SOURCE: ZipRealty


December 29, 2009 15:07 ET

ZipRealty Breaks Down the Major Housing Stories of 2009

Foreclosures and Short Sales Dominated the U.S. Housing Market in 2009

EMERYVILLE, CA--(Marketwire - December 29, 2009) - Foreclosures were the driving force behind the roller coaster year for U.S. real estate in 2009. With banks controlling many home listings, fewer homes coming on the market, and government intervention, foreclosures played a large part in shaping the housing market this year -- both good and bad. Leading online real estate brokerage ZipRealty ( (NASDAQ: ZIPR) has compiled the nine key housing stories of 2009. The list follows below.

Nine in 2009

1. Bank Market -- Many have described the 2009 housing market as the "year of the bank" with institutions needing to approve short sales and foreclosures on the homes they owned. In some markets this was a significant part of the available inventory. For example, foreclosures made up 87 percent of properties sold through the end of November 2009 in Las Vegas, NV and 60 percent in Sacramento, CA, according to MLS data. Los Angeles MLS data showed distressed property sales rise from 8 percent in 2008 to 35 percent in 2009.

2. Declining Inventory -- The number of homes for sale dropped 28 percent compared to 2008, according to ZipRealty's monthly inventory report, a survey of MLS-listed homes in 27 markets where the company operates. Major markets that saw the steepest declines include Los Angeles, Las Vegas, San Diego and the San Francisco Bay Area, all experiencing year-over-year declines of more than 50 percent.

3. Government Intervention -- Congress enacted a first-time homebuyer tax credit which increased buyer activity in the entry-level housing market. According to the National Association of Realtors® November survey of members reported that the number of first-time home buyers climbed to 51 percent.

4. Investors Jump Back In -- Both foreign and domestic real estate investors took advantage of slashed prices to scoop up properties across the country. According to MDA Dataquick's October home sales report, absentee buyers bought 41 percent of all Las Vegas-area homes sold in October -- the highest figure for any month this decade. In Phoenix, absentee buyers purchased 38 percent of all homes sold -- a relatively high percentage in the West. Absentee buyers are often investors, but can include second-home buyers and others who, for various reasons, indicate at the time of sale that the property tax bill will go to a different address.

5. Prices Flattening -- Later in the year, median home prices in most markets stopped falling, and some markets actually saw increases. California saw some of the largest increases -- ZipRealty tracks median home prices from MLS sales in 27 markets and from January to November, San Diego's median rose 55 percent, San Francisco Bay Area rose 31 percent, Los Angeles rose 25 percent, and Orange County rose 19 percent.

6. Buy vs. Rent -- Home prices in some markets declined to a point where purchasing became a more viable option than renting. In July, ZipRealty did a survey of ten cities' average rent from a random selection of Craigslist postings. According to this survey, in Las Vegas, the average rental price was $1,440, for the same mortgage payment this would have purchased more than 3,000 homes listed for sale at the time. In Kissimmee, FL where the average rent was $1,224, buyers could purchase more than 1,000 properties for the average rent, assuming an 80 percent, 30-year loan at 6 percent interest

7. High End Freeze -- The luxury home market continued to stagnate as financing remained difficult and higher end buyers scarce. Homes priced over $1 million spent an average of 167 days on the market in 2009 as opposed to 148 days in 2008, according to a survey of MLS-listed homes in the 27 markets ZipRealty tracks.

8. Multiple Offers -- Lower home prices coupled with reduced inventory of moderately priced homes created multiple bids for homes in some entry level markets. According to local ZipRealty brokers, some quality resale homes in Boston have seen up to four offers. In Las Vegas, the low end of the market has heated up over the past three months; ZipRealty's brokers report that some homes priced under $200,000 are seeing up to seven offers. ZipRealty brokers in Los Angeles and Phoenix also state that they are beginning to see more multiple offers.

9. Mobile Shopping -- 2009 was the year of the app. Prospective homebuyers and sellers can now track real estate on the go. ZipRealty's featured iPhone app includes not only homes for sale in more than 8,000 cities, but also third-party estimates of home values and recent sales.

"As 2009 draws to a close, we are beginning to see a light at the end of the tunnel for Southern California and Las Vegas with rising prices and fewer distressed sales," said ZipRealty President and CEO Patrick Lashinsky. "This year we will look to places like New York state where housing has not yet been strongly affected by foreclosures, and to Dallas, since the real estate market there tends to reflect what is taking place across the rest of the country."

About ZipRealty

ZipRealty is a full-service residential real estate brokerage firm. The Company utilizes its user-friendly Web site and employee real estate agents to provide home buyers and sellers with high-quality service and value. ZipRealty's Web site provides users with access to comprehensive local Multiple Listing Services' home listings data, as well as other relevant market and neighborhood information. The Company's proprietary business management system and technology platform help to reduce costs, allowing the Company to pass on significant savings to consumers. Founded in 1999, the company operates in 36 major markets in 22 states and the District of Columbia. For more information on ZipRealty, visit or call 1-800-CALL-ZIP.

Cautionary Language

This release contains forward-looking statements within the meaning of the "safe harbor" provisions of the federal securities laws, including, without limitation, that current housing market trends such as decreased inventory, flattening home prices in some markets, increased offers on homes, increasing investor participation in the housing market, high rates of foreclosures and shorts sales, government intervention and reduced sales in the high priced real estate market may continue. The forward-looking statements are subject to risks and uncertainties that could cause actual events to differ materially from those projected, including the risk factors set forth in our Form 10-K filed with the SEC for the fiscal year ended December 31, 2007 and other filings with the SEC including our quarterly Form 10-Qs and periodic Form 8-Ks. The forward-looking statements included in this release are made as of today's date and, except as otherwise required by law, we do not intend to update these forward-looking statements to reflect events or circumstances after the date hereof.

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