Home Value Growth Slowing Going into Home Shopping Season

– Over the past year, U.S. home values rose 6.7 percent, the slowest rate of appreciation since November 2016

– Home values across the U.S. rose 6.7 percent since last January, to a median home value of $207,600. San Jose, California, Las Vegas and Seattle reported the greatest home value growth over the past year.

– U.S. home values are rising at their slowest pace since November 2016, which could help buyers going into home shopping season.

– Median rent in the U.S. rose 2.6 percent over the past year, to a median of $1,441. The fastest appreciating rental markets are along the West Coast.

– There are 10 percent fewer homes on the market to choose from than a year ago, with San Jose, Las Vegas and Indianapolis reporting the greatest drops.

Seattle, WA – Feb. 22, 2018 (PRNewswire) Home value growth across the country is increasing at the slowest pace in 15 months, according to the January Zillow® Real Estate Market Report(i). Over the past year, home values rose 6.7 percent to a median home value of $207,600.

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In May 2017, national home values were rising at their fastest pace since the housing bubble, up 7.6 percent year-over-year, but have since slowed, dropping about a tenth of a percentage point each month since last summer.

While home value growth is slowing, mortgage rates are picking up, ending the month of January at 4.04 percent(ii) — the highest rate in four years(iii). Going into the spring home shopping season, buyers may find a slight relief on prices, but should expect higher mortgage rates to lead to an increase in monthly costs.

“The pace of home value appreciation we experienced during much of last year was not sustainable, and a slow glide path down to a more normal appreciation rate has been expected for some time,” said Zillow Senior Economist Aaron Terrazas. “This slowdown is nothing to be overly concerned with — demand from home buyers remains very high, and inventory remains tight. New home construction is growing, providing some relief to buyers who can afford the generally high price point of new homes. It’s important to note that home values are still growing very quickly relative to historic norms. After years of intense competition, some buyers may be more willing than previously to take more time with the process and to wait until the right home at the right price comes on the market, even if it’s not for several months. Removing a lot of this frenzy, especially as inventory remains incredibly tight, may prove to be good news for beleaguered buyers.”

Markets with the greatest home value appreciation are in the West — San Jose, California, Las Vegas and Seattle reported the greatest home value growth over the past year. In San Jose, home values rose about 23 percent – about three times faster than its historic pace – to a median home value of $1,202,900.

Tight inventory will put a strain on buyers this home shopping season, even more so than last year. There are almost 10 percent fewer homes on the market than a year ago, with San Jose, Las Vegas and Indianapolis reporting the greatest drop in inventory. New home starts have increased about 7 percent over the past year, a positive trend but still insufficient to meet demand.

Median rent across the nation rose 2.6 percent since last January, to a median payment of $1,441 per month. Sacramento, California, Riverside, California and Seattle reported the highest year-over-year rent appreciation among the 35 largest U.S. housing markets. Median rent in Sacramento rose just over 8 percent to a Zillow Rent Index(iv) (ZRI) of $1,845. Rent in Riverside rose 6 percent year-over-year, and rent in Seattle rose 5 percent.

Mortgage rates(v) on Zillow gradually increased throughout the month of January, starting at 3.77 percent and ending at 4.04 percent, the month high. Zillow’s real-time mortgage rates are based on thousands of custom mortgage quotes submitted daily to anonymous borrowers on the Zillow Mortgages site and reflect the most recent changes in the market.

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Zillow is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group, Inc. (NASDAQ: Z and ZG), and headquartered in Seattle.

Zillow is a registered trademark of Zillow, Inc.

(i) The Zillow Real Estate Market Reports are a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Real Estate Research. For more information, visit www.zillow.com/research/. The data in Zillow’s Real Estate Market Reports are aggregated from public sources by a number of data providers for 928 metropolitan and micropolitan areas dating back to 1996. Mortgage and home loan data are typically recorded in each county and publicly available through a county recorder’s office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood level can be accessed at www.zillow.com/local-info/ and www.zillow.com/research/data.

(ii) Mortgage rates on Zillow.

(iii) Mortgage rates have increased further through the first three weeks of February. They are about 30 basis points higher than January month-end.

(iv) The Zillow Rent Index (ZRI) is the median Rent Zestimate® (estimated monthly rental price) for a given geographic area on a given day, and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow’s database, regardless of whether they are currently listed for rent. It is expressed in dollars.

(v) Mortgage rates for a 30-year fixed mortgage.

