This Week in Real Estate: February 26, 2018

As available inventory continues to be the subject of most “chatter” throughout the industry, favorable news This Week in Real Estate with respect to the growth of single-family permits in 45 states and the District of Columbia last year. In addition, the demand from first-time homebuyers does exist, as evidenced by the Genworth Mortgage Insurance report, that concluded first-time buyers participation in single-family home purchases in 2017 was the largest share since 2000. Below are a few highlights from the third week of February that influence our business:

* Permits Grow Across Most States in 2017. Over the twelve months ending in December 2017, the total number of single-family permits issued nationwide reached 817,319. This is 9.6% ahead of its level over the first twelve months of 2016, 745,525. The results from the SOC are similar, single-family permits over the first twelve months of 2017, 817,700 are 8.9% ahead of their level over the same period of 2016, 750,800. Between December 2016 to December 2017, 45 states and the District of Columbia saw growth in single-family permits issued. Twenty states recorded a growth above 9.6% but five states had a decline in growth, including Oregon. Hawaii had the highest growth rate during this time at 23.6% while single-family permits in North Dakota declined by 9.8%. Washington state experienced 4% growth.
* First-Time Homebuyers Make Biggest Share of Deals in 17 Years. First-time buyers rushed into the market last year, making 38 percent of all U.S. single-family home purchases, the biggest share since 2000, data released Thursday by Genworth Mortgage Insurance shows. The 2.07 million new or existing homes bought by first-timers was 7 percent more than in 2016, according to the insurer. Millennials, who were putting off purchases because of student-debt burdens and a preference for renting, are becoming a force in the market as the oldest of the group get married and have children, said Tian Liu, chief economist of the insurer. Census Bureau data back that up. The homeownership rate for Americans under age 35 rose in the fourth quarter to 36 percent. It hasn’t been higher since the first quarter of 2014.
* Most House Hunters Have Been Searching For 3 Months or More. Most Americans – 61% – who intend to buy a home in the next 12 months have been searching for a whopping three months.Or more. That finding comes from a recent survey conducted by the National Association of Home Builders, and includes people who are searching for both new and previously-owned homes. What’s making the house-hunt take so long? Some 42% of respondents told NAHB they “can’t find a home at a price I can afford,” while 36% “can’t find a home with the features I want” and 34% “can’t find a home in the neighborhood I want.” And even if would-be buyers can overcome all those obstacles, nearly 30% said they “continue to get outbid whenever I make an offer.” On Wednesday, the National Association of Realtors said that home purchase contracts signed in January had been on the market for only 42 days.                                                                                    Full Story... https://www.marketwatch.com/story/two-thirds-of-house-hunters-have-been-searching-for-3-months-or-more-2018-02-22

http://eyeonhousing.org/2018/02/builder-confidence-stays-at-strong-level-in-february/

Have a productive week.

Jason

This Week in Real Estate: February 20, 2018

While inventory levels hover around an all-time low, builder confidence remains strong according to the National Association of Home Builders/Wells Fargo Housing Market Index released This Week in Real Estate. Consequently, the pace of single-family starts to begin the new year has the three-month moving average near a post-recession high. Below are a few highlights from the second week of February that influence our business:

 
* Total Housing Starts Near Post Recession High. Total housing starts increased in January, led by strong gains for multifamily development. Starts jumped 9.7% to a 1.33 million seasonally adjusted annual rate, according to the joint data release from the Census Bureau and HUD. The pace of single-family starts expanded in January, rising 3.7% to an 877,000 seasonally adjusted annual rate. The three-month moving average for single-family starts remained near a post-recession high rate of construction (890,000). The gains for single-family starts match ongoing healthy levels of the NAHB/Wells Fargo Housing Market Index, now registering a score of 72. Single-family permits posted a slight decline of 1.7% in January, but that decline was off a strong December permitting rate. Multifamily starts were up almost 24% to a noticeably strong seasonally adjusted annual rate of 449,000 in January. Multifamily permits also posted a gain in January, with permitting rising 27%. Multifamily data tends to be volatile in the month-to-month data. In January, there were 499,000 single-family units under construction, a gain of almost 12% from this time in 2017.
 
* Nearly Two-Thirds of U.S. Housing Markets See Home Prices Hit All-Time High. As housing inventory sank to its all-time low during the fourth quarter, home prices increased, creating all-new highs in many U.S. markets, according to the latest quarterly report from the National Association of Realtors. The national median existing single-family home price in the fourth quarter came in at $247,800, up 5.3% from $235,400 in the fourth quarter of 2016. Single-family home prices increased in 92% of measured markets, or 162 out of 177 metropolitan statistical areas. In fact, 15% of metro areas saw double digit increases, and now 64% of markets reached a new all-time high in home prices. This is up by 18 metros from last quarter. “A majority of the country saw an upswing in buyer interest at the end of last year, which ultimately ended up putting even more strain on inventory levels and prices,” NAR Chief Economist Lawrence Yun said. “Remarkably, home prices have risen a cumulative 48% since 2011.”
* Builder Confidence Stays at Strong Level in February. Builder confidence in the market for newly-built single-family homes remained unchanged at a healthy level of 72 in February on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Demand conditions are positive, but supply-side construction hurdles need to be managed, as scarce labor and building material price increases remain top concerns. In particular, the HMI gauge of future sales expectations has reached a post-recession high, an indicator that consumer demand for housing should grow in the months ahead. With ongoing job creation, increasing owner-occupied household formation, and a tight supply of existing home inventory, the single-family housing sector should continue to strengthen at a gradual but consistent pace. Looking at the three-month moving averages for regional HMI scores, the Midwest rose two points to 72, the South increased one point to