Townhome Market Shows Signs of a Comeback

DAILY REAL ESTATE NEWS | TUESDAY, FEBRUARY 24, 2015

Townhouse construction was back on the rise in 2014, as home buyers show an increasing appetite for this type of housing once again. 

Single-family attached starts totaled 19,000 in the fourth quarter of 2014 – 12 percent higher than a year prior, according to Census data. For all of 2014, townhouse construction starts totaled 72,000, up from 68,000 starts in 2013.

The market share of townhouses comprises 12 percent of all single-family starts. The peak for townhouse construction was during the first quarter of 2008 when it reached 14.6 percent.

During the recent recession, the townhome market plunged, particularly as the number of first-time home buyers fled the market. But as the number of first-time home buyers rebounds, construction of town homes is expected to rise again too.

“The prospects for townhouse construction over the long run are positive given large numbers of home buyers looking for medium density residential neighborhoods, such as urban villages that offer walkable environments and other amenities,” writes Robert Dietz, an economist for the National Association of Home Builders, on NAHB’s Eye on Housing blog.

REALTORS® are upbeat about townhome prospects in the District of Columbia, North Dakota, Colorado, Texas, California, Florida, Hawaii, and Alaska, according to the December 2014 REALTORS® Confidence Index Survey.

However, REALTORS® continue to be concerned about the condo market overall, reporting that obtaining Federal Housing Administration financing for condos remains a big hurdle for home buyers because many condos continue to not meet FHA eligibility criteria. Existing condo and co-op sales fell 3.5 percent on a seasonally adjusted annual rate in January; they remain 1.8 percent below year ago levels, the National Association of REALTORS® reported in its latest housing report.  

Read more: Only 30% of Condo Buildings Are FHA Approved

“Condominiums offer an affordable option and are the first step to home ownership for many home buyers,” NAR President Chris Polychron said in a recent statement. “NAR has urged FHA to develop policies that will give buyers access to more flexible and affordable financing opportunities and a wider choice of approved condo developments.”

Source: “Townhouse Market Expanded in 2014,” National Association of Home Builders’ Eye on Housing blog (Feb. 23, 2015) and “States with Strong Townhouses and Condos Market,” National Association of REALTORS® Economists’ Outlook blog (Feb. 10, 2015)

http://realtormag.realtor.org/daily-news/2015/02/24/townhome-market-shows-signs-comeback

www.RebeccaSellsAZ.com

Why Buyers May Find Mortgages Easier to Get

DAILY REAL ESTATE NEWS | MONDAY, FEBRUARY 23, 2015

Good news for potential home shoppers: A Mortgage Bankers Association index shows lender requirements regarding credit scores, down payments, and other key terms are finally loosening up. Some lenders are even expanding the types of mortgages they offer. These moves come after years of lenders tightening loan requirements in the aftermath of the housing crisis.

The Opening of the Credit Box

Smaller Down Payments Lure More Buyers

3% Down Payments May Be Game Changer

The newly-released MBA index shows that recent improvements in lending are mostly tied to the government’s efforts to ease regulations and improve affordability in the housing market. For example, mortgage financing giant Fannie Mae is now allowing purchases of conventional mortgages that have down payments as low as 3 percent; Freddie Mac is planning to do the same for mortgages closed on or after March 23.

Also, the Federal Housing Administration, which insures loans with down payments as low as 3.5 percent, reduced its upfront mortgage insurance premiums last month, which is expanding eligibility for home purchases to thousands of potential home shoppers.

“Things are looking better for home buyers and refinancers,” not just in the loosening of underwriting requirements but also in the cost of credit, says Brad Blackwell, executive vice president of Wells Fargo Home Mortgage, the nation’s largest mortgage originator based on volume.

Blackwell says that Wells Fargo has been gradually opening its credit box as the government has taken steps to clarify its lending policies and penalties against lenders for defaulting loans. That has helped lenders gain confidence to expand lending to a broader range of borrowers, including those who may not have high credit scores or a sizable down payment for their home purchase.

Wells Fargo says it also has relaxed its policy on down payment gifts to borrowers from relatives and friends. Wells Fargo previously required borrowers to contribute at least 5 percent of the total costs on a home purchase from their own finances in order to qualify for a conventional loan with a 5 percent or lower down payment. The bank giant recently reduced that requirement to 3 percent, allowing for greater gift assistance.

