A buyer's market emerges
As the housing market strengthens, key indicators point to a growing buyer's market.
During the last days of summer and early fall, a Realtor.com analysis of housing data reflects a market that is tipping slightly toward buyers. While sellers still have the advantage, it is showing signs of lessening, the analysis notes.
"We are now entering the time of the year when both inventory and demand typically reach their peak, as the start of the school year takes away a substantial chunk of near-term demand," says Jonathan Smoke, Realtor.com's chief economist.
"This year we're seeing inventory continue to grow. And while overall demand is strong, the trend on median days on market is suggesting that the market is finding more of a balance -- and that bodes well for would-be buyers who have been frustrated by the inability to find a home to buy this spring and summer."
During the first three weeks of August, inventory of for-sale homes increased 3 percent month-over-month. Median list prices nationwide rose 8 percent year-over-year to $233,000.
Also, the median days on the market of listings was on the rise in August, increasing to 75 days as houses take slightly longer to sell -- another sign reflecting a market that is slightly tilting toward buyers, it was reported by the National Association of Realtors.
Q. Is the housing market stabilizing?
A. Yes, and as the housing market continues to stabilize, analysts are expanding the scope and range of their studies.
For example, one research group added two additional states -- Arkansas and Tennessee -- as well as four additional metro areas to Freddie Mac's latest multi-indicator market index reading. The added metros are Omaha, Neb.; Scranton, Pa.; Chattanooga, Tenn.; and Madison, Wis.
The MiMi measures the stability of the nation's housing market by comparing its long-term stable range to current ratios in home purchase applications, debt-to-income ratios, on-time mortgage payments and employment.
Since hitting an all-time low in October 2010, the national MiMi has rebounded 35 percent. However, it remains significantly off from its high of 121.7. It's currently at a value of 80.3, a housing market considered mostly in a stable range, it was reported by the National Association of Realtors.
"Housing markets are the strongest they've been in years, with the National MiMi above 80 for the first time since 2008," says Len Kiefer, Freddie Mac's deputy chief economist.
Q. How many homes are located in areas with a high risk of natural disasters?
A. Many more than you might think. RealtyTrac, a source for housing data, released its 2015 U.S. Natural Disaster Housing Risk Report, which found that 35.8 million U.S. single family homes and condos with a combined estimated market value of $6.6 trillion are in counties with high or very high natural hazard risk.
Those 35.8 million homes represent 43 percent of the 83.4 million single-family homes and condos in all counties analyzed for the report.
For the report RealtyTrac assigned a natural disaster risk score to 2,318 counties nationwide with sufficient home value data available. Based on its score, each county was assigned to one of five risk categories for overall risk of natural disaster: Very High, High, Moderate, Low and Very Low.
"In the interest of personal safety and protecting the value of what is likely their biggest financial asset, prospective buyers and investors should be aware of any natural disaster risk impacting a potential home purchase," said Daren Blomquist, vice president at RealtyTrac.
Q. Are mortgage applications rising?
A. At last report, applications were indeed rising. Mortgage applications increased 11.3 percent from one week earlier, according to data from the Mortgage Bankers Association's Weekly Mortgage Applications Survey.
• Email Jim Woodard at storyjim@aol.com.
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