Credit Suisse Monthly Report of Real Estate Agents September 2013 Results

7/27/2019 Credit Suisse Monthly Report of Real Estate Agents September 2013 Results

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CREDIT SUISSE SECURITIES (USA) LLC

DISCLOSURE APPENDIX CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, INFORMATION ON TRADE ALERTS, ANALYST MODEL PORTFOLIOS AND

THE STATUS OF NON-U.S ANALYSTS. FOR OTHER IMPORTANT DISCLOSURES, visit www.credit-suisse.com/ researchdisclosures or call +1 (877) 291-2683. U.S. Disclosure:

Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that

could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

October 4, 2013

Daniel Oppenheim, CFAHomebuilding & Building Products

212-325-5726

[email protected]

Michael Dahl

212-325-5882

[email protected]

William Alexis

212-538-3992

[email protected]

Patrick Murray, CFA

212-325-5292

[email protected]

Monthly Survey of Real Estate Agents Septem ber 2013

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BuyerTrafficIndex

50 - Exceeds Expectations

Traffic dropped in September, further below agents' expectations, as buyers showed more hes itancydue to the combination of higher rates and home prices; we think weaker buyer traffic will lead tomore modest price appreciation.

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HomePriceIndex

50 - Higher than Prior Month

Home price appreciation continues, though our survey suggests slowingmomentum as the gains and rising mortgage rates eat into affordability.

Source: Credit Suisse


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September 13Slide 1

Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell

Index

Apr-13 64.4 84.8 52.9 73.7 81.0

May-13 63.4 84.9 54.1 67.1 81.1

Jun-13 60.5 87.3 54.1 61.8 75.9

Jul-13 52.9 82.3 55.3 63.3 68.6

Aug-13 45.2 75.7 52.8 57.2 57.6

Sep-13 36.2 71.5 49.1 56.3 56.4

Point Change (9.0) (4.2) (3.7) (0.9) (1.2)

50%

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Home Prices Incentives Time to Sell

How Do the Recent 30 Days Compare tothe Prior 30 Days...

Increased Remained the same Decreased

September Survey of Real Estate Agents:Buyer Traffic Slips Further, Despite Stabil ization/ Pullback in Rates Market continues to cool at start of fall season: The housing markets fall season started slowly as fatigue over

rising rates, home prices, and a lack of attractive inventory persisted across most markets in September. The decline inmortgage rates will hopefully help traffic over time, but hasnt yet. Buyers are pushing back on the aggressive priceincreases from recent months, and while agents generally saw rising prices in September due to limited available

inventory, we saw slowing momentum and increased incentive use (not surprising, especially as builders can tailorincentives to address hot-button issues such as interest rate buy-downs).

Buyer traffic drops again in September, well belo w agents expectations as h esitancy continues, despite therecent pullback in rates: Our buyer traffic index fell to 36 in September from 45 in August, pointing to a secondstraight month of traffic missing agents expectations (a reading of 50 indicates in-line traffic). This is also the lowestlevel since November 2011. Agents blamed the increase in mortgage rates and home prices, and we didnt see signsthat the recent pullback in rates has led buyers to re-engage yet. Weakness was broad-based, with none of the top-20markets exceeding expectations, though markets in Texas and Florida (aside from Jacksonville) appeared comparativelymore healthy. Investor-heavy markets (Atlanta, Phoenix, Vegas) continued to take a hit as investors pulled back.

Lack of inventory still driving prices higher, though m omentu m appears to be easing: Our home price index fellto 72 in September from 76 in August. This still indicates rising home prices, but less broad-based than in prior months,suggesting momentum is slowing. The key driver lifting prices remains the lack of supply, which is offsetting weakertraffic in most markets. We also saw signs of increased incentive use, a negative for pricing.

Inventories and time to sell trend modestly lower: Our home listings was unchanged at 57, while our time to sellindex edged down to 57 from 58 in August, modestly above neutral readings. These indicators remain supportive forhome price trends, though continued weakness in traffic would likely lead to less favorable conditions.

15%

43%

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Traffic Levels Versus Expectations

More than expected Meets expectations Less than expected

Source: Credit Suisse


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September 13Slide 2

Table o f ContentsKey Housing Markets: Key Housing Markets Continued:

3 Atlanta, Georgia 25 Orlando, Florida

4 Austin, Texas 26 Philadelphia-Southern New Jersey

5 Baltimore, Maryland 27 Phoenix, Arizona

6 Boston, Massachusetts 28 Portland, Oregon

7 Charleston, South Carolina 29 Raleigh, North Carolina

8 Charlotte, North Carolina 30 Richmond, Virginia

9 Chicago, Illinois 31 Sacramento, California

10 Cincinnati, Ohio 32 San Antonio, Texas

11 Columbus, Ohio 33 San Diego, California

12 Dallas, Texas 34 San Francisco, California

13 Denver, Colorado 35 Sarasota, Florida14 Detroit, Michigan 36 Seatt le, Washington

15 Fort Myers, Florida 37 St. Louis, Missouri

16 Houston, Texas 38 Tampa, Florida

17 Inland Empire (Riverside-San Bernardino), California 39 Tucson, Arizona

18 Jacksonville, Florida 40 Virginia Beach, Virginia

19 Las Vegas, Nevada 41 Washington, D.C.

20 Los Angeles, California 42 Wilmington, North Carolina

21 Miami, Florida Appendix:

22 Minneapolis, Minnesota 45 Historical Trends by Market

23 Nashville, Tennessee 50 Agent Recommendations

24 New York-Northern New Jersey 51 Survey Methodology


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September 13Slide 3

Atlanta, GA Traffic Continues to Slump, Likely Limiting Further Near-term Price Momentum

Source: Credit Suisse; Census Bureau

(9,146 single-family building permits in 2012, 5th largest market in the country)

Comments from Real Estate Agents:

Unstable interest rates; uncertainty in Washington;extremely low inventory.

