Concerns about rising mortgage rates, which spiked in to the mid-4 percent range in just the past week, have dampened expectations for home price gains this summer. Analysts also worry that prices are rising too fast, far faster than income growth, and will soon price too many potential buyers out of the housing market.

“Today’s Case-Shiller numbers may reflect where the housing market has been in some of the frothier metros, but they are not indicative of where it’s headed,” said Zillow’s chief economist, Stan Humphries. “The housing market worm has turned over the past few weeks—inventory levels are beginning to show signs of easing, and mortgage interest rates are creeping up. Going forward, both of these factors will help mitigate extreme price spikes caused by very strong housing demand and very low housing supply.”

This latest report only tracks prices on a three-month moving average through the end of April, well before mortgage rates began their climb. Still, Blitzer contends that rising rates will not slow price gains.

Article source: http://www.cnbc.com/id/100839986

Does this mean a return to the reckless equity withdrawals of the housing bubble? Likely not.

“I would guess that most of the current home equity line borrowing is quite prudent. We know that it is being very conservatively underwritten with plenty of equity,” said Guy Cecala, editor of Inside Mortgage Finance.

(Read More: Housing Already Shows Signs of a New Bubble.)

While it is too early to say exactly what borrowers are spending this new cash on, anecdotal evidence shows borrowers are largely sinking the money back into their homes.

“We are seeing more responsible uses today, like home improvements, education expenses or other major expenses that would be a more responsible use of a customer’s home equity,” Blackwell said.

The average home equity line in October of 2012 was just below $90,000 compared to October 2006, when lines averaged just over $100,000, according to Equifax.

Article source: http://www.cnbc.com/id/100446233

SAN FRANCISCO

Home prices across much of the San Francisco Bay area showed signs of leveling off as March sales hit their highest point in five years, a real estate research firm reported Thursday.

Nearly 7,700 new and existing homes and condominiums sold in a nine-county region in March, up more than 9 percent from the same period in 2011, according to a survey by DataQuick. It’s the highest tally for the month since more than 8,300 homes were sold in March 2007.

The San Diego-based firm said the jump was spurred in part by lower prices, though the decline compared to the same time last year was minimal. The median sales price last month was $358,000, a drop of less than 1 percent from the median March 2011 price of $360,000.

“While the changes we’re seeing are incremental, they’re incremental in a positive direction,” said Dataquick president John Walsh.

About one-quarter of existing home sales were for properties in foreclosure during the previous year. Another 19 percent were “short sales” — when the price is below the amount owed by the seller.

All-cash sales favored by investors accounted for just less than 30 percent of March sales in the region, while absentee buyers made up a little less than one-quarter of all sales. Both rates were near historic highs.

DataQuick said foreclosures in the Bay Area remained above typical levels but were down compared to the peak of the housing crisis.

Article source: http://www.businessweek.com/ap/2012-04/D9U85KVG0.htm

WASHINGTON, DC-NAREIT?s Calvin Schnure has crunched the numbers and tells GlobeSt.com?s Erika Morphy that demand will outpace supply until at least 2017.

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Article source: http://www.globest.com/news/12_301/sanfrancisco/leasing/Private-Biotech-Firm-Signs-220000-SF-Lease-319364.html

Nationally, residential real estate prices fell 3.9 percent in the three months ended in September compared with the same period last year, according to the SP/Case-Shiller Home Price Indices. Compared with a year ago, prices fell in 18 of the 20 metropolitan areas tracked by the index, including the San Francisco area, which was down 5.9 percent in the quarter compared with 2010.

“There is no significant momentum, no signs of the housing market contributing to the economy anytime soon,” said Maureen Maitland, vice president of SP Indices, which produces Case-Shiller. “The fact that so many markets were negative does cause us to pay attention. We are on very shaky ground.”

While some seasonal weakness is to be expected after the prime spring selling season, “weakness and negativity do not have to be synonymous,” she said.

In other words, while flat prices might not stir concern, the continued price declines do.

The San Francisco metropolitan area – which Case-Shiller defines as the counties of Alameda, Contra Costa, Marin, San Francisco and San Mateo – is actually among the better-performing regions, despite falling more than the national average.

“San Francisco (metro) has recovered 13 percent from its low in 2009,” Maitland said. “Since then, its prices have been largely increasing, although they have recently fallen down a bit on a year-over-year basis. But two years ago, when there was some recovery, San Francisco was one of the markets that was doing better than others.”

