Market Pulse Survey, June 2015

MARKET PULSEJune 2015

1

Survey Methodology

Monthly online survey of 300+ CA REALTORS

Respondents are asked about their last closedtransaction and business activity in their market areafor the previous month and the last year.

2

LASTTRANSACTION

3

More than 4/10TransactionsClosed BelowAsking Price

Q: Did your last closed transaction sell over, at or below asking price?

0%

10%

20%

30%

40%

50%

60%

Jan-

14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

Over Below At

4

SERIES: Market Pulse SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS

Premium Paid OverAsking Price Increased

Q: At what percentage was your last closed transaction sold over asking price?

7.3%8.0%

11%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Jan-

14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

Average

5


Premium Paid OverAsking Price Stable

6.7% 7.5%7.9%

10% 10% 10%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

Average

Q: At what percentage was your last closed transaction sold over asking price?

6


Discount on Asking Price Increases

Q: At what percentage was your last closed transaction sold below asking price?

-14.0%

-12.0%

-10.0%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

Jul-14Aug-

14Sep-

14Oct-

14Nov-

14Dec-

14Jan-15

Feb-15

Mar-15

Apr-15

May-15

Jun-15

Average -5.8% -5.6% -5.8% -6.3% -12% -13% -11% -11% -11% -11% -7.0% -11%

7


Discount on Asking Price Decreased Slightly

-5.7%

-10% -11%-10%

-12%

-10%

-8%

-6%

-4%

-2%

0%2014-Q3 2014-Q4 2015-Q1 2015-Q2

Average

Q: At what percentage was your last closed transaction sold below asking price?

8


65% of Properties Receiving MultipleOffers

Q: How many offers did the seller in your last closed transaction receive?

0%

10%

20%

30%

40%

50%

60%

70%

80%Ja

n-14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

9


More Properties Receiving MultipleOffers

0%

10%

20%

30%

40%

50%

60%

70%

2014-Q12014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

69% 66%61%

58% 60%67%

Q: How many offers did your last closed transaction receive?

10


Number of Offers Received Flat

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0Ja

n-14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

2.7 2.82.9

Average


11


Average Number of Offers Increased

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

3.12.8

2.52.4 2.6

3.1

Average


12


Proportion of Properties with Listing PriceReductions Declining

Q: Were there any listing price reductions before escrow opened in your last closed transaction?

20%

25% 26%28%

33%

29%31% 31% 31%

23%

28%25%

21%

0%

5%

10%

15%

20%

25%

30%

35%

13


Proportion of Properties with Listing PriceReductions Declining

20%25%

31%28%

25%

0%

5%

10%

15%

20%

25%

30%

35%

2014-Q2 (June) 2014-Q3 2014-Q4 2015-Q1 2015-Q2

Average

Q: Were there any listing price reductions before escrow opened in your last closed transaction?

14


% of Previous Renters Flat

Q: Was the buyer of your last closed transaction a renter immediately prior to purchasing the property?

37% 38%37%

0%

10%

20%

30%

40%

50%

60%Ja

n-14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

15


Proportion of Previous Renters Slightly Down

0%

10%

20%

30%

40%

50%

2014-Q12014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

46%

40%

34%40% 40%

38%

Q: Was the buyer of your last closed transaction a renter immediately prior to purchasing the property?

16


Fewer Sellers Becoming Renters

Q: Did the seller of your last closed transaction become a renter immediately after selling the property?

0%

5%

10%

15%

20%

25%

30%Ja

n-14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

17


Fewer Sellers are Becoming Renters

0%

5%

10%

15%

20%

25%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

19%21%

18%20%

15% 15%

Q: Did the seller of your last closed transaction become a renter after selling the property?

18


Share of First-time Buyers Fluctuating

Q: Was the buyer of your last closed transaction a first-time buyer?

24%

31% 30%

31%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%Ja

n-14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

% First-time Buyers Long Run Average

19


Share of First-Time Buyers Declining

32%28% 30%

35%32% 30%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

Q: Was the buyer of your last closed transaction a first-time buyer?

20


Majority Purchases are Primary Residences

Q: What was the intended use of the property?

74% 79% 75%

18% 13% 16%

0%10%20%30%40%50%60%70%80%90%

100%

Jan-

14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

Primary residence Investment Vacation home Other

21


Majority Purchases are Primary Residences

Q: What was the intended use of the property?

75% 75% 76% 78% 75% 76%

18% 16% 16% 16% 18% 16%

3% 6% 6% 4% 4% 5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

Primary residence Investment Vacation home Other

22


International Buyers Fluctuate

Q: Was the buyer an international client (one who was not a citizen or permanent resident of the U.S.)?

4.7%

3.2%

7.9%

6.1%

0%

2%

4%

6%

8%

10%

12%

Jan-

14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

% International Buyers Long Run Average

23


International Buyers Up Slightly

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

2014-Q12014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

5.0% 5.0% 5.6%

8.5%

5.8% 6.0%

Q: Was the buyer an international client someone from the U.S. who purchased a property for a vacation orinvestment purposes?

