Appraisal Scoop

One Cause of the Uneven Recovery: The Home-Buyer Credit - The Atlantic

Housing stimulus programs are history. Home buyer tax credits are water under the bridge. Still, they're part of explanation for why we're where we are, economically speaking, trying to extract ourselves from a funk the likes of which only those who lived through the Great Depression can remember.

Here, the Atlantic's Daniel Indiviglio tries to shed light on the distortive effect of the home buyer tax credit on reisdential investment, and therefore, the economy, by regraphing the quarters and pulling out the stimulus' impact.

 

Indiviglio's chart takes actual

" GDP growth (red) and then imagined what GDP would have looked like without the credit (blue). In my estimate, residential investment dropped to $321 billion in the third quarter of 2009 -- where it fell to when the home buyer credit was removed last summer and has hovered around ever since.

Here, you see that the third quarter of 2009's pop looks a little weaker. But growth looks better in most of the quarters that followed -- especially the third quarter of 2010, during which time the big fall in residential investment due to the credit's expiration cut GDP.

Better home sales would have had some effect on other aspects of GDP as well -- but just like you're seeing here, removing those effects in later quarters would have created an adverse effect."

Like other important economic events, we'll need more history to run its course before we'll be able to say it's positive or negative.

Source: The Atlantic

Banks Sell 3X More Than Builders

Housing remains stuck in the doldrums even with extremely low mortgage rates and despite some improvement in private payroll employment.  Part of the reason for this disconnect is the slew of foreclosures and bank-owned properties which are still flooding the housing market. 

Defaults are expected to reach new record-highs this year which have buyers holding out for better deals and traditional home-sellers battling low-ball offers from banks.  The aggressive pricing on distressed properties is undercutting individual home sellers and new home builders alike, and wreaking havoc on local housing markets. 

According to data from Housing IntelligencePro, both new home activity and regular resale activity made up a smaller portion of total closing activity compared to the first three months of last year (and every quarter since). more...

Source: Hanley Wood Market Intelligence

Housing Scorecard: Delinquencies Down. Foreclosures Delayed - HAMP Report

The Departments of Housing and Urban Development (HUD) and Treasury released their Monthly Housing Scorecard for February on Wednesday afternoon according to Jann Swanson's Mortgage News Daily article.

This monthly report is an attempt to encapsulate the Obama Administration's efforts to stabilize the housing market and provide a snapshot of the status of that market.  It contains a round-up of information from both public and private sources.  The Scorecard is issued simultaneous with the release of the monthly report on the Making Home Affordable Program (HAMP).

FULL HAMP REPORT

According to the Scorecard, the housing market remains fragile as data through January paint a mixed picture of recovery.  On the sales front there was a little good news as sales of existing homes ticked up to 446,700 in January compared to 435,000 in December.  New home sales, however, dropped from 27,100 to 23,700.  The inventory of existing homes fell by slightly less than 200 thousand to 3.38 million while the supply of new homes was almost flat at 188,000.  There is a 7.6 month supply of existing homes compared to 8.2 months in December and a 7.9 month supply of new homes as compared to 7.0 months. 

Over 3.6 million homes are currently vacant and held off the market for a variety of reasons.  This is an increase of 45,000 since December.

Click here to read the full article

New Instructor-Led Appraisal Online Class - Statistics, Modeling and Finance

New Instructor-Led Online Classes Promote a Traditional Classroom Experience Through the Convenience of a Personal Computer

STAMFORD, Conn., Jan. 26, 2011 /PRNewswire/ -- CompuTaught, part of Cengage Learning and a leading developer of computer-based real estate education, today unveiled a new series of live, instructor-led, advanced appraisal courses that will be offered online via WebEx.

The new online courses feature CompuTaught's standard online registration, administration and learning management support systems while combining real-time instruction with WebEx's synchronous, interactive delivery, bringing a live classroom experience to the student's personal computer. These live, online appraisal courses have gained both International Distance Education Certification Center (IDECC) and Appraiser Qualification Board (AQB) approval and will be delivered in accordance with individual state regulations.

 

With all of the features of an onsite classroom and more, the courses feature a virtual classroom environment with audio, video, screen and document sharing, chat and other interactive elements, with instant access to required course materials. To aid with testing and engagement, the classes also include incremental assessment exams which are reviewed live by the instructors to ensure understanding. Courses include random individual student inquiries throughout the duration to verify student identity and engagement. In addition, students receive information on scheduling the proctored final exam for the course (if required).