While the nation has undergone a “double dip” in which prices fell, recovered and then fell further, San Francisco has not, she said.

Case-Shiller tracks sales of the same single-family houses over time. It compares changes with a base value of 100, which represents values as of January 2000.

The San Francisco index is now 133.22, meaning that prices here are 33.22 percent above their year 2000 level. The region’s index peaked at 218.37 in May 2006 and hit a low of 117.74 in March 2009.

“Housing is struggling to get up off the mat everywhere,” said Jim Diffley, chief regional economist for IHS Global Insight. “The Bay Area in some ways has been more fortunate than its Sun Belt neighbors. Its economy is doing relatively better.”

IHS predicts that the California market is near bottom and that prices nationally may drop another 7 percent before turning around in mid-2012. “We may have a little further to fall in other parts of the country before we finally get some growth in 2012,” Diffley said.

Patrick Newport, U.S. economist for IHS, said the continued weakness in sales of existing homes bodes poorly for recovery in construction of new homes, typically a major source of job creation. The country is on track to build 600,000 new homes this year, compared with a normal market of 1.4 million new homes.

“This year is probably going to be the worst we’ve ever had for new-home sales and new-home starts,” he said. “Normally, in a recovery, housing is a key sector that gets the economy back on track. Building more homes creates more jobs and has a positive feedback loop.”

The only two regions where prices increased year-over-year were Detroit, where they had tumbled so drastically that they may have hit bottom, and Washington, D.C., where federal jobs buoy the local economy, Maitland said.

Prices nationally rose 0.1 percent in the third quarter compared with the second quarter, which means they were essentially flat.

E-mail Carolyn Said at csaid@sfchronicle.com.

This article appeared on page D – 1 of the San Francisco Chronicle

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/11/30/BUOG1M5MCG.DTL&type=business

For years, as Internet use boomed, builders of the giant, air-conditioned computer warehouses known as data centers couldn’t keep up with demand.

Now, though many investors continue to pile into the data-center business, one of the few hot spots in real estate, others fear the peak may be past.

In key markets from New Jersey to Silicon Valley, there are signs that supply is catching up with the needs of the telecommunications, Internet and other companies that rent space from data-center landlords. Adding to the concern, some large tenants, such as Facebook Inc., are building their own facilities and avoiding …

Article source: http://online.wsj.com/article/SB10001424052702303763404576417531646400002.html?mod=googlenews_wsj

Nothing like getting to work on a Monday morning and finding no fewer than four dismal reports on the housing market in my “Inbox.”

It’s not like anyone thought housing recovered over the weekend (that was pretty clear from the precious few “Open House” signs in my neighborhood at least), but the outlook is deteriorating, and we’re just a day away from getting what is expected to be a weak report on existing home sales for May.

Let’s start with home prices from Fannie Mae’s Economics and Mortgage market Analysis Group, which predicts additional home price declines through the third quarter before flattening out at the end of 2011. “Ultimately, the labor market holds the key to a housing recovery, but job growth is needed in order to activate housing demand,” said Fannie Mae Chief Economist Doug Duncan. “Hiring delays will continue to push out timing for the housing rebound.”

Okay, not exactly a shock, but never a good thing to hear analysts say, “growth is stalling.”

Now to a new point about investors, from the May Housing Market report from Campbell/Inside Mortgage Finance, which tracks several indices:

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Existing home sales were basically flat in April, down close to one percent month-to-month and down nearly 13 percent year-over-ear, but you have to remember last year we were heavily under the influence of the home buyer tax credit.

Now we are heavily under the influence of the mortgage market, or lack thereof.

It’s all in the numbers.

Let’s start with all-cash.

Thirty-one percent of buyers in April used all-cash, and that’s down from 35 percent the previous month. It’s likely because the number of investors buying in April also fell. Investors have been the only real fuel in this market, buying distressed properties at distressed prices.

Just look at the share of what’s selling at what price point:

The low end is moving (your investors), and the high end is moving because higher-end folks don’t always need a mortgage; neither investors nor high-end buyers were affected by the home buyer tax credit last year. The trouble is, the middle of the market makes up the lions share of home sales, over 60 percent, and it’s not moving.

What’s also juicing the lower end is the fact that the FHA raised insurance premiums on April 18th, so mortgage applications for FHA loans surged 20 percent in the four weeks before and then fell nearly 27 percent the week after. With that surge, you would have thought we’d see a lot more sales, but that wasn’t the case.

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