(vi) The Zillow Home Value Index (ZHVI) is the median estimated home value for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. It is expressed in dollars, and seasonally adjusted.

(vii) The Zillow Rent Index (ZRI) is the median Rent Zestimate® (estimated monthly rental price) for a given geographic area on a given day, and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow’s database, regardless of whether they are currently listed for rent. It is expressed in dollars.

Growth Outlook Unchanged Despite Recent Market Volatility

Washington, D.C. – Feb. 15, 2018 (PRNewswire) Rising long-term interest rates and soaring market volatility are not enough to alter the forecast for strong 2.7 percent real GDP growth in 2018, according to the Fannie Mae Economic and Strategic Research Group’s February 2018 Economic and Housing Outlook. With long-term Treasury yields hitting multi-year highs in February and equities experiencing a sudden repricing, downside risks to the forecast are present, particularly if the recent stock market declines are sustained and prove contagious to other markets. Strength in economic fundamentals continues to underpin the current forecast, including recent momentum in domestic demand and a historically healthy labor market. Consumer spending surged in the fourth quarter due to unsustainably strong replacement demand for vehicles damaged by the hurricanes. With that demand satiated, spending growth should moderate in coming quarters but remain the primary driver of headline growth, in part due to increased disposable income from the tax cut. Meanwhile, the generous depreciation provisions of the Tax Cuts and Jobs Act should spur strong growth in capital expenditures. Given that the economy is already approaching full employment, the passage of deficit-financed stimulus in this year’s budget will likely stoke additional overheating concerns. Finally, we expect the first rate hike of the year at the March Fed meeting, a move fully priced in by the market, with continued gradual monetary policy normalization under the new leadership of Fed Chair Jerome Powell.

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“Fiscal Policy and the Fed: Stimulus/Response – our 2018 theme – will be paramount in the months ahead as the economy navigates newfound turbulence and heightened inflationary concerns,” said Fannie Mae Chief Economist Doug Duncan. “While our 2018 growth forecast remains unchanged, upside and downside risks are emerging that are contingent on those policy influences. Legislatively, stimulus from tax reform and the recently passed budget could add to growth. However, if additional growth is accompanied by signs – or even fears – of inflationary pressure, it could complicate the Fed’s attempt at a ‘soft landing’ and may require more aggressive monetary action. On housing, we upped this year’s 30-year fixed mortgage rate forecast by 30 basis points to an average of 4.4 percent during the fourth quarter as a result of the unexpected spike in long-term interest rates at the start of the year. However, we don’t expect rates to play much of a role in total home sales, especially with anticipated stronger disposable household income growth. The ongoing inventory shortages should continue to constrain sales despite otherwise ripe home buying conditions.”

Visit the Economic & Strategic Research site at www.fanniemae.com to read the full February 2018 Economic Outlook, including the Economic Developments Commentary, Economic Forecast, Housing Forecast, and Multifamily Market Commentary.

Opinions, analyses, estimates, forecasts, and other views of Fannie Mae’s Economic & Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae’s business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.

Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of Americans. We partner with lenders to create housing opportunities for families across the country. We are driving positive changes in housing finance to make the home buying process easier, while reducing costs and risk. To learn more, visit fanniemae.com and follow us on twitter.com/fanniemae.

Facebook’s U.S. Growth Stalls as Youngsters Jump Ship

Source: Statista

When Facebook reported its fourth quarter results on January 31, the company had to admit for the first time that its user base in the United States and Canada had stopped growing on a quarter-over-quarter basis. While the number of monthly active users remained flat at 239 million between Q3 and Q4 2017, the number of daily active users even declined from 185 to 184 million users.

According to eMarketer’s latest forecast on social network usage in the United States, this trend will continue through 2018. eMarketer predicts that Facebook’s U.S. user base will grow by less than 1 percent this year as young Americans appear to lose interest in what they probably feel has become a social network for the elderly.

As our chart illustrates, Facebook is expected to see an exodus of users aged 11 to 24 this year. While a lost user is never good for the company running the affected platform, Facebook can probably take solace in the fact that most of its young deserters will remain active on Instagram, the platform that Facebook foresightedly acquired in 2012.

Social Media Infographic

Secrets to Insanely Rapid Business Growth – Tom Bilyeu at the Tom Ferry Elite Retreat 2018 Keynote

Tom Bilyeu shares his tactics on how to get your mindset, attitude, and action plan aligned in order to grow your business and improve your life.

