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2015 4th Quarter Market Report:
A Healthy and Growing Housing Market

by Lauren Agajanian, MBA


The 2015 US Housing Market in the 4th quarter is the best overall we’ve seen in almost a decade.   This quarter our survey’s  continue to show a shift from 10% plus  home price increases to a slower pace of 5-10%  home price appreciation, as well as a trend toward a more balanced, healthy and steadily growing housing market.

This data comes from a survey of HouseHunt agents with exclusive territories across America. This grassroots approach to studying the housing market gives us a thorough look at where the real estate market will continue to go in 2016 and beyond.

Buyer & Seller Activity

Last quarter, we presented a seller’s market with slowing prices and that trend continues. There were considerably more buyers than sellers in the market, and conditions responded accordingly.  This quarter, while still a seller’s market overall, a large increase of markets surveyed  are reporting a more balanced market between buyers and sellers.  48% of the markets reported more buyers  than sellers compared to 56% in the 3rd quarter and 64% in the 2nd quarter representing an  8% decline in buyer activity in each of the last two quarters.   However there was only an increase of 4% in seller activity in the last two quarter with 28% of the markets showing buyer and sellers about even.  This is compared to only 16% in the 2nd quarter and 20% in the 3rd quarter.  There is clear evidence that there is a shift from a strong sellers market to a more balanced market between buyers and sellers which indicates why home price appreciation is slowing.

This quarter our survey shows that 64% of our markets are showing an increase in buyer activity versus 70% of HouseHunt agents surveyed report an increase in buyer activity in the previous quarter.  This is a further decline from 83% in the 2nd quarter.

Seller activity has  also slowed in the 4th quarter with  35% of Agents reporting an increase in seller activity versus 50% in the previous quarter.  It is not uncommon for seller and buyer activity to slow in the Holiday season.

Overall real estate home sales  outpace 2014 with NAR reporting  existing home sales of 5.46  million homes in 2015 compared to 4.76 million sales in 2014, an increase of 7.7%.

Home Inventory

A seller’s market equates to a strong economy. 90% of HouseHunt agents saw their listings sell for more this quarter than this time last year. This is about average: last quarter saw 90% report an increase, and this time last year saw 89% report an increase. What really makes the 4th quarter of 2015 stand out is the shift to a slower pace of home price increases. Only 24% of the agents reported increase home prices of 10% or more compared to 36% in the 4th quarter of 2014.  This slowing of price point increase is in line with NAR reports showing that the 4th quarter 2015 median home price dropped slightly to $224,100 compared to 3rd quarter’s $229,000.

Only 4% of agents across the nation say their listings are selling for less. That’s the lowest depreciation rate since before the burst of the housing bubble! Last year this time we reported 8% of the markets having negative appreciation.

Besides sale price, we also need to take a look at how long active listings sit on the market.  In the 4th quarter of 2015 our agents reported that 65% of the homes sold within 60 days while 35% stayed on the market over 60 days.  Indicating  that even though the market is more balanced there is still a slight edge to the seller as there are still more buyers competing  for fewer homes.

So listings are selling for more and they’re selling quickly. Does this mean more contentment with people selling their homes? Not necessarily. It’s important for sellers to keep their expectations realistic. They are clearly being inundated with all this good news about the market, and they immediately think they can overprice their homes. 23% of our agent’s clients saw their listings close with less than 95% of their original asking price.  However this is lower than last year at this time when 28% of our agents reported homes staying on the market for over 60 days.

Foreclosures

This quarter, 87% of our agents said foreclosures made up less than 15% of their local market compared to 84% in the previous quarter.  The impact of foreclosures on the national market is at normal levels.  This is consistent with Realty Trac’s report that foreclosure activity at the end of 2015 is at a nine-year low saying  that the US has returned to a healthy foreclosure market with any activity fueled only by local economic factors.

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Source:  HouseHunt, Inc.

2015 US Housing Market Condition Survey

December 31, 2015

In Conclusion…

Home price appreciation is solid with the majority of homes between 5-10% appreciation.  Buyer activity continues to outweigh seller activity but is trending towards a more balanced market.  Inventories are still tight somewhat because of seasonal factors.  Seller activity could very well increase in the first and second quarters of 2016 as home sellers are recovering equities and have options to sell their homes and move to a new home.  Current low mortgage rates and high costs of rentals may very well fuel an increase in first time buyer activity which remains at all time low levels and are a true catalyst to a healthy real estate market.

HouseHunt’s Quarterly Comparison Chart For the U.S. | 4th Quarter 2015 Results in Red

2013 2014 2015
Quarter 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th
Buyer-Seller Ratio
More Buyers 57% 51% 61% 54% 39% 50% 61% 64% 56% 48%
More Sellers 26% 21% 19% 24% 37% 26% 15% 20% 24% 24%
About Even 17% 28% 20% 22% 24% 24% 24% 16% 20% 28%
Average Days On Market
0-60 Days 65% 57% 60% 63% 63% 56% 55% 70% 69% 65%
Sold in 60 Days Plus 35% 43% 40% 37% 37% 44% 45% 30% 31% 35%
Unsold Inventory
Good Supply 26% 32% 24% 28% 39% 44% 26% 26% 31% 33%
Tight Supply 74% 68% 76% 72% 61% 56% 74% 74% 69% 67%
Annual Price Appreciation
Up 0-5% 18% 29% 24% 27% 26% 26% 25% 26% 26% 30%
Up 5-10% 17% 31% 26% 29% 38% 27% 35% 33% 44% 36%
Up 10% Plus 54% 31% 42% 37% 25% 36% 27% 32% 20% 24%
Unchanged 5% 3% 3% 3% 4% 3% 6% 5% 6% 6%
Negative Appreciation 6% 6% 5% 4% 7% 8% 7% 4% 4% 4%
Buyer Activity
Repeat / Move UP / Investors 85% 78% 79% 77% 84% 76% 82% 75% 79% 84%
First-time Buyers 15% 22% 21% 23% 16% 24% 18% 25% 21% 16%
Ask vs. Sale Price
Less Than 95% 23% 30% 23% 9% 22% 28% 29% 26% 25% 23%
More Than 95% 77% 70% 77% 91% 78% 72% 71% 74% 75% 77%
Multiple Offers?
Yes 91% 87% 83% 86% 83% 76% 84% 88% 86% 85%
No 9% 13% 17% 14% 17% 24% 16% 12% 14% 15%
Short Sales / Foreclosures
Less than 15% of the market 77% 80% 83% 79% 87% 85% 86% 84% 86% 87%
More than 15% of the market 23% 20% 17% 21% 13% 15% 14% 16% 14% 13%