Lack of inventory. Sellers apprehensive about listing theirproperty until they see something they would buy.

Seeing less first time homebuyers and more second timebuyers as the higher prices allow more people to sell theirhomes and purchase new ones.

Rising interest rates.

Seasonal, but still slower than normal.

Our Take:

Our buyer traffic index slumped to 17 in September from 36 inAugust, indicating lower traffic and levels well below agentsexpectations. Agents primarily cited mortgage rates coupled

with a lack of attractive inventory even for those motivated tobuy. Lower traffic, if continued, may start to impact pricing.

Home prices increased again, albeit the gains appeared morenarrow as our index fell to 62 in September from 79 in August(readings above 50 point to rising prices).

Weaker traffic and longer time to sell point to waning pricingmomentum.

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HomePriceIndex


Month

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Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell

IndexApr-13 53.6 82.1 46.4 57.1 71.4

May-13 53.1 93.3 43.3 65.6 81.3

Jun-13 42.9 80.0 35.7 56.7 70.0

Jul-13 47.1 81.3 50.0 78.1 59.4

Aug-13 35.7 78.6 42.9 64.3 46.4

Sep-13 17.4 61.9 52.5 80.4 43.5

Point Change (18.3) (16.7) 9.6 16.1 (3.0)

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September 13Slide 4

Austin, TX Demand Cooling Off, but Pricing Still Going Strong


(7,970 single-family permits in 2012, 7th largest market in the country)


School starts and everything just drops off the cliff. Veryslow traffic after great 7 months.

Interest rates reduced buying power.

We had a speed bump and after canvassing other brokers

and builder reps I have discovered they are seeing the samelull. Though September was one of the best sales months ofthe year, our pipeline needs more action.

Supply and demand...increasing interest rates have shovedwaiting buyers off the fence.

Things cooled off a little bit.

Our Take:

Buyer traffic in Austin fell back to essentially in-line with/slightlybelow agents expectations for this time of year, as our indexdipped to 47 from 65 in August. This is the lowest since last

November. Most viewed this as more of a speed bump dueto higher rates, as local economic trends remain favorable.

Solid home prices gains continued, as our August index camein at 80 in September from 85 in August, still far above aneutral level of 50.

Inventory levels and the length of time needed to sell continuedto trend lower, though both moved toward more neutral levels.

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Month

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Index

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Incentive

Index

Home Listings

Index

Time to Sell

IndexApr-13 81.8 95.8 69.2 76.9 92.3

May-13 80.8 100.0 63.6 75.0 87.5

Jun-13 63.3 85.7 65.4 60.7 76.7

Jul-13 61.1 94.4 44.4 55.6 72.2

Aug-13 65.4 84.6 50.0 69.2 69.2

Sep-13 46.7 80.0 43.3 56.7 63.3

Point Change (18.7) (4.6) (6.7) (12.6) (5.9)

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September 13Slide 5

Baltimore, MD Buyers Worry Over Rates and Jobs, Though Lack of Supply Lifts Prices




Uncertainty regarding the economy because of thethreatened government shut-down. The Baltimore areamarket is very sensitive to this issue due to high employmentin the federal sector.

Looks like there is some renewed optimism in the economy,rates have come back a bit; but lack of inventory will kill thismomentum quickly.

Higher rates, uncertainty over government.

Our Take:

Buyer traffic fell back below agents expectations inSeptember, as our traffic index fell to 20 from 50 in August.Rising rates had some impact, but agents also said the

looming prospect of a government shutdown weighed onpotential buyers given the areas job base.

A lack of inventory continued to help lift home prices, as ourprice index improved to 80 from 56.

Inventory levels continued to decline, contributing to a shortertime needed to sell despite the weaker traffic. This shouldcontinue to help prices in the near-term.

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BuyerTrafficIndex


Month

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IndexApr-13 25.0 100.0 50.0 100.0 87.5

May-13 38.9 83.3 43.8 66.7 88.9

Jun-13 30.0 100.0 60.0 50.0 70.0

Jul-13 28.6 71.4 57.1 50.0 64.3

Aug-13 50.0 56.3 42.9 75.0 50.0

Sep-13 20.0 80.0 40.0 100.0 70.0

Point Change (30.0) 23.8 (2.9) 25.0 20.0

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September 13Slide 6

Boston, MA Lack of Inventory Remains a Huge Problem; Rising Rates Frustrate Buyers




Frustrated buyers not enough inventory.

Rising interest rates.

Higher rates, potential government shutdown, and lack ofinventory.

Continued low inventory.

Our Take:

Buyer traffic deteriorated in September, as our index fell to 25from 47 in August, below agents expectations (reading of 50).Agents noted mounting frustrations, as inventory levels remain

extremely low and buyers watch mortgage rates head higher,leaving them unable to capitalize on attractive affordability.

Home prices increased again in September, though our priceindex slipped to 66 from 78 in August, as fewer agents sawappreciation.

