Realogy Holding Corp (RLGY) finished as the top performer on the HW 30 — HousingWire’s exclusive list of mortgage-related stocks — Monday as the company reported net revenue of $1.55 billion, up 21% year-over-year.
The company’s 29% increase in year-over-year homesale transaction volume exceeded the 26% sales volume increased reported by the National Association of Realtors.
“While industry observers anticipated that the mortgage rate environment would slow the housing recovery, we now believe the exact opposite occurred — it accelerated,” explained Realogy chairman, CEO and president Richard Smith.
He added, “In our view, the strong volume increase was driven by a combination of pent-up demand, relatively low inventory and a shift in homebuyer preference to purchase existing homes over new homes due to the ability to lock in mortgage rates for the shorter period it takes to close on an existing home purchase over a new home."
Realogy Holdings posted impressive results Monday, up more than 7% at the close of the day, or $43.8 a stock.
In the fourth quarter, the company expects year-over-year homesale transaction volume growth to continue, although, at a comparatively slower pace than last year’s growth, which was influenced by the change in capital gain taxes, stated Realogy executive vice president, CFO and treasurer Anthony Hull.
“Looking ahead, we expect full-year 2013 homesale transaction volume to increase 17% to 19% compared to 2012, resulting in annual Adjusted EBITDA for 2013 in the range of $785 to $800 million, an increase of 16% to 19% year-over-year,” Hull said.
He continued, “This reflects the expected impact from reduced refinance activity, principally in our PHH Home Loans mortgage origination venture, on our fourth quarter financial results."
HW 30 was the only index to close down Monday, while all other indices posted slight gains after plateauing for most of the session.
Investors remained reluctant to jump in after both the Dow Jones Industrial Average and S&P 500 amid uncertainty over when the Federal Reserve would begin to start changing the pace of its monetary stimulus.
The Dow remained unchanged, while both Nasdaq and S&P 500 finished modestly up, 0.37% and 0.36%, respectively.
