market pulse-november 2015

MARKET PULSENovember 2015

1

Survey Methodology

• Monthly online survey of 300+ CA REALTORS®

• Respondents are asked about their last closedtransaction and business activity in their market areafor the previous month and the last year.

2

LASTTRANSACTION

3

More than Half Are SellingAt or AboveAsking

Q: Did your last closed transaction sell over, at or below asking price?

27%

40%

33%

0%

10%

20%

30%

40%

50%

60%

Over Below At

4

SERIES: Market Pulse SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Premium Paid overAsking Price Remains Flat

Q: At what percentage was your last closed transaction sold over asking price?

10%

8.9%

0%

2%

4%

6%

8%

10%

12%

14%

Average

5


8.9%

7%

12%13%

0%

2%

4%

6%

8%

10%

12%

14%

Jul-

14

Au

g-1

4

Sep

-14

Oct

-14

No

v-14

Dec

-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-15

Jun

-15

Jul-

15

Au

g-1

5

Sep

-15

Oct

-15

No

v-15

Average

Percentages Paid BelowAsking Price Reaches Peak

Q: At what percentage was your last closed transaction sold below asking price?

6


Market RemainedCompetitive asTwo-thirds ofProperties Received MultipleOffers

Q: How many offers did the seller in your last closed transaction receive?

64% 64%66%

0%

10%

20%

30%

40%

50%

60%

70%

80%

7


Number ofOffers ReceivedWas the Highest sinceJuly

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Jan

-14

Feb

-14

Mar

-14

Ap

r-14

May

-14

Jun

-14

Jul-

14

Au

g-1

4

Sep

-14

Oct

-14

No

v-14

Dec

-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-15

Jun

-15

Jul-

15

Au

g-1

5

Sep

-15

Oct

-15

No

v-15

2.4 2.42.7

Average

Q: How many offers did your last closed transaction receive?

8


PropertiesWith Listing Price Reduced Dips Slightly

Q: Were there any listing price reductions before escrow opened in your last closed transaction?

29%32%

30%

0%

5%

10%

15%

20%

25%

30%

35%Ju

n-1

4

Jul-

14

Au

g-1

4

Sep

-14

Oct

-14

No

v-14

Dec

-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-15

Jun

-15

Jul-

15

Au

g-1

5

Sep

-15

Oct

-15

No

v-15

9


BuyersWhoWere Previous Renters Decreased

Q: Was the buyer of your last closed transaction a renter immediately prior to purchasing the property?

0%

10%

20%

30%

40%

50%

60%

42%

48%

43%

10


Sellers Becoming Renters at the Lowest Level in theLast Four Months

Q: Did the seller of your last closed transaction become a renter immediately after selling the property?

0%

5%

10%

15%

20%

25%

20%18%

15%

11


Share of First-time Buyers Decreased

Q: Was the buyer of your last closed transaction a first-time buyer?

38%

34%32%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45% % First-time Buyers Long Run Average

12


Majority Purchases are Primary Residences

Q: What was the intended use of the property?

82%

66%61%

13%

23% 29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Primary residence Investment Vacation home Other

13


International BuyersContinues to Fluctuate

Q: Was the buyer an international client (one who was not a citizen or permanent resident of the U.S.)?

11%10%

5.0%

0%

2%

4%

6%

8%

10%

12%

% International Buyers Long Run Average

14


MARKET CONDITIONS

15

REALTORSContinued to Receive Fewer FloorCallssince the Peak inApril 2015

Q: Compared to last month, the number of floor calls from potential clients in your market area this month was …

40%

37%

23%

0%

10%

20%

30%

40%

50%

60%

70%

Feb

-14

Mar

-14

Ap

r-14

May

-…

Jun

-14

Jul-

14

Au

g-1

4

Sep

-14

Oct

-14

No

v-14

Dec

-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-…

Jun

-15

Jul-

15

Au

g-1

5

Sep

-15

Oct

-15

No

v-15

Last MonthDown Flat Up

16


ListingAppointments/Presentations toClientsSlowing Down

Q: Compared to last month, the number of listing appointments and presentations to clients in yourmarket area this month was …

49%

30%

21%

0%

10%

20%

30%

40%

50%

60%

70%

Feb

-14

Mar

-14

Ap

r-14

May

-14

Jun

-14

Jul-

14

Au

g-1

4

Sep

-14

Oct

-14

No

v-14

Dec

-14

Jan

-15

Feb

-15

Mar

-15

Ap

r-15

May

-15

Jun

-15

Jul-

15

Au

g-1

5

Sep

-15

Oct

-15

No

v-15

Last Month

Down Flat Up

17


Open HouseTraffic InchedUp Slightly afterDropping EightConsecutive Months

Q: Compared to last month/year, open house traffic in your market area this month was …

40%

35%

25%

0%

10%

20%

30%

40%

50%

60%

70%

Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15

Down Flat Up

18


Auctions Up from Last Month and LastYear

Q: Compared to last month/year, the number of auctions in your market area this month was …

45%

37%

18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15

Down Flat Up

19


AllCash Purchases IncreasedSharply FromOctober

Q: Compared to last month/year, the number of all cash purchases in your market area this month was …

37%

33%

30%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15

Down Flat Up

20


9 of 10 REALTORS® Believed MarketConditions willEither Improve or Remain the Same in 2016

Q: What are your expectations for market conditions over the next year?

11%

53%

36%

0%

10%

20%

30%

40%

50%

60%

70%

Worsen Same Improve

21


Why REALTORS® Expect MarketConditions toWorsen

Affordability for average buyer – OrangeCounty

Rates increase, this will eventually preventa lot of the buyers – Sacramento County

Prices have gone up way too much andincome hasn't – Riverside County

Financing!!! – Sonoma County

Q: Why do you expect real estate market conditions to worsen over the next year?

22


REALTORS®AreConcernedAboutAffordability andInventory

23

0%

4%

3%

6%

8%

8%

9%

12%

22%

28%

0% 5% 10% 15% 20% 25% 30%

No Concerns

Other

Policies & Regulations

Housing bubble

Lending & financing

Slow down in economic growth

Rising Interest Rates

Home prices overinflated

Decline in housing affordability

Lack of Inventory

Q: What is your biggest concern about the current real estate market?SERIES: Market Pulse SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

What are REALTORS® Saying?

Seems like some banks, mortgage companies are revertingback to ways that caused the last recession. – Napa County

New mortgage rules nearly derailed the entire transaction. –San Francisco County

Way too many changes to the lending, title, escrow process,from TRID to FHA specifically.- Los Angeles County

It feels like 2008 again. – Butte County

Q: Do you have any specific comments, professional observations, or information that you would like to sharewith us--such as information on multiple bidding, changing buyer preferences, mortgage credit issues, orother topics?

24

market pulse-november 2015

Documents

market pulse surveysource

closed transaction

market areafor

market pulsenovember

overasking price

listing price reductions

firsttime buyers decreasedq

online survey