This Week in Real Estate: November 27, 2017

The National Association of Realtors released This Week in Real Estate that the pace of existing-home sales in October was the strongest it has been since June. Below are a few highlights from the third week of November that influence our business:

* Existing Home Sales Grow 2% in October. Existing-home sales increased in October to their strongest pace since earlier this summer, but continual supply shortages led to fewer closings on an annual basis for the second straight month, according to the National Association of Realtors. Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2.0 percent to a seasonally adjusted annual rate of 5.48 million in October from a downwardly revised 5.37 million in September. After last month’s increase, sales are at their strongest pace since June (5.51 million), but still remain 0.9 percent below a year ago. Existing-home sales in the West grew 2.4 percent to an annual rate of 1.27 million in October, and are now 0.8 percent above a year ago. The median price in the West was $375,100, up 7.8 percent from October 2016. The median existing-home price2 for all housing types in October was $247,000, up 5.5 percent from October 2016 ($234,100). October’s price increase marks the 68th straight month of year-over-year gains.
* Freddie Mac November 2017 Outlook. “It’s unlikely the economic environment will be much more favorable for housing and mortgage markets in 2018 and 2019. We forecast that interest rates will remain low by historical standards, but gradually creep higher over the next two years. We also forecast that housing construction will gradually pick up, helping to supply more homes to inventory-starved markets. More housing supply and modestly higher rates will lead to a moderation in house price growth. Refinance activity will drop to very low levels and the mortgage market will be dominated by purchase activity,” said Freddie Mac Chief Economist Sean Becketti. Modest economic growth, robust job gains, and low interest rates make for a favorable economic environment for housing and mortgage markets. But despite the favorable environment, housing markets have stalled a bit through summer and into fall. A lack of available for-sale inventory is helping to contribute to an acceleration in home prices.Full Story... http://freddiemac.mwnewsroom.com/press-releases/freddie-mac-november-2017-outlook-otcqb-fmcc-1325624?feed=429e0be3-9aef-4a3a-9775-43f8e470d510
* Once Hot Apartment Construction Cooling as U.S. Housing Engine. Faster apartment building was instrumental in pulling the U.S. housing market out of its slump a decade ago. Now, that engine is starting to throttle back. The supply of apartments and condominiums has surged in recent years as builders responded to rising demand, fueled in part by young Americans who preferred to rent rather than purchase a home in the aftermath of the recession. A surge in prices for single-family properties, as the real-estate market recovered from its 2006 plunge, also made apartments more attractive for both builders and people unable to buy.  A Commerce Department report on Friday showed completions of multifamily units in October reached the fastest annualized rate in almost three decades. What’s more, the pipeline of apartments under construction is leveling off from a 42-year high reached at the start of 2017. And the number of multifamily units authorized but not yet started also is cooling as builders attempt to calibrate the supply.

Have a productive week.

Jason


This Week in Real Estate: November 20, 2017

Favorable news from the new construction sector This Week in Real Estate with the three month-moving average ending in October for single-family housing starts rising to a post-recession high, while builder confidence in November reached the second highest reading since July 2005. Below are a few highlights from the second week of November that influence our business:

* Housing Starts Rise in OctoberTotal housing starts increased in October, with solid readings from the single-family sector. Total starts increased 13.7% to a 1.29 million seasonally adjusted annual rate, according to the joint data release from the Census Bureau and HUD. A jump in multifamily construction also increased the headline rate. Single-family starts increased for the month, rising to an 877,000 seasonally adjusted rate in October. This monthly annualized rate matches the post-recession high pace set in February of this year. However, the three month-moving average for single-family starts is at a post-recession high (860,000). Single-family starts are up more than 8% year-to-date compared to 2016 as limited existing inventory and solid builder confidence make for positive market conditions. Single-family permits, a reasonable indicator of future construction conditions, are running 10% higher on a year-to-date basis. Part of the gain for single-family construction in October was a rebound in Florida and Texas after project delays in September. Single-family starts in the South were up 17% compared to September.
* CoreLogic: Mortgage Delinquency Rates Lowest in More Than a Decade. CoreLogic released its monthly Loan Performance Insights Report Tuesday which shows that, nationally, 4.6 percent of mortgages were in some stage of delinquency (30 days or more past due including those in foreclosure) in August 2017. This represents a 0.6 percentage point year-over-year decline in the overall delinquency rate compared with August 2016 when it was 5.2 percent. As of August 2017, the foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, was 0.6 percent, down from 0.9 percent in August 2016. This was the lowest foreclosure inventory rate for the month of August in 11 years since August 2006 when it was 0.5 percent. The rate for early-stage delinquencies, defined as 30-59 days past due, was 2 percent in August 2017, down slightly from 2.1 percent in August 2016. The share of mortgages that were 60-89 days past due in August 2017 was 0.7 percent, unchanged from August 2016. The serious delinquency rate (90 days or more past due) declined 0.5 percentage points year over year from 2.4 percent in August 2016 to 1.9 percent in August 2017. The 1.9 percent serious delinquency rate in June, July and August of this year marks the lowest level for any month since October 2007 when it was also 1.9 percent, and is also the lowest for the month of August since 2007 when the serious delinquency rate was 1.7 percent. Alaska was the only state to experience a year-over-year increase in its serious delinquency rate in August 2017.

* Builder Confidence Nears Post Crash High. Builder confidence increased for the second consecutive month after taking a hit in September from the late summer hurricanes.  The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) increased 2 points in November, hitting 70, the highest score since March.  It was also the second highest reading for the index which measures NAHB’s new home builder members confidence in the new home market since July 2005.  “November’s builder confidence reading is close to a post-recession high – a strong indicator that the housing market continues to grow steadily,” said NAHB Chairman Granger MacDonald. Regional HMI scores are presented as three-month moving averages.  The Northeast jumped 5 points to 54 and the South rose 1 point to 69. Both the West and Midwest remained unchanged at 77 and 63, respectively. NAHB Chief Economist Robert Dietz commented, “Demand for housing is increasing at a consistent pace, driven by job and economic growth, rising homeownership rates and limited housing inventory.  With these economic fundamentals in place, we should see continued upward movement of the single-family housing market as we close out 2017.”

 

Have a productive week.

Jason


This Week in Real Estate: November 13, 2017

Favorable news This Week in Real Estate from the U.S. Census Bureau regarding homeownership. For the second time in 2017, homeownership has increased. In other news, as inventory constraints still exist in most markets across the country, the fact that new construction spending is well ahead of last year provides some optimism that supply may start to relieve the pressure of demand. Below are a few highlights from the last week of October that influence our business:

* Homeownership Rate Improves For Second Time in 2017. The homeownership rate improved to 63.9 percent in the third quarter—the second time it has inched up this year, slightly topping 63.7 percent in the second quarter and 63.5 percent this time last year, according to the U.S. Census Bureau’s recent Quarterly Housing Vacancies and Homeownership report. Approximately 87 percent of housing was occupied in the third quarter, with 55.7 percent owner-occupied and 31.4 percent renter-occupied. Owner-occupied and renter-occupied housing accounted for 55.5 percent and 31.6 percent shares, respectively, in the second quarter of this year, and 55.5 percent and 31.8 percent shares, respectively, in the first quarter. The homeownership rate in the third quarter was again highest in the Midwest, at 69.1 percent, and the South, at 65.5 percent. The rate in the Northeast was 60.4 percent, while the rate in the West was 58.9 percent.
Full Story… http://rismedia.com/2017/10/31/homeownership-rate-improves-second-time-2017/?utm_source=newsletter&utm_medium=email&utm_campaign=eNews

