Real Estate Recovery Or Not? 2012 Predictions by the Pro's Infographic

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Education & Training with ActiveRain
http://actvra.in/tJy

Real Estate Recovery or Not?
2012 Predictions By the Pro’s Infographic


Data, data everywhere, but what should you believe?  Are we on, in the middle, or at the tail of a deflating real estate bubble?  Is there a Florida real estate bubble?

There is A LOT of conflicting data emerging about the 2012 real estate market and 2012 real estate transactions.  Case-Shiller has emerged as the leading index of real estate values.  The Q4 2011 S&P/Case-Shiller index (1) shows continuing declines in real estate values with quarter over quarter declines of 1.1-1.2% and annual declines of 3.0-3.4%.   RealtyTrac is the leading source of foreclosure data.   On January 12, 2012, RealtyTrac published (2) surprisingly good news showing a 33% decline in the number of homes in foreclosure from 2010 to 2011.   The National Association of Realtors (NAR) Chief Economist Lawrence is projecting a modest 4.7% increase in real estate transactions with a 2.0% increase in real estate values in 2012 vs. 2011.  But, on December 19, 2011, NAR was forced to re-state historical homes sold data (3) due to “upward drift” of their core homes sold benchmarks, which historically have been based on feeds from the multiple listing service (MLS).

So what should you believe?  Nearly all data on real estate transactions and real estate values is historical;  it does not forecast the future and may not reflect the situation in your local market.   Real estate is inherently local, so if the national real estate market is in decline or on the mend, what does that say about your local market?  Does a national real estate bubble portend a Florida real estate bubble? Or a bubble in Fort Myers, or Sanibel Island specifically.

The largest real estate social network ActiveRain Corp surveyed 1,835 real estate agents and real estate brokers in the US and Canada to understand if the real estate market and economy are poised for recovery in 2012, both nationwide and in local markets.

ActiveRain Recovery or Not Infographic

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A Bottom of the American Real Estate Market


American real estate agents expect the US real estate market to be largely flat from 2011 to 2012.  Real estate agents predict that real estate values will be flat from 2011 to 2012, signaling a bottom to the real estate market or the end of the real estate bubble.  Given historically low interest rates as well as a bottoming of real estate values, real estate agents expect that the number of real estate transactions and new construction starts will increase slightly in 2012.   Additionally, real estate agents believe local economies are on the mend and we will see improvements in the economy.

US Real Estate Confidence

Rental Nation?


With low real estate values, low interest rates and a recovering economy, American real estate agents believe that 2012 is a great time to purchase both single family and multi-family rental properties.  Real estate agents feel that single family homes and luxury homes represent great investment opportunities.   What did real estate agents think are the worst opportunities in the 2012 real estate market?  Due to the glut of inventory in the real estate market due to short-sales and foreclosures, new construction condominiums, new construction single family homes, and land for construction were rated as the worst investment opportunities.

US Real Estate Opportunities

What’s the Problem?  The Banks, Stupid!


When polled about the biggest challenges facing the real estate market and economy, real estate agents rated bank related issues the highest.  The biggest challenges were:  1) short sales, 2) ability to finance a new home purchase / loan qualifications, and 3) foreclosures.  The significant shadow inventory caused by short sales and foreclosures continues to drag on real estate values.  Though interest rates are at historical lows, increased loan qualifications are preventing first time home buyers from purchasing homes and current home owners from trading up into new homes.

We would have expected unemployment to be a greater concern to real estate agent.s  Persistently high unemployment was ONLY the fourth concern to real estate agents, which was surprising given how the poor economy and lack of jobs has dominated the news headlines for the past 24 months.

US Real Estate Problems

Local Opportunities, Local Problems


From a local market perspective, the 2012 ActiveRain real estate survey shows markets where real estate agents are significantly more optimistic and others in which real estate agents are concerned about 2012.  Based on our survey data, the ActiveRain real estate network has created a real estate confidence index and ranked the top real estate markets. 

Below is a list of the TOP 10 and BOTTOM 10 real estate markets ranked by real estate agent confidence.

US Market Confidence ActiveRain
See real estate confidence in your local real estate market.

Key Trends in Top Markets


Low Cost of Living Markets Rule: Low interest rates and low cost of living have attracted buyers and relocations back into these markets.  Even though the general economy is not as robust as anyone would like, home buyers are adjusting lifestyles to find markets with low cost of living and reasonable housing prices.   Applicable markets: Ft. Myers, Austin, Boise, San Antonio, Denver, Dallas, Nashville, Houston, Salt Lake City

Invasion of the Snowbirds: Senior Housing & Second Homes:  Seniors and those planning for retirement have returned to the South.  Seniors are taking advantage of low priced housing inventory in the Sun Belt and low interest rates to buy a retirement home or a second home in a warmer climate.  Many of these buyers have saved for lifetime and 2012 represents a great opportunity to buy while prices and interest rates are low.   Seniors are targeting markets with low cost of living for retirement. Applicable Markets:  Ft Myers, Austin, San Antonio, Nashville, Miami, Salt Lake City

International Buyers:  International home buyers are taking advantage of a weak dollar and low real estate values.  Florida is the biggest beneficiary of international buyer interest.  Miami is reporting strong home purchase market based on International cash transactions.

