Black Knight reported in its October Mortgage Monitor that the percentage of cash utilized in home purchases is declining. Less cash is flowing towards home purchases. Specifically, in the third quarter of 2015, cash sales declined from 32 percent in Q3 2014 to 28 percent in Q3 2015. For reference and perspective, the peak was 43 percent in 2012. And cash purchases on condominiums is now below 50 percent, touching down on a five-year low.
Fannie Mae released its Home Purchase Sentiment Index (HPSI) last week. And not surprisingly, the November HPSI fell by 2.4 points to 80.8, back to the March 2015 HPSI level. Housing affordability was cited as the main index component that contributed to the decrease.
There have been many reports about increasing home prices lately; here’s my take from North of the border. In Toronto, the average house value for a single-family detached home is about $1.1 million. An average house price for a semi-detached home, one of two homes that share a common wall, is about $660,000.
On November 18, Ellie Mae released its latest Origination Insight Report, which showed credit scores are declining for the fifth straight month. So the creditworthiness of homebuyers is on the decline. Let’s try to understand why, and what impact this has for today’s real estate agent — possibly during the negotiation phase of buying and selling homes.
In November, Howmuch.net released this visual examining economic growth across the country. It’s a great visual, and it’s one I initially relished because it was clean, comparatively descriptive, and it made me think that real estate agents should hitch a ride on the next wagon train to participate in this gold rush. But hold on.