in those verticals. Some verticals that proportionally cost less but still incur significant costs and are deployed across asset types, like drywall and bricklaying, are appealing, but it is unclear how quickly a large-scale contractor would rush to adopt them.
In the near future we will see more companies tackling the cost-consuming tasks on big development projects. CREDIT: PXHERE.COM
The space is still evolving, but I suggest holding off on large checks until we see movers who can tackle some of the costlier verticals, like cast-in-place concrete or facade installation. Automating these jobs will save contractors major money and could be widely adopted in time. While construction robotics are still maturing, I believe that in the next two to three years, we will see more companies tackling the cost-consuming tasks on big development projects, helping us finish more of our cities, offices, hospitals, and homes on time.
HUDSON VALLEY, NY — Cooler temps, what a relief! That means it’s time to plan a trip this weekend to an orchard for a bushel or two of the season’s finest apples (and in some cases the last of the blackberries, pears and peaches).
You’ll love how most of these “pick your own” orchards offer a chance to pick up many other seasonal vegetables, select farm fresh foods, and enjoy some family-style events and activities.
The kinds of apples ready for picking changes over the season, so you’ll be able to visit several of these wonderful orchards and farms this fall. Look at their lovely websites and start planning trips!
Wilkens Fruit and Fir Farm 1335 White Hill Road, Yorktown Heights. 914 245-5111 The farm offers more than a dozen varieties of apples. The season started in August with peaches and runs into December when you can hunt for the perfect Christmas trees. Pumpkin picking season starts in October. Stop by the gift shop for freshly baked cookies, doughnuts and strudel sticks.
Stuart’s Fruit Farm 62 Granite Springs Road, Granite Springs 914 245-2784 The 200-acre family-owned farm offers nine different varieties of apples as well as pumpkins. On weekends you can take a hayride through the orchards. You can end the visit by enjoying a freshly baked pie or doughnut with a glass of apple cider.
Harvest Moon Farm and Orchard 130 Hardscrabble Road, North Salem 914 485-1210 The family-run farm lets visitors pick McIntosh and Front Hill apples but also sells Gala and Ginger Gold. The farm holds a Fall Festival on Saturdays and Sundays from Sept. 7 through Oct. 27 10am-5pm as well as Sept. 30, Oct. 1, Oct. 9 and Oct. 14. Entertainment for kids include farm animals, bouncy castles and hayrides. You can also buy homemade doughnuts, cider, produce and fresh eggs. Dogs are not allowed; service animals with proper identification are allowed.
Dr. Davies Farm 306 Route 304, Congers 845 268-7020 Not only are there apples galore at Dr. Davies 35-acre farm, but there are apple themed T-shirts for sale, as well as homemade doughnuts and fresh pressed cider, vegetables and decorative pumpkins. Bring cash or a check as the farm does not accept credit cards.
The Orchards of Concklin 2 South Mountain Road, Pomona 845 354-0369 At The Orchards of Concklin, iyou can pick your own produce, visit the farm stand, and taste the fresh pressed apple cider. The bakery offers delicious pies, cookies, and pastries. If you can’t make it there this year, they can ship to you.
Meadowbrook Farm 29 Old Myers Corners Road, Wappingers falls 845 297-3002 The farm has been a local favorite for over 70 years. They offer a large variety of apples for picking and uses their own apples to make fresh cider.
Fishkill Farms 9 Fishkill Farm Road, Hopewell Junction 845-897-4377 The farm offers several varieties of apples for picking, hayrides, a farm market, cider doughnuts, and barbecued jerk chicken for lunch. In addition to 40 acres of apples, they grow peaches, nectarines, black currants, cherries and pumpkins, all of which are available in season for pick-your-own. They sell New York state hard cider, wine, beer and spirits, roasted coffee and local ice cream.
Apple Hill Farm 124 Route 32, New Paltz 845 255-1605 Apple Hill Farm overlooks the picturesque Shawangunk and Catskill Mountains. The apple picking season begins in September with McIntosh, Cortland, Opalescent and Spartan and end the season with Red and Golden Delicious. Pick-your-own hours are from 10 a.m. to 5 p.m.