Deep in the Heart of Texas: No other state has FOUR major cities listed as growth markets.  So what is going on in Texas?  Texas represents exactly what every home buyer should be looking for: low cost of living, low cost housing, and job growth.   Throw in no state income tax and Texas is looking a lot more appealing than California.  Texas is attracting many large corporations to set up headquarters and operations in the state.   This is especially true in Austin.  Finally Texas has a great mix of technology companies AND energy companies (oil & gas and renewable energy).  See below.  Applicable Markets: Austin, Dallas, San Antonio, Houston

Technology and Energy Industries: Even in the current down market, technology and energy are growth industries driving job creation.  Though most think of San Francisco, Boston, New York and Seattle when we think of technology.  Secondary markets participating in technology and energy job growth are likely good real estate markets in 2012, due to low cost of living and high demand for skilled jobs.   Markets: Austin, San Antonio, Denver, Dallas, Houston, Salt Lake City  

Investment Property: Low interest rates, low real estate values, and rising rents due to job growth is a great investment proposition.  A number of the lower cost of living and lower real estate value markets are reporting growth driven by investors coming into the market looking for deals.   Applicable Markets: Boise, Nashville, Salt Lake City, Austin, San Antonio

Key Trends in Poor Markets


High Cost of Living, High Real Estate Values: Though interest rates are historicly low, cities with expensive housing and high costs of living are suffering.  Tightened loan standards are preventing home buyers from entering the market.  Families are relocating to lower cost of living markets.  The high cities with high real estate values are also suffering the most from the shadow inventory of foreclosures and short sales.  Applicable markets: New York, Los Angeles, Chicago, San Diego


California: Californian cities benefited from the greatest price increases during the real estate bubble.  Simultaneously California has suffered the greatest in the downturn with the highest numbers of foreclosures and short sales in the country.  California is also facing a major budget deficit of $XBn leading to reductions in government services, increased class sizes and increased taxes. Applicable markets: Los Angeles, San Diego, Sacramento

High Shadow Inventory:  Large numbers of foreclosures and short sales continue to depress real estate prices in many markets.  It will take several more years for many markets to stabilize.  Buyers continue to wait on the sideline for conditions to improve.  Applicable markets: Reno, Sacramento, Chicago, Springfield, Los Angeles, Philadelphia

High Unemployment:  Persistently high unemployment without an economic catalyst is preventing home buyers from entering the market and locking sellers into their current homes.  Applicable markets: Philadelphia, Los Angeles, New York, Chicago, Sacramento, Reno

Reliance on the Finance Industry:  Downsizing in the banking industry combined with reduction in Wall Street bonuses has caused challenges in markets reliant on banking,   Wall Street layoffs and a lack luster stock market have affected the highest cost markets like NYC most directly.  Applicable markets: New York , Chicago, Los Angeles, Philadelphia

O Canada!


Unlike the United States, Canadian real estate agents are fairly optimistic about 2012.  Canadian real estate agents believe that all core metrics of the Canadian real estate market and economy will be increasing in 2012.  Real estate values, real estate transactions, new construction starts, and the local economy are project to increase slightly in 2012.  Canada continues to have a strong banking system, a strong dollar, and low unemployment.  Interest rates are low, spurring international investment in Canada..  Canadian confidence continues to be high.  Job growth is being driven by the energy industry in Canada.


Canadian Real Estate Confidence

Few problems are facing the Canadian real estate market or the Canadian economy.  Inflation and gas prices are the only problems that the Canadian economy seems to be facing.  Unlike the US real estate market, Canada any issues with short sales or foreclosures.


Canadian Real Estate Problems

Canadian real estate agents feel like single family homes, investment properties for rental and condominiums all represent good investment opportunities, due to historically low interest rates.  Interestingly, Canadian real estate agents are slightly LESS optimistic about real estate as investment opportunity when compared to American real estate agents


Canadian Real Estate Opportunities

ActiveRain Corp is the world's largest network of real estate professionals.  ActiveRain is a social network, blogging and training platform built for real estate professionals, including real estate agents, real estate brokers, lenders, mortgage brokers, title companies, home inspectors, architects, home stages, and contractors.  ActiveRain receives more than 2 million real estate visitors per month.   For more information, sign up for a FREE account on ActiveRain here.

