Investment Home Price Growth Eclipses Traditional Home Price Growth in July

Prices for single-family rentals (SFRs) grew 7.1 percent, versus 4 percent for owner-occupied housing
IRVINE, Calif., Aug. 18, 2016 – HomeUnion, a leading online real estate investment and management firm, has released new data on the U.S. housing market that shows median prices for investment housing growing at a faster rate than owner-occupied home prices. According to the new HomeUnion Home Sales Report, prices for investment housing – both financed and all-cash – jumped 7.1 percent to $213,300, while the median price for owner-occupied homes increased 4.0 percent to $274,500 in July.

“Investor demand for single-family rentals (SFRs) remains strong as evidenced by the overall decline in cap rates in July,” explains Steve Hovland, director of research for HomeUnion. Cap rates for all types of investment housing dropped 50 basis points to 5.1 percent, cash cap rates retreated 60 basis points to 6.0 percent and leveraged investment cap rates declined 20 basis points to 4.4 percent.

“Overall, the housing market remains solid, although we’ve started to see evidence of moderating price growth nationwide” says Steve Hovland, director of research for HomeUnion. “This slower price growth is correlated to the seasonality of the housing market: We’re are coming off a frenzied spring buying season that is beginning to cool.” Although home prices are expected to decline in the fall months, the overall supply/demand imbalance will keep values elevated and many first-time buyers on the sidelines. As a result, downward pressure on the already record-low homeownership rate will persist through the end of the year.

Here are more details on the current state of the U.S. housing market:

Data YOY Change
Total Median Sales Price $255,700 4.5%
Owner-Occupied Median Sales Price $274,500 4.0%
Investment Median Sales Price $213,300 7.1%
Investment Cap Rate 5.1% -50 basis points
Investment Cash Median Price $167,200 5.2%
Cash Cap Rate 6.0% -60 basis points
Investment Leveraged Median Price $248,800 2.1%
Leveraged Cap Rate 4.4% -20 basis points

 

Source: HomeUnion Research Services

Disclaimer: Median sales price nonseasonally adjusted and based on transactions of single-family homes above $30,000.

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About HomeUnion

HomeUnion is an online real estate investment management firm. Based in Irvine, Calif., it provides all the services needed for individuals to invest remotely in single-family rental (SFR) 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 18 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.

Media Contact:
Stacey Corso

Communications Manager, HomeUnion
stacey.corso@homeunion.com
415.672.6460

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