Our time to sell index remained at 61, although this may slip iftraffic remains weak in the coming months.

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HomePriceIndex


Month

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IndexApr-13 75.0 91.7 60.0 79.2 75.0

May-13 66.7 91.7 59.1 70.8 91.7

Jun-13 67.9 92.9 53.6 67.9 82.1

Jul-13 46.9 80.0 64.3 70.0 70.0

Aug-13 47.2 77.8 61.8 72.2 61.1

Sep-13 25.0 65.8 52.8 60.5 60.5

Point Change (22.2) (12.0) (9.0) (11.7) (0.6)

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September 13Slide 7

Charleston, SC Traffic Steady but Shy of Expectations; Price Appreciation Continues




Many people are coming to the Carolinas.

Some super jumbo loans are starting to appear in themarket for investment properties.

Worry of rising mortgage rates and prices.

Rising interest rates and back to school has slowed traffic.

Our Take:

Our buyer traffic index edged up to 44 in September from 42in August, pointing to traffic levels just shy of agentsexpectations for this time of year. Agent cited a combination of

continued credit restrictions and worries over risingrates/prices for the continued softness, though conditions herewere more stable than in many other markets.

Home prices continued to rise, as our price index wasunchanged at 75 in September.

Inventory levels were stable, while the time to sell shortened supportive for further price improvement.

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HomePriceIndex


Month

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IndexApr-13 33.3 66.7 50.0 66.7 66.7

May-13 64.3 85.7 50.0 64.3 78.6

Jun-13 50.0 91.7 58.3 66.7 58.3

Jul-13 80.0 90.0 60.0 80.0 70.0

Aug-13 41.7 75.0 50.0 58.3 66.7

Sep-13 43.8 75.0 42.9 50.0 68.8

Point Change 2.1 0.0 (7.1) (8.3) 2.1

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September 13Slide 8

Charlotte, NC Traffic Recoups Some Ground from Last Month, but Buyers Remain Hesitant




Very limited inventory. Hedge funds just came through. Bothbuyers and sellers seem cautious about making decision tosell and/or buy.

Nice traffic, but seems to be waning as fall approaches.

A combination of higher rates, low inventory and negativeeconomy news concerning the debt ceiling etc.

Sense of urgency with rising rates.

Very typical September for our market.

Our Take:

Buyer traffic levels improved a bit but remained below agentsexpectations in September, as our index increased to 39 from31 in August (below a neutral 50). Agents suggested both

buyers and sellers are still taking time to digest currentconditions (higher prices, rates, etc.).

Our home price index came in at 78 vs. 93 in August, stillpointing to fairly broad increases in home prices (any readingover 50).

Our inventory and time to sell indexes edged closer to neutrallevels, indicating some easing in competition.

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HomePriceIndex


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Index

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Index

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Index

Time to Sell

IndexApr-13 65.4 83.3 46.2 46.2 73.1

May-13 66.7 87.5 66.7 62.5 91.7

Jun-13 60.0 90.0 70.0 65.0 70.0

Jul-13 50.0 80.0 65.0 80.0 70.0

Aug-13 31.3 92.9 50.0 71.4 71.4

Sep-13 38.9 77.8 50.0 61.1 55.6

Point Change 7.6 (15.1) 0.0 (10.3) (15.9)

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September 13Slide 9

Chicago, IL Traffic Slightly Below Expectations; Tight Supply Continues to Drive Prices Higher




Lack of desirable inventory. Prices have gone up too muchtoo quickly...Buyers are taking a wait and see approachbefore jumping in.

Hesitant buyers are getting spooked by rising interest

rates. The interest rates are going up which is taking buyers off

the fence & moving them into action. Plus the prices ofhouses are starting to go up and the people who sold shortin the past are now back in the market buying again.

Lack of inventory.

Our Take:

Buyer traffic slid slightly below agents expectations inSeptember, as our buyer traffic index fell to 45 from 50 inAugust. Agents continued to note a split in buyer sentiment,

with some getting spooked by the sharp rise in rates, andothers getting pushed off the fence to buy now. Most agreedthat the inventory selection was disappointing, though.

Home prices marched higher, as our index improved to 76 inSeptember from 62 in August, pointing to broad increases.

Inventory remains tight, though the time to sell index fell backtoward a neutral level, suggesting urgency could be waning.

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HomePriceIndex


Month

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Index

Home Price

Index

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Index

Home Listings

Index

Time to Sell

IndexApr-13 59.6 70.0 41.7 61.5 73.1

May-13 68.3 81.3 50.0 68.8 77.4

Jun-13 64.0 80.0 45.2 76.0 79.2

Jul-13 55.8 80.0 45.8 50.0 74.1

Aug-13 50.0 61.7 50.0 66.7 66.7

Sep-13 44.8 75.9 55.8 69.0 53.4

Point Change (5.2) 14.2 5.8 2.3 (13.2)

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September 13Slide 10

Cincinnati, OH Buyers Take a Break; Price Appreciation Appears to Moderate




Less activity at open houses. Sign and internetcalls/connects off just a bit.

Maybe more people bought earlier in the year and nowworry about the high interest rates.

Interest rates, loan availability, price increases. People are feeling more secure about their jobs.

Our Take:

Our buyer traffic index slumped to 20 in September from 67 inAugust, pointing to weaker traffic levels, below agentsexpectations. Agents saw less activity following a better

August, suggesting some choppiness which agents blamed onworries about higher rates, prices, and tight credit.

