Thursday, April 30, 2009

S&P/Case-Shiller: February 2009 report

The S&P/Case-Shiller Home Price Indices report for February 2009 was released two days ago. Although prices continue to decline, the report says "the pace of the decline in residential real estate prices slowed in February."

"...shows continued broad based declines in the prices of existing single family homes across the United States, with 10 of the 20 metro areas showing record rates of annual decline, and 15 reporting declines in excess of 10% versus February 2008. For the first time in 16 months, however, the annual decline of the 10-City and 20-City composites did not set a new record."

“While the declines in residential real estate continued into February, we witnessed some deceleration in the rate of decline in some of the markets,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “All 20 metro areas recorded a monthly decline in February, but 16 of the 20 metro areas saw an improvement in their monthly returns compared to January. Nine of the 20 metro areas showed improvement in their annual returns compared to their returns in January. Furthermore, this is the first month since October 2007 where the 10- and 20-City Composites did not post a record annual decline. We will certainly need a few more months of data before we can determine if home prices are finally turning around.”

Unfortunately, the DC area's market was not one of the 16 metro areas showing improvement in monthly returns. YoY, prices fell 19.19% and, from January to February, prices declined 2.3%. The DC area's home price index is close to that of February 2004.

The charts below reflect home price data for the Washington, DC MSA.



Monday, April 27, 2009

District Sales: February 2009 [preliminary]

I've finally begun working on District sales data for February 2009. Please forgive the delay, work and house buying have taken all my spare cycles.

Analysis forthcoming.

Wednesday, April 15, 2009

Meet the Gazillionaire

There've been a number of articles about the sale I mentioned in my last post. The property was sold to this fellow for $7.295MM. With a living area of 4415 sq ft [$1652/sq ft], the condo has 4 bedrooms, 5.5 bathrooms. The previous owner bought it for $4.5MM in December 2005. Whowuzat?

Car mogul Jamie Darvish bought a four-bedroom, six-bathroom penthouse apartment at the Ritz-Carlton in Georgetown for $4.5 million. The apartment listed for $6 million and has a master bedroom with a wall of windows overlooking the Potomac as well as a private terrace. Darvish, whose father, John Darvish, founded Darcars Automotive Group, is general manager of his family’s company.

It turns out a mere bazillionaire bought a unit in the same building for $4.6MM in March, too.

In terms of dollar volume, these two sales represent 13% of condo sales and 5.86% of all sales in March. Removing the gazillionaire and bazillionaire condos from the analysis, it turns out dollar volume for condos was up a slight 1.25% YoY and the average price for condos was up 14.2%.

Monday, April 13, 2009

MRIS March 2009 Housing Report: The Gazillionaire Effect

Last week MRIS released its data for signed sales contracts for existing home and condos in the District during March 2009. I have to say it was an odd month. As you can see below, all metrics - save transaction volume - were negative.

When you look at the data, you'd think there's a sudden boomlet in condo sales since MRIS' data show a 16.37% increase in dollar volume and an almost 30% increase in average sales prices for that market. However, a little investigation showed that ten condos sold for more than $1MM; two cost between $2.5-5MM and one sold for more than $5MM. The latter, located at the Georgetown Ritz-Carlton, sold for $7.295MM and was the subject of a story by my buddies at UrbanTurf. Since MRIS' data aren't granular enough for detailed analysis, it's difficult to determine the degree to which these particular sales skewed the market. At least until I analyze the District's sales data. Since the Ritz-Carlton sale clouds an effective analysis of the month's sales using MRIS data, I declare the month null and void thanks to the Gazillionare Effect.

What I'm seeing in March's data:

  • More homes sold [up 14.21%], but at lower prices [down 26.04%], so overall dollar volume was 15.52% lower. Nineteen homes sold for more than $1MM.
  • YoY, condo unit sales fell 10.34% and average prices rose 29.79%, which is is questionable thanks to the gazillionaire's purchase at the Ritz.
  • Based on March's sales volume, there is a 9.07 month inventory of condos listed [a huge 43.76% decrease from February] and 9 month's supply for homes [a 25.04% decrease]. Compared to February 2008, the number of condos listed is up 1.98%, while home listings grew 8.14%.

I wonder what the condo fee is at the Ritz-Carlton.

Detailed Data

Average Sales Price

Dollar Volume

Transaction Volume

Friday, April 10, 2009

MRIS March 2009 Sales Report: Preliminary data

Today, MRIS released March's data for sales of existing homes in the District. Although the market isn't improving, its precipitous decline has slackened, at least for now. Key points [YoY]:

  • Dollar volume down 3.6%
  • Average price is down 5.05%, median is down 6.13%
  • Unit sales volume [aggregate] up 1.53%
  • Home unit sales up 14.2%
  • Condo unit sales down 10.3%

Sales prices were 91.81% of list, much better than the previous two months. At March's sales rate, the condo market has a 9 month supply listed for sale, a significant improvement.

My own experience during la chasse has been that, for the most part, homes that are in move-in condition and are priced right move quickly. Otherwise, they sit on the market and experience the joys of periodic price reductions of up to $80K at a pop [the $400K price reduction yesterday of 2501 Wisconsin Ave NW #403 was quite spectacular].

Analysis forthcoming after a quick trip to Kansas to see the grandkids [and their parents].

Thursday, April 09, 2009

Schadenfreude

Some of you may remember this golden oldie. It discussed the increasing difficulty Wall Streeters were having in obtaining mortgages for Manhattan apartments. Among the gems was this statement from a NYC real estate professional:

The problems facing buyers from Wall Street won’t necessarily cause Manhattan apartment prices to slide drastically, said Diane M. Ramirez, the president of Halstead Property, though they could result in slightly less competition for properties and prompt more sellers to negotiate.

