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.
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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.
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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.
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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.
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Friday, March 6, 2015

C.A.R. Market Matters

Housing in 2015: Four Reasons for Optimism (And One for Worry)
Source: NPR
Will 2015 be the year that the housing market finally breaks out of its tepid recovery and takes off as economic indicators point to strong improvement? According to economists, there are several factors to encourage optimism. Firstly, employers are hiring again, job growth is relatively strong, and consumer confidence is growing. Also, slower price appreciation in 2014 may have set the stage for a buying surge in 2015. Millennial entry into the market and high rents may also working in housing’s favor.
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Buying a Home in California is Harder for Middle Class Families
Source: KPBS
 
The median income required to buy a home today in California is $30,000 higher than it was a few years ago, which means less than a third of California households can afford a home at the median price right now. According to Selma Hepp, senior economist with the CALIFORNIA ASSOCIATION OF REALTORS®, it’s much harder today than it was a year ago to buy a home in the state because there are very few affordable homes available in places most people want to live.
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Five Things to Watch in Housing In 2015
Source: Wall St. Journal
 
With lingering concerns about the recovery of the housing market, there are several key factors to watch in 2015, including affordability. It remains to be seen whether sales will pick up in 2015 if there’s more available for sale, and if those sellers realize prices aren’t rising the way they were one or two years ago. Slight loosening in access to credit may make the process of obtaining a mortgage less burdensome, but without an increase in incomes, there may not be sufficient buyers. Interest rates, inventory, and new construction are also important to monitor.
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Young Home Buyers Return in U.S. as Economy Accelerates
Source: Bloomberg
 
It is hoped that an increase in first-time buyers, whose market share dropped to a record low last year, will provide a boost to the sluggish mortgage industry. As the economy improves, economists expect weak demand to turn around as more renters are put in a better position to buy. It is believed that increasing confidence in the job market is the strongest indicator home sales will improve.
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Housing market on track for more improvement this year
Source: The Hill
Existing-home sales are expected to increase 7.4 percent this year, according to the National Association of REALTORS®. The forecast predicts that median home prices are expected to rise about 4 percent, while new homes sales are slated to jump 37 percent and rents are likely to increase 4 percent. Problem areas for the market include an expected rise in interest rates, stifled lending, and tough conditions for first-time home buyers.
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Stop charging borrowers for yesterday’s mistakes, FHA
Source: HousingWire

The Urban Institute is calling on the Federal Housing Administration to update its approach to insurance premiums because current rates are too high. According to its analysis, the FHA can significantly lower its premiums—charging current borrowers more appropriately for their risks—while continuing to build the necessary reserves against future losses.
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Friday, February 27, 2015

News Flash!!

The employment report for the month of December came in a little better than expected BUT, some components of the report were weaker than expected.  As a result rates have improved.  Conforming rates are around 3.75% (depending on credit score and other factors) and some experts are saying rates will drop to 3.5% or lower.

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Safety First

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