Price appreciation continued but seemingly at a more modestpace, as our index fell to 60 from 80 in August, vs. a neutrallevel of 50.

Home listings and the time needed to sell both increased for asecond month, which will likely limit near-term price gains.

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IndexApr-13 50.0 81.3 50.0 81.3 81.3

May-13 50.0 78.6 57.1 57.1 71.4

Jun-13 33.3 58.3 50.0 66.7 58.3

Jul-13 42.9 71.4 50.0 78.6 64.3

Aug-13 66.7 80.0 60.0 37.5 25.0

Sep-13 20.0 60.0 50.0 40.0 40.0

Point Change (46.7) (20.0) (10.0) 2.5 15.0

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12/55


Columbus, OH Buyers Remain Engaged as Tight Inventory Levels Drive Prices Higher, Despite Rates




Low inventory, brisk sales pace and stabilizing prices.

Better consumer confidence.

Shortage of inventory and rise in interest rates.

Appraisals are seeing a small turn; less fussy.

Lack of inventory.

Our Take:

Buyer traffic came in essentially in-lien with agentsexpectations, as our buyer traffic index increased to 45 inSeptember from 38 in August (close to a neutral 50). Agents

acknowledged headwinds from higher rates, but said buyersremain confident or at least somewhat motivated given the lackof supply and rising home prices.

Home prices marched higher, as our index slipped to 70 from75 in August but remains well above a neutral 50.

Our home listings and time to sell indexes both remainedfavorable, a positive for near-term pricing trends.

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Month

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Index

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Index

Home Listings

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IndexApr-13 68.8 78.6 50.0 78.6 92.9

May-13 50.0 83.3 41.7 41.7 75.0

Jun-13 70.0 100.0 40.0 40.0 90.0

Jul-13 42.9 83.3 58.3 66.7 58.3

Aug-13 37.5 75.0 62.5 75.0 62.5

Sep-13 45.0 70.0 40.0 60.0 70.0

Point Change 7.5 (5.0) (22.5) (15.0) 7.5

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13/55


Dallas, TX Fairly Steady Traffic, Strong Pricing Power


(17,821 single-family permits in 2012, 2nd largest market in the country)


Slightly more buyers than sellers.

Low rates and low inventory, though the governmentshutdown may slow it.

Both lending standards and appraisals seem to be

loosening up some. Local buyers concerned about rising mortgage rates.

Lack of exciting inventory.

Time of year when business typically slows down. Seems alittle slower than expected.

Our Take:

Our buyer traffic index rebounded to a neutral level of 50 inSeptember after falling to 40 in August. A few agents notedsome concerns among buyers regarding the rising mortgage

rates, but overall the levels of activity seem healthy and thecontinued lack of supply is still helping buyer urgency. Oneagent also noted some loosening in credit, which would help.

Home prices continued to enjoy broad increases in September,as our price index was unchanged at 80.

Inventory levels continued to decline and it took less time tosell in September, favorable near-term indicators for prices.

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Month

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Time to Sell

IndexApr-13 80.0 96.7 67.9 78.6 90.0

May-13 65.0 90.0 66.7 65.0 100.0

Jun-13 70.0 86.7 53.3 56.7 93.3

Jul-13 56.3 75.0 75.0 62.5 75.0

Aug-13 40.0 80.0 55.0 55.6 55.0

Sep-13 50.0 80.0 50.0 80.0 70.0

Point Change 10.0 0.0 (5.0) 24.4 15.0

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D CO C i D Off F i d L l Hi h R d I C l D d/P i


14/55


Denver, CO Coming Down Off Frenzied Levels as Higher Rates and Inventory Cool Demand/Prices




I'm noticing daily price drops in MLS so sellers have startedto realize that the BOOM market of spring/summer 2013 isover. Higher interest rates, more competition...and torrentialrain for days in CO are keeping buyers away.

I think prices have settled in and with inventory up we won'tsee much appreciation over the winter.

Market has slowed from the spring/summer frenzy. Highermortgage rates, higher prices, and increasing inventory maybe the causes.

Not as many showings, feels like we have no buyers.

Our Take:

Buyer traffic continued to worsen in September, as our buyertraffic index fell to 31 from 34 in August. Agents suggested theincrease in prices and mortgage rates has hurt demand, while

the rising inventory levels are leading to lower buyer urgencyand competition.

Home prices were flat in September (index of 53 vs. 72 inAugust), and appear at risk of falling in coming months basedon the weak demand, rising inventory and longer time to sell.

Inventory levels continue to rise, while the time needed to sellalso lengthened negatives for home prices.

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HomePriceIndex


Month

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Index

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Index

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Index

Home Listings

Index

Time to Sell

IndexApr-13 75.0 93.8 65.0 77.1 79.2

May-13 68.8 85.7 60.9 56.5 82.6

Jun-13 63.2 86.8 44.1 28.9 76.3

Jul-13 55.0 83.3 45.0 26.2 57.1

Aug-13 34.0 72.0 48.0 24.0 42.0

Sep-13 30.6 52.5 47.4 20.0 27.5

Point Change (3.4) (19.5) (0.6) (4.0) (14.5)

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D i MI T ffi Sl b A S i M Sli h T P


15/55


Detroit, MI Traffic Slows but Agents See it More as a Slight, Temporary Pause




Higher interest rates have slowed the buyers down a littlebit, but they are still out there looking and buying.