Visitors can also check out the restored 1859 barn for fresh pressed apple cider and mulled apple cider donuts, as well as wreaths, dried and fresh-cut flowers. Hayrides.
Hurds Family Farm 2185 Route 32, Modena 845 883-6300 At Hurds Family Farm you can pick a variety of apples, including Ginger Gold, gala, Honeycrisp, Empire, Cortland, Jonagold and Golden Delicious, as well as Fuji, Rome Beauties and the flavorful Ruby Frost. You can find out which apples are being picked at the moment by visiting the site. There’s also a lot for kids to do, too.
Wilklow Orchards 341 Pancake Hollow Road, Highland 845 691-2339 The family who runs Wilklow Orchards has been farming the spot for six generations. They try to be sustainable and ecologically minded because they want the farm to last for another six generations. Besides picking your own apples, when you visit the site, you can also shop at their bakery. New York State flour and regional butter and eggs are used to make muffins and bread. Fruit from the farm is used to make jam and cider. There are 13 different varieties of apples to pick so call and find out what’s ripe.
Greig Farm 227 Pitcher Lane, Red Hook 845 758-1234 The farm is open for picking blackberries and apples, including Jonamac, Gala and McIntosh, from 9 a.m. to 7 p.m. seven days a week. The farm has been open to the public for more than 60 years. You can also pick raspberries and other vegetables. Kids may appreciate feeding the goats. There’s also a nursery/garden shop and Christmas shop. The farm organizes wine tastings.
Rose Hill Farm, 1798 19 Rose Hill, Red Hook 845 758-4215 Established in 1798, the farm offers cherries, blueberries, peaches, apples and pumpkins in a peaceful and scenic slice of the Hudson Valley. Gingergolds and Paula Reds apples are ripe. The farm also offers flowers, fresh eggs, meat and jam.
Lawrence Farms Orchards 39 Colandrea Road, Newburgh 845 562-4268 The family farm is a family-friendly location with “show chickens,” playful goats, a”Little Village” and hay bale maze. The farm has been doing “pick your own” fruits and vegetables for 30 years. Brand-new this year are milkshakes and frozen cider.
Growth in residential remodeling spending is expected to slow considerably by the middle of next year, according to the Leading Indicator of Remodeling Activity (LIRA) released today by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects that annual gains in homeowner expenditures for improvements and repairs will shrink from 6.3 percent in the current quarter to just 0.4 percent by the second quarter of 2020.
“Declining home sales and homebuilding activity coupled with slower gains in permitting for improvement projects will put the brakes on remodeling growth over the coming year,” says Chris Herbert, Managing Director of the Joint Center for Housing Studies. “However, if falling mortgage interest rates continue to incentivize home sales, refinancing, and ultimately remodeling activity, the slowdown may soften some.”
“With the release of new benchmark data from the American Housing Survey, we’ve also lowered our projection for market size about 6 percent to $323 billion,” says Abbe Will, Associate Project Director in the Remodeling Futures Program at the Center. “Spending in 2016 and 2017 was not nearly as robust as expected, growing only 5.4 percent over these two years compared to 11.9 percent as estimated.”
More information about the newly released benchmark data and changes to the projected LIRA market size can be found here.
Click image for full-size chart.
The Leading Indicator of Remodeling Activity (LIRA) provides a short-term outlook of national home improvement and repair spending to owner-occupied homes. The indicator, measured as an annual rate-of-change of its components, is designed to project the annual rate of change in spending for the current quarter and subsequent four quarters, and is intended to help identify future turning points in the business cycle of the home improvement and repair industry. Originally developed in 2007, the LIRA was re-benchmarked in April 2016 to a broader market measure based on the biennial American Housing Survey.
The LIRA is released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University in the third week after each quarter’s closing. The next LIRA release date is October 17, 2019.
