Radian Index Covers More of the Market Than
Existing Indices
West Region Ends
Three-year Run as Top Annual Gainer
Top Zip Codes
Identified for First-time Homeowners to Tap Home Equity for
Renovations
Home price appreciation has accelerated across the United
States, according to a new historical home price index (HPI)
announced today by Radian Group Inc. (NYSE: RDN). The newly
released September 2019 Radian HPI data shows a 7.9 percent
year-over-year increase in median values, after a 5.8 percent
annualized growth rate in the second quarter of 2019.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20191022005275/en/
Radian Home Price Index (Graphic:
Business Wire)
“Stronger year-over-year home price appreciation was driven by
lower interest rates, lack of supply and a solid economy,” said
Senior Vice President of Data and Analytics Steve Gaenzler.
“Year-over-year gains in appreciation had slowed throughout much of
2018 and the first months of 2019, but the Radian Home Price Index
tells a different story now. All indications are that low interest
rates in particular have re-heated an already hot real estate
market.”
On a regional basis, prices in all six of the tracking regions
increased in September from the prior reading, but the Radian HPI
detected a shift in regional strength. For each period from July
2016 through July 2019, the West region recorded the strongest
annual price gains. Beginning this summer, however, the West has
dropped from first to fourth place, behind the Midwest, South, and
Southwest. The Northeast and Mid-Atlantic while growing, show
comparatively slower rates of appreciation.
Existing First Time Homeowners Hold Win-Win Options
After years of positive home price appreciation, many existing
first-time homeowners in need of more space are currently faced
with the decision of whether to sell and buy their next home, or to
tap into their home equity to expand their current residence.
The September 2019 Radian HPI evaluated three-digit zip code
areas in the U.S. in order to identify those markets where
renovating to expand a two-bedroom starter home may be a better
housing option than selling and purchasing a larger home. Targeting
U.S. markets where the five-year growth in home prices has eclipsed
35 percent, 10-year growth exceeded 50 percent, and where the
minimum average gain was more than $50,000 over the last five
years, Radian HPI evaluated the gaps in current prices between
two-bedroom starter homes and the next “forever” home.
Of the eligible markets in the Radian HPI, home prices between
the starter home and forever homes in four states showed the
greatest opportunity in favor of renovations: Texas, Florida,
Colorado, and California. Areas where equity build-up was enough to
support cashing out without expanding loan-to-value ratios, and
where the market price of the next larger house was more than the
cost of the renovation are considered the best for a face lift.
- Homes in the 334 zip code, an area along the southeastern coast
of Florida and including cities from Deerfield Beach to Jupiter,
are a prime example. That zip code recorded a 10-year gain in
two-bedroom property value of more than $80,000, well more than
enough to cover the cost of an average addition, which is a little
more than $45,000 depending upon location, type of addition, and
finishes. In this area, the inferred increase in value created
through an addition is more than $119,000, based on the current
value of three-bedroom homes in the area.
- Not surprisingly, some metro areas registered more than one
three-digit zip code at the top end of the list. These included
areas around Dallas, TX (3); Denver, CO (2); Fresno, CA (2);
Melbourne, FL (2); Miami, FL (3); Orlando, FL (2) and Phoenix, AZ
(2).
- In addition to the larger metros, Radian HPI found a number of
opportunities in midsized cities around Manchester, NH; Detroit,
MI; Sioux City, IA; Burlington, VT and Kansas City, KS. These areas
have also experienced strong home price increases, but still retain
the value proposition of renovation relative to selling and buying
a three-bedroom home.
For homes with large equity increases but where the price jump
between two- and three-bedroom homes remains narrower, combined
with near record low interest rates, it may make more economic
sense to take the cash from a sale and invest in a larger home.
Regardless of the individual situation, the strong growth in
home equity has created some win-win decisions for existing
first-time homeowners looking to expand their living area.
About Radian HPI
The Radian HPI uses a wealth of housing market data and property
valuation expertise to value nearly all of the housing inventory
across the country, offering an unrivalled view on conditions and
trends in the U.S. housing market. For more information about
Radian HPI, visit info.radian.biz/hpi.
“The Radian Home Price Index is an excellent example of
leveraging proprietary analytics to power new products and services
for our clients and the broader housing markets,” said Chief
Executive Officer Rick Thornberry. “We will continue to develop
innovative, market-disruptive technologies for participants
throughout the real estate value chain.”
The Radian HPI is based upon a proprietary automated valuation
model, or AVM, for single-family houses and condominiums/townhomes
in the U.S., which draws on multiple modeling methodologies and
leverages one of the largest housing data repositories along with
other proprietary sources. That collective information provides
broader, deeper and more timely coverage of U.S. housing markets
and submarkets compared to other indices.
The most widely publicized indices currently in the market, are
“repeat sales” indices, which estimate the property value by
calculating changes in the sales price of the same properties over
time. But that means the only valid observations of pricing each
month come from properties that are sold, so those indices will
typically include only 400,000 unique observations each month.
In contrast, the Radian HPI evaluates nearly 70 million
individual properties each month and takes numerous factors into
consideration, including information about the property and the
surrounding market, to determine a value. As a result, the Radian
HPI is based on data that comprehensively captures the housing
market, making the development of granular indices possible without
sacrificing stability or accuracy.
The Radian HPI will provide coverage in all markets, including
non-disclosure and rural markets, at multiple levels of geography –
national, regional, state, county, city and even neighborhood –
with the ability to compare and contrast over time. Users will also
have the ability to dynamically build indices through a deep set of
characteristics to produce property and portfolio valuations,
pricing forecasts, micro market analysis and scenario creation.
About Radian
Radian is ensuring the American dream of homeownership
responsibly and sustainably through products and services that
include industry-leading mortgage insurance and a comprehensive
suite of mortgage, risk, real estate, and title services. We are
powered by technology, informed by data and driven to deliver new
and better ways to transact and manage risk. Learn more about
Radian’s financial strength and flexibility at www.radian.biz and
visit www.radian.com to see how Radian is shaping the future of
mortgage and real estate services.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191022005275/en/
Emily Riley – Phone: 215.231.1035 Email:
emily.riley@radian.com
Rashi Iyer – Phone: 215.231.1167 Email:
rashi.iyer@radian.com
Radian (NYSE:RDN)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Radian (NYSE:RDN)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024