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(1) Q4 2011 S&P/Case-Shiller index

(2) RealtyTrac 2011 Year End Foreclosure Report

(3) NAR Re-Benchmarking of Home Sales

 

 

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Re-Blogged 35 times:

Re-Blogged By Re-Blogged At
  1. Shannon Coe 02/21/2012 07:31 AM
  2. Robert May 02/21/2012 09:39 AM
  3. Hannah Williams 02/21/2012 03:19 PM
  4. Gail Robinson 02/21/2012 05:56 PM
  5. Kevin B. Tolbert PA Team 02/21/2012 06:47 PM
  6. Dagny Eason 02/21/2012 08:09 PM
  7. Stephen Howell 02/22/2012 04:37 AM
  8. Ed Silva 02/22/2012 06:12 AM
  9. Frank Rubi 02/22/2012 06:24 AM
  10. Tere Rice 02/22/2012 06:42 AM
  11. Debra B Albert,PA 02/22/2012 07:02 AM
  12. Jeanne Dufort 02/22/2012 07:39 AM
  13. John Marshall - FORE! 02/22/2012 07:42 AM
  14. Gary W. Oakes 02/22/2012 09:39 AM
  15. Didi Doolittle 02/22/2012 11:57 AM
  16. Jayne Williamson, REALTOR, Broker, GRI 02/22/2012 12:16 PM
  17. Kimberly Luna 02/22/2012 12:19 PM
  18. Carla Muss-Jacobs, Principal Broker/Owner 02/22/2012 12:47 PM
  19. Sandy and John Kohlmoos 02/22/2012 02:44 PM
  20. Gregory Bain 02/22/2012 06:52 PM
  21. Lynn B. Friedman 02/23/2012 07:44 AM
  22. Patty Keller 02/24/2012 09:27 AM
  23. Maggie Finegan 02/26/2012 06:24 PM
  24. Carol Pease 02/28/2012 05:46 PM
  25. Barbara Martino-Sliva 03/07/2012 02:12 PM
  26. Courtney Cooper 03/07/2012 04:49 PM
  27. Amy Jones Group 03/07/2012 04:50 PM
  28. Susan Goulding 03/07/2012 09:42 PM
  29. Jason Nenadov 03/08/2012 07:21 AM
  30. Holly Weatherwax 03/28/2012 05:06 AM
  31. Sandy Wallace 03/28/2012 02:38 PM
  32. Randi Lubenow 04/04/2012 02:01 PM
  33. Mykel Martin 03/30/2012 08:26 PM
  34. Richard & Beth Witt 07/25/2012 10:31 AM
  35. Tracy Coles 08/06/2012 12:32 PM
Tags:
real estate market predictions
activerain
real estate values

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Rainmaker
228,263
Michael Blue
Home Smart Realty West - Encinitas, CA
REALTOR - 760-889-8877, Encinitas/Carlsbad

Well....I kept going back to the numbers and I do wonder....where is Phoenix and Las Vegas?  Two major contributors to the short sale-REO numbers on the red side are missing???

Mar 08, 2012 05:23 PM #144
Rainer
189,984
Thomas McCombs
Century 21 HomeStar - Akron, OH

I am surely glad we got this all straightened out.  Now we all know in which direction to jump.  This analysis has led directly to the conclusion created by the consensus of the survey participants and of the recognized data collectors (such as Case-Shiller), that the housing market is changing.

And new direction of the market and the result of that change is that . . . . . . (drumroll please) . . .  IT DEPENDS!

Whew! what a relief.

Mar 08, 2012 06:17 PM #145
Rainer
5,000
Jim Graham
West USA Realty - Surprise, AZ

I am not sure that I agree 100% with this information.  I see no mention of the Phoenix market.  Our inventory is way down from a year ago and in the West Valley where I specialize we are seeing multiple offers and cash buyers.

Jim Graham

Mar 08, 2012 08:56 PM #146
Rainmaker
852,479
Fred Carver-Top Realtor Victoria, BC
Re/Max Camosun Victoria BC Real Estate - Victoria, BC
Accredited Victoria BC Real Estate Consultant

Hi Guys....I believe Buyer Confidence is a key factor, and it is directly effected negatively by negative financial news night after night on the TV, which seems to have slowed down, and Buyer activity has since picked up.

Mar 08, 2012 10:35 PM #147
Rainer
199,413
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton

Dear Kerrie,

Not so easy to get this to the right person. Cool graphic though.

Mar 09, 2012 07:26 AM #148
Staff
577,025
Kerrie La Guardia
ActiveRain, Community Manager - Kirkland, WA
Let it Rain!

Dorte - You have the option to embed the infographic in your materials, email this url to any interested parties, shorten the url of this post to Tweet it or use the social buttons on the top right of this post to share it on your social networks.  Shoot me an email at kerrie@activerain.com if you'd like more direction on this.  I'm happy to help!

