Friday, April 24, 2015

Buyers' Remorse

Buyers' Remorse

California Home Sales Not Drying Up

March Sales Jump 33.1 Percent From February,
Median Price Gains 4.8 Percent


For the first time in 16 months, sales were higher than a year earlier,” said Madeline Schnapp, Director of Economic Research for PropertyRadar. “Pent-up demand, mild winter weather and attractive interest rates have created a wellspring of California housing market sales. Despite the California drought dominating headlines, we aren’t seeing data that suggests the drought is having a negative impact on the market. Obviously we’ll continue to monitor that closely.”

VIEW THE ENTIRE REPORT. ELEVEN VISUAL CHARTS & GRAPHS COVERING:
Home Sales, Year-over-Year Home Sales, Median Sales Price vs. Sales Volume, California Home Owner Equity, Cash Sales, Flipping, Market Purchases by LLCs and LPs, Market Sales by LLCs and LPs, Trustee Sale Purchases by LLCs and LPs, Foreclosure Notices and Sales, Foreclosure Inventory

Friday, April 17, 2015

Market Matters

3 ways to make your home worth more
Source: Yahoo! Finance

In the new book "Zillow Talk: The New Rules of Real Estate," Zillow’s CEO Spencer Rascoff and Chief Economist Stan Humphries put data from the online portal to use by sharing ways to get the most value out of a home. They crunched the data and found that a bathroom remodel adds the most value to a house—not a kitchen remodel. According to Zillow's data, a mid-range $3,000 bathroom remodel results in a $1.71 increase in home value for every $1.00 spent on renovation. They also argue that ending your home price in a ‘9’ is incredibly beneficial.
Read the full story

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It's Easier to Get a Mortgage in 2015
Source: Kiplinger
 
Thanks to rising home prices, less-stringent down-payment requirements, and new rules that limit lenders’ liability when loans that meet certain criteria go bad, it is expected that borrowers should encounter fewer obstacles when getting a mortgage in 2015.  Mortgage rates are still hovering at levels unimaginable a generation ago, but many buyers have been unable to capitalize on such low-rate loans due to tight lending standards after the recession. 
Read the full story


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More Young Adults Are Living With Their Parents, and It’s Probably Because of Student Debt
Source: Wall St. Journal
 
A $10,000 increase in student debt per graduate in a U.S. state is associated with an additional 2.9 percentage point rise in the rate of 25-year-olds living with parents, according to an analysis of young Americans with credit reports by the New York Federal Reserve. This is the latest study to show that young Americans are now much more likely to delay leaving home, or to “boomerang” back. “Parental co-residence rates” were as high as 50 percent in 12 U.S. states during 2012. 
Read the full story
 

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We must boost homeownership
Source: Sacramento Bee
 
Chris Kutzkey, President of the CALIFORNIA ASSOCIATION OF REALTORS®, stresses the importance of homeownership to families, communities, and the economy. Kutzkey writes, “Somewhere, somehow over the last six years, too many decision-makers have come to believe homeownership isn’t important. Their inability to create a clear path forward in the mortgage finance arena has led to uncertainty and restricted credit for qualified homebuyers. This has hurt not only families, but the nation as a whole.”
Read the full story

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Castro grilled over lowering mortgage insurance premiums
Source: The Hill
Republicans grilled Housing and Urban Development Department Secretary Julian Castro during a House hearing about his recent decision to lower mortgage insurance premiums despite the Federal Housing Administration falling short of its capital reserve requirement. But Castro argued that the FHA is delicately balancing its mission of meeting the needs of U.S. homeowners of more modest incomes while trying, at the same time, to reach the statutory 2 percent capital reserve requirement.
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New home purchases jump 29%
Source: HousingWire
 Mortgage applications for new home purchases jumped by 29 percent compared to the previous month, according to the January Mortgage Bankers Association Builder Application Survey. The average loan size of new homes dropped from $311,398 in December to $304,364 in January. The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 530,000 units in January 2015.
Read the full story

