Tweet this: September home price growth spreads to all 42 reported markets in @DataQuick’s #PIR, but is growing at unsustainable pace
SAN DIEGO, – October 25, 2013 – (RealEstateRama) — DataQuick®, a provider of advanced real estate information solutions powered by data, analytics and decisioning announced that home price growth resumed at a rapid rate in September and spread to all 42 reported markets. The increase comes after overall prices decreased during the summer months of July and August.
Aside from the brief summer pause, home price growth has spread consistently across the country over the last 12 to 18 months, as all reported markets are experiencing growth in excess of their long term average. According to Gordon Crawford, Ph.D. and vice president of analytics for DataQuick, this steady increase in home prices should have some immediate implications on various areas of the housing market.
“We expect that the home price growth we have experienced as of late will begin to affect multiple areas of the housing landscape,” Crawford said. “Some immediate implications to look for include an increase in home price listings and overall sales as homeowners with negative equity are gradually swept toward a position of positive equity, a decrease in foreclosures as homeowners have the equity to sell and avoid default, and an increase in demand for home equity lines of credit as borrowers look to tap into increased equity from home price growth.”
Other consequences of increases in home prices include continued single-family rental demand driven by decreases in home affordability, sustained risk of home price corrections and stringent mortgage credit standards, and an increase in purchases by investors driven by continued rental demand and tight credit standards.
Though positive now, Crawford warns that current elevated home price growth rates cannot continue without increased risk of a substantial correction.
“This rate of growth is spreading at an unsustainable pace as it is not supported by the underlying economic fundamentals,” Crawford added. “For example, home price growth for the last year ranges from a minimum of just under 4.5 percent in Suffolk County, New York to a maximum of more than 31.0 percent in Sacramento, California; with an average across markets of roughly 16 percent. In the past, moderate economic fundamentals have supported long term home price growth rates of three to four percent respectively. While generally positive, current economic drivers are weaker than those experienced in most previous expansions, leading to considerable uncertainty about future economic prospects.”
DataQuick’s monthly Property Intelligence Report (PIR) leverages its national property database and analytics expertise to assess 42 of the largest counties in the United States using valuation trends, REO inventory trends and sales trends metrics. Other key findings for September include:
· Home price growth was positive in all of the 42 reported counties over the last month, quarter, and year
· Sales increased in 26 of the 42 reported counties over the last month
· Sales increased in 28 of the 42 reported counties over the last quarter
· Sales increased in 29 of the 42 reported counties over the last year
· Foreclosures decreased in 24 of the 42 reported counties over the last month
· Foreclosures decreased in 26 of the 42 reported counties over the last quarter
· Foreclosures decreased in 24 of the 42 reported counties over the last year
San Diego-based DataQuick, a Decision Insight Information Group company, delivers advanced information solutions powered by higher quality data, innovative analytics and automated decisioning across a national footprint. The company drives better decision making and improved profitability for the real estate, mortgage lending and secondary investor markets. DataQuick’s integrated solutions include property data and analytics, appraisals and non-appraisal evaluations, flood determinations, mortgage credit reports, automated valuation models, automated decisioning software, Title insurance and property information, property research portals and marketing tools. For more information, visit the company’s website at www.dataquick.com, on LinkedIn or on Twitter at @DataQuick.
About Decision Insight Information Group
Decision Insight Information Group, located in the U.S., Canada and Europe, delivers a comprehensive range of information, infrastructure and decision support products and services for financial and legal professionals. Operating at the heart of the property industry, Decision Insight Information Group manages complex information solutions and provides clarity on decision making for buying, selling, conveyancing, financing and insurance. Decision Insight Information Group companies include MSB and DataQuick in the U.S., Access Point Information Canada, SearchFlow, xit2 and Decision Insight Hub in the UK, Millar & Bryce in Scotland, Rochford Brady Group in the Republic of Ireland, Wertweiser, a joint venture with HVB Bank, in Germany, and Decision First, a joint venture with First Title, in the UK. Decision Insight Information Group has 1,100 employees in 16 offices. For more information, visit www.decisioninsightgroup.com. Decision Insight Information Group is a TPG Capital portfolio company.