Mar 09, 2012 10:09 AM #149
Rainer
45,006
Jairo Arreola
Aladdin Realty - San Jose, CA
VA Home Loan Specialist - SF Bay Area - South Bay - San Jose

Great Info! Just shared it across social media outlets. 

Mar 10, 2012 06:43 PM #150
Rainmaker
1,929,242
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

I posted link to the 8 posts in the comment section of Kathy's post but I am repeating it here as well.

I looked up trend in  townships in Bucks County and Hatboro in Montgomery county, the number of listings has gone up . The average sale price is lower and the average list price has come down over last few weeks. Here are the links

http://actvra.in/vpK

http://actvra.in/vr4

http://actvra.in/vdX

http://actvra.in/vlZ

http://actvra.in/wK6

http://actvra.in/wK5

http://actvra.in/x6p

http://actvra.in/x2n

 

Mar 12, 2012 04:54 AM #151
Rainmaker
656,887
Evelyn Kennedy
Gallagher & Lindsey, Alameda, California - Alameda, CA
Alameda, Real Estate, Alameda, CA

I keep forgetting to post my links to this post.  Here is my latest:  CAR chief economist speak to Alameda Realtors

I see that everyone has posted all of their links at one time.  So I will post all of my links later.  Sorry for my confusion.

Mar 18, 2012 10:47 PM #153
Rainmaker
1,654,898
Captain Wayne Rowlett / Florida Real Estate School
REcampus Fully Accredited Florida ONLINE & Classroom Training in Destin, Pensacola Florida - Panama City Beach, FL
Instructor / Owner of Rowlett Real Estate School
Anonymous
Anonymous
Louise Speck

Great Information!  Lots to digest and kudo's to Active Rain for gathering it!

Apr 02, 2012 08:52 AM #156
Anonymous
Anonymous
Ruby

I am sorry to bust the recovery bubble. If there are no jobs, any recovery is either seasonal or short term. Obvioursly, there are people that got cash and real estates are a much better investment than the bank savings so investors flocked to low cost income properties; however, they alone can't sustain the real estate market. The last crash took 15 years and the emerge of the internet technology to recover. Based on historical lessons, the real estate market lags the recovery of the economy, not the reverse. The survey is the wishful thinking of real estate agents. I am surprised that the professionals think the bank not loosening the lending policy is the culprit; it is the bank who relaxed the landing that had caused this problem. The real recovery is sustainable only because of job growth and healthy economic outlook of our country, not arbitrarily relaxation of funny money.

Apr 23, 2012 04:49 PM #157
Rainer
161,910
Matthew Johnson
Keller Williams Premier Realty - Woodbury, MN

With rental rates increasing I see plenty of young professionals jumping into the market. The Twin Cities (does not show up on this report) has an almost 2% lower unemployment rate and plenty of jobs to go around!

May 22, 2012 07:23 AM #158
Rainmaker
285,956
Marilyn Harrell
ReMax Riverhaven - Beaverton, MI
Wixom Lake - Beaverton MI

Tends to vary a little from place to place...

May 22, 2012 01:22 PM #159
Rainmaker
659,378
Richard & Beth Witt
RE/MAX Wittney Estates 516-795-6900 www.longislandrealestatesearch.com - Massapequa, NY
Broker/Owner RE/MAX Wittney Estates Long Island NY

Not sure how I missed this but I did and for that reason I will re-blog it because I think it is full of valuable information.  I agree that no one knows for sure what is ahead of us however for the most part I agree with this evaluation and in time we will see how accurate it was... thank you for taking the time to put this together for all of us...

Jul 25, 2012 10:27 AM #160
Ambassador
1,264,451
Erica Ramus
Erica Ramus - Ramus Realty Group - Pottsville, PA - Pottsville, PA
MRE, Schuylkill County PA Real Estate

Happy Birthday! You have an agent on your roster who really cares about you! 

 

Aug 02, 2012 05:45 PM #161
Rainer
44,258
Michele Peterson
Sellstate Realty First - Roseville, CA
Sellstate Realty First

Proud to say..Sacramento, California metro Prices have increased by 15% - 19% depending on location

over last year. In addition, we have gone from a 30 week supply of houses to an 8-10 week supply!!

If the home is on the market for 5 days - something is wrong!

We have done a complete turn around in the last year.

* Buyers are happy with interest rates, great prices and ability to close homes in 30 days or less

* Sellers are happy - many now have equity again

* REO inventory is down

* Agents are busy - back to the basics - hitting the streets to find equity listings, flips,and buyers

2013 should be just as exciting for our area.

Nov 15, 2012 08:40 PM #162
Rainer
14,722
RCP Real Estate
RCP Real Estate LLC - San Tan Valley, AZ
Your Arizona Real Estate Agent

I like this infographic but I wish they would come up with an updated one.

Mar 18, 2014 10:58 AM #165
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