Friday, April 10, 2015

Market Matters

Economists Differ on Impact of Falling Oil Prices on Housing
Source: Wall St. Journal
In a big increase from 2014, economists are anticipating that home builders will start construction on as many as 804,000 new single-family homes this year. But will falling oil prices affect housing construction? Some economists predict there could be an indirect benefit to the housing market in the form of more consumer spending, which will create more job/income growth and by extension make it easier for people to buy homes. But there are concerns that there could be a slowdown to housing construction activity in oil-focused local economies, such as cities in Texas.
Read the full story

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Will 2015 be better for California’s housing market?
Source: HousingWire
 
While prices are still very high, 2015 may fare slightly better for potential buyers in California thanks to mortgage interest rates trending lower and loosening lending standards. The California housing market stayed in line with 2014 predictions and hopefully set the pace for a better 2015, according to PropertyRadar’s December Real Property Report. California’s real estate market continues to show steady improvement, as the number of homeowners in a negative equity position fell 1.1 percent to 987,000 in December, and the number of underwater borrowers shrank 28.5 percent for the year.
Read the full story
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Housing is about 75% back to normal: Report
Source: CNBC

The U.S. housing market is about three-quarters of the way back to "normal," according to a new report from Trulia. Both sales and prices of existing homes are 82 percent back to normal levels, compared with a year ago, when they were just 73 and 66 percent recovered, respectively. Single-family housing starts are still struggling, as household formation is almost entirely on the rental side. The recovering employment of 25- to 34-year-olds is also an important factor for housing.
Read the full story
 
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Builder confidence holds steady in January
Source: The Hill
 
According to the latest National Association of Home Builders/Wells Fargo Housing Market Index, there is plenty of optimism in the housing market's future, but home builder confidence did fall a point in January. It was the third straight month that the index has hovered in the upper 50s. The component gauging current sales conditions remained unchanged at 62 in January, while the index measuring expectations for future sales dropped 4 points to 60 and the component gauging traffic of prospective buyers fell 2 points to 44.
Read the full story
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U.S. single-family starts hit 6-1/2-year high in December
Source: Reuters
As the housing market continues to recover, U.S. housing starts rose more than expected in December as groundbreaking for single-family homes hit its highest level in more than 6-1/2 years. The Commerce Department reported that starts increased 4.4 percent to a seasonally adjusted annual pace of 1.09 million units. Groundbreaking on single-family projects in the West hit a seven-year high, while starts in the Midwest were the highest since December 2011.
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HUD’s Castro says first-timers should buy homes right now
Source: HousingWire
 Housing & Urban Development Secretary Juli├ín Castro received questions from challenged home buyers in a chat hosted by Zillow. Castro touted homeownership as an important way to build wealth. He commented, “Investment in a home is an investment in the long run in creation of wealth. A confluence of better economy, wages starting to go up and gas prices going down create some breathing room for people stuck in that rut to save some money to buy that first home.”
Read the full story

Friday, April 3, 2015

Market Matters

A third of mortgage holders don't know their rate
Source: CNBC

While the mortgage interest rate governs Americans’ single-largest monthly expense, more than a third don’t know the rate that they’re paying. Bankrate.com surveyed a national sample of 1,000 adults and found that 35 percent did not know their mortgage interest rate. One in seven mortgage holders were either "not too confident," "not at all confident," or had no idea about their rate. Most borrowers know the general range, but a half and a quarter percentage point variance can translate into meaningful savings, especially in today's changing lending environment.
Read the full story
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U.S. Homeownership Rate Falls to 20-Year Low
Source: Wall St. Journal
 
At the end of 2014, the U.S. homeownership rate fell to its lowest level in 20 years. According to the Commerce Department, some 63.9 percent of U.S. households owned their homes in the fourth quarter, a level last recorded in the third quarter of 1994. The homeownership rate hasn’t fallen below that level since 1988. Just last year the homeownership rate stood at 65.1%. Data shows that household formation increased by 1.66 million from a year earlier, with 2 million more renter households and 350,000 fewer owner households. The homeownership rate was at its highest in 2005, when it peaked at 69.2%.
Read the full story
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Overseer of Fannie and Freddie Takes Cautious Steps to Strengthen Housing
Source: New York Times
 