Slowed a little. Fewer houses available and prices haverisen. Still very healthy market.

Buyers have slowed slightly in reflection of rising mortgageinterest rates.

Price are still rising. Some foreclosures (HUD) are puttingin disclosures that if the property appraises under askingbuyer will bring extra funds to closing.

Our Take:

Traffic edged lower in September, as our index fell to 37 from47 in August, pointing to levels below agents expectations(reading of 50). Interestingly, agents comments appeared

more upbeat than this would suggest, as they noted a slightpullback due to higher rates and prices, but said buyer interestremains solid. Hopefully this translates to better fall trends.

Pricing trends remained solid, as our home price index came inat 80 vs. 81 in August, well above a neutral 50.

Inventory stabilized after rising last month, and our time to sellremained at 50.

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Month

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Index

Apr-13 57.1 89.3 57.7 78.6 82.1

May-13 53.8 87.5 45.5 83.3 83.3

Jun-13 47.5 90.0 50.0 60.0 73.7

Jul-13 50.0 86.1 55.9 69.4 64.7

Aug-13 46.9 81.3 43.3 34.4 50.0

Sep-13 36.7 80.0 50.0 56.7 50.0

Point Change (10.2) (1.3) 6.7 22.3 0.0

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Ft M FL B d P i G i T ffi R i Ab E t ti


16/55


Ft. Myers, FL Broad Price Gains as Traffic Remains Above Expectations




People getting a head start before high season.

Slower than summer, but still exceeds expectations.

Seeing buyers who are retiring soon and low interest ratesthat might go up soon.

Appraisals still lag current sales; lender criteria verystringent on 2nd homes.

We are having environmental conditions due to massivedirty water releases from Lake Okeechobee...that are killingour beaches & quality of water. Tourists & locals are nothappy.

Our Take:

Ft. Myers appears to be one of the healthier markets amongthose we survey, as buyer traffic remained at solid levels aheadof expectations and strong price gains continued. Our trafficindex edged up to 61 vs. 60 in August, as agents said buyersare getting a head start on the fall/winter season.

Home prices continued to experience broad-based increases,as our index came in at 83 in September vs. 94 in August.

Inventory levels continue to trend lower and the length of timeneeded to sell is also declining, both of which are positiveindicators for future pricing.

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Month

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Index

Time to Sell

Index

Apr-13 53.3 78.6 42.9 82.1 82.1

May-13 58.3 75.0 41.7 79.2 83.3

Jun-13 60.0 83.3 43.3 86.7 76.7

Jul-13 59.1 95.5 40.9 86.4 80.0

Aug-13 60.0 94.4 33.3 80.0 66.7

Sep-13 61.1 83.3 38.9 68.8 83.3

Point Change 1.1 (11.1) 5.6 (11.3) 16.7

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H t TX R t d Ti ht S l C i T ffi Th h S ll M i t i P i i P


17/55


Houston, TX Rates and Tight Supply Crimp Traffic, Though Sellers Maintain Pricing Power


(28,568 single-family permits in 2012, largest market in the country)


Market appears to be finally approaching a more normalbalance between buyers and sellers but still very much aseller's market.

Increase in rates; low inventory.

We are seeing typical fall slowing but still heavy for the timeof year. No sign of inventory shortage easing.

Move up buyers, buyers moving in to Houston and first timebuyers getting a position in a fast moving market.

Our Take:

Buyer traffic downshifted in September and came in just shy ofagents expectations, though the majority of agents were stillsatisfied with the levels of activity they are seeing. Our buyertraffic fell to 42 from 68. Those who saw worse than expectedtraffic blamed higher mortgage rates and low inventory levels.

Prices continued to rise, as our home price index improved to88 from 86, though agents noted incentives increased.

Inventory levels fell in September and the time needed to sellalso trended lower, suggesting the market likely remains asellers market for now, unless traffic continues to weaken.

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Month

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Index

Apr-13 91.7 86.8 47.4 78.9 89.5

May-13 77.8 97.2 62.5 91.2 88.2

Jun-13 71.4 92.3 66.7 88.5 96.2

Jul-13 70.8 87.5 63.6 79.2 79.2

Aug-13 68.2 86.4 54.5 59.1 77.3

Sep-13 41.7 87.5 41.7 63.6 62.5

Point Change (26.5) 1.1 (12.9) 4.5 (14.8)

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I l d E i CA B T k St B k S ll St t t St U


18/55


Inland Empire, CA Buyers Take a Step Back as Sellers Start to Step Up




Higher rates and list prices.

Not enough inventory.

My VA buyers not able to purchase as sellers want cashbuyers only.

The reason traffic is what I expected is in listing homes lastmonth I went by recent closed sales. I did not list abovecomps. They sold for list price in less than a week.

Appraisals are lender driven rather than true values.

Our Take:

Buyer traffic took a sharp turn lower, as our index dropped to23 in September from 55 in August. Agents noted that thecombination of higher prices and rising mortgage rates ishurting buyers ability/desire to buy, especially as they continueto face limited choices of homes.

Home prices increased again, though our price index fell to 64from 86, suggesting slowing momentum.

Inventory levels and the length of time needed to sell increasedin September, as sellers look to capitalize on higher prices butface softer buyer interest.

