Wave of Singles to Make Big Impact on Housing

DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 13, 2014

Half of all American adults now live in one-person households, a rapidly growing number, according to the Bureau of Labor Statistics. The singles demographic is likely to reshape multifamily communities and single-family home designs going forward, according to Builder Online.

In 1976, only 37 percent of adults were single. As of August, that percentage has bloomed to 50.2 percent, or about 124.6 million singles. It marks the first time that single Americans make up the majority of the adult population since the government began tracking such data.

Get tips on how real estate pros can best serve this growing group.

“Thanks to the growth of single-adult households, floor plans will go from static to flexible as living arrangements change more frequently,” Susan Yashinsky, vice president of innovation trends for Waterford, Mich.-based Sphere Trending, LLC, predicts on Builder Online. “Analysts project that this group of adults will job hop more often, bring new types of living arrangements into the housing market (think friends buying homes together), and expect their environments to adapt to their frequently changing lifestyles as easily as picking a favorite Keurig coffee flavor.”

Affordability will be key, since single home buyers will have less income per household than dual-earner couples.

Also, “housing developments will need to embed elements of community that address the social aspects singles need, similar to what we have seen in multifamily new builds,” according to Builder. “Builders, developers, and designers who create housing for single consumers need to consider fresh concepts, such as communal sheds for lawnmowers and snow blowers, and even cars that can be rented as needed versus owned. Work/live spaces will evolve to reflect the growing number of entrepreneurs working from home. And, backyard cottages will bring solutions for related and/or unrelated adults sharing a single lot.”

Source: “More Americans Are Going Solo,” Builder Online (Oct. 6, 2014)

http://realtormag.realtor.org/daily-news/2014/10/13/wave-singles-make-big-impact-housing

www.RebeccaSellsAZ.com

Why Low Rates Aren't Enough for Buyers

DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 13, 2014

Federal Reserve Chair Janet Yellen and housing forecaster Robert Shiller said earlier this year that they expected low rates to serve as a stimulus to home buying this year.

Freddie Mac reported the 30-year fixed-rate mortgage dropped to 4.12 percent for the week ending Oct. 9, near the lowest average rate of the year. The rate is far less than a 20-year mean of more than 6 percent for the 30-year fixed-rate mortgage. Yet mortgage rates hovering near annual lows for the past few weeks have not spurred the market. What's going on?

From low down payment options for first-time buyers to jumbo loan options for move-up purchases, find out what lenders are offering buyers today.

However, home sales are facing major challenges that even low borrowing costs can’t help. The Wall Street Journal explains that 2014 home sales “have been hit by poor weather, a low number of homes available for sale, and tight credit.” Also, the most popular home sales season—typically the spring and summer—has already come to an end.

“Families buying houses need to be done with that by the time that school starts,” says Guy Cecala, publisher of Inside Mortgage Finance. “Rates have been hovering around 4 percent for the better part of the peak home-buying season. I don’t think anybody has been sitting on the sidelines, waiting for rates to drop.”

Second, high credit standards in the wake of the financial crisis are still preventing many would-be buyers from getting a loan and taking advantage of the low rates.

“Right now the real issue isn’t the price of credit, it’s more the availability,” says Robert Denk, an economist with the National Association of Home Builders. Eighty three percent of homebuilders recently surveyed by NAHB say they have lost sales over the last six months due to buyers not qualifying for a mortgage. Tight credit has resulted in about 18,700 new-home sales lost, NAHB estimates. 

Source: “Housing Needs More Than Mortgage Rates of 4%-ish to Boom,” The Wall Street Journal (Oct. 9, 2014)

http://realtormag.realtor.org/daily-news/2014/10/13/why-low-rates-arent-enough-for-buyers

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

Home Owners are Tapping Into Equity, Again

DAILY REAL ESTATE NEWS | THURSDAY, OCTOBER 09, 2014

Home equity lines of credit surged nearly 20 percent compared to a year ago and are now at the highest level since the 12 months ending in June 2009, according to RealtyTrac’s Home Equity Line of Credit (HELOC) Trends Report. HELOC originations comprised 15.4 percent of all loan originations nationwide during the first eight months of the year, the highest percentage since 2008.

Here's why HELOCs are back on the rise: Nearly 1 Million Homes Regain Equity

“This recent rise in HELOC originations indicates that an increasing number of home owners are gaining confidence in the strength of the housing recovery and, more importantly, have regained much of their home equity lost during the housing crisis,” says Daren Blomquist, vice president at RealtyTrac.

Nearly 10 million home owners nationwide, representing 19 percent of all home owners with a mortgage, have regained at least 50 percent equity in their homes, RealtyTrac data shows. Meanwhile the percentage of home owners with severe negative equity has fallen from 29 percent in the second quarter of 2012 to 17 percent in the second quarter of this year, Blomquist notes.

Despite home equity lines of credit rising significantly in the past year, they still remain 76 percent below the 2006 peak reached during the housing boom, RealtyTrac notes.

Among the nation’s largest metro areas tracked, 49 out of 50 posted year-over-year increases in HELOC originations for the year ending June 2014 (the lone exception was Rochester, N.Y.).

The following metro areas had the largest year-over-year increases in HELOC originations:

• Riverside-San Bernardino, Calif.: +87.7%
• Las Vegas: 85.1%
• Cincinnati: 81%
• Sacramento, Calif.: 65.1%
• Phoenix: 60.1%

Source: RealtyTrac

http://realtormag.realtor.org/daily-news/2014/10/09/home-owners-are-tapping-equity-again

www.RebeccaSellsAZ.com

Latest Rate Drops Lift Loan Demand

DAILY REAL ESTATE NEWS | WEDNESDAY, OCTOBER 08, 2014

Mortgage applications picked up last week, as a drop in interest rates gave a boost to both refinances and home purchases, the Mortgage Bankers Association reports in its weekly mortgage market survey, reflecting the week ending Oct. 3. Total mortgage application volume rose 3.8 percent on a seasonally adjusted basis compared to the previous week.