* Metro Home Prices Maintain Fast Growth in Third Quarter; Rise 5.3%. Severely lacking inventory levels across the country pinched sales growth and kept home prices rising at a steady clip in nearly all metro areas in the third quarter, according to the latest quarterly report by the National Association of Realtors. The national median existing single–family home price in the third quarter was $254,000, which is up 5.3 percent from the third quarter of 2016 ($241,300). Single–family home prices last quarter increased in 92 percent of measured markets, with 162 out of 177 metropolitan statistical areas (MSAs) showing sales price gains in the third quarter compared with the third quarter of 2016 (the most since the second quarter of 2015, at 93 percent). In the West, existing–home sales increased 2.8 percent in the third quarter and are 1.9 percent above a year ago. The median existing single–family home price in the West increased 7.0 percent to $373,700 in the third quarter from the third quarter of 2016.
Full Story… https://www.nar.realtor/newsroom/metro-home-prices-maintain-fast-growth-in-third-quarter-rise-53-percent

* Single Family and Multifamily Construction Spending Post Gains. NAHB analysis of Census Construction Spending data shows that total private residential construction spending stood at a seasonally adjusted annual rate (SAAR) of $515.4 billion in September, virtually unchanged from downwardly revised August estimates. The total private residential construction spending was 9.6% higher than a year ago. Residential spending was flat for the month but is still running well ahead of the 2016 pace, especially that single-family number. Single-family construction was up 0.2 percent month-over-month to a rate of $265.59 billion, but that contributed to the 11.9 percent annual growth. On an unadjusted basis, residential spending in September, at $46.41 billion, represented more than half of the total $83.57 billion spent on all privately funded construction. Residential spending through August came to $345.71 billion, up 11.7 percent over the same period last year. Single family construction spending for the month was estimated at an unadjusted $24.73 billion and multi-family at $5.261. Year-to-date spending in the two categories was 8.9 percent and 4.3 percent higher than during the same period in 2016.
Full Story… http://eyeonhousing.org/2017/10/cash-sales-retreat-as-a-share-of-new-home-purchases/

Have a productive week.

Jason


This Week in Real Estate: November 6, 2017

Good Morning!

Favorable news This Week in Real Estate from the U.S. Census Bureau regarding homeownership. For the second time in 2017, homeownership has increased. In other news, as inventory constraints still exist in most markets across the country, the fact that new construction spending is well ahead of last year provides some optimism that supply may start to relieve the pressure of demand. Below are a few highlights from the last week of October that influence our business:

* Homeownership Rate Improves For Second Time in 2017. The homeownership rate improved to 63.9 percent in the third quarter—the second time it has inched up this year, slightly topping 63.7 percent in the second quarter and 63.5 percent this time last year, according to the U.S. Census Bureau’s recent Quarterly Housing Vacancies and Homeownership report. Approximately 87 percent of housing was occupied in the third quarter, with 55.7 percent owner-occupied and 31.4 percent renter-occupied. Owner-occupied and renter-occupied housing accounted for 55.5 percent and 31.6 percent shares, respectively, in the second quarter of this year, and 55.5 percent and 31.8 percent shares, respectively, in the first quarter. The homeownership rate in the third quarter was again highest in the Midwest, at 69.1 percent, and the South, at 65.5 percent. The rate in the Northeast was 60.4 percent, while the rate in the West was 58.9 percent.
Full Story… http://rismedia.com/2017/10/31/homeownership-rate-improves-second-time-2017/?utm_source=newsletter&utm_medium=email&utm_campaign=eNews

* Metro Home Prices Maintain Fast Growth in Third Quarter; Rise 5.3%. Severely lacking inventory levels across the country pinched sales growth and kept home prices rising at a steady clip in nearly all metro areas in the third quarter, according to the latest quarterly report by the National Association of Realtors. The national median existing single–family home price in the third quarter was $254,000, which is up 5.3 percent from the third quarter of 2016 ($241,300). Single–family home prices last quarter increased in 92 percent of measured markets, with 162 out of 177 metropolitan statistical areas (MSAs) showing sales price gains in the third quarter compared with the third quarter of 2016 (the most since the second quarter of 2015, at 93 percent). In the West, existing–home sales increased 2.8 percent in the third quarter and are 1.9 percent above a year ago. The median existing single–family home price in the West increased 7.0 percent to $373,700 in the third quarter from the third quarter of 2016.
Full Story… https://www.nar.realtor/newsroom/metro-home-prices-maintain-fast-growth-in-third-quarter-rise-53-percent

