News Feed Item

Clear Capital: Six Month Forecast Calls for an Attitude Adjustment

Double Digit Gains Are Behind Us. Move On. 3.9% Year-End Growth a Sign of Long-Term Stability.

TRUCKEE, CA--(Marketwired - July 01, 2014) - Clear Capital (www.ClearCapital.com), the premium provider of data and solutions for real estate asset valuation and collateral risk assessment, today released its Home Data Index™ (HDI) Market Report with data through June 2014. Using a broad array of public and proprietary data sources, the HDI Market Report publishes the most granular home data and analysis earlier than nearly any other index provider in the industry.

  • We have seen this coming since December 2013. Clear Capital's update to our 2014 forecast confirms national home prices moderating over the next six months -- only 0.9% growth forecasted. When all is said and done, we expect to see 2014 year-end housing gains fall in line with historical rates of 3%-5%, with growth of just 3.9%. Between 1984 and 2013, national home prices grew on average 3.2% per year.
  • The low price tier, one of the key drivers of the recovery, has put on the breaks. Through the end of 2014, national annual rates of growth will be more than cut in half from the current 12.4% to just 5.6%. By Q4, quarterly growth across all three price tiers is set to fall below 1%, with the low tier forecast showing the weakest quarterly growth of all (Graph 1).
  • It's not all gloom and doom. National levels of distressed saturation fell below 20% for the first time since February 2008. This is certainly a good move for the long-term health and stability of the market, though discounted distressed opportunities particularly among investors helped to jump start the recovery. Improvements in distressed market measures mean other economic measures, like consumer confidence and the job market, must continue to improve to support the recovery. 
  • Where do we go from here? Though metro market trends reflect moderating patterns seen at the national level, June data and forecasts through the end of 2014 reveal notable variations that suggest opportunity and risk will persist through moderation.
    • Atlanta and San Jose should each continue a relatively strong recovery, leading the top 50 MSAs with 2.9% growth through the end of 2014. The markets' drastically different distressed saturation rates, however, signal they have very different demand drivers.
    • Detroit, on the other hand, is slated to see declines of 4.6% over the next six months, to end the year with total growth just under 2%. Detroit continues to see large variability in price trends in part influenced by low price points, with a median price of $115,000.
  • Contact Alanna Harter for your June 2014 file of the Top 30 MSAs, our Mid-Year Forecast or access our data on the Bloomberg Professional service by typing CLCA < GO >.

"Our mid-year forecast continues to support the initial 2014 projection for national price growth we made back in December 2013, with overall home prices expected to end the year up 3.9%," said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital. "While it might feel like a shock to market participants and observers who have grown used to double digit price growth, the market's continued move back toward long-run historical levels and growth rates is something we have expected. What we will be watching for, however, is whether the market settles into this historical sweet spot or whether prices continue to underperform historical norms.

Declining distressed saturation levels are an undeniable sign that we're transitioning back to pre-bubble norms. As markets fall back toward 3%-5% historical rates of growth, we hope stability will restore consumer confidence and help support this healthy rate of growth in the long-term.

Yet, any hint of declines in prices over the winter could have a negative effect on the spring buying season in 2015. There is real concern that the markets are not quite strong enough to withstand any further shocks. Uncertainty surrounding drivers like household formations, move up buyers on lock down with underwater mortgages, and constraints in the job market could limit the market's ability to sustain any type of growth moving forward."

About the Clear Capital® Home Data Index™ (HDI) Market Report

The Clear Capital HDI Market Report provides insights into market trends and other leading indices for the real estate market at the national and local levels. A critical difference in the value of the HDI Market Report is the capability of Clear Capital to provide more timely and granular reporting than nearly any other home price index provider.

The Clear Capital HDI Market Report

  • Offers the real estate industry (investors, lenders, and servicers), government agencies, and the public insight into the most recent pricing conditions, not only at the national and metropolitan level, but within local markets as well.
  • Is built on the most recent information available from recorder/assessor offices, and then further enhanced by adding the company's proprietary streaming market data for the most comprehensive geographic coverage and local insights available.
  • Reflects nationwide coverage of sales transactions and aggregates this comprehensive dataset at ten different geographic levels, including hundreds of metropolitan statistical areas (MSAs) and sub-ZIP code boundaries.
  • Includes equally-weighted distressed bank owned sales (REOs and short sales) from around the country to give the most real world look of pricing dynamics across all sales types.
  • Allows for the most current market data by providing more frequent updates with patent pending rolling quarter technology. This ensures decisions are based on the most up-to-date information available.

The Clear Capital HDI Methodology

  • Generates the timeliest indices in patent pending rolling quarter intervals that compare the most recent four months to the previous three months. The rolling quarters have no fixed start date and can be used to generate indices as data flows in, significantly reducing the multi-month lag time experienced with other indices.
  • Includes both fair market and institutional (real estate owned) transactions, giving equal weight to all market transactions and identifying price tiers at a market specific level. By giving equal weight to all transactions, the HDI is truly representative of each unique market.
  • Results from an address-level cascade create an index with the most granular, statistically significant market area available.
  • Provides weighted repeat sales and price-per-square-foot index models that use multiple sale types, including single-family homes, multi-family homes, and condominiums.

