Home Sellers See Highest Price Gains in Years

Most home sellers are seeing plenty of equity when selling their home. In March, sellers on average sold for $30,500 more than what they had paid for their home – a 17 percent gain, according to RealtyTrac’s March and First Quarter 2016 Home Sales Report. That marks the highest average price gain for sellers in any month since December 2007, the onset of the Great Recession.

“Home sellers in many markets are now seeing average price gains close to or above what home sellers experienced during the last housing boom,” says Daren Blomquist, RealtyTrac senior vice president. “That should encourage more home owners to take advantage of the prime seller’s market and list their homes for sale this year.”

Source: RealtyTrac

Advantage: Home Buyers?

The residential real estate market has “clearly shifted in favor of buyers,” says Jonathan Smoke, realtor.com®’s chief economist, in his latest analysis of housing data from the first three weeks of September.

“Would-be buyers have struggled to find a home all year, but now inventory is nearly as high as it has been all throughout 2015, and it isn’t moving as quickly,” Smoke says. “Likewise, price appreciation remains above normal levels but has declined from the higher pace of the spring and summer.”

Homes have been selling more slowly in September, which might make sellers more willing to negotiate on the price or other concessions, realtor.com®’s report notes.

“Sellers should have reasonable expectations for prices and be more patient during the fall,” Smoke says in his latest report. “But both buyers and sellers should be encouraged by a market that continues to see healthy gains in transactions over last year.”

Source: “The 20 Hottest Markets in September 2015,” realtor.com® (Sept. 29, 2015)

For Those Who Held On, ‘Equity Has Returned’

Home prices surged 11.3 percent this year compared to 2012, the latest housing data by the National Association of REALTORS® shows. A rise in home prices has pulled more home owners out from underwater with the return of equity this year, NAR notes.

On NAR’s Economists’ Outlook blog, researchers explain that a borrower who bought a median-priced home in 2004 and held it for nine years – the average tenure in a home – would now have $28,114 in equity (includes combined price appreciation and paying down mortgage principle).

A home owner who purchased a median priced home in 2012 would have more than $23,000 in equity, according to NAR research.

Home owners who purchased in 2006  and 2007 – during the peak of the market – have faced the biggest falls in home prices, but NAR researchers note they are “nearly in positive equity” territory. A home owner who bought a home in 2006, for example, and owned through 2012 would have been underwater by about $28,200. However, by this year, that downfall has lessened to $4,700. Home owners who bought since 2007 are mostly in positive equity, according to NAR research.

A study released last week by CoreLogic showed that more home owners were regaining equity. About 13 percent of all homes with a mortgage remain in negative equity by the end of the third quarter, compared to 14.7 percent who stood in negative equity at the end of the second quarter.

Source: “Housing Equity 2013,” National Association of REALTORS® Economists’ Outlook Blog (Dec. 20, 2013)