Source: “Lenders Begin Easing Requirements to get a Mortgage,” The Los Angeles Times (Feb. 22, 2015)

http://realtormag.realtor.org/daily-news/2015/02/23/why-buyers-may-find-mortgages-easier-get

www.RebeccaSellsAZ.com

Home Owners, Appraisers Align on Price

DAILY REAL ESTATE NEWS | WEDNESDAY, FEBRUARY 18, 2015

Appraisers’ opinions of home values are mostly falling in line with home owners’ estimates, according to the latest reading of Quicken Loans' Home Price Perception Index. Indeed, appraisers’ opinions of home values were only 0.18 percent higher than home owners – the closest the two opinions have been since September 2013. The previous month, the difference between appraiser and home owners’ price opinions was 1.43 percent.

While the value perception is closing, home values have also been on the rise. The national median single-family home price at $208,700 in the fourth quarter, up 6 percent year-over-year, according to the National Association of REALTORS®. 

Quicken Loans, the nation’s second largest retail mortgage lender, uses its index to evaluate perceptions of the housing market. Appraisers in more than 74 percent of the metro areas the company examined continued to have higher opinions of home values than the home owners – which means that many may have more equity in their home than they realize.

“Interest rates have dropped and we have seen more and more Americans refinance their mortgage,” says Bob Walters, chief economist for Quicken Loans. “These consumers have been watching their local housing market and realizing their home’s true value more accurately than any time in the last year and a half. This is encouraging, but I urge home owners to continue to watch the ebbs and flows of the market, especially in their neighborhood, so they understand the direction of home values in their community when it comes time to sell.”

Source: “Quicken Loans Study Shows Appraiser and Homeowner  Opinions in January Nearly Equal,” Quicken Loans Press Room (Feb. 10, 2015)

http://realtormag.realtor.org/daily-news/2015/02/18/home-owners-appraisers-align-price

www.RebeccaSellsAZ.com

Existing-Home Sales Rebound: 5 Stats to Know

DAILY REAL ESTATE NEWS | FRIDAY, JANUARY 23, 2015

Home sales picked up at the end of 2014, closing off a year that had a sluggish start but then showed encouraging signs in the second half, according to the National Association of REALTORS®’ latest housing report, released Friday.

Existing-home sales rose 2.4 percent in December month-over-month, bouncing back after a dismal November. Total home sales –reflecting completed transactions of single-family homes, townhomes, condos, and co-ops – reached a seasonally adjusted annual rate of 5.04 million in December.

“Home sales improved over the summer once inventory increased, prices moderated, and economic growth accelerated,” says Lawrence Yun, NAR’s chief economist. “Sales were measurably better in the second half – up 8 percent compared to the first six months of the year.”

Overall for 2014, the median national existing-home price was $208,500, reaching the highest level since 2007, and a 5.8 percent increase from 2013 when it was $197,100. However, total existing-home sales were 3.1 percent lower in 2014 compared to 2013, NAR reports.

Here’s a closer look at five housing stats from NAR’s latest report -- reflecting December 2014 data -- to gauge the market:

1. Home sales: Single-family home sales rose 3.5 percent in December to a seasonally adjusted annual rate of 4.47 million compared to 4.32 million in November. Single-family home sales are 4 percent above the pace a year ago. Existing condo and co-op sales, on the other hand, dropped 5 percent in December.

2. Home prices: The median existing-home price for all housing types in December was $209,500 – 6 percent higher than year ago levels. This marks the 34th consecutive month of year-over-year price gains.

3. Days on the market: Properties typically stayed on the market in December for 66 days, a slightly shorter time frame than a year ago when the average was 72 days. Short sales were on the market the longest amount of time at a median of 98 days in December, while foreclosures sold in 61 days. Non-distressed homes averaged 66 days on the market. About 31 percent of homes that were sold in December were on the market for less than a month, according to NAR.

4. Distressed sales: Foreclosures and short sales edged up slightly in December, reaching 11 percent of sales compared to 9 percent in November. However, distressed sales are down from 14 percent a year ago. Of December existing-home sales, 8 percent were foreclosures and 3 percent were short sales. On average, foreclosures sold for a discount of 15 percent below market value while short sales were discounted 12 percent.