"Moving through this digital age, the traditional classroom is shifting and a recent growth in online education is giving us the opportunity to transform the way we teach and deliver content," said Dave Shaut, vice president, CompuTaught. "These new live courses combine the trusted reliability of our computer-based real estate and appraisal education with the convenience of live instruction. We strive to continually evolve with our ever-changing customers and provide them with the most convenient and cost effective ways to work toward their real estate and appraisal education goals."

The NEXT course to be introduced, Statistics, Modeling and Finance, will be offered on Feb. 22 and Feb. 23, 2011.  The course will be led by Certified General Real Estate Appraisers and award-winning instructors Mark A. Munizzo and Lisa Virruso Musial.  This course comes at an important time for the industry, as Bradford Technologies' Appraisal Industry Predictions for 2011 indicate that certified residential appraisers and other real estate professionals are searching for courses on statistics, applied regression and advanced valuation skills to stay current or advance their career. 

Courses are IDECC, AQB and State approved and delivered online via WebEx.   For state specific information, click here http://www.careerwebschool.com/ , THEN click on Appraisal / Continuing Education on the right, THEN select your state.  On the next screen, click on the red "View Online Instructor-Led Courses" button. 

Main Features:

• 50 minute sessions w/breaks, 1hr for lunch
• WebEX with audio, video, and chat
• Textbook: eBook (PDF) and hard copy
• Quizzes reviewed live by the instructors
• Random individual student inquires throughout the course to verify student identity and engagement
• Information on scheduling the proctored final exam for the course, if required
• System Requirements: Broadband to Internet, speakers or headphones

"Many students operate under the false impression that online learning is inferior to a traditional classroom," said Sam Martin, educator, certified appraiser and creator of samthetutor.com. "In fact, according to a recent white paper from the U.S. Department of Education, online courses are just as effective as conventional classroom instruction, proving these new courses from CompuTaught as a convenient and interactive alternative for students who are seeking state approved education."

For more information on the new courses, CompuTaught's Educational Referral Network program or other online or computer-based courses offered, please visit www.computaught.com or www.cengage.com.

About CompuTaught

CompuTaught, part of Cengage Learning, is a market leader in the computer-based real estate learning market. In 1989, CompuTaught was the first in the country to offer state-approved real estate licensing courses on computer and continues to be the leading developer of computer-based education for the real estate and appraisal professions. It currently distributes its courses through more than 300 independent schools, with about 50,000 enrollments annually. For more information on CompuTaught, please visit www.computaught.com.

About Cengage Learning

Cengage Learning is a leading provider of innovative teaching, learning and research solutions for the academic, professional and library markets worldwide. The company's products and services are designed to foster academic excellence and professional development, increase student engagement and improve learning outcomes. Cengage Learning's brands include Heinle, Gale, Wadsworth, Delmar, Brooks/Cole and South-Western, among others. For more information on Cengage Learning please visit www.cengage.com

SOURCE Cengage Learning http://www.cengage.com

'Sustainable' Housing Price Recovery Not Shown in April Case/Schiller Home Price Index

According to the latest S&P/Case-Shiller Home Price Index, the annual growth rates of all 20 MSAs and the 10- and 20-City Composites improved in April compared to March because of the home buyer tax credit program that ended April 30, 2010.

New York, June 29, 2010 – Data through April 2010, released today by Standard & Poor’s for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show that annual growth rates of all 20 MSAs and the 10- and 20-City Composites improved in April compared to March 2010. The 10-City Composite is up 4.6% from where it was in April 2009, and the 20-City Composite is up 3.8% versus the same time last year. In addition, 18 of the 20 MSAs and both Composites saw improvement in prices as measured by April versus March monthly changes.

The chart above depicts the annual returns of the 10-City and 20-City Composite Home Price Indices with increases of 4.6% and 3.8%, respectively, in April 2010 compared to the same month last year. Of note, Dallas, Denver, San Diego and San Francisco have all posted six consecutive months of positive annual rates of return, recording +3.3%, +4.4%, +11.7% and +18.0% in April, respectively.

“Home price levels remain close to the April 2009 lows set by the S&P/Case Shiller 10- and 20-City Composite series. The April 2010 data for all 20 MSAs and the two Composites do show some improvement with higher annual increases than in March’s report. However, many of the gains are modest and somewhat concentrated in California. Moreover, nine of the 20 cities reached new lows at some time since the beginning of this year. The month-over-month figures were driven by the end of the Federal first-time home buyer tax credit program on April 30th. Eighteen cities saw month-to-month gains in April compared to six in the previous month. Miami and New York were the two that fared the worst in April compared to March. New York is the only MSA to have posted a new relative index low with April’s report.” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. 