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Index

Apr-13 65.0 90.0 50.0 90.0 80.0

May-13 63.2 97.4 61.1 84.2 92.1

Jun-13 75.0 100.0 45.8 87.5 95.8

Jul-13 53.3 90.0 64.3 70.0 46.7

Aug-13 54.5 86.4 60.0 31.8 59.1

Sep-13 22.7 63.6 36.4 36.4 36.4

Point Change (31.8) (22.7) (23.6) 4.5 (22.7)

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Jackson ille FL Chopp Conditions Contin e ith September Coming in Ver Weak


19/55


Jacksonville, FL Choppy Conditions Continue, with September Coming in Very Weak


(4,582 single-family permits in 2012, 23rd largest market in the country)


Traffic has slowed a lot. Thin inventory and rising rates arehaving an effect. Plus, I do believe folks aren't feeling arecovering economy that is being touted on the news.

New construction companies becoming more aggressive.

Buyers do not qualify for loans as prices increase.

Rising interest rates and low lot inventory.

Increased interest rates.

Our Take:

Traffic dropped in September, as the volatility seen in our indexin recent months continued. Our buyer traffic index slumped to11 (lowest in three years) from 75 in August, as activity levelsdisappointed most agents. Agents blamed worseningaffordability and low inventory levels for the lack of demand.

Despite the lower traffic, prices pushed higher as our homeprice index came in at 72 vs. 63 in August, though this likelywont last if traffic remains this weak.

Inventory levels increased in September, while the time to sellwas essentially unchanged.

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Month

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Index

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Index

Home Listings

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Index

Apr-13 68.8 87.5 37.5 81.3 78.6

May-13 71.4 71.4 50.0 71.4 71.4

Jun-13 55.0 75.0 45.0 50.0 75.0

Jul-13 37.5 62.5 50.0 62.5 75.0

Aug-13 75.0 62.5 43.8 71.4 62.5

Sep-13 11.1 72.2 44.4 43.8 55.6

Point Change (63.9) 9.7 0.7 (27.7) (6.9)

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Las Vegas NV Diminishing Buyer Urgency as Prices/Rates Move Higher and Inventory Comes Back


20/55


Las Vegas, NV Diminishing Buyer Urgency as Prices/Rates Move Higher and Inventory Comes Back




Traffic has decreased in recent weeks. Buyer areoverwhelmed with the news media, and changes coming inNV regarding Home Owner's Bill of Rights. Down rightconfusing!

Property values have not appreciated in the last 30 days.More inventory coming on he market.

Buyers are not seeing urgency to respond as much as priormonths.

Primary buyers are frustrated, and the investors are not outin full force.

Our Take:

Buyer traffic continued to fall in September, as our traffic indexfell to 24 from 36 in August, below agents expectations andthe lowest reading since November 2010). Agents said buyerurgency has waned as prices and rates have pushed higherand more inventory is emerging.

Home prices rose in September, though our price indexslipped to 75 from 86. Agents noted higher incentives,however, suggesting price gains likely wont continue for long.

Inventory increased as sellers look to cash out, while the weaktraffic led to a longer time to sell negatives for pricing.

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HomePriceIndex


Month

Buyer Traffic

Index

Home Price

Index

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Index

Home Listings

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Time to Sell

Index

Apr-13 75.0 100.0 57.5 92.5 95.0

May-13 65.9 97.6 73.8 64.3 81.0

Jun-13 61.1 100.0 61.8 63.9 79.4

Jul-13 46.2 90.4 64.0 60.0 65.4

Aug-13 36.1 86.1 55.6 41.2 52.8

Sep-13 23.7 75.0 30.6 25.0 30.6

Point Change (12.4) (11.1) (25.0) (16.2) (22.2)

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Los Angeles CA Buyers Push Back on Price Increases Amid Rising Rates


21/55


Los Angeles, CA Buyers Push Back on Price Increases Amid Rising Rates


(4,921 single-family permits in 2012, 22nd largest market in the country)


Buyers putting off purchase. Getting tired of the multipleoffers game and interest rate uncertainty. Home prices shotup high very quickly spooking buyers. Some think this isanother bubble.

Higher level of inventory, unrealistic seller priceexpectations have slowed the market, which usually is slowthis time of year anyhow. But we needed the slow down tostop the runaway price increases.

The buyers are aware that the prices are rising. We havevery little inventory and the rates are still not too bad.

Our Take:

Traffic fell again in September and dipped below agentsexpectations, as our traffic index fell to 39 from 47 in August.Agents said buyers have been turned off by the sharp priceincreases theyve seen in recent months, especially given themove higher in rates. Some also noted that appraisals haventkept pace with pricing, causing challenges for buyers.

Prices still increased, though comments point to increasingresistance. Our price index came in at 76 vs. 78 last month.

Inventory levels were stable, but it took longer to sell a home inSeptember, consistent with slowing price momentum.

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Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell

Index

Apr-13 66.7 96.6 63.5 70.7 81.0

May-13 76.5 97.1 65.0 65.3 83.3

Jun-13 63.0 95.7 53.1 71.4 84.1

Jul-13 52.1 85.4 55.0 41.7 45.7

Aug-13 47.2 77.8 43.8 38.9 41.7

Sep-13 38.5 76.0 56.5 46.2 38.0

Point Change (8.8) (1.8) 12.8 7.3 (3.7)

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Miami FL Buyers Fatigued After Battling Stiff Competition From Investors and Higher Prices


22/55


Miami, FL Buyers Fatigued After Battling Stiff Competition From Investors and Higher Prices


(5,048 single-family permits in 2012, 21st largest market in the country)


Lack of inventory has caused buyer fatigue. Several of mycustomers have decided to take a break. Also, interest rateshave caused some buyers to continue to rent.