24


MARKET CONDITIONS

25

Floor Calls from Potential Clients Declining

Q: Compared to last month, the number of floor calls from potential clients in your market area this month was

0%

10%

20%

30%

40%

50%

60%

70%

Feb-

14

Mar

-14

Apr

-14

May

-

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-

Jun-

15

Last MonthDown Flat Up

26


Floor Calls from Potential Clients Up

0%10%20%30%40%50%60%70%80%90%

100%

2014-Q12014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

22% 33% 45% 44%34%

18%

46%44% 34% 36%

31%

30%

33% 24% 21% 20%35%

52%

Last MonthDown Flat Up

27

Q: Compared to last month, the number of floor calls from potential clients in your market area this month was SERIES: Market Pulse SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS

ListingAppointments/Presentations toClientsDecrease

Q: Compared to last month, the number of listing appointments and presentations to clients in yourmarket area this month was

0%

10%

20%

30%

40%

50%

60%

70%

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

Last Month

Down Flat Up

28


ListingAppointments/Presentations toClientsUp

24% 27%37% 45% 35%

17%

32%40%

37%34%

31%

26%

44%33% 26%

21%34%

56%

0%10%20%30%40%50%60%70%80%90%

100%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

Last Month

Down Flat Up

Q: Compared to last month, the number of listing appointments and presentations to clients in your marketarea this month was

29


Open HouseTraffic Declining

Q: Compared to last month/year, open house traffic in your market area this month was

0%

20%

40%

60%

80%

Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15

Last Month Down Flat Up

0%10%20%30%40%50%60%70%80%

Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15

LastYear

30

Open HouseTraffic Up

Q: Please indicate the movement of each of the following in your market area compared to last month & lastyear Open house traffic

16%27%

38% 42% 31%19%

34%

37%

37%37%

31%

27%

50%36%

25% 21%38%

55%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Last Month

21%35%

46% 49%

26%18%

29%

25%

25% 24%

22%21%

49%40%

29% 27%

52%62%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

LastYearDown Flat Up

31


Auctions Steady

Q: Compared to last month/year, the number of auctions in your market area this month was

0%

20%

40%

60%

80%

Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15


0%10%20%30%40%50%60%70%80%

Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15

LastYear

32

Auctions Increasing

Q: Compared to last month/year, the number of auctions in your market area this month was

55% 54%66% 59% 55%

32% 37%23%

23% 26%

13% 10% 11% 18% 19%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Last Month

61% 61%71% 68% 66%

26% 28%15% 15% 15%

14% 11% 13% 17% 19%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%LastYear

Down Flat Up

33


All Cash Purchases Decreasing

Q: Compared to last month/year, the number of all cash purchases in your market area this month was

0%

10%

20%

30%

40%

50%

Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15


0%

10%

20%

30%

40%

50%

60%

70%

Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15

LastYear

34

All Cash Purchases Up

Q: Compared to last month/year, the number of all cash purchases in your market area this month was

40% 44% 35% 28%

39% 36%35%

35%

21% 19%29% 37%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014-Q32014-Q4 2015-Q1 2015-Q2

Last Month

52% 59% 46% 41%

25%24%

22%23%

23% 18%32% 36%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014-Q3 2014-Q4 2015-Q1 2015-Q2

LastYearDown Flat Up

35


Majority of REALTORS Expect Better/SimilarMarketConditionsOver the NextYear

Q: What are your expectations for market conditions over the next year?

0%

10%

20%

30%

40%

50%

60%

70%

Jan-

14

Feb-

14

Mar

-14

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

15

Mar

-15

Apr

-15

May

-15

Jun-

15

Worsen Same Improve

36


REALTORS Expect Mostly Similar/Better MarketConditionsOver the NextYear

0%10%20%

30%

40%

50%

60%

70%

80%

90%

100%

2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2

10% 15% 22%13%

8% 13%

36%45% 45%

45%

34%40%

55%40% 33%

42%

58% 47%

Worsen Same Improve

Q: What are your expectations for market conditions over the next year?

37


Why REALTORS Expect MarketConditions toWorsen

New mortgage regulations, short supply, higher prices.

Prices are too high.

History.

Buyers are pulling away due to inflated prices.

Rising interest rates.

Q: Why do you expect real estate market conditions to worsen over the next year?

38


Top 10 Counties

Q: In which county do you live?

May 2015 June 2015

1 Los Angeles Los Angeles

2 San Diego San Diego

3 Alameda Riverside

4 Riverside Orange

5 Santa Clara Alameda

6 Sacramento Santa Clara

7 Orange Sacramento

8 Fresno San Luis Obispo

9 Contra Costa Marin

10 San Mateo Sonoma

39


Documents

Market Pulse Survey, June 2015