5. Inventory: Total housing inventory at the end of December fell 11.1 percent to 1.85 million existing homes available for sale. That represents a 4.4-month supply at the current sales pace, which is down from 5.1 months in November. Unsold inventory is now 0.5 percent lower than a year ago.

“A drop in housing supply in December raises some affordability concerns in the months ahead as minimal selection and the potential for faster price appreciation could offset the demand from buyers encouraged by a stronger economy and sub-4 percent interest rates,” says Yun. “Housing costs – both rents and home prices – continue to outpace wages and are burdensome for potential buyers trying to save for a downpayment while looking for available homes in their price range.”

By Region

The following is a look at how existing-home sales performed across the country in December:

• Northeast: existing-home sales fell 2.9 percent to an annual rate of 660,000. Sales are 3.1 percent above year ago levels. Median price: $246,600, up 3.2 percent above a year ago.
• Midwest: existing-home sales dropped 3.5 percent to an annual level of 1.09 million in December. Sales are 2.7 percent below December 2013. Median price: $159,100, up 5.3 percent from a year ago.
• South: existing-home sales in the South climbed 3.8 percent to an annual rate of 2.17 million in December. Sales are 7.4 percent above December 2013. Median price: $184,100, up 6.6 percent from a year ago.
• West: existing-home sales surged 9.8 percent to an annual rate of 1.12 million in December. Sales are 2.8 percent above a year ago. Median price: $299,600, up 5.6 percent year-over-year.

Source: National Association of REALTORS®

http://realtormag.realtor.org/daily-news/2015/01/23/existing-home-sales-rebound-5-stats-know

www.RebeccaSellsAZ.com

Housing Starts Reach Six Year Highs

DAILY REAL ESTATE NEWS | THURSDAY, JANUARY 22, 2015

Housing starts for single-family homes surged to the highest level in more than six-and-a-half years, a promising sign at the end of 2014, the Commerce Department reported Wednesday.

Measuring Sentiment:Homebuilders Remain Cautiously Confident

"The last piece of the economic puzzle is starting to come together now as housing construction is coming back. The housing market is continuing to heal," Chris Rupkey, chief financial economist at MUFG Union Bank in New York, told Reuters.

Homebuilding has been significantly low despite recent economic growth. Household formation has been running at about 500,000 a year – way below the 1-million mark that most economists consider healthy for the sector.

But the Commerce Department’s report on Wednesday hints at a turnaround: Single-family housing starts, the largest portion of the homebuilding market, rose 7.2 percent to a seasonally adjusted annual pace of 728,000 units in December. It’s the highest level since March 2008.

Meanwhile, groundbreaking on the volatile multi-family market fell slightly at 0.8 percent in December.

Overall, housing starts – reflecting the single-family and multi-family markets – increased 4.4 percent in December to a 1.09 million-unit rate.

Economists point to several factors as helping to lift the new-home market, notably the 30-year mortgage rate is down more than 80 basis points from early 2014, the government’s move to ease credit conditions, and overall wage and employment growth.

"This should allow for many more individuals to enter the market. We expect much of the improvement to occur in sales at the lower end of the market, which has been lagging the overall housing recovery," says David Nice, an economist at Mesirow Financial in Chicago.

Overall for 2014, groundbreaking on single-family and multifamily homes rose 8.8 percent to 1.01 million units – the highest since 2007.

However, the new-home market still has a ways to go. Building permits – a sign of future homebuilding activity – dropped 1.9 percent in December – mostly attributed to an 11.8 percent drop in the multi-family segment. Yet, single-family permits increased 4.5 percent, marking the highest level since January 2008. Building permits in the South in December reached their highest level since February 2008.

Source: “U.S. Single-Family Housing Starts Highest Since Early 2008,” Reuters (Jan. 21, 2015) and “Housing Starts End Year Solidly, Up 4.4%,” Dow Jones Business News (Jan. 21, 2015)

http://realtormag.realtor.org/daily-news/2015/01/22/housing-starts-reach-six-year-highs

www.RebeccaSellsAZ.com

4 Things You Don’t Know About Outdoor Kitchens

DAILY REAL ESTATE NEWS | WEDNESDAY, JANUARY 21, 2015

Now that the 2015 International Builders’ Show has partnered with the Kitchen & Bath Industry Show, there are plenty of examples of beautiful cooking spaces, indoors and out. But what about the numbers? The results of a new survey released at the show attempt to define what consumers want when it comes to outdoor kitchens.