We've fallen off a cliff. Cash buyers don't like the higher

prices and conventional buyers don't like the higher ratesOR the higher prices. Only the hard core or mega richbuyers are still out there looking seriously.

Market appears to be cooling down except in the under$250,000 range where demand is outpacing inventory andmultiple offers are common place.

Our Take:

Agents noted buyer traffic fell below expectations inSeptember, as our traffic index dropped to 30 from 46 inAugust (below a neutral 50). Tight inventory levels aresupporting price increases, but agents say buyers are taking abreak after fighting investors and not finding quality inventory atattractive prices, along with less attractive mortgage rates.

Home prices continued to enjoy broad increases, as our indexincreased to 84 from 81, though weak traffic could slow gains.

Inventory levels and the length of time needed to sell continuedto trend lower, both of which are supportive for prices.

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Month

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Home Listings

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Time to Sell

Index

Apr-13 66.7 92.4 40.0 87.9 89.4

May-13 75.8 93.9 51.6 72.6 87.9

Jun-13 64.3 86.1 48.6 65.3 77.8

Jul-13 55.9 92.6 46.9 77.3 77.3

Aug-13 46.0 81.3 48.0 66.0 80.0

Sep-13 30.0 84.0 50.0 66.0 60.0

Point Change (16.0) 2.8 2.0 0.0 (20.0)

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Minneapolis MN Buyers Pull Back Hoping for Better Deals in the Coming Months


23/55


Minneapolis, MN Buyers Pull Back, Hoping for Better Deals in the Coming Months




Higher rates, fewer good buys due to higher prices. Thetalk is the hope rates will come back down and more gooddeals are around the corner.

Showing has dramatically slowed in the outer suburbs

(fourth tier). Had a listing without a single showing for aweek.

Agreeable mortgage rates, increasing inventory of saleablehomes.

Rates are still low with pressure and PR that they willrise...good combo for motivation.

Our Take:

Buyer traffic slowed in September, missing expectations as ourtraffic index fell to 38 from 63 in August. Agents noted thatbuyers took a small step back after not finding attractive deals,thinking or hoping that mortgage rate may come back downand more inventory will come back, presenting better deals.

Home price appreciation continued but seemingly at a lowerpace, as our price index fell to 58 from 68, only modestlyabove a neutral reading of 50.

Inventory levels increased, the first increase since early 2011.Further increases would likely dampen price appreciation.

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Month

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Index

Home Listings

Index

Time to Sell

Index

Apr-13 60.0 92.9 42.9 78.6 92.9

May-13 73.1 88.5 41.7 83.3 88.5

Jun-13 55.3 92.1 52.8 60.5 84.2

Jul-13 55.9 85.3 55.9 76.5 76.5

Aug-13 62.5 68.2 45.5 63.6 54.5

Sep-13 37.5 58.3 50.0 41.7 58.3

Point Change (25.0) (9.8) 4.5 (22.0) 3.8

0%

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Nashville TN Buyer Traffic Plunges on Higher Rates; Home Prices Gain Further


24/55


Nashville, TN Buyer Traffic Plunges on Higher Rates; Home Prices Gain Further




Not as many people out shopping for homes or putting theirhomes up for sale.

Now holders of approved new subdivisions are reaping theharvest. Speculators are sniffing to lock down undeveloped

but nearby land. The increase in rates is slowing traffic.

Pent-up demand.

Our Take:

With no agents responding that traffic levels exceeded theirexpectations, our buyer traffic index moved significantly lowerin September to 21 vs. 61 in August. Multiple agents notedhigher rates and rate volatility continue to negatively impactbuyer traffic although some comments suggest there arebuyers waiting in the wings for the right home to hit the market.

While agents saw prices higher, the increase appears lessbroad-based as our price index fell to 64 from 89 in August.

Inventories continued to fall in September although the time tosell increased for the first time since November 2012.

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Month

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Home Listings

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Time to Sell

Index

Apr-13 80.8 73.1 65.4 53.8 88.5

May-13 72.7 81.8 68.2 72.7 86.4

Jun-13 68.2 81.8 70.0 72.7 86.4

Jul-13 54.5 90.9 72.7 86.4 90.9

Aug-13 61.1 88.9 68.8 83.3 77.8

Sep-13 21.4 64.3 64.3 85.7 42.9

Point Change (39.7) (24.6) (4.5) 2.4 (34.9)

0%

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New York-Northern NJ Light Inventory Holds Prices Up in the Face of Weak Traffic


25/55


New York-Northern NJ Light Inventory Holds Prices Up in the Face of Weak Traffic




Very high taxes and increasing interest rates are slowing themarkets.

Low inventory is leading to multiple bids but buyers are verychoosy so below average homes remain unsold.

Everything is scaring buyers interest rates, Obamacare,jobs, etc. Confusion reigns. Until there is a clearer picture offinancial stability, I am afraid that purchasing a home is riskyfor most buyers.

Fresh supply of bank owned properties is hitting themarket.

