Study Finds Housing Recovery Fully Taken Hold Nationwide
RealtyTrac has released an analysis of housing market health in 410 U.S. counties in two-year increments over the past eight years, finding that 96 percent of county housing markets are better off than they were four years ago when foreclosures peaked in 2010, but only eight percent of county housing markets are better off than they were eight years ago in 2006 before the housing price bubble burst.
The analysis also found that 80 percent of the county housing markets were better off than two years ago in 2012, when median home prices hit bottom, and 30 percent were better off than six years ago in 2008, at the front-end of the Great Recession.
The analysis looked at four different key categories of housing market health: home price appreciation, affordability, percentage of bank-owned (REO) sales, and the unemployment rate. Each county received a ranking between one and 2.5 for each category each year, and those four rankings were summed up for a total index score for a maximum possible score of 10 each year. The 410 counties analyzed in the report account for 63 percent of the U.S. population.
“The housing recovery has taken root in hundreds of counties across the country and almost all local housing markets are better off than they were four years ago when foreclosure activity peaked in 2010, with more than one million homes lost to foreclosure in that year alone,” said Daren Blomquist, vice president at RealtyTrac. “We saw less than half that number of bank repossessions nationwide in 2013. Even in hard-hit markets like Stockton, Las Vegas and Lansing, Mich., where REO sales represented more than half of all sales in 2010, the percentage of REO sales has been cut at least in half.”
“The foreclosure-REO business has dramatically decreased since the peak of the crisis in 2010 and is pretty much non-existent in the Lake Tahoe and Reno markets,” said Craig King, COO of Chase International, covering the Reno and Lake Tahoe markets. “Housing inventory is nowhere near the levels of inventory we saw in 2006 before the foreclosure crisis began, because there just isn’t very much listing inventory for buyers in the market right now, but I think we can expect a much stronger spring market.”
"The Denver housing market is healthy and strong, however our historically low inventory is keeping the market from returning back to the normal levels of 2006 before the recession hit.” Chad Ochsner, owner/broker of RE/MAX Alliance, covering the Denver, Colo. market. “Denver and Colorado have come out of the foreclosure crisis for the most part. Colorado was one of the first states to go into the recession and, following suit, we are one of the first ones to come out.”
“Home prices in three-fourths of the counties analyzed are still below 2006 levels, but low inventory has helped home prices accelerate past pre-recession levels in some markets like Seattle, San Francisco, Denver and Oklahoma City,” Blomquist noted. “Those rapid home price gains are causing a concerning drop in affordability rates in some cities, but homebuilders and homeowners with regained equity should help provide more supply to balance out many of those markets in 2014.”
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