Clear Capital has released its Home Data Index (HDI) Market Report with data through September 2013. Using a broad array of public and proprietary data sources, the HDI Market Report publishes the most granular home data and analysis earlier than nearly any other index provider in the industry. September 2013 highlights include:
►National home price gains in September picked up to 10.9 percent year-over-year, evidence of residual summer buying activity. All regions saw small up-ticks in yearly price gains, with relative positions still in place (see map).
►Metro-level performance highlights fresh storylines behind recovery front-runners.
►San Francisco led metro price performance in September, with 4.4 percent quarterly growth and 28.3 percent yearly growth. Close behind, Detroit home prices saw 4.3 percent and 23.3 percent in quarterly and yearly growth, respectively. Growth must be viewed contextually to local market dynamics and home price drivers fueling gains.
►San Francisco median home prices hover at $600,000, while Detroit median home prices rest at just $107,500. The national median home price is $215,000.
►San Francisco REO saturation remains low, at 6.3 percent, yet Detroit REO saturation remains relatively high and much improved, at 31.7 percent. Yet over the last four years, REO saturation in Detroit has been cut in half. Just over the last six months, REO saturation fell by 11.5 percentage points.
►San Francisco home prices are now just 28.2 percent off peak prices, whereas Detroit is still down 64.5 percent.
►Detroit growth percentages are more easily swayed by gains than San Francisco. For example, to see one percent growth, median home prices in San Francisco would need to rise by $6,000, but in Detroit by just $1,075.
►Contact Alanna Harter for your September 2013 file of the Top 30 MSAs, or access our data on the Bloomberg Professional service by typing CLCA <GO>.
"While national and regional rates showed more of the same in September, an interesting dichotomy is unfolding beneath the surface," said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital. "Strong performances in San Francisco and Detroit remind us that in a dynamic market, the only constant is change. For about a year and a half now, we've been focused on First-In, First-Out recoveries characterized by hard hit markets attracting investor interest, like Miami, Phoenix and Las Vegas. Now as the recovery matures, we see homebuyers re-engaging in markets that haven't fit the typical investor profile.
Detroit was arguably one of the hardest hit in the country and is finally seeing a recovery with 23.3 percent growth over the year. Detroit's struggle with relatively high REO saturation over the last several years delayed recovery. Now, low price points and recent improvements in REO saturation, a key precursor to recovery, are driving gains. On the other hand, San Francisco's median home price at $600,000 suggests non-investor homebuyer demand is materializing, supported by its relatively strong local economy.
As demand calibrates to local economic environments, markets will start to find their natural equilibriums with moderating gains ahead. This should invite new markets, such as San Francisco and Detroit to share the spotlight as their recoveries continue to evolve."