The Great Outdoors

Transform a Yard Into an Outdoor Sanctuary

Stylish Outdoor Living

Staging Outdoor Spaces

5 Tips for the Ultimate Backyard

Dave Brown, a partner with Chicago-based ad firm HY Connect, surveyed consumers who have or would like to have outdoor kitchens in their homes. The study, which surveyed households making $150,000 or more in household income across the United States, was conducted in December 2014. He discussed the results of the survey at the first day of IBS/KBIS in Las Vegas on Tuesday.

A Growing Market
While only 4 percent of affluent households have outdoor kitchens today, 13.6 percent say they are planning on adding one in 2014. Brown says that the largest age group who don’t have these amenities but are hoping to incorporate them in their living space is between the ages of 45 and 54. He also adds that those who are interested in this particular amenity are more likely to have children in the home, noting, “These are active households. They’re doing stuff.”

The Difference Between Indoor and Outdoor
The needs and wants associated with an indoor kitchen don’t necessarily translate to that of an outdoor cooking space. “Outdoors is all about socializing… it is all about having fun and a great experience,” Brown says, noting that adequate seating space is one place where home owners tend to underestimate. Also, he adds that “storage in the indoor kitchen is huge [but] in terms of the outdoors, food prep becomes more important.”

Unexpected Features Top Favorites Lists
It may not seem that surprising that survey respondents consistently rated the outdoor kitchen their favorite room in the whole house. However, their favorite features weren’t the traditional items seen in most outdoor entertainment areas. The No. 1 item that current owners of outdoor kitchen regretted leaving out was a pizza oven. “What’s loved the most is what’s unique. Fountains, fireplaces, pools,” Brown says. He adds that his backyard pizza oven serves as a gathering place for guests to participate in the food prep process. “It’s what I call ‘kitchen karaoke.’”

Integration Is Key
Brown says that many home owners start small with the intention of adding on features later. But he notes that the most successful, best-loved outdoor kitchens tend to occur when the design process is holistic: “It feels like an entire outdoor room where I can have an event and not just a bunch of stuff stuck outside.”

—Meg White, REALTOR® Magazine

www.rebeccasellsAZ.com

http://realtormag.realtor.org/daily-news/2015/01/21/4-things-you-don-t-know-about-outdoor-kitchens

Mortgage Lending Plunges to 13-Year Low

DAILY REAL ESTATE NEWS | MONDAY, DECEMBER 01, 2014

Mortgage lending is running at its lowest level in more than a decade, and 2014 is on pace to be the weakest for new mortgages since 2000, according to newly released figures by the Federal Reserve Bank of New York.

Will Lenders Ease Up?

Fannie, Freddie to Loosen Up on Lending

QRM Rule to Open More Doors for Consumers

Most of the drops in mortgage lending this year have been attributed to a sharp decrease in refinancing. The New York Fed’s data does not separate mortgage lending for home purchases from those for refinancing.

Mortgage lending has averaged $357 billion per quarter for the past year ending in September, which marks the lowest amount since the middle of 2001, the Fed reports. If the fourth quarter doesn’t show a spike in lending activity–which historically it does not—2014 will go down as the worst year for mortgage volume since 2000.

The drop in lending comes at a time when mortgage rates are hovering near historic lows. Freddie Mac reported that the 30-year fixed-rate mortgage averaged 3.97 percent last week. The rate drop in recent months has been welcome news for buyers and home owners who have been able to take advantage, particularly after the increase last year. The 30-year fixed-rate mortgages jumped in the middle of last year from around 3.6 percent to 4.6 percent in June, before falling back down in recent months.

Source: “New Mortgage Lending Drops to 13-Year Low,” The Wall Street Journal (Nov. 25, 2014)

http://realtormag.realtor.org/daily-news/2014/12/01/mortgage-lending-plunges-13-year-low

www.RebeccaSellsAZ.com

Survey: More Americans Ready to Sell

DAILY REAL ESTATE NEWS | TUESDAY, NOVEMBER 11, 2014

More Americans are growing optimistic about home-price appreciation and selling, according to Fannie Mae's October 2014 National Housing Survey of 1,000 American adults.