* Single Family and Multifamily Construction Spending Post Gains. NAHB analysis of Census Construction Spending data shows that total private residential construction spending stood at a seasonally adjusted annual rate (SAAR) of $515.4 billion in September, virtually unchanged from downwardly revised August estimates. The total private residential construction spending was 9.6% higher than a year ago. Residential spending was flat for the month but is still running well ahead of the 2016 pace, especially that single-family number. Single-family construction was up 0.2 percent month-over-month to a rate of $265.59 billion, but that contributed to the 11.9 percent annual growth. On an unadjusted basis, residential spending in September, at $46.41 billion, represented more than half of the total $83.57 billion spent on all privately funded construction. Residential spending through August came to $345.71 billion, up 11.7 percent over the same period last year. Single family construction spending for the month was estimated at an unadjusted $24.73 billion and multi-family at $5.261. Year-to-date spending in the two categories was 8.9 percent and 4.3 percent higher than during the same period in 2016.
Full Story… http://eyeonhousing.org/2017/10/cash-sales-retreat-as-a-share-of-new-home-purchases/

Have a productive week.

Jason


This Week in Real Estate: October 30, 2017

image001

While the Pending Home Sales Index is at it’s lowest level since January 2015, data released by HUD and the Census Bureau This Week in Real Estate revealed a significant jump in new home sales in September. Year-to-date through September new home sales is running 8.6% higher than the same time a year ago. Below are a few highlights from the fourth week of October that influence our business:

* Jump for New Home Sales in September. Contracts for new home sales expanded by 18.9% in September to a 667,000 seasonally adjusted annual rate, according to estimates from the joint data release of HUD and the Census Bureau. The solid reading in September returns new home sales to the positive growth trend it has been on for several years. This expansion is supported by ongoing job growth and improving household formations, as well as tight existing home inventory. September marks the fifth month in 2017 at an annual sales pace of more than 600,000. New home sales through September are running 8.6% higher than this time in 2016. Regionally, there was sales growth in all regions. On a year-to-date basis, new home sales are up 28% in the Northeast, up 12% in the West, 6% higher in the South, and up 4% in the Midwest compared to this time in 2016. Full Story… http://eyeonhousing.org/2017/10/jump-for-new-home-sales-in-september/

* Pending Home Sales Flatten in September. The Pending Home Sales Index, unchanged in September, has fallen on an annual basis in five of the past six months, and is at its lowest level since January 2015. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), remained unchanged at 106.0 from a downwardly revised August level. The PHSI is now 3.5% below its level a year ago. The PHSI increased 1.9% in the West, 1.4% in the Midwest and 1.2% in the Northeast, but fell 2.3% in the South. Year-over-year, the PHSI decreased in all four regions, ranging from 2.4% in the Northeast to 5.0% in the South (2.9% in the West). Full Story… https://www.nar.realtor/newsroom/pending-home-sales-flatten-in-september

* Cash Sales Retreat as a Share of New Home Purchases. NAHB analysis of the most recent Quarterly Sales by Price and Financing published by the Census Bureau reveals that cash sales accounted for just 4.8% of the total, down from 6.5% in the second quarter. The share of new home sales financed with conventional mortgages rose to 72.8%, the highest share since the third quarter of 2016.

FHA-loans financed 14.3% of new home sales during the third quarter of 2017. Census data and NAHB calculations show that new home sales backed by VA products fell to 11,000 (-4,000) in the third quarter of 2017, and market share declined from 8.8% to 7.5%. Although cash sales make up a small portion of new home sales, they constitute a larger share of existing home sales. Roughly 20% of existing home transactions were all-cash sales in September, according to estimates from the National Association of Realtors.
Full Story… http://eyeonhousing.org/2017/10/cash-sales-retreat-as-a-share-of-new-home-purchases/

Have a productive week!