Broken out, applications for refinancings rose 5 percent compared to the previous week, while purchase applications, viewed as a gauge for future home sales, ticked up 2 percent.

"The purchase index reached its highest level since July," says Michael Fratantoni, the MBA’s chief economist. "The increase was led by a 3.7 percent increase in government purchase volume for the week."

Nevertheless, purchase applications remain down nearly 8 percent on an annual basis.

The MBA reported that the nationwide average on the 30-year fixed-rate mortgage fell from 4.33 percent the prior week to 4.30 percent. What’s more, as the stock market weakened on Tuesday, rates continued to post more drops, even in some cases nearing their lowest level of the year of 4 percent averages, CNBC reports.

Source: “Falling Rates Offer Home Buyers a Push,” CNBC (Oct. 8, 2014)

http://realtormag.realtor.org/daily-news/2014/10/08/latest-rate-drops-lift-loan-demand

www.RebeccaSellsAZ.com

Americans' Attitudes Improve on Housing

DAILY REAL ESTATE NEWS | WEDNESDAY, OCTOBER 08, 2014

Consumers’ optimism toward the housing market showed a slight rebound last month, with more people now saying it’s a good time to buy or sell a home, according to Fannie Mae’s September 2014 National Housing Survey, based on about 1,000 Americans’ attitudes on the housing market.

A Hopeful Trend

Consumers Aren't Losing Confidence in Home Prices

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Fannie: More Americans Say Buy, Sell Now

The share of consumers who say now is a good time to purchase a home rose to 68 percent in September, a four percentage point increase from August. Also, the share of Americans who said they’d prefer to buy a home on their next move rose to 66 percent, following a three-point drop the previous month. The percentage of those who reported now is a good time to sell grew to 39 percent. Those surveyed also were more upbeat about home prices rising in the next 12 months, with expectations of price gains of 2.2 percent, on average.

Consumers also showed greater optimism toward the overall economy, with 40 percent now saying the economy is on the right track, posting a five percentage point gain from last month.

"The September National Housing Survey shows a slight recovery in consumer housing sentiment after a two-month setback, bringing us back to the modestly positive trend we've seen over the last year," says Doug Duncan, senior vice president and chief economist at Fannie Mae. "It might be too late to save this year's home sales from posting the first decline in five years. However, the return to an upward trend in housing sentiment, combined with this month's positive news on the jobs front, suggests that a broad-based, albeit measured, housing recovery is on track to resume in 2015. The results of the past few months show that consumer optimism remains cautious and somewhat volatile, and we'll likely continue to see bumps on the housing recovery path reflected in our survey results."

Source: Fannie Mae

http://realtormag.realtor.org/daily-news/2014/10/08/americans-attitudes-improve-housing

www.RebeccaSellsAZ.com

Luxury Buyers Are Spending Mega Bucks in These Markets

DAILY REAL ESTATE NEWS | FRIDAY, OCTOBER 03, 2014

The high-end residential real estate market remains strong point and plays a big role in the housing recovery. Nearly half – 48 percent – of all wealthy consumers recently reported that they plan to purchase a luxury home within the next 12 months, according to a survey of consumers with a net worth of at least $5 million conducted by Coldwell Banker Previews International program and the Luxury Institute. For affluent individuals under the age of 35, the percentage of those planning to buy a luxury home in the next year jumps to whopping 81 percent. This group of affluent Millennials also reported the highest average purchase price of all age groups at $7.8 million, according to the survey. 

Inside the Luxury Market

Priced to Sell at $30M? Apparently, Yes!

Luxury Market Takes Larger Chunk of Sales

Speculative Building Returns to Luxury Market

So where are luxury buyers’ targeting their home search? Coldwell Banker’s survey identified the following 10 U.S. cities as having the highest number of luxury home sales valued at $1 million or more during the last 12 months through June 2014:

1. San Francisco: 2,485 (the number of home sales valued at $1 million-plus)
2. Los Angeles: 2,170
3. New York: 2,145
4. San Jose, Calif.: 1,119
5. Houston: 981
6. Chicago: 972
7. Naples, Fla.: 964
8. Miami: 933
9. San Diego: 927
10. Washington, D.C.: 878

In the $10 million-plus sales category, New York, with 58 home sales valued at $10 million-plus and Beverly Hills, Calif., with 28 home sales of $10 million-plus led the pack.

What Are Luxury Buyers Looking For?

Location is no longer the top search criteria among luxury buyers, particularly the younger generations, according to the survey. With the ability to work remotely becoming an option for a growing number of people, only 25 percent of the under-35 age group indicate that location dominates their home search criteria. The under-35 group factors in lifestyle considerations instead, with 75 percent saying that dictates their choice of which home to buy, according to the survey.

The demand for eco-friendly homes is growing, too. Nearly one-third of all wealthy buyers under the age of 45 surveyed said a “green” or “LEED certified” home was more important to them than it was just three years ago. Twenty-one percent of all wealthy buyers say they want to purchase an eco-friendly home, a significant jump up from 7 percent in 2013.

Twenty-five percent of luxury home buyers also view a fully automated, high-tech home as a greater priority. For 37 percent of respondents under the age of 35 and 30 percent of those with a net worth of more than $10 million, safe rooms were also found to be a top priority.

Source: Coldwell Banker Previews International/Coldwell Banker (Oct. 1, 2014)

http://realtormag.realtor.org/daily-news/2014/10/03/luxury-buyers-are-spending-mega-bucks-in-these-markets

www.RebeccaSellsAZ.com