Home-price expectations rose significantly in the latest survey, largely reversing a dip over the past four months, says Doug Duncan, Fannie Mae's chief economist. Also, the share of consumers who say now is a good time to sell a home reached another survey high this month.

"The narrowing gap between home buying and home selling sentiment may foreshadow increased housing inventory levels and a better balance of housing supply and demand," Duncan says. "These results may help drive a healthier housing market in 2015."

Duncan says that the latest survey showed that consumers are growing more optimistic about the housing market "in the face of broader improvement in economic sentiment. The share of consumers who expect their personal finances to get better is near its highest level since the survey's inception, while those expecting their finances to get worse reached a survey low."

The following are some additional highlights from the Fannie Mae survey:

• Home buying and selling: The percentage of Americans who say now is a good time to buy a house dropped to 65 percent in October, but sellers were more optimistic. Those who say it's a good time to sell rose to 44 percent, marking a new all-time survey high.
• Home prices: The average home-price expectation for the next 12 months increased to 2.8 percent. Forty-four percent of respondents now say they expect home prices to rise within the next 12 months.
• Personal finances: Forty-five percent of respondents say they expect their personal financial situation to improve during the next 12 months, seven points higher than a year ago. The share expecting their financial situation to worsen, meanwhile, decreased to 10 percent last month.
• Rent expectations: The percentage of respondents who expect home rental prices to rise fell by six percentage points to 49 percent in October.

Source: Fannie Mae

http://realtormag.realtor.org/daily-news/2014/11/11/survey-more-americans-ready-sell

www.RebeccaSellsAz.com

Community Revitalization From the Ground Up

DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 13, 2014

Does your community have a lifeless block of vacant storefronts holding it back? Better Block might be able to help. The program helps a community come together and figure out the kind of change that will revitalize a neighborhood quickly.

Holly Moskerintz, community affairs representative for the National Association of REALTORS®, explains how Better Block helps precipitate change in a way that circumvents the common barriers to neighborhood development.

"Better Block is a demonstration tool that rebuilds and revitalizes an area using grassroots efforts to show the potential to create a great walkable, vibrant neighborhood – and even a destination... It’s a way to give residents a taste of what’s possible," Moskerintz writes on NAR's Spaces to Places blog. The "focus is to bring back a neighborhood rapidly rather than developing a larger scale, more financially complex project that could take years. It can help people come together to create a community destination quickly."

And the process doesn't have to cost much, either. Better Block Co-founder Jason Roberts tells Moskerintz the projects “never cost more than $3,000... and we can pull them off for as low as $500 if we have to.” At least one Better Block program has received an NAR Smart Growth grant to help cover costs.

Moskerintz shows Better Block in action in Memphis, Dallas, and Norfolk, Va. But you can also see a project first-hand in New Orleans during the REALTORS® Conference & Expo this November.

Source: "One Block at a Time," Spaces to Places (Oct. 8, 2014)

http://realtormag.realtor.org/daily-news/2014/10/13/community-revitalization-from-ground-up

www.RebeccaSellsAZ.com

Student Debt Burden Holding First-Time Buyers Back

DAILY REAL ESTATE NEWS | WEDNESDAY, SEPTEMBER 03, 2014

Carrying student loan debt is making it more difficult for many young professionals to qualify for a mortgage. Recent college graduates with student loan debt who want to own a home will need to earn about one-third more annually — or $8,969 more — than those who are debt-free, according to new research by the real estate data firm RealtyTrac.

The Student Loan Debt Crisis

Student Loans Causing Housing Shift, CFPB Says

Study: Student Debt Holds Buyers Back, But Doesn't Need To

5 States with the Highest Levels of Student Debt

The Plight of First-Time Buyers

“To overcome the additional debt from student loans, indebted college graduates need to make more income than college graduates without student loans to be able to afford a home,” says Daren Blomquist, a vice president at RealtyTrac. For its analysis, RealtyTrac factored in the median home price for each state and county and calculated the minimum amount of income needed to qualify for a loan to purchase a home at that price.

RealtyTrac found that graduates with student loans who are earning the median U.S. household income can afford to make the monthly payments on a median-priced home in 96 percent of the 494 county markets it analyzed.

But many graduates with student loans are saddled with high debts and are struggling to break ahead.

The average graduate in 2014 carried $33,000 in debt, an amount that has tripled over the last 20 years, according to Edvisors.com, a network of websites about planning and paying for college. The average starting salary for an employee holding a bachelor’s degree is around $45,000.