Tom Bilyeu (not a born entrepreneur) is best known as the co-founder of Quest Nutrition, the second fastest growing private company (57,000% growth) in North America on the Inc 5000 for 2014 and the host of Impact Theory, an interview series that explores the mindsets of the world’s highest achievers to learn their secrets of success.

Twitter’s User Growth Flatlines

Source: Statista

Having struggled to attract new users for a while, Twitter just reported that its user base didn’t grow at all between the third and fourth quarter of 2017. The social network is stuck at 330 million users and looks to be losing sight of its competitors.

On a positive note, Twitter posted its first quarterly profit ever, sending its stock price soaring to the highest level in more than two years.

Twitter Infographic

RealPage® Reports Moderate Apartment Rent Growth for Calendar Year, Normal Seasonal Pricing Cuts in the Fourth Quarter

Occupancy remains tight, helped by demand bumps in hurricane-impacted markets

Richardson, TX – January 3rd, 2018 (BUSINESS WIRE) U.S. apartment rents climbed at a moderate pace of 2.5 percent in calendar 2017, according to real estate technology and analytics firm RealPage, Inc. (NASDAQ: RP). Nationally, typical monthly apartment rent is now $1,330.

Effective rents for new leases slipped 0.9 percent during the fourth quarter. Those slight rent cuts late in the year reflect normal seasonality, as slower leasing activity in the colder-weather months can spur housing owners and operators to offer more pricing deals.

“While the apartment rent growth pace has slowed from the performance seen a couple years ago, it’s the longevity of the current cycle that’s so impressive,” said Greg Willett, RealPage’s chief economist. “Rents have climbed substantially for eight consecutive years.”

Few local markets are experiencing the price spikes that were common in 2014-2015. Sacramento’s yearly growth is currently the strongest among the country’s bigger metros at 6.5 percent, but the California capital is the only large market posting an increase of more than 6 percent.

Two years ago, more than a dozen big metros registered rent jumps topping 6 percent, with the pace of increase reaching as high as 12 percent in Portland, Oregon, then the country’s rent growth leader. Rents in Portland climbed just 1.9 percent in 2017.

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Apartment rents held largely flat during 2017 in several of the nation’s big markets. Rent growth proved minimal at less than 1 percent across Kansas City, Nashville, San Antonio, Pittsburgh, West Palm Beach and Washington, D.C. Prices even dipped a bit in Austin, where average rent slid 0.4 percent.

Occupancy Remains Healthy

National apartment occupancy stands at 95.1 percent at the end of the fourth quarter, unchanged from the year-ago performance.

While year-end occupancy inched down 20 basis points from 95.3 percent in the third quarter, the decline is less than the normal seasonal drop of about 50 basis points that occurs when leasing activity slows as the temperature cools.

That smaller-than-typical seasonal occupancy drop reflected market tightening in a handful of locations where hurricane damage sent displaced households to the apartment stock. In Texas, occupancy jumped 140 basis points on a quarterly basis in the big Houston metro and 220 basis points in the smaller Corpus Christi market. Florida metros, which have received households leaving Puerto Rico, tended to register small occupancy increases in the fourth quarter.

“The country’s apartment market remains tight, with product availability generally limited to recently-completed properties moving through initial leasing,” Willett said. “Unless a renter can afford that expensive new stock, finding a ready-to-lease unit takes some real work in most locations.”

Among the country’s bigger markets, Minneapolis/St. Paul stays atop the occupancy leaderboard, with 97 percent of the existing stock now full.

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The Outlook Holds Stable

RealPage market analysts anticipate that 2018’s apartment performance fundamentals will register at levels very similar to the 2017 results. “Minimal shifts in momentum are expected over the coming year,” Willett said. “Apartment demand should stay very solid, but new supply will continue to be delivered at a pace that will keep leasing conditions competitive in the top-tier product niche. In turn, rent growth should remain moderate.”

“The biggest question mark for 2018 may be the construction starts volume,” according to Willett. “At this late stage of the cycle, new building sites are difficult to source, and construction costs have climbed notably. With fewer starts likely in the coming year or so, delivery volumes should fall quite a bit by 2019 and 2020.”

About RealPage

RealPage is a leading global provider of software and data analytics to the real estate industry. Clients use its platform to improve operating performance and increase capital returns. Founded in 1998 and headquartered in Richardson, Texas, RealPage currently serves nearly 12,500 clients worldwide from offices in North America, Europe and Asia. For more information about the company, visit http://www.realpage.com.

Contacts

RealPage, Inc.
Jay Board
(972) 820-4915
jay.board@realpage.com