Jason


This Week in Real Estate: October 23, 3017

image001
Builder confidence reaches its highest reading since May and the unemployment rate settles into a 16-year low fueling early fourth quarter optimism This Week in Real Estate. Below are a few highlights from the third week of October that influence our business:
* CoreLogic Releases First HPI Forecast Validation ReportCoreLogic released its first HPI Forecast Validation Report on Thursday that publicly compares its 12-month HPI Forecast to the actual HPI Index. The HPI Forecast is a projection of home prices using the HPI and other economic variables. The first validation report shows: (1) the national forecast prediction of a 5.4 percent increase was within 0.7 percent of the 6.1 percent increase of the HPI for the 12-month period ending in June 2017, (2) the most accurate forecast was for the Phoenix-Mesa-Scottsdale, AZ area, which at 6.6 percent came within 0.4 percent of the actual HPI increase of 6.2, and (3) the widest gap was in Seattle-Bellevue-Everett, WA with an 8.4 percent under-estimation of actual increase.
* Builder Confidence Rises Four Points in October. Builder confidence in the market for newly-built single-family homes rose four points to a level of 68 in October on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This was the highest reading since May. This current reading shows that home builder sentiment is rebounding from the initial reaction of concern due to hurricanes in Florida and Texas, including the anticipated effects of repair and restoration work. However, builders need to be mindful of long-term, regional impacts from the storms, such as intensified material price increases and labor shortages. It nonetheless is encouraging to see builder confidence return to the high 60s levels we saw in the spring and summer. Looking at the three-month moving averages for regional HMI scores, the South rose two points to 68 and the Northeast rose one point to 50. Both the West and Midwest remained unchanged at 77 and 63, respectively.
* Jobless Claims Are The Lowest Since 1973. America’s job market is red hot. Only 222,000 American’s filed jobless claims for the first time last week, the fewest since March 1973. Unemployment is at a 16-year low of 4.2%. When unemployment peaked at 10% in 2009, shortly after the Great Recession, initial jobless claims were over 650,000.

Have a productive week!

Jason


This Week in Real Estate: October 16, 2017

image001

The Consumer Sentiment Index for early October was released This Week in Real Estate, reaching its highest level since the start of 2004. Below are a few highlights from the second week of October that influence our business:

* Lot Values Stable at Record High. Single-family lot prices remained at record high levels in 2016, with half of the lots priced at or above $45,000. According to NAHB’s analysis of the Census Bureau’s Survey of Construction (SOC) data, the median lot value reached $45,000 for the first time in 2015 exceeding the previous record of $43,000 reached in 2006. The Pacific division where densities are high and developed land is scarce has the smallest lots. However, high regulatory costs push the median lot value to $78,900, the second most expensive value in the nation. The lot values here are fast approaching the housing boom levels, when half of the lots were priced at above $82,000. The Pacific division lots also stand out for being most expensive in the nation in terms of per acre costs.
Full Story… http://eyeonhousing.org/2017/10/lot-values-remain-record-high-in-2016/

* Consumer Confidence Soars to Highest Level Since 2004. Consumer confidence crushed expectations in October, flying by a seven-month high hit in August. The consumer sentiment index, a survey of consumers by The University of Michigan, rose to 101.1 in October, far ahead of the 95 economists polled by Reuters anticipated. “Consumer sentiment surged in early October, reaching its highest level since the start of 2004,” Richard Curtin, chief economist for the Surveys of Consumers, said in a statement. Curtin noted that current trends indicated consumer spending continuing to expand through the middle of next year. He says, if that pace continues, it would mark the second longest expansion period since the mid-1800s. The economist says October’s numbers reflect “an unmistakable sense among consumers that economic prospects are now about as good as could be expected.”
Full Story… https://www.cnbc.com/2017/10/13/october-us-consumer-sentiment.html?__source=mnd%7Cnews%7C&par=mnd

