More Than Half of Homes Sold at a Discount

Daily Real Estate News | Tuesday, July 14, 2015

Prices may be on the rise, but about 63 percent of homes sold at a discount compared to the list price in May, according to the 2015 REALTORS® Confidence Index Survey. The discount averaged in the 1 to 11 percent range.

Read more: REALTORS® Stay Upbeat in Market Outlook

The longer a property lingers on the market, it becomes more likely the home will end up selling at a discount. Eighty-four percent of homes that sold after 12 months were sold at a discount. On the other hand, 24 percent of homes that sold within a month sold at a premium.
Staging a home may help a listing to fetch more, according to the National Association of REALTORS®' 2015 Profile of Home Staging. The survey found that 32 percent of buyers' agents say that staged homes increases the dollar value a home buyer is willing to offer by one to five percent.
Source: "Despite Rising Prices, 63 Percent of Properties Sold at Discount in May 2015," National Association of REALTORS® Economists' Outlook blog (July 13, 2015)

More Owners Fall Into an Equity Sweet Spot

Daily Real Estate News | Wednesday, July 15, 2015

As home prices rise, home owners equity is growing at the fastest quarterly rate since 2013, according to the National Association of REALTORS® Economists’ Outlook blog. The total value of household equity has bloomed to $11.7 trillion – $5.6 trillion higher than it was at the bottom of the housing crisis. This equates to about $63,000 per property, according to NAR.

Read more: NAR's Inside Look at the Home Equity Picture

Home owner equity peaked in 2005 when the value of U.S. homes (measured in market value less debt) soared to $13.1 trillion. But the financial crisis caused millions of home owners to see their equity slip away as home values plunged. This meant that, even with falling rates, many could not refinance and others couldn’t sell without bringing cash to closing. As such, home owners stayed put or were forced to face a short sale or foreclosure.
Between 2011 and 2014, the home owner equity picture has gradually changed. Home equity levels may likely return to 2005 levels by the end of this year or mid-2016. With more equity, home owners will have better options, such as the ability to sell or even take out home equity lines of credit by borrowing against their homes. The improvement in home equity is also leading to fewer foreclosure starts.
Source: “Returning Equity Boosts Real Estate Markets,” RealtyTrac (July 9, 2015) and “Home Owner Equity as a Share of the Value of Real Estate Could Normalize Within the Year,” National Association of REALTORS® Economists’ Outlook blog (June 18, 2015)