“The average student loan debt varies from state to state, and somewhat counterintuitively, some of the most expensive states for housing also have the lowest average student loan debt,” Blomquist says. For example, while California has one of the lowest levels of student loan debt, it boasts some of the highest home prices in the nation.

In some cases, college grads with student loan debts are having to earn a lot more money than their debt-free counterparts if they want to buy a home. According to RealtyTrac’s analysis, the following states are where recent graduates with student loans need to make even more income to match the purchasing power of students without loans:

• Connecticut: 58%
• Rhode Island: 56%
• Michigan: 55%
• Ohio: 52%
• Pennsylvania: 49%

Student loan debt is a pressing hurdle for graduates not only in purchasing a home but also in building wealth over the long term. For example, households headed by young, college-educated adult without any student debt have about seven times the typical net worth ($64,700) than households headed by young, college-educated adults with student debt ($8,700), according to data from the Pew Research Center. About a quarter of households headed by an adult under 40 has student debt, a record high, according to Pew.

Source: “College Grads Face High Hurdles to Buying First Homes,” MarketWatch/The Wall Street Journal (Aug. 28, 2014)

http://realtormag.realtor.org/daily-news/2014/09/03/student-debt-burden-holding-first-time-buyers-back

www.RebeccaSellsAZ.com

Why Redfin Is Predicting a Home Sales Surge

DAILY REAL ESTATE NEWS | TUESDAY, SEPTEMBER 02, 2014

A slowdown in home price growth and a shift in pricing power from sellers to one that more closely aligns with buyers expectations will “drive an unusual surge in home sales this fall,” predicts analysts at the real estate brokerage Redfin in its latest housing report.

“Home buyers who have been willing to wait for better deals are starting to be rewarded for their patience, as sellers drop listing prices to meet buyers’ more value-focused expectations,” Redfin notes in its latest report.

Reason for Optimism? 

Why the Second Half of 2014 Will Be Better Than the First

Altos: Critics Are Wrong About Where Housing Is Headed

Builder Confidence Rises Above Key Benchmark

The number of homes that sold above list price in July was down nearly 7 percent to 20.1 percent from 26.8 percent a year ago, according to Redfin’s analysis.

“Sellers are finally catching on that it’s not a seller’s market anymore,” says Jeremy Cunningham, a Redfin real estate professional in Virginia.

Sellers are adjusting their prices, particularly in markets that have seen a large increase in for-sale inventories or big increases in home price appreciation over the past year.

According to Redfin, Denver is the metro that has registered the largest percentage of listing price drops. Its median sales price has increased by 15 percent year-over-year compared with an average of 5.5 percent for all metros.

On the other hand, Ventura County and Sacramento, Calif., have seen more moderate price growth year-over-year but have seen their for-sale inventories rise by 25.6 percent and 18.3 percent, respectively. The two metros had the second and third largest percentage of homes for sale with price drops in July, according to Redfin.

Some of the metros with the fewest price drops tended to have smaller increases in median home prices and for-sale inventories, analysts note. On the other hand, some West Coast markets like San Francisco, San Jose, Los Angeles, and Seattle continue to sell for more than list price.

Get Ready for a Hot Fall?

Redfin analysts are predicting a surge in home sales in September and October.

“We continue to see strong buyer demand as we head into fall,” according to Redfin’s housing report, which shows the number of tours and offers picking up from July and into August. “The buyer fatigue from competing against multiple offers, bidding wars. and tight inventory is diminishing. Additionally, the widespread increase in price drops is likely to give buyers even more confidence that they have regained some of the bargaining power lost last year.”

Also, analysts note that borrowing costs still remain attractive, which will help buyers off the fence.Mortgage rates continue to hover near yearly lows. 

Source: “Listing Price Drops Will Help Drive a Fall Surge in Home Prices,” Redfin (Aug. 29, 2014)

http://realtormag.realtor.org/daily-news/2014/09/02/why-redfin-predicting-home-sales-surge

www.RebeccaSellsAZ.com

Strengthening Job Market, Rising Inventories Lift Home Sales

DAILY REAL ESTATE NEWS | FRIDAY, AUGUST 22, 2014

Existing-home sales were on the rise in July, with sales moving to the highest pace of this year, the National Association of REALTORS® reports in its latest housing data release. It also marked the fourth consecutive month of gains in sales. NAR’s chief economist expects the growing momentum in home sales to continue for the rest of the year.