* Serious Delinquency Rate for Home Loans Holds Steady at a Near 10-Year Low. CoreLogic released its month Loan Performance Insights Report on Tuesday which shows that, nationally, 4.6 percent of mortgages were in some stage of delinquency (30 days or more past due including those in foreclosure) in July 2017. This represents a 0.9 percentage point year-over-year decline in the overall delinquency rate compared with July 2016 when it was 5.5 percent. As of July 2017, the foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, was 0.7 percent, down from 0.9 percent in July 2016 and the lowest since the rate was also 0.7 percent in July 2007. “While the U.S. foreclosure rate remains at a 10-year low as of July, the rate across the 100 largest metro areas varies from 0.1 percent in Denver to 2.2 percent in New York,” said Dr. Frank Nothaft, chief economist for CoreLogic. “Likewise, the national serious delinquency rate remains at 1.9 percent, unchanged from June, and when analyzed across the 100 largest metros, rates vary from 0.6 percent in Denver to 4.1 percent in New York.”
Full Story… http://www.corelogic.com/about-us/news/corelogic-reports-serious-delinquency-rate-for-home-loans-holds-steady-at-a-near-10-year-low.aspx

Have a productive week!

Jason


This Week in Real Estate: October 9, 2017

image001

ATTOM Data Solutions released it’s Q3 Home Affordability Index This Week in Real Estate concluding that the index reached it’s lowest point since Q3 2008. Below are a few highlights from the first week of October that influence our business:

* Home Affordability Improves in 60% of U.S. Markets in Q3 2017 Compared to Previous Quarter. ATTOM Data Solutions released its Q3 2017 U.S. Home Affordability Index Thursday, which shows that home affordability in the third quarter improved compared to the previous quarter in 60 percent of 406 U.S. counties analyzed in the report — although affordability was still worse off than a year ago in 79 percent of those counties. The national home affordability index was 100 in the third quarter of 2017, the lowest national affordability index since Q3 2008, when the index was 86. An index of 100 means the share of average wages needed to buy a median-priced home nationwide in Q3 2017 is on par with historic averages (see full methodology below). “Falling interest rates in the third quarter provided enough of a cushion to counteract rising home prices in most U.S. markets and provide at least some temporary relief for the home affordability crunch,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “More sustainable relief for the affordability crunch, however, will need to be some combination of slowing home price appreciation and accelerating wage growth. Wage growth is outpacing home price growth in about half of all local markets so far this year, an indication that a more sustainable affordability pattern is taking shape in more local markets.”
Full Story… https://www.attomdata.com/news/affordability/q3-2017-u-s-home-affordability-index/

* Fastest Growing Cities in America. Frisco is the fastest-growing city in America. No, not THAT Frisco with the incessant fog and Golden Gate Bridge. The Dallas suburb scored No. 1 on WalletHub’s list of fastest-growing cities in America due to its rapid job and population growth. To compile the ranking, WalletHub analysts compared 515 cities of varying population sizes based on 15 key measures of both growth and decline, such as population, unemployment rate and regional GDP per capita over a period of seven years. WalletHub’s10 fastest-growing cities in America: (1) Frisco, TX, (2) Kent, WA, (3) Lehigh Acres, FL, (4) Meridian, ID, (5) Midland, TX, (6) McKinney, TX, (7) Fort Meyers, FL, (8) Bend, OR, (9) Austin, TX and (10) Pleasanton, CA.
Full Story… http://www.marketwatch.com/story/these-are-the-fastest-growing-cities-in-america-2017-10-03?dist=realestate

* Lot Size is at a New Record Low. The median lot size of a new single-family detached home sold in 2016 stands at 8,562 square feet, or just under one-fifth of an acre. This is a new record low and a small decline since 2015, when the median lot size fell under 8,600 square feet for the first time since Census Bureau’s Survey of Construction (SOC) started tracking the series for single-family detached homes. While nation’s lots are getting smaller on average, the regional differences in lot sizes persist. Looking at single-family detached speculatively built (or spec) homes started in 2016, the median lot size in New England is almost twice as large as the national median and exceeds a third of an acre. The East South Central Division is second on the list with the median lot occupying just slightly less than a third of an acre (0.3 acres). The Pacific division where densities are high and developed land is scarce has the smallest lots, with half of the lots being under 0.15 acres.
Full Story… http://eyeonhousing.org/2017/10/lot-size-is-at-a-new-record-low/

 

Have a productive week!