About Clear Capital®

Clear Capital (www.ClearCapital.com) is the premium provider of data and solutions for the mortgage finance industry. The Company's products include appraisals, broker price opinions, property condition inspections, value reconciliations, automated valuation models, quality assurance services, and home data indices. Clear Capital's combination of progressive technology, high caliber in-house staff, and a well-trained network of more than 40,000 field experts sets a new standard for accurate, up-to-date, and well documented valuation data and assessments. The Company's customers include the largest U.S. banks, investment firms, and other financial organizations. Clear Capital's home price data can be accessed on the Bloomberg Professional service by typing CLCA < GO >.

The information contained in this report is based on sources that are deemed to be reliable; however no representation or warranty is made as to the accuracy, completeness, or fitness for any particular purpose of any information contained herein. This report is not intended as investment advice, and should not be viewed as any guarantee of value, condition, or other attribute.

Image Available: http://www.marketwire.com/library/MwGo/2014/6/30/11G017662/Images/Price_Tier_Forecast_V3-840229725188.jpg
Image Available: http://www.marketwire.com/library/MwGo/2014/6/30/11G017662/Images/National_and_Regional_Markets_-_June_2014-301257348138.jpg
Image Available: http://www.marketwire.com/library/MwGo/2014/6/30/11G017662/Images/50_Major_Metro_Markets_-_June_2014-633691052553.jpg

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, will discuss the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of So...
SYS-CON Events announced today that StarNet Communications will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. StarNet Communications’ FastX is the industry first cloud-based remote X Windows emulator. Using standard Web browsers (FireFox, Chrome, Safari, etc.) users from around the world gain highly secure access to applications and data hosted on Linux-based servers in a central data center. ...
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
Virgil consists of an open-source encryption library, which implements Cryptographic Message Syntax (CMS) and Elliptic Curve Integrated Encryption Scheme (ECIES) (including RSA schema), a Key Management API, and a cloud-based Key Management Service (Virgil Keys). The Virgil Keys Service consists of a public key service and a private key escrow service. 

SYS-CON Events announced today that eCube Systems, the leading provider of modern development tools and best practices for Continuous Integration on OpenVMS, will exhibit at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. eCube Systems offers a family of middleware products and development tools that maximize return on technology investment by leveraging existing technical equity to meet evolving business needs. ...
Web Real-Time Communication APIs have quickly revolutionized what browsers are capable of. In addition to video and audio streams, we can now bi-directionally send arbitrary data over WebRTC's PeerConnection Data Channels. With the advent of Progressive Web Apps and new hardware APIs such as WebBluetooh and WebUSB, we can finally enable users to stitch together the Internet of Things directly from their browsers while communicating privately and securely in a decentralized way.
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Eric Robertson, General Manager at CollabNet, will discuss how customers are able to achieve a level of transparency that e...
Amazon has gradually rolled out parts of its IoT offerings, but these are just the tip of the iceberg. In addition to optimizing their backend AWS offerings, Amazon is laying the ground work to be a major force in IoT - especially in the connected home and office. In his session at @ThingsExpo, Chris Kocher, founder and managing director of Grey Heron, explained how Amazon is extending its reach to become a major force in IoT by building on its dominant cloud IoT platform, its Dash Button strat...
Two weeks ago (November 3-5), I attended the Cloud Expo Silicon Valley as a speaker, where I presented on the security and privacy due diligence requirements for cloud solutions. Cloud security is a topical issue for every CIO, CISO, and technology buyer. Decision-makers are always looking for insights on how to mitigate the security risks of implementing and using cloud solutions. Based on the presentation topics covered at the conference, as well as the general discussions heard between sessi...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
DevOps is speeding towards the IT world like a freight train and the hype around it is deafening. There is no reason to be afraid of this change as it is the natural reaction to the agile movement that revolutionized development just a few years ago. By definition, DevOps is the natural alignment of IT performance to business profitability. The relevance of this has yet to be quantified but it has been suggested that the route to the CEO’s chair will come from the IT leaders that successfully ma...
Fifty billion connected devices and still no winning protocols standards. HTTP, WebSockets, MQTT, and CoAP seem to be leading in the IoT protocol race at the moment but many more protocols are getting introduced on a regular basis. Each protocol has its pros and cons depending on the nature of the communications. Does there really need to be only one protocol to rule them all? Of course not. In his session at @ThingsExpo, Chris Matthieu, co-founder and CTO of Octoblu, walk you through how Oct...
Major trends and emerging technologies – from virtual reality and IoT, to Big Data and algorithms – are helping organizations innovate in the digital era. However, to create real business value, IT must think beyond the ‘what’ of digital transformation to the ‘how’ to harness emerging trends, innovation and disruption. Architecture is the key that underpins and ties all these efforts together. In the digital age, it’s important to invest in architecture, extend the enterprise footprint to the cl...
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.