Home prices have been moving higher nationally according to the most recent reading of the S&P/Case-Shiller home price index. The index reports on prices nationally and for 20 major cities. The most recent report, which reported on home sales from May, showed improvement in all 20 cities that are tracked. Prices were up, or at least unchanged, from April. Collecting data on real estate transactions takes time to collect so the index is released with a two month delay. The state of the real estate market as it relates to prices, today Home owners in Chicago and Atlanta enjoyed the largest monthly increases. Prices were 4.5 percent higher in Chicago and up 4 percent in Atlanta. Home owners in Atlanta were probably very pleased with the data. That city has been especially hard hit in the ...

The California State Department of Real Estate (DRE) recently reported that it revoked a record number of real estate licenses in the last year. According to a press release from the DRE, the department also accepted a record-high number of license surrenders from agents facing disciplinary action. In total, during the twelve months ending June 30, 2012, 1,109 licenses were suspended, surrendered and revoked. The number of revocations jumped nearly 14 percent from the 686 revocation actions that were taken in the previous year. Suspensions increased by about 80 percent over the last year. License surrenders, which the department says “can occur when a licensee surrenders his or her license rights while a disciplinary action is pending,” were up 20 percent. The number of suspensions, su...

According to a recent article in the San Diego Union-Tribune, the real estate market in San Diego may have finally reached a bottom. “Re-sale’s of single-family homes in San Diego closed out an epic month in May,” according to one columnist. This assessment was then supported with some impressive data. The median sales price was up by 3.2 percent to $335,000 in May when compared with the median price a year ago. The median is the midpoint of the reported sales prices and is commonly used in reporting on the real estate market. Some homes sell for very high prices while others sell for very low prices, so the more commonly used average (or mean) price could be skewed dramatically by just a few sales. Other indications that San Diego real estate has hit a bottom In addition to prices, ...

If you think real estate is overpriced where you live, consider what buyers in Manhattan, in the heart of New York City, face. In the US, the median price of a previously-owned single-family home was $158,100 in March of this year, according to the National Association of Realtors. In Manhattan, the median price of an apartment is $625,000 for a one-bedroom and $1.2 million for a two-bedroom. Bloomberg recently offered some examples that highlight the choice New Yorkers face. “For $3,100 a month, a tenant can lease a 575-square-foot (53-square-meter) studio with a fireplace in a West Village prewar building, he [Jed Kolko, chief economist at the San Francisco- based property-data firm Miller Samuel] said, citing a recent rental agreement. That monthly payment could be used to purchase a ...

A few years ago, homes were considered investments and many people bought them expecting to enjoy rapid appreciation. Those days are gone and home buyers are rediscovering another reason to buy a home – they need somewhere to live and buying can be more affordable than renting for most, especially given recent trends in rental prices. According to a recent article in the San Diego Union-Tribune, rents in San Diego County are rising as prospective renters are facing increased competition for apartments. The rental market has become more competitive because home buying has become a more difficult process. The need for a larger down payment and tighter credit standards has excluded many from the real estate market. Others have chosen to rent because they are concerned that home prices could...

In June 2006, Mark Kiesel, a managing director at Pacific Investment Management Co. (PIMCO), said that, “Housing is the next NASDAQ bubble. It’s not just houses that will be for sale. You’re going to see financial assets for sale over time, and ultimately corporate bonds.” He spoke just one month before home prices in the US peaked according to the S&P/Case-Shiller Index of Values in 20 cities. Kiesel believed in his forecast so strongly that he followed his own advice and sold his home in 2006. Now he’s a buyer and recently bought a home in Newport Beach, CA, near the headquarters of the firm he works for. PIMCO manages more than $1.75 trillion in assets. The company has some of the brightest minds in finance on their team. Bill Gross, the company’s co-founder, is wide...

Home prices follow the economic laws of supply and demand. As supply drops the prices of homes should go up, and as prices rise the number of new homes being built should move up. Given the big drop in home prices in recent years, to see a healthy market recovery, the number of new homes should grow slowly allowing prices to stabilize. The latest news on housing starts points towards a healthier housing market. In February, home builders across the nation broke ground on 698,000 new homes (based on an annual rate). This was in lime mostly with what economists surveyed by Bloomberg News expected. Economists are typically off with their estimates because forecasting the economy is a very difficult task. That means it is possible to gain valuable insights from how wrong their estimates are. W...

While changing diapers in the middle of the night, many parents dream of the day their day baby will grow up and have a home of their own. Few parents spent those sleepless nights dreaming of having to change the batteries in a video game remote control for their adult child. But it has become more and more common for adult children to live with their parents, and retirees are often caring for their children later in life. A growing percentage of adults are living with their parents all around the world. In Italy, they are often called “mammismo” or “mamma’s boys.” According to a recent article in The Fiscal Times, 37 percent of men in Italy who are 30 years old have never lived away from home. In Japan, these young adults seem to be viewed less favorably, often called “parasit...

Recently, the University of San Diego hosted its annual round table of local economists to discuss the year ahead. In general, the experts seem to believe that there will be slow but steady economic growth in our area, largely mirroring what economists expect to see at the national level. The best news may be from Point Loma Nazarene University economist Lynn Reaser who said that she believes San Diego would probably lead both the nation and the state of California in the recovery. She believes this because of our region’s concentration in innovative fields like high-tech and biotech. Unfortunately, she thinks that the county probably will not recover all of the jobs it lost during the recession until 2015. What economists are saying about the housing market in San Diego Recovery in the ...

Nationally, economic data is sending mixed signals. Unemployment is down, inflation is up and home prices are stable. Many of these same data points are available for individual cities. The trend in San Diego is the generally the same as national trends with no clear picture of growth emerging. At the national level: Unemployment fell to 8.6 percent in November. This was the first time the number was below 9 percent since March 2011, and a decline in unemployment is good news for the economy. In San Diego: The unemployment rate fell to 9.7 percent in October (the most recent data available). It peaked at 10.8 percent in March 2010 and has been above 10 percent in 15 of the 19 months since then. As with the national rate, any good news is welcome and there is at least a hope that this is ...