All the Real Estate News That’s Fit to RE-Print™
Welcome to our weekly edition of Real Estate Investing News This Week. Highlights this week include:
- Widespread Slowdown in Home Price Gains
- Foreclosure Inventory Down 33%
- Best Markets for Buying Rental Properties
- Distressed Homes Sold At Less Than Half Price in 8 States
- Distressed Sales: Only 11% of Total Home Sales in July
We hope these real estate news items help you stay up-to-date with your real estate investing strategies and inspire some profitable real estate deals for you.
The S&P/Case-Shiller Home Price Indices show a sustained slowdown in price increases.
The National Index gained 6.2% in the 12 months ending June 2014 while the 10-City and 20-City Composites gained 8.1%.
All three indices saw their rates slow considerably from last month. Every city saw its year-over-year return worsen.
“Home price gains continue to ease as they have since last fall,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “For the first time since February 2008, all cities showed lower annual rates than the previous month.
Other housing indicators – starts, existing home sales and builders’ sentiment – are positive. Taken together, these point to a more normal housing sector.”
On Thursday, CoreLogic reported that the national foreclosure inventory fell by 33 percent year over year in August 2014 to approximately 629,000 homes, or 1.6 percent of all homes with a mortgage.
That’s down from 936,000, or 2.4 percent, in August 2013.
This marks 34 months of continuous year-over-year declines in the inventory of foreclosed homes, including 19 straight months of declines greater than 20 percent.
On Thursday, RealtyTrac® released its Q3 2014 Residential Property Rental Report, which ranks the best markets for buying residential rental properties.
Top 10 markets for rental returns
Edgecombe County, N.C., in the Rocky Mount metro area had the highest annual gross rental yield among the 586 counties analyzed, 41.57 percent, followed by Clayton County, Ga., in the Atlanta metro area (26.88 percent annual gross rental yield), Duplin County, N.C., (24.40 percent annual gross rental yield), Howard County, Ind., in the Kokomo metro area (24.00 percent), and Putnam County, Fla., in the Palatka metro area.
The remainder of the top 10 markets included three other Florida counties (Columbia, Pasco and Hernando) along with another Atlanta-area county (Spalding) and Wayne County, Mich., in the Detroit metro area.
10 markets with lowest rental returns
New York County, N.Y. (Manhattan) ranked lowest among the 586 counties with an annual gross rental yield of 2.40 percent, followed by San Francisco County (3.16 percent annual gross rental yield), Kings County, N.Y. (Brooklyn, 3.64 percent), Williamson County, Tenn., in the Nashville metro area (3.73 percent), and Marin County, Calif., also in the San Francisco metro area (3.75 percent).
The remainder of the bottom 10 markets for annual gross rental yield included three other Northern California counties (Santa Clara, San Mateo and Santa Cruz), along with Westchester County in the New York City metro area and Eagle County, Colo., in the Edwards metro area.
16 Safe Havens for Single Family Rentals
RealtyTrac identified 16 counties as safe havens for single family rental investing. In these counties the unemployment rate was below the national average of 6.2 percent in July and the rental vacancy rate was below the national average of 8.7 percent as of the end of 2012, but all these counties also had an annual gross rental yield of 10 percent or higher.
The top five safe haven markets were Clark County, Ohio in the Springfield metro area (14.17 percent annual gross rental yield), Pottawatomie County, Okla., in the Shawnee metro area (13.50 percent), Broward County, Fla., in the Miami metro area (12.99 percent), Creek County, Okla., in the Tulsa metro area (12.93 percent) and Belmont County, Ohio in the Wheeling, WV-OH metro area (12.05 percent).
Other metros with counties in the safe haven list include Auburn, N.Y., Chicago, Ill., Lima, Ohio, Pittsburgh, Pa., Washington D.C., Albany, N.Y., Little Rock, Ark., Columbia S.C. and Elkhart, Ind.
16 High-Risk, High-Yield Hotspots for Single Family Rentals
RealtyTrac identified 16 counties as high-risk, high-yield hot spots for single family rental investing. In these counties the unemployment rate was above the national average of 6.2 percent in July 2014 and the rental vacancy rate was above the national average of 8.7 percent as of the end of 2012, but all these counties had an annual gross rental yield of 14 percent or higher.
Topping the high risk, high yield hotspots were Edgecombe, N.C. in the Rocky Mount metro area (41.57 percent annual gross rental yield), Clayton and Spalding counties in the Atlanta metro area (26.88 percent and 20.35 percent), Duplin County, N.C. (24.40 percent) and Wayne County, Mich., in the Detroit metro area (19.88 percent).
Other metro areas with counties on the high risk, high yield list included Lake City, Fla., Tampa, Fla., Sebring, Fla., Baltimore Md., Syracuse, N.Y., Vineland, N.J., Lancaster, S.C., Hickory, N.C., Gaffney, S.C., Mobile, Ala., and Macon, Ga.
By Brian Honea, DSNews.com
“Eight states reported a median sales price for distressed homes at less than half the sales price of non-distressed homes in August, according to a report recently released by RealtyTrac….
Distressed sales accounted for 13.5 percent of all single-family residential home sales in the U.S. in August, according to RealtyTrac….
Nationwide, distressed homes were sold at an average discount of 37 percent compared with the median sales price of non-distressed homes for August, which RealtyTrac reported at $205,000.
The eight states in which distressed homes were sold at a discount of more than 50 percent were, according to the RealtyTrac report: West Virginia (66 percent, $44,500); Vermont (64%, $77,099); Michigan (61 percent, $53,000); Wisconsin (56 percent, $73,100); Pennsylvania (55 percent, $70,375), Ohio (55 percent, $61,000), Oklahoma (54 percent, $62,000), and Kentucky (52 percent, $60,000).
All 50 states and the District of Columbia reported a distressed home sales discount of at least 22 percent, according to RealtyTrac. The two states that tied for the lowest distressed home price discount with 22 percent were Arizona ($142,600) and Nevada ($142,000).”
Distressed sales (REO and short sales) accounted for 11.1 percent of total home sales in July 2014. That’s the lowest share since December 2007 and a strong improvement from the same time a year ago when this category made up 15.5 percent of total sales.
REO sales made up 7.1 percent of total home sales, and short sales made up 4 percent of total sales in July.
At its peak, the distressed sales share totaled 32.5 percent of all sales in January 2009, with REO sales making up 28 percent of that share.