Mel Watt, director of the Federal Housing Finance Agency, gave his first on-the-record meeting with reporters and indicated that he would not seek any major transformation in the government’s role in the housing economy. He deflected criticism of a plan that allows down payments as low as 3 percent of the purchase price for buyers who are short on cash by noting that credit counseling and other measures would keep buyers on track with payments. In light of expectations that the plan will attract only a small number of people, the New York Times describes his other ideas for helping homeowners as “similarly modest.”
Read the full story
 
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It's a great time to buy a home: Fannie Mae
Source: Yahoo! Finance
 
The 2015 housing outlook from Fannie Mae forecasts a 5.8 percent increase in home sales for 2015. Its economists revised previous GDP estimates to 3.1%, up from 2.7%, and said that the economy would “drag housing higher,” meaning that both the economy and housing will pick up speed this year, but the economy will improve at a greater pace. According to Fannie Mae’s chief economist, 2015 will only be a breakout year if millennials feel that their incomes are secure enough and mobility is less of an issue.
Read the full story
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Starbucks could jolt home values
Source: Union-Tribune San Diego
Homes located near a Starbucks appreciate much faster than homes farther away from the coffee giant, according to new analysis from Zillow. In the online portal’s new book Zillow Talk, it is noted that the average home near a Starbucks appreciated from $137,000 in 1997 to $269,000 in 2014, a 96 percent gain. Homes not near a Starbucks were up 65 percent over that same time period to $168,000. However, some critics of this thesis say the appreciation has more to do with where Starbucks chooses to locate, in up-and-coming neighborhoods.
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Urban Institute: 3 predictions for mortgage lending
Source: HousingWire
 The Urban Institute and CoreLogic hosted a panel of four experts from the government, private, and non-profit sectors to address a range of issues related to mortgages, and three predictions were made during the discussion. One, the new rules for Private Mortgage Insurers (PMIs) won’t raise mortgage insurance prices much. Secondly, the guarantee-fees charged by Fannie Mae and Freddie Mac could be reduced. Thirdly, whatever the resolution on remaining issues, borrowers should benefit as the FHA, the GSEs, and PMIs recalibrate as they try to find the new industry equilibrium over the coming months.
Read the full story

Friday, March 27, 2015

Market Matters

Remodeling Market Has Regained its Mojo
Source: Wall St. Journal
According to a new report released by the Harvard University Joint Center for Housing Studies, the remodeling market has fully regained its mojo, despite the fact that the overall U.S. housing market still is struggling to hit its stride. Forecasts predict that spending in the U.S. remodeling market will grow by 4 percent to 5 percent this year to at least $330 billion, spanning work on both owned homes and rentals. This would surpass the previous high point of $324 billion in 2007. More baby boomers are remodeling as they opt to stay in their long-time homes.
Read the full story 
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Fannie Mae, Freddie Mac regulator defends 3% down payment mortgages
Source: L.A. Times
 
Melvin L. Watt, director of the Federal Housing Finance Agency, told lawmakers this week that new programs to back mortgages with down payments as low as three percent had enough safeguards to make them as safe as loans with higher down payments. Watt faced criticism at a Congressional hearing that he was risking the loss of taxpayer money by returning to the irresponsible lending practices that caused the subprime housing market bubble. Watt noted that these loans will make up only "a very small percentage" of the mortgages in the portfolios of Fannie Mae and Freddie Mac.
Read the full story
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‘Boomerang’ Buyers Set to Surge Back Into Housing Market
Source: Time

Over the next eight years, nearly 7.3 million Americans who lost their homes in the housing crash will become creditworthy enough to buy again. According to analysis from RealtyTrac, these “boomerang buyers”—those who suffered a foreclosure or short sale between 2007 and 2014—are rapidly approaching, or already past, the seven-year window “conservatively” needed to repair their credit. This year, more than 550,000 of these buyers could be in a position to get back into the market.
Read the full story
 
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First-Time Home Buyers Held Back in 2014
Source: Wall St. Journal
 
First-time buyers purchased nearly one-third of previously owned homes sold in 2014, which is the same share as 2013. This is the lowest share, 29 percent, since the National Association of REALTORS® began tracking the data in 2008. Mounting student debt, higher rents, and tight credit conditions continue to make it tough for first-time borrowers to save enough money for a down payment and qualify for a mortgage.
Read the full story
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