US Real Estate Update

The data also shows that total housing inventory at the end of December dropped 12.3 per cent to 1.79 million existing homes available for sale, and is now 3.8 per cent lower than a year ago. Unsold inventory is at a 3.9 month supply at the current sales pace, down from 5.1 months in November and the lowest since January 2005 when it was 3.6 months.

National Association of Realtors

Although some growth is expected, the housing market will struggle in 2016 to replicate last year’s 7 per cent increase in sales. In addition to insufficient supply levels, the overall pace of sales this year will be constricted by tepid economic expansion, rising mortgage rates and decreasing demand for buying in oil-producing metro areas,” said Lawrence Yun, NAR chief economist.

First Time Buyers

The share of first time buyers was at 32 per cent in December, matching the highest share since August, up from 30 per cent in November and 29 per cent a year ago. First time buyers in all of 2015 represented an average of 30 per cent, up from 29 per cent in both 2014 and 2013. A separate NAR survey from the NAR revealed that the annual share of first time buyers in 2015 was at its lowest level in nearly three decades.

All Cash Sales

All-cash sales were 24 per cent of sales in December, down from 27 per cent in November and are down from 26 per cent a year ago. Individual investors, who account for many cash sales, purchased 15 per cent of homes in December, down from both 16 per cent in November and 17 per cent a year ago. Some 64 per cent of investors paid cash in December.

Properties typically stayed on the market for 58 days in December, an increase from 54 days in November but below the 66 days in December 2014. Short sales were on the market the longest at a median of 86 days in December, while foreclosures sold in 68 days and non-distressed homes took 57 days while 32 per cent of homes sold in December were on the market for less than a month.



Foreclosures sold for an average dis- count of 16 per cent below market value in December compared to 15 per cent in November, while short sales were discounted 15 per cent, unchanged from November.

A breakdown of the data shows that single family home sales jumped 16.1 per cent to a seasonally adjusted annual rate of 4.82 million in December from 4.15 million in November, and are now 7.1 per cent higher than a year ago. The median existing single family home price was US$226,000 in December, up 8 per cent from December 2014.

Underwater Mortgages

RealtyTrac’s full-year US Home Equity & Underwater Report, re- leased Thursday, shows that as of the end of 2015 there were 6.4 million US properties seriously under- water — where the combined loan amount secured by the property is at least 25 per cent higher than the property’s estimated market value — representing 11.5 per cent of all properties with a mortgage.

The year-end 2015 seriously underwater properties were down 481,292, from 6.9 million, representing 12.7 per cent of all proper– ties with a mortgage at the end of 3Q 2015, and down 616,189 from 7.1 million, representing 12.7 per cent of all properties with a mortgage at the end of 2014. The number of seriously underwater proper- ties at the end of 2015 was half the 12.8 million, representing 28.6 per cent of all properties with a mortgage in Q2 2012, the peak for seriously underwater properties.