Major competitors in the United States market are concentrated in three regions: East Coast, Midwest, and West Coast. Particular areas of concentration include California, Missouri, Nebraska, and Pennsylvania.

Some of the major players in the industry that are from Florida and New York as are as follows:


Most Resilient U.S. Real Estate Markets
In markets expected to recover more slowly, such as Boston and Denver, low buyer confidence coupled with a surplus of housing stock has lengthened the slump. NAR chief economist Lawrence Yun points out that buyers are looking for clear signs of a market bottom and are content to wait on the sidelines until then.

It’s easy to see why. Most of the country’s real estate markets are feeling the effects of overproduction. A strong market hovers near a 1.5% vacancy rate, but the national average currently stands at 2.8% and in cities such as Miami, Atlanta and Denver, figures hang around 3.5%. In addition, every nugget of good news (a May Commerce Department report said that new-home sales are at a 14-year high) comes with bad news (median price growth is at a 10-year low).

Behind The Numbers
Market corrections follow three basic recovery patterns. A V-shaped recovery where a market experiences a sharp, fast decline but comes out strong once it hits bottom; a U-shaped recovery, where prices decline gradually and recover slowly; and an L-shaped curve, a hard, fast fall with paltry price bounceback following the market trough.

The differences between a V-shaped market and a U-shaped one has to do with barriers to growth. High vacancy rates and high investor share can hurt a market, but if the local economy remains strong and housing stock affordable it’s only a matter of how long it takes to absorb the excess inventory.

Tampa is a perfect candidate for a V-shaped recovery, according to research from Moody’s Economy.com, an economic analysis, forecasting and credit risk firm. The local economy remains strong, and subprime lending is relatively low. Tampa’s problem? A high investor share that lead to high vacancy rates. When the market turned sour in 2005, more than 25% of Tampa homes were owned as investment properties. Investors are quicker to flee during a downturn, thus creating a glut of available housing stock. In Tampa’s case, vacancy rates now stand at 3.5%.

Based on Moody’s Economy projections, Tampa should burn off its excess inventory and hit a price trough in the first quarter of 2008, at which point prices are expected to increase by 10.6% the following year.
These projections take into account housing affordability, vacancy rates, the strength of the local economy and job market, investor share in 2005 and the share of subprime mortgages. Data comes from Moody’s, the Bureau of Labor Statistics and the Federal Reserve’s Home Mortgage Disclosure Act.

Predicting the bottom of any asset market, especially real estate, is a difficult thing. While these projections are based on sound data and advanced modeling by Moody’s, no one can predict futures markets with absolute certainty.

Other Bounce Backs
Like Tampa, Phoenix is similarly afflicted by high investor share (26.1%) and it has a vacancy rate over 3%. Good affordability rates and a surging job market suggest that once Phoenix bottoms out, price growth will be strong. Moody’s projection model has Phoenix reaching its price trough in the fourth quarter of 2008 and then growing by 7.7% the following year.

Slower recovery rates are expected in markets such as Minneapolis and Boston, where a slumping local economy, slow job growth and negative migration numbers hamper long term prospects. Along with other U-shaped markets like Sacramento, that have double-digit subprime lending share, Zandi says it’s going to be harder for these markets to get going again.

That doesn’t necessarily mean V-shaped markets are in the clear. The labor markets in cities such as Las Vegas, Phoenix and San Diego, whose future economic success will be critical to recovery, are heavily in housing-related industries, according to Moody’s. So long as those economies can weather their respective corrections, they should be all right.

Most Affordable U.S. Real Estate Markets

Behind The Numbers
The first is a look at the ratio of median home price to median household salary, which determines how many years of gross salary the median household would have to spend to buy the median house. In Indianapolis, where the median household income is $60,383, it would take just under two years of gross salary to buy.
That must sound pretty nice to the residents of Los Angeles, where the median household income is $58,319, but housing is more than five times more expensive than in Indy.

The second measure tracks the percentage of homes sold in the first quarter of this year that were affordable to the median income-earning household.

This metric illustrates what’s at play in a market like San Diego. The city might be in the midst of a price slump, but that doesn’t necessarily mean it has become significantly more affordable. Only 9% of San Diego homes sold in the first quarter of 2007 were within the reach of the median income-earning household, according to the National Association of Home Builders and the Wells Fargo affordability index, which assumes a 10% down payment and a market-rate mortgage.

Economists say this indicates the top of the market is moving, but the middle and bottom strata are having problems. In a market where housing is that unaffordable, buyers have to rely more heavily on credit. Potential future foreclosures can throw a market into stall–not a great sign for recovery.

Reasonable Real Estate

Compare San Diego’s numbers to those of the country’s most affordable areas. Almost 90% of Indianapolis sales in the first quarter of this year were affordable to the median income-earning household. In Cincinnati, that number was 78% and in Cleveland, 82%.

Other areas on the list, such as Dallas and Atlanta, are experiencing growth, yet remain affordable.
Price-to-income affordability in Dallas was seventh best overall, and just under 70% of homes sold in Atlanta in the first quarter of this year were available to the median income-earning household. Prices can remain affordable in fast-growing cities when there are high rates of new-home construction and relaxed growth restrictions.
High demand doesn’t necessarily impede affordability either.

Examine the difference between Boston and Raleigh, N.C.; since 2000, Boston has experienced steady emigration, while Raleigh has welcomed new residents.

But during that time, Boston home prices increased by 16.7%, and median income-earning households can afford about half of what they could seven years ago. In Raleigh, home prices have grown by 37%, but the share of median income earners who can afford homes has only dropped by 3%, all while the city underwent a population boom.

The reason could be a high increase in new-home construction and growth policies not overburdened by regulation acted as price reliefs in Raleigh. Boston doesn’t have such policies and hasn’t seen a great deal of new-home construction.

Both Raleigh and Charlotte, ranks at Nos. 12 and 13, respectively.


The down payment makes a comeback

As a result of the collapse of the subprime mortgage market, lenders will — gasp! — once again require down payments, filling the market with unsold homes and driving down prices.

Essentially, the subprime mortgage industry — which lends to consumers with credit issues — is gone. Since the pendulum swung as far as it could in the direction of reckless lending, which the whole bubble was about, it will now swing back toward the quaint notion of folks being lent only the amount of money they can reasonably be expected to pay back. And,
the lenders will want their loans to have a margin of safety, in the form of down payments.

Unfortunately, a lot of people will be deep in debt, and it would be difficult to sell houses — or purchase them — as lending standards change back to the strict guidelines from before.

Subprime ripple effect hits retail real estate according to market research

Not long after the dot-com industry collapsed a few years ago, retailing became the hottest sector in commercial real estate. Online shopping was no longer viewed as a threat to bricks-and-mortar stores, and rising housing values made it easy for people to borrow more money – and spend it. Shopping centers began changing hands at ever-escalating prices.

Two years ago, retail real estate began losing some of its allure for investors as the condo-conversion craze took over. More recently, investors have gravitated toward office buildings and hotels.

Now many people in the retail real estate industry are bracing themselves for a slowdown in spending as the subprime mortgage crisis and the decline in housing values continue to send ripples through the economy.
And shopping centers have been caught in the credit squeeze that has transformed the capital markets. Private buyers, who were once able to finance 95 percent or more of the cost of a transaction, are being driven out of the market because such high leverage is no longer available.

According to investors, brokers and analysts, deals are taking longer to complete, and prices – at least for the second- and third-tier properties – are declining by as much as 10 percent.