DataQuick has announced in its monthly Property Intelligence Report (PIR) that home price growth increased in all 42 reported markets for the second month in a row. However, rapid price appreciation comes at a price, as total home sales decreased in most markets in October. The PIR shows that 33 counties saw a decline in sales during the month; more than double the number of counties who experienced an overall sales decrease in September. The county with the largest decline in sales numbers was Shelby, Tenn. (Memphis), which experienced a more than 27 percent drop from September to October. Shelby was followed closely by Cook and Dupage, Ill. (Chicago) and Jackson County, Mo. (Kansas City) which all had more than 20 percent sales decreases.
However, despite sales of existing homes being low and recent construction remaining well below normal levels, the recent trend of rapid property price appreciation should begin increasing home sales in many markets across the country, according to Gordon Crawford, Ph.D. and vice president of analytics for DataQuick.
“As homeowners with negative equity experience home price growth, they will become more motivated to list their property because positive equity means they are in a position to sell without being required to bring cash to the closing table,” Crawford said. “Homes listed for sale and overall sales will increase as more borrowers find themselves no longer underwater. However, we can expect purchases by investors to continue to be a large share of all purchases, as a lack of affordable properties and tight credit standards will continue to drive high rental demand and keep many entry-level home buyers out of the market.”
DataQuick’s monthly Property Intelligence Report (PIR) leverages its national property database and analytics expertise to assess 42 of the largest counties in the United States using valuation trends, REO inventory trends and sales trends metrics. Other key findings for October include:
►Home price growth was positive in all of the 42 reported counties over the last month, quarter, and year
►Sales increased in nine of the 42 reported counties over the last month
►Sales increased in 17 of the 42 reported counties over the last quarter
►Sales increased in 28 of the 42 reported counties over the last year
►Foreclosures decreased in 22 of the 42 reported counties over the last month
►Foreclosures decreased in 18 of the 42 reported counties over the last quarter
►Foreclosures decreased in 27 of the 42 reported counties over the last year