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Welcome to our blog! Check back here often to get the latest in local and national real estate news, statistics, and discussions. Click here to subscribe to our RSS Feed.

Housing Market Continues Recovery

The National Association of Realtors® reported February 2012 homes sales of 4.59 million on a seasonally-adjusted annualized rate—a gain of 8.8 percent when compared to February 2011.  That’s really good news for the housing market since home prices typically follow the trajectory of sales numbers, although lagging 18 to 24 months.   Dr. Ted C. Jones provides the following graphs and analysis based on NAR’s recent release.

Finally, some solid, good news for the national housing market not created by an artificial tax stimulus.

To remove the seasonality noise from the data, the following table shows a 12-month moving average of existing home sales.  Focus on the rising sales numbers in the red circle below and realize that the market indeed is recovering.  Existing home sales on a 12-month moving average basis have now increased in six of the past seven months.

Home values may have finally stabilized, after declining almost 27 percent from the peak in July 2006. This now makes three months that prices (on a 12 month moving average) have remained static.  I am calling a bottom to the housing market at this time.

While home sales and prices are far off of the 2002 levels (which I consider normal given that period was following the 2001 recession and prior to the stupidity of subprime lending which caused the bubble), sales numbers are finally increasing and prices have stabilized.  I truly believe that housing has turned the corner to recovery—and that is great news.

To read the entire NAR press release, click: http://www.realtor.org/press_room/news_releases/2012/03/ehs_feb

Beverly Kerr from the Austin Chamber of Commerce provides a powerful analysis Austin’s continued growth in creating jobs. While Austin turned in a solid performance for 2011 with 12,600 new jobs, it’s growth rate over the last 12 months through the end of January versus the same time last year was a whopping 3.5%, second highest in the nation out of the top 50 metros. Read full report.


On February 27, 2012, the FHA announced mortgages backed by FHA will soon see a rise in fees. In particular, FHA will increase two fees that borrowers pay. Starting April 1, it will increase its annual mortgage insurance premium for all loans by 10 basis points (.10 percent), bringing the total cost from 1.15 percent of the loan amount to 1.25 percent. Starting June 1, loans above $625,500 premiums will see an increase of an additional 0.25 percent of a percentage point, bringing the total premium costs up to 1.5 percent of the loan amount. Click here to read more...

Recently Angelos Angelou reported that Venture Capital Investment increased for 2011 to 637 million for a 75% increase. This morning, the ABJ reports that Austin beat out Seattle to become the Number 2 market for Tech Startup Jobs!  Seattle had higher median salary but Austin had more jobs.  VC money flows to markets with entrepreneurs and a high tech labor pool – and Austin is a great fit for both.

Click here for full article.

 

Remodeling Magazine has released the 2011-2012 study analyzing which remodeling projects have the best payoff for homeowners.  This report is must-have information to homeowners, appraisers, Realtors® and real estate agents that are listing homes for sale.  Even better, the information is available via a free iPhone/iPad APP (Search for “Remodeling” in the App Store)

The study looks at the various value added of mid-range and up-scale projects, with the typical costs and value added as follows:

Remodeling Cost vs. Value Report 2011-2012



Resale Cost
Mid-Range Projects Job Cost Value Recouped
Attic Bedroom $51,428 $37,142 72.2%
Backup Power Generator $14,718 $7,136 48.5%
Basement Remodel $64,519 $45,186 70.0%
Bathroom Addition $40,710 $21,695 53.3%
Bathroom Remodel $16,634 $10,668 64.1%
Deck Addition (composite) $15,620 $10,337 66.2%
Deck Addition (wood) $10,973 $7,986 72.8%
Entry Door Replacement (fiberglass) $3,576 $2,147 60.0%
Entry Door Replacement (steel) $1,218 $1,243 102.1%
Family Room Addition $85,740 $53,624 62.5%
Garage Addition $60,608 $35,876 59.2%
Garage Door Replacement $1,291 $1,083 83.9%
Home Office Remodel $28,888 $13,235 45.8%
Major Kitchen Remodel $58,367 $40,126 68.7%
Master Suite Addition $108,090 $68,146 63.0%
Minor Kitchen Remodel $21,695 $15,790 72.8%
Roofing Replacement $21,488 $12,780 59.5%
Siding Replacement (vinyl) $11,357 $8,223 72.4%
Sunroom Addition $75,224 $36,540 48.6%
Two-Story Addition $165,243 $107,338 65.0%
Window Replacement (vinyl) $11,066 $7,920 71.6%
Window Replacement (wood) $12,027 $8,707 72.4%

 



Resale Cost
Up-Scale Projects Job Cost Value Recouped
Bathroom Addition $78,409 $41,562 53.0%
Bathroom Remodel $53,759 $30,738 57.2%
Deck Addition (composite) $38,382 $22,154 57.7%
Garage Addition $90,053 $48,278 53.6%
Garage Door Replacement $3,545 $2,476 69.8%
Grand Entrance (fiberglass) $7,700 $4,979 64.7%
Major Kitchen Remodel $113,464 $67,746 59.7%
Master Suite Addition $232,062 $122,370 52.7%
Roofing Replacement $38,022 $21,120 55.5%
Siding Replacement (fiber-cement) $13,382 $10,707 80.0%
Siding Replacement (foam-backed vinyl) $13,973 $10,119 72.4%
Window Replacement (vinyl) $14,284 $10,368 72.6%
Window Replacement (wood) $18,226 $12,303 67.5%

Source:  Remodeling Magazine
http://www.remodeling.hw.net/remodeling-market-data/about-the-report.aspx