“The number of houses for sale is higher than a year ago and tamer price increases are giving perspective buyers less hesitation about entering the market,” says Lawrence Yun, NAR’s chief economist. “More people are buying homes compared to earlier in the year, and this trend should continue with interest rates remaining low and apartment rents on the rise.”

New-Home Construction Also Rebounds:

Homebuilders Pick Up Pace to Meet Shortages, Demand

Total existing-home sales – which reflect completed transactions for single-family homes, townhomes, condominiums, and co-ops – rose 2.4 percent to a seasonally adjusted annual rate of 5.15 million in July. However, sales remain 4.3 percent below last July, the peak for 2013.

Housing inventories at the end of July rose by 3.5 percent to 2.37 million existing homes for-sale – which represents a 5.5 month supply at the current sale pace, NAR reports.

Fading Affordability

Yun cautions that housing affordability is likely to decline in the upcoming years. “Although interest rates have fallen in recent months, median family incomes are still lagging behind price gains, and mortgage rates will inevitably rise with the upcoming changes in monetary policy,” Yun notes.

The median existing home price for all housing types in July was $229,900 – 4.9 percent higher than July 2013. It marks the 29th consecutive month of year-over-year price gains, NAR reports.

Distressed Sales Hit Important Milestone

Distressed homes – which include foreclosures and short sales – made up 9 percent of July sales, down from 15 percent a year ago. It was the first time that distressed sales fell to single-digits since NAR began tracking the category in October 2008 – an important milestone, NAR notes.

In July, 6 percent of sales were foreclosures (selling for an average discount of 20 percent below market value) and 3 percent were short sales (discounted, on average, 14 percent), NAR reports.  

“To put it in perspective, distressed sales represented an average of 36 percent of sales during all of 2009,” Yun says. “Fast-forward to today and rising home values are helping owners recover equity and strong job creation are assisting those who may have fallen behind on their mortgage due to unemployment or underemployment.” 

Regional Snapshot

Across the country, here’s a look at how existing-home sales performed in July:

• Midwest: Existing-home sales rose 1.7 percent in July to an annual 1.22 million level, but remain 4.7 percent lower than July 2013 numbers; median price: $175,200, up 4.1 percent from a year ago.
• Northeast: Existing-home sales held flat in July at an annual rate of 640,000 for the second consecutive month, remaining 9.9 percent below year ago levels; median price: $273,600, a 2.4 percent increase year-over-year
• South: Existing-home sales increased 3.4 percent to an annual rate of 2.12 million, and are up slightly by 0.5 percent year-over-year; median price: $192,000, up 5.0 percent from a year ago.
• West: Existing-home sales rose 2.6 percent to an annual rate of 1.17 million, but are 8.6 percent below year ago levels; median price: $304,100 -- 6.3 percent higher year-over-year.

Source: National Association of REALTORS®

http://realtormag.realtor.org/daily-news/2014/08/22/strengthening-job-market-rising-inventories-lift-home-sales

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13 States Soar to New Home-Price Highs

DAILY REAL ESTATE NEWS | WEDNESDAY, AUGUST 06, 2014

More than a dozen states saw home prices accelerate in June to record-level highs, according toCoreLogic’s latest Home Price Index, which dates back to January 1976.

Are Price Gains Sustainable?

Home-Price Appreciation to Slow Down Through 2016

Markets Poised for the Biggest Price Gains

Study: Home Prices Undervalued by 3%

REALTORS® Still Optimistic on Rising Appreciation

Altos: Critics Are Wrong About Where Housing Is Headed

Survey: Lenders Fear Another Housing Bubble Is Brewing

Those states are:

• Alaska
• Colorado
• District of Columbia
• Iowa
• Louisiana
• Nebraska
• North Dakota
• Oklahoma
• South Dakota
• Tennessee
• Texas
• Vermont
• Wyoming

Year-over-year home prices were up in every state, except Arkansas, which posted a 0.4 percent decrease in home prices in June, CoreLogic reports. But excluding distressed sales, all states experienced year-over-year rises in prices, according to the report.