Talk about a blown call. From today's NY Times:

...the Manhattan real estate market has just begun a steep slide. It parallels the decline in New York’s financial services industry, and housing analysts say it may continue long after other markets heal.

...housing analysts are predicting a prolonged slump in prices and sales that could last as long as four or five years.

In this year’s first quarter, sales of co-ops and condominiums in Manhattan plunged nearly 60 percent from the first quarter of 2008. Average co-op prices fell as much as 24 percent in the same period, according to various market reports released last week.

How far may prices fall?

[Jonathan J. Miller, an appraiser who prepares quarterly reports on Manhattan] said that during the last big real estate downturn, ... studio apartments were so cheap that he considered buying one on a credit card...

What's in your wallet?

Wednesday, April 08, 2009

District Sales: January 2009

I've completed my analysis of January 2009 sales of homes and condos, as recorded by the District. Compared to the last two analyses I performed, this was a piece of cake - only 432 sales to process. The table below shows January 2009 average and median sales prices and unit volume by zip code and the percentage change from January 2008.

By my count, 75 recorded sales - 17.36% of the month's transactions - were foreclosures; Fannie Mae, Deutsche Bank, and HSBC were among the lucky "buyers".

The following table shows the change in prices and sales volume for each District neighborhood; few were in the black for the month. YoY, dollar volume fell by $62.2MM and 59 fewer units sold.

State of the Market

In January the District recorded 432 residential sales. The average sales price fell 15.97% and the median sales price fell 14.95%. The condo market was decked: unit sales were down 39.57% YoY and dollar volume tumbled 42.55%. Condo prices fell, too.The number of homes sold soared 23.94% and dollar volume was similarly positive, up 21.43%. However, average and median sales prices for homes fell 27.56% and 30.06%, respectively. Sixty of the foreclosures were of single family homes, which may explain the opposing direction of prices and volume.

Wards 3 and 6 had a positive month, experiencing price increases despite a precipitous fall in unit volume.

Condo sales ruled Wards 1, 2, and 6, constituting 59.18%, 76.79%, and 54.44% of units sold, respectively.

Distribution of Sales

The chart below shows the distribution of January's recorded sales by sales price.

Download the Data

You can download a listing of the District's January 2009 home and condo sales discussed in this post for $2.50. Information in the listing includes [see below]:

  • Address
  • Sale price and sale date
  • Unit number [if a condo and if available]
  • Price per square foot
  • Square footage
  • The number of bedrooms and baths for each unit

Note: Data may not be available for all properties. My analysis is dependent upon the completeness and fidelity of the District's appraisal data.

January 2009 Sales ListingsAdd to Cart

Detailed Data

Sales by Neighborhood

Category by Zip Code


Category by Ward

Disclaimer:

  • Unlike MRIS, my data and analyses include new units [primarily condos] so there will be some differences in my conclusions about the market's state compared to a similar analysis based solely on MRIS reports, which only report sales of existing units sold and/or listed by real estate agents.
  • This analysis is of sales recorded by the District during the month as opposed to sales settled in the month, which is what MRIS reports, so there may be some discrepancies because of timing issues. However, I believe the data do provide a helpful indicator of trends in the District.
  • Sales may have been recorded by the District's Recorder of Deed during the month yet may not appear in the District's real property sales database, my data source, many months later. Consequently, those sales will not be in the month's analysis.
  • My analysis is based on District sales and appraisal data that I've collected and processed. I've deleted those sales that appear to be of questionable data quality. Errors are always possible.
  • My analysis is limited to condos and single family homes; I omit properties the District classifies as multifamily conversions. I'm sure I'm excluding some properties that are legitimate single family homes, but I want to eliminate uncertainty.

Monday, April 06, 2009

Whee!

I know how Snoopy feels! I just found out that the Washingtonian [see page 2] has named this one of the best blogs in DC.

What follows are some of the Web sites that make us enjoy living in the area even more—from great new voices and observations about Washington to resources that make it easier to work, live, and play here.

Hit it, Schroeder!

Wednesday, April 01, 2009

S&P/Case-Shiller: January 2009 report

The S&P/Case-Shiller Home Price Indices report for January 2009 was released two days ago. The headline says it all: "The New Year Didn’t Change the Downward Spiral of Residential Real Estate Prices"

"Home prices, which peaked in mid-2006, continued their decline in 2009,” says David M. Blitzer, Chairman of the Index committee at Standard & Poor’s. “There are very few bright spots that one can see in the data. Most of the nation appears to remain on a downward path, with all of the 20 metro areas reporting annual declines, and nine of the MSA’s falling more than 20% in the last year. Indeed, the two composites are very close to that rate and have been reporting consecutive annual record declines since October 2007. The monthly data follows a similar trend, with the 10-City and 20-City Composite showing thirty consecutive months of negative returns."

The DC area's market continues to decline; YoY, prices fell 19.34%. Prices fell 2.48% from December to January. The DC area's home price index continues its backwards march; it's now about equal to that of February 2004. While you may think that's awful, it's worse elsewhere:

As of January 2009, average home prices across the United States are at similar levels to what they were in late 2003. From the peak in the second quarter of 2006, the 10-City Composite is down 30.2% and the 20-City Composite is down 29.1%.

...Seven metro areas and the 20-City Composite recorded a record monthly decline in January. In addition, seven metro areas (not always the same seven) reported declines in excess of 4% in the month of January alone. Phoenix led with a report of -5.5%. Every MSA has had at least five consecutive months of decline, dating back to September 2008.

The charts below reflect home price data for the Washington, DC MSA.