Jason


This Week in Real Estate: October 2, 2017

image001

This Week in Real Estate, according to the recently released Financial Accounts of the United States, published by the Federal Reserve Board of Governors, the market value of owner-occupied real estate reached $23.8 trillion in the second quarter, up $7.8 trillion since 2011. Below are a few highlights from the last week of September that influence our business:

* Homeowner’s Equity Continues to Improve. Households’ owner-occupied real estate increased to $23.8 trillion in the second quarter of 2017, $1.597 billion more than the second quarter of 2016. Total home mortgage debt outstanding stands at $9.9 trillion, $250 billion more than the same period of 2016. Since 2011, the market value of households’ real estate has rebounded. In the second quarter of 2017, it was $23.8 trillion, $7.8 trillion higher than six years ago. Mortgage debt barely changed over the past six years and has remained at $9.9 trillion. Thus, the value of owners’ equity in real estate rose by $7.8 trillion reflecting the increase in the market value of households’ real estate.
Full Story… http://eyeonhousing.org/2017/09/homeowners-equity-continues-to-improve/

* Green Home Building Continues to Gain Traction. Green construction is rapidly gaining traction among both single family and multifamily home builders, according to new research published in the Green Multifamily and Single Family Homes 2017 SmartMarket Brief. At least one third of single family and multifamily builders who were surveyed said that green building is a significant portion of their overall activity (more than 60 percent of their portfolio). By 2022, this number should increase to nearly one half in both the single family and multifamily sectors. Within this group, nearly 30 percent of multifamily builders fall into the category of “dedicated” green builders (more than 90 percent of their portfolio). On the single family side, the percentage of “dedicated” green builders is nearly 20 percent, but that share is expected to grow sizably by 2022. Increasing energy efficiency continues to be the most common method of improving the performance of a green home, followed by creating a healthy indoor living environment.
Full Story… http://www.prnewswire.com/news-releases/study-finds-green-home-building-continues-to-gain-traction-300526537.html

* Don’t Give Up, Buyers: More Newly Constructed Homes Are On The Way. Permits, the best indicator of how many newly built homes will rise over the next few months, were up in August, according to the seasonally adjusted numbers in the latest residential sales report jointly released by the U.S. Census Bureau and U.S. Department of Housing and Urban Development. Builders were issued 5.7% more permits from July to August and 8.3% more than August 2016. The bulk of those increased permits were to put up condo and apartment buildings with five or more units. Meanwhile, the number of permits for those perennially in-demand single-family homes—the typical standalone abodes that usually come with yards— dipped 1.5% from July. But they were up 7.7% over August 2016.
Full Story… https://www.realtor.com/news/real-estate-news/new-home-construction-august-2017/

Have a productive week!

Jason


This Week in Real Estate: September 25, 2017

image001

While America’s largest living generation, Millennials, are delaying their home-buying plans by a median seven years as a result of their student loan debt, according to a report released by the National Association of Realtors, single-family starts and single-family permits are up 9% and nearly 11% respectively year-over-year and owners of mortgaged U.S. properties realized an aggregate gain of $766 billion in additional equity between second quarter 2016 and the same quarter this year. Below are a few highlights from the third week of September that influence our business:

* Home Equity Increases, Average Gains Vary Wildly. Rising home prices continue to fuel fast growth in household equity. CoreLogic said on Thursday that owners of mortgaged properties in the U.S. (roughly 63 percent of all homes) gained an aggregate of $766 billion in additional equity between the second quarter of 2016 and the same quarter this year. This is an increase of 10.6 percent in nationwide equity over that period. The average increase for each homeowner was just under $13,000, but the distribution is far from even across the states. A few states in the west, notably Washington, Hawaii, and California, with equity gains of $40,000, $33,000 and $30,000 respectively, have offset much poorer performances elsewhere. Homeowners in Alaska saw their equity decline by an average of $1,200 and Delaware homeowners also posted a tiny loss. On the other side of the ledger, the number of underwater homes declined by 10 percent from the first quarter of 2017, to 2.8 million properties, or 5.4 percent of mortgaged homes. A year earlier 7.1 percent of mortgaged homes had been underwater, a total of 3.6 million properties. This is an annual decrease of 22 percent. Negative equity had peaked at 26 percent of mortgaged properties in the fourth quarter of 2009. “Over the last 12 months, approximately 750,000 borrowers achieved positive equity,” said Dr. Frank Nothaft, chief economist for CoreLogic. “This means that mortgage risk continues to decline and, given the continued strength in home prices, CoreLogic expects home equity to rise steadily over the next year.” “Homeowner equity reached $8 trillion in the second quarter of 2017, which is more than double the level just five years ago,” said Frank Martell, president and CEO of CoreLogic. “The rapid rise in homeowner equity not only reduces mortgage risk, but also supports consumer spending and economic growth.”
Full Story… http://www.mortgagenewsdaily.com/09212017_corelogic_negative_equity.asp

* Single Family Starts Post Slight Gain in August. The pace of single-family starts posted a slight gain in August, albeit over downwardly revised estimates of the rate of July construction. Nonetheless, the three-month moving average for single-family starts is at a post-recession high of 849,000 as the gradual recovery in home building continues. Total starts declined almost 1% in August to a 1.180 million seasonally adjusted annual rate, according to the joint data release from the Census Bureau and HUD. The headline decline was due to multifamily production decreases. Single-family starts increased, rising slightly to an 851,000 seasonally adjusted rate in August. Single-family starts are up almost 9% year-to-date compared to 2016 as limited existing inventory and solid builder confidence make for positive market conditions. Single-family permits declined slightly in August, falling 1.5%. However, on a year-to-date basis, single-family permits are nearly 11% higher compared to this time in 2016, representing an additional 54,400 permits for a total of 564,000 thus far this year. These data are consistent with recent trends in the NAHB/Wells Fargo measure of single-family builder confidence and NAHB’s forecast of modest single-family construction growth in 2017. However, we can expect volatility ahead, as the counties affected by Hurricanes Harvey and Irma represent about 14% of national single-family production. With respect to housing’s economic impact, 56% of homes under construction in August were multifamily (610,000). As noted in the graph above, with recent production declines for apartments, the current count of multifamily units is effectively unchanged from a year ago. There were 472,000 single-family units under construction, a gain of 11% from this time in 2016.
Full Story… http://eyeonhousing.org/2017/09/single-family-starts-post-slight-gain/

* Student Debt Delaying Millennial Homeownership by 7 Years. College debt is having a compounding effect on how millennials perceive and plan for homeownership. Eighty-three percent of millennials in a recently released report by the National Association of REALTORS® (NAR) say they are delaying their home-buying plans by a median seven years as a result of their student loan debt. Twenty percent of the millennials surveyed in the study are homeowners; 80 percent are not. The typical millennial homeowner is burdened by $41,200 in student debt, and earning $38,800 annually. Homeownership is not the only casualty of student debt—millennials are also postponing career changes, children, marriage and retirement savings, the study shows. Forty-one percent of millennials have put off marriage; 61 percent have skipped a retirement savings payment; and 86 percent have stayed in an unsatisfying job, or taken on a second job or one outside of their field, as a result of student debt.
Full Story… https://www.nar.realtor/news-releases/2017/09/student-debt-delaying-millennial-homeownership-by-7-years


©2016 BHH Affiliates, LLC. An independently operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate, and a franchisee of BHH Affiliates, LLC. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc. Equal Housing Opportunity.