Michigan led the nation with the highest home appreciation year-over-year at 11.5 percent, followed by California with an 11.3 percent rise and Nevada at 11.1 percent.

“Home prices are continuing to rise fueled by ongoing tight supply, low rates, and aggressive investor buying on the East and West Coasts,” says Anand Nallathambi, president and CEO of CoreLogic. “The expected surge in the number of homes for sale has not materialized to date as many home owners are staying put and waiting for better economic times and higher prices in the future.”

Overall, CoreLogic’s index shows that nationwide home prices rose 7.5 percent year-over-year in June, marking the 28th consecutive month for year-over-year increases. Still, including distressed sales, nationwide home prices remain 12.9 percent below the peak reached in April 2006. On a month-over-month basis, home prices nationwide ticked up modestly at 1 percent in June.

“Home price appreciation continued moderating in June with its slight month-over-month increase,” says Mark Fleming, chief economist for CoreLogic. “This reversion to normality that we are finally experiencing is expected to continue across the country and should further alleviate concern over diminishing affordability and the risk of another asset bubble.”

Source: CoreLogic

http://realtormag.realtor.org/daily-news/2014/08/06/13-states-soar-new-home-price-highs

www.RebeccaSellsAZ.com

Where's the Nation's Safest Metro? Hint: There's No Kids

DAILY REAL ESTATE NEWS | WEDNESDAY, JULY 30, 2014

The fastest-growing metropolitan area in the United States has 110,000 residents, 42 golf courses, and more golf carts than New York has taxis.

The Villages, Fla., whose population is largely made up of retirees over 55, is a retirement community that has sold more than 50,000 new homes since 1986, generating $9.9 billion in revenue. Home prices range from about $150,000 to $1 million.

The privately owned community has rules that determine everything from how long children can visit for to how many pet fish residents can keep, and developer H. Gary Morse also owns the local newspaper, radio station, and TV channel.

Resident Jerry Conkle, who has lived in the community for two decades, calls the development "an adult Disney World" and says that everything he needs is a golf-cart ride away and he can't imagine living anywhere else. "There's hardly any crime," he says. "I don't know any place that's safer than here."

Source: "Fastest-Growing Metro Area in U.S. Has No Crime or Kids," Bloomberg.com (June 27, 2014)

http://realtormag.realtor.org/daily-news/2014/07/30/wheres-nations-safest-metro-hint-theres-no-kids

www.rebeccasellsaz.com

New-Home Sales Post Biggest Drop in a Year

DAILY REAL ESTATE NEWS | FRIDAY, JULY 25, 2014

Sales of newly built, single-family homes dropped 8.1 percent in June, the largest decline since July 2013, the Commerce Department reported Thursday. New-home sales were at a seasonally adjusted annual rate of 406,000 units in June. May’s sales pace was also revised from a previously reported 504,000 units to 442,000 units.

"The numbers are a little disappointing, but May was unusually high and some pull back isn't completely unexpected," says Kevin Kelly, chairman of the National Association of Home Builders. "Our surveys show that builders are confident about the future and we are still seeing a gradual upward trajectory in housing demand."

Recovery or Not?

• 3 Challenges Still Facing the Housing Market
• Why the Second Half of 2014 Will Be Better Than the First
• New-Home Construction to Be Low for a While

Across the country, new-home sales were down, falling by the largest amount – 20 percent – in the Northeast. New-home sales were also down by 9.5 percent in the South; by 8.2 percent in the Midwest; and by 1.9 percent in the West.

Inventories of new homes for-sale rose 3.1 percent in June to the highest number since October 2010, reaching a 5.8-month supply at the current pace.

Builders are still optimistic that the new-home sector will see improvement later this year.

"With continued job creation and economic growth, we are cautiously optimistic about the home building industry in the second half of 2014," says David Crowe, NAHB chief economist. "The increase in existing home sales also bodes well for builders, as it is a signal that trade-up buyers can move up to new construction."

The National Association of REALTORS® reported this week that existing-home sales gained momentum in June, reaching an annual pace of 5 million sales for the first time since October 2013.

Source: National Association of Home Builders and “U.S. New Home Sales Post Biggest Drop in Almost a Year,” Reuters (July 24, 2014)

http://realtormag.realtor.org/daily-news/2014/07/25/new-home-sales-post-biggest-drop-in-year

www.RebeccaSellsAZ.com