The Remodeling Futures Program, initiated by the Joint Center for Housing Studies in 1995, is a comprehensive study of the factors influencing the growth and changing characteristics of housing renovation and repair activity in the United States. The Program seeks to produce a better understanding of the home improvement industry and its relationship to the broader residential construction industry.
The Harvard Joint Center for Housing Studies advances understanding of housing issues and informs policy. Through its research, education, and public outreach programs, the Center helps leaders in government, business, and the civic sectors make decisions that effectively address the needs of cities and communities. Through graduate and executive courses, as well as fellowships and internship opportunities, the Center also trains and inspires the next generation of housing leaders.
Sixteen projects earned accolades from our panel of judges for this year’s Builder’s Choice & Custom Home Design Awards program, representing some of the best residential design work being constructed today.
Overall, the jurors—J. Carson Looney of Memphis, Tenn.–based Looney Ricks Kiss, Michael Hennessey of San Francisco–based Michael Hennessey Architecture, and Jonathan Tate of New Orleans–based Office of Jonathan Tate—praised function in smaller footprints, use of innovative building materials, and remodels that respect the existing architecture. From production homes to interior renovations to meticulously crafted custom abodes, there is no shortage of inspiration below for you to reimagine for your own projects.
EXPLORE: ALL PROJECT OF THE YEAR GRAND AWARD MERIT AWARD
A second housing price index is showing an uptick in the rate of appreciation, possibly because interest rates declines have begun to mitigate affordability issues. CoreLogic says its Home Price Index for July was up 3.6 percent in July, the annual increase in June, was 3.4 percent. On a month over month basis the gain was 0.5 percent compared to an increase of 0.4 percent the previous month. Last week Black Knight noted that the rate of increase in its index had risen for the first time in 16 months.
CoreLogic Chief Economist Frank Nothaft said, “Sales of new and existing homes this July were up from a year ago, supported by low mortgage rates and rising family income. With the for-sale inventory remaining low in many markets, the pick-up in buying has nudged price growth up. If low interest rates and rising income continue, then we expect home-price growth will strengthen over the coming year.”
Annual price gains were experienced in all states but Connecticut and South Dakota. The highest increases were posted in Idaho (11.5 percent) Utah (8.4 percent) and Maine (7.7 percent).
The company’s forecast is for home prices to increase by 5.4 percent on a year over year basis from July to this year to the corresponding month in 2020. On a month-over-month basis, home prices are expected to increase by 0.4 percent from July 2019 to August 2019.
The graph below shows a comparison of the national year-over-year percent change for the CoreLogic HPI and CoreLogic Case-Shiller Index from 2000 to present month with forecasts one year into the future. Both the CoreLogic HPI Single Family Combined tier and the CoreLogic Case-Shiller Index are posting positive, but moderating year-over-year percent changes, and forecasting gains for the next year.
“Although the rise in home prices has slowed over the past several months, we see a reacceleration over the next year to just over 5 percent on an annualized basis,” CEO President and CEO Frank Martell commented. “Lower rates are certainly making it more affordable to buy homes and millennial buyers are entering the market with increasing force. These positive demand drivers, which are occurring against a backdrop of persistent shortages in housing stock, are the major drivers for higher home prices, which will likely continue to rise for the foreseeable future.”
During the second quarter of 2019, CoreLogic and RTi Research conducted a survey of Millennial generation consumer-housing sentiment. They found that approximately 26 percent of that age group expressed an interest in buying a home in the next 12 months, but only 8 percent indicated a desire to sell their home within the same time frame. This means that new housing starts, or sellers from other age cohorts, will need to make up the necessary available supply to meet the demand. This desire to buy while housing stock is limited will continue to force prices up as buyers search for a home to purchase.
CoreLogic considers 37 percent of large metropolitan areas to have an overvalued housing stock as of July. Their analysis categorizes home prices in individual markets as undervalued, at value or overvalued by comparing home prices to their long-run, sustainable levels, which are supported by local market fundamentals such as disposable income. Twenty-three percent were undervalued, and 40 percent were at value. When the analysis is done on only the top 50 markets 40 percent were overvalued, 16 percent were undervalued, and 44 percent were at value.