Real Estate Brokerage -- More Consolidation

From RISMedia:

Realogy announced today it will be expanding its portfolio of brand offerings, franchising Corcoran® and Climb Real Estate® for the first time and selling agreements as early as 2019. The Realogy portfolio currently includes Better Homes and Gardens® Real Estate, CENTURY 21®, Coldwell Banker® and Coldwell Banker Commercial®, ERA®, and Sotheby’s International Realty®.

The San Francisco-based Climb brokerage sold itself to Realogy in 2016 so this franchising isn't technically consolidation.  But the Corcoran deal certainly is.

Presumably, this is (at least part of) Realogy's strategy to counter other growing brokerages and real estate sales business models such as Compass, REXX and Zillow Offers.

New Listing Watch -- more signs of change

We just concluded our survey of new listings for the past two weeks.  Here are the highlights:

• 17% more new listings than the same period a year ago
• almost 3x the number of single family home price reductions than a year ago 
• 50% more condo price reductions than a year ago
• the number of new listings of single family homes that went into contract within the same two-week period fell from 13% a year ago to 10% this year
• the number of new listings of condos that went into contract within the same two-week period fell from 28% to just 6% this year

At the time of year when the number of new listings should be trending down, we're seeing new listings every two weeks since Labor Day higher than during the same period for the last four years.

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Simultaneously we're seeing higher rates of price reductions than we have during the last four years.

Finally, the percentage of new listings going into contract in the same two-week period is down substantially for condos but also to a lesser extent for single family homes compared to the same period a year ago.

Our full report can be found at our web site:
http://www.boldsf.com/Statistics%20test/Statistics.html

New Listing Market Watch - signs of change

New listings in the last two weeks are lower than the previous period but higher than a year ago and the percentage of new listings going into contract in the same two weeks has fallen compared to the previous period and compared to a year ago.  But the most notable item that stands out is the number of price reductions, particularly in the condo market.

Compared to the previous period price reductions of single family homes rose from 27 to 37.  Price reductions of condos rose by 75% from 46 to 81.  (As a reminder, condos represented in this report are those listed in the MLS and do not include the majority of new construction condos being sold directly by the developer.  However, we have seen asking prices for new construction condos drop in some developments and often being accompanied by incentives to both buyer and buyer's agent).

Compared to a  year ago price reductions have doubled for single family homes (18 vs 37) and increased by 65% (49 vs 81).

As mentioned above, new listings of both single family homes and condos have fallen compared to the prior two week period (154 vs 189 for single family homes and 229 vs 272 for condos).  Although this has been the pattern in previous years, the number of new listings of condos is noticeably higher than a year ago (229 vs 189).

The number of new listings that went into contract in the most recent two week period has fallen by half compared to the prior period and compared to a year ago.  For single family homes 9.7% went into contract compared to 11.6% in the prior period and compared to 12.6% a year ago.  For condos, 5.2% went into contract compared to 9.6% during the prior period and 11.6% a year ago. 5.2% is the lowest percentage of condos going into contract in the same two week period in the last 12 months.

Interest Rates Heading Higher

(From Business Insider)

Notice the similarity to the 30-year mortgage interest rates:

Here's a graph with both:

This is a reasonable predictor of mortgage interest rates.

And despite the somewhat hysterical headline and the underlying story which is discussing stock/equity markets, this trend will have effects on the overall economy.