“Other housing data confirm the large impact, and likely near-future pullback, of the federal program. Recently released data for May 2010 show sharp declines in existing and new home sales and housing starts. Inventory data and foreclosure activity have not shown any signs of improvement. Consistent and sustained boosts to economic growth from housing may have to wait to next year. ”

The chart above shows the index levels for the 10-City and 20-City Composite Indices. As of April 2010, average home prices across the United States are at similar levels to where they were in late summer/early autumn of 2003. From their peak in June/July of 2006 through the trough in April 2009, the 10-City Composite is down 33.5% and the 20-City Composite is down 32.6%. The peak-to-date figures through April 2010 are -30.5% and -30.0%, respectively. 

New York posted a new index low in April, as measured by the current housing cycle, where it peaked in June 2006. The peak-to-trough figure is -21.7%. Eighteen MSAs and both Composites showed monthover- month improvements in April. The 10- and 20-City Composites were up 0.7% and 0.8%, respectively. Eleven of the MSAs reported monthly increases of at least 1.0%. Miami and New York were down 0.8% and 0.3%, respectively. San Diego has now shown 12 consecutive months of positive returns. It is the only market that did not contract in the late winter months.

The S&P/Case-Shiller Home Price Indices are revised for the 24 prior months, based on the receipt of additional source data. More than 23 years of history for these data series is available, and can be accessed in full by going to http://www.homeprice.standardandpoors.com

Appraisal Scoop Authors to speak at ICAP Summer Seminars - July 7 and Aug 11

The Illinois Coalition of Appraisal Professionals (ICAP) is pleased to announce registration for the 2010 summer seminars is now available on-line at http://www.icapweb.com/education.php. As usual, two seminars will be held this summer. The first seminar will be held on July 7th in Springfield at the Crowne Plaza hotel. The second seminar will be held August 11th in Lisle at the Hilton hotel.

“We are extremely excited about the seminars this year. The committee did a fantastic job of selecting topics and speakers. The people in attendance are really going to enjoy the day and will find the seminar to be pertinent to their daily work as real estate appraisers”, said Randy Neff, seminar chair. "As is tradition of the seminars, Mr. Brian Weaver, IDFPR appraisal coordinator, will be the keynote speaker."

The seminars will be headlined by Mr. Patrick Egger of Las Vegas, NV and Mr. Anthony Young, of San Ramon, CA. Mr. Egger will speak on the importance of analyzing key economic indicators in projecting trends in the real estate market. Mr. Young will speak on graphing market trends and then incorporating the graphs into appraisal reports. Ms. Markie Lemons of Chicago will give a presentation on short sales. “ICAP seminars are not typical real estate appraiser CE seminars.

Here's a little more info on the speakers this year and their topics . . .

Patrick Egger is from Las Vegas. He is an appraiser, professional educator, and author of many articles on the Appraisal Scoop blog under the blog category "Outside The Boxes".  He speaks extensively about using key economic indicators to project housing market trends. Patrick is nationally known among appraisers through his participation on blogs, forums, and speaking engagements. Mr. Egger will be speaking about…

Market Analysis: What moves the market? Indicators, Ratios and Relationships.  

"It’s often said that an appraisal is merely a “snapshot in time”. While snapshots provide a glimpse of what’s happening, they’re like tombstones, telling the reader little more than born when, died when an who’s in the grave. Presenting a simple matrix of key indicators will turn a market glimpse into market perspective. The key to any report is how you communicate your observations and conclusions to someone reading that report. A simple matrix of key indicators will inform the reader on what is motivating the market and why. In turn, you can use the same matrix and indicators to logically support your conclusions in key sections of the report, such as market trends, adjustments and the reconciliation."

"Not only is the information readily available, it only needs to be updated monthly or quarterly; and it can be used with any type of report, transforming static snapshots into dynamic perspectives. Clients expect reasonable conclusions. They also require rational explanations and support for those conclusions. The Data tells us what happened, however it doesn’t tell us why it happened. This is where the matrix will help the appraiser and the reader comprehend where the market was, where it is now and what factors may determine where it is headed."

