Median sales prices for all types of residential real estate are soaring, according to the just-released monthly HomeUnion Home Sales Report that examines August 2016 data. The report shows that the median sales prices for investment houses and owner-occupied homes increased 12.6 percent from one year ago to $266,500. The all-cash segment of the single-family rental (SFR) sector also grew dramatically: then median sales price soared 21.2 percent to $186,500 in August year-over-year.
“Anyone taking out a mortgage, including SFR investors, will be able to leverage properties at historically low rates,” explained Steve Hovland, director of research for HomeUnion, an online real estate investment management firm. “Mortgages on those assets, meanwhile, can be covered by rising rents. This explains both the recent surge in activity among investors acquiring SFRs and (August’s) continued price growth for owner-occupied housing.”
“Since a move from the Fed is unlikely until the December meeting, we expect investors to expand their portfolios further through the end of 2016 as the competition prevalent in the summer buying season fades,” Hovland added. “However, lenders will begin lifting rates well in advance of the December Fed meeting, so we expect interest rates to inch higher through year-end.”
HomeUnion is a California-based online real estate investment management firm that provides services needed for individuals to invest remotely in single-family rental properties. The company uses a combination of research and data-driven proprietary analytics to incorporate over 110 million homes and 200,000 neighborhoods into their database, and then delivers its solutions to an on-the-ground infrastructure that currently serves 20 locations. HomeUnion’s role spans the lifecycle of the investment transaction: identifying sound investments, handling all aspects of acquisition, maximizing income, protecting asset value and selling the asset when the time comes.