Our Take:

Buyer traffic dipped further in September with our indexlanding at 31 vs. 43 in August. Consistent with our homelisting index, agents highlighted a continued lack of qualityinventory to bring buyers out although comments suggest thatbuyers who can handle the move in interest rates are veryinterested in seeing all properties that come to market.

Home prices edged higher in September as our index came inat 55, down from 71 in August but above a neutral 50.

Inventories inched lower, which should help buoy prices in theface of declining traffic, while the time to sell was unchanged.

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Month

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Home Listings

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Index

Apr-13 51.0 66.3 51.1 64.4 72.1

May-13 60.4 69.8 57.1 65.1 72.6

Jun-13 46.7 64.8 59.0 52.2 56.7

Jul-13 52.3 70.5 53.6 50.0 50.0

Aug-13 42.9 71.4 51.7 62.9 64.3

Sep-13 30.6 55.1 58.0 56.1 54.2

Point Change (12.2) (16.3) 6.3 (6.7) (10.1)

8%

45%

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31%

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Orlando FL Low Inventory Supporting Prices but Continuing to Weigh on Traffic


26/55


Orlando, FL Low Inventory Supporting Prices, but Continuing to Weigh on Traffic




Traffic and offer levels down over past 30 days on acombination of rates, low inventory levels and a sense offrustration from buyers having to compete in multiple offersituations.

With the tick up in interest rates, the downside is that somebuyers under contract have had to cancel.

Uncertainty in the economy. Obamacare implementationconcerns.

Low inventory, increased interest rates.

Our Take:

Buyer traffic bounced to 39 in September from 25 in Augustalthough agents continued to see interest rates and lowinventory levels have a negative impact on traffic levels.Economic worries appear to be moving into buyers minds aswell too, which we hadnt heard much of in recent months.

Home prices rose further in September with our index comingin at 78, which indicates broad-based strength.

Inventory was flat in September vs. August, although nearly allagents saw the time to sell continue to decrease, which shouldhelp prices despite lackluster traffic.

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Month

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Index

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Index

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Index

Home Listings

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Time to Sell

Index

Apr-13 34.4 81.3 50.0 84.4 75.0

May-13 61.8 91.2 58.8 79.4 90.6

Jun-13 45.0 95.5 50.0 63.6 90.9

Jul-13 46.9 86.7 57.1 63.3 73.3

Aug-13 25.0 80.0 55.0 65.0 60.0

Sep-13 38.9 77.8 50.0 50.0 94.4

Point Change 13.9 (2.2) (5.0) (15.0) 34.4

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67%

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Philadelphia PA-Southern NJ Some Buyers Return to Take Advantage of Slipping Rates


27/55


Philadelphia, PA Southern NJ Some Buyers Return to Take Advantage of Slipping Rates




Higher interest rates have kept buyers home.

People are rushing in to buy because they got pushed outof their homes at the end of summer by last minute selling ofthem and fear of further rising rates.

The fluctuating mortgage rates have buyers who were onthe fence acting now before they go any higher.

Desire to secure current (low) interest rates.

More sellers are staging their homes!

Our Take:

Our traffic index moved a bit closer to neutral with Septembercoming in at 42 vs. 38 in August. While higher interest rateshave had a negative impact on traffic levels in recent months(nearly all agents that saw lower than expected traffic levelshighlighted rates as the likely cause), some agents have seenbuyers come back to take advantage of the recent declines.

Home prices were generally seen higher in September withour index at 58, although it was down from 66 in August.

Inventory levels increased (a level below 50) for the first timesince April 2012.

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Month

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Index

Home Price

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Index

Home Listings

Index

Time to Sell

Index

Apr-13 61.1 63.9 50.0 52.9 77.8

May-13 56.8 65.9 50.0 67.5 75.0

Jun-13 61.5 69.2 54.2 65.4 80.8

Jul-13 52.6 63.2 50.0 71.1 65.8

Aug-13 37.5 65.6 60.0 50.0 61.8

Sep-13 41.7 57.9 44.4 39.5 60.5

Point Change 4.2 (7.7) (15.6) (10.5) (1.2)

28%

28%

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26% 28%21%

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Phoenix, AZ Higher Prices, Higher Rates, and Low Inventories Convince Buyers to Stay Home


28/55


Phoenix, AZ Higher Prices, Higher Rates, and Low Inventories Convince Buyers to Stay Home


(11,859 single-family building permits in 2012, 3rd largest market in the country)


Investors are leaving town as prices increase and inventorydrops.

Buyers have dried up. We barely have showings.

Prices, inventory and home loan interest rates all went up

while buyer interest level has gone down. Concern among buyers that they may have missed the

window for really great buys coupled with the bump ininterest rates, and concern over the wrangling inWashington and the economy near term has dampened theenthusiasm in the Phoenix/Mesa market.

Our Take:

Our buyer traffic index fell to a 3-year low in September with a22 reading vs. 43 in August as the combination of higherprices and interest rates scared many buyers away. However,the recent pick-up in inventory may help bring some buyersback while tempering the rate of price gains.

Home prices rose further in September with our price indexlanding at a still-strong 79 vs. 83 in August.

After contracting in each month YTD, home listings and time tosell were both unchanged, but when combined with lowertraffic levels, these could lead to slower pricing gains.

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Home Price

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Incentive

Credit Suisse Monthly Report of Real Estate Agents September 2013 Results

Documents

Transcript of Credit Suisse Monthly Report of Real Estate Agents September 2013 Results