Another one of the ICAP guest speakers is Anthony Young. Anthony is an active appraiser from San Francisco. He is going to illustrate how to graph housing trends using excel and inserting them into appraisal reports.  Here's an example of one of his Appraisal Scoop articles.

Real Estate Trend Analysis and Graphing

Anthony Young is a Certified Residential Appraiser and principle of Young & Associates Real Estate Appraisal Company in San Ramon, California, where he specializes in the valuation of complex and "high-end" residential properties and housing market trend analysis.

He enjoys showing Real Estate professionals graphing and charting techniques for studying the buying behaviors to conclude adjustments in valuations and has developed a How-To-Do-Trend-Analysis DVD that teaches professionals to measure (and visually graph) the behavior of the Real Estate Marketplace over time and to provide supported and credible results within the appraisal report.

Both Patrick and Anthony will be speaking in the afternoon. The afternoon session will include a real estate agent from Chicago, also known as the foreclosure queen, and Brian Weaver from IDPFR.

Marki Lemons will give a presentation on short sales, what they are, how they impact the market, how price is negotiated and other fundamental items about short sales. She specializes in short sales and foreclosures.

Sounds like a great lineup this year!!!

ICAP is using the Appraisal Institutes online education platform to register for the 2010 summer seminars. This is the second year we have used this platform.

You will have to create a username and password before you can register for the course.

As an ICAP member, you will receive a $25.00 discount for the class if you use the following promo codes. These codes are case sensitive so please type them as they appear below.

Springfield Seminar July 7: icap7sf

Lisle Seminar August 11: icap11lisle

Click on the following link to register….DON’T DELAY!!!

http://www.icapweb.com/education.php  

103 Months to Clear "Real and Shadow" Housing Inventory? - Real Time Economics - WSJ

 103: The number of months it would take to sell off all the foreclosed homes in banks’ possession, plus all the homes likely to end up there over the next couple years, at the current rate of sales.

As of March, banks had an inventory of about 1.1 million foreclosed homes, up 20% from a year earlier, according to estimates from LPS Applied Analytics. Another 4.8 million mortgage holders were at least 60 days behind on their payments or in the foreclosure process, meaning their homes were well on their way to the inventory pile. That “shadow inventory” was up 30% from a year earlier.

 via blogs.wsj.com

Excess Inventory May Impede Housing Recovery: Fannie Mae

Although housing is beginning to stabilize, excess inventory and shadow supply may hinder continued recovery, according to the April 2010 Economic Outlook released Monday by Fannie Mae’s Economics & Mortgage Market Analysis Group.

via www.dsnews.com

Comprehensive Housing Market Analysis - Additional Data - via HUD USER

 HUD's Economic and Market Analysis Division prepares Comprehensive Housing Market Analysis that assist and guide HUD in its operations. The factual information, findings, and conclusions contained in the reports could also be useful to builders, mortgagees, and others concerned with local housing conditions and trends. 

For each analysis, HUD economists develop a factual framework based on information available, as of a particular date, from both local and national sources. 

Each analysis takes into consideration changes in the economic, demographic, and housing inventory characteristics of a specific housing market area during three periods: from 1990 to 2000, from 2000 to the as-of date of the analysis, and from the as-of date to a forecast date. 

The reports present counts and estimates of employment, population, households, and housing inventory.

via www.huduser.org

U.S. Monthly House Price Index Declines 0.6 Percent From December to January

WASHINGTON, DC – U.S. house prices fell 0.6 percent on a seasonally adjusted basis from December to January, according to the Federal Housing Finance Agency’s monthly House Price Index. The previously reported 1.6 percent decline in December was revised downward to a 2.0 percent decline. For the 12 months ending in January, U.S. prices fell 3.3 percent. The U.S. index is 13.2 percent below its April 2007 peak.

The FHFA monthly index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac. For the nine Census Divisions, seasonally adjusted monthly price changes from December to January ranged from –1.8 percent in the East North Central Division to + 2.0 percent in the Mountain Division.

Monthly index values and appreciation rate estimates for recent periods are provided in the table and graphs on the following pages. Click here for complete historical data.

For detailed information concerning the monthly HPI, please see the HPI Frequently Asked Questions (FAQ). The next release will be on April 22, 2010 and will include monthly data for February. The next release of FHFA’s quarterly HPI will be on May 25, 2010 and will include monthly data for March as well as data for the first quarter of 2010.

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The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. These government-sponsored enterprises provide more than $6.3 trillion in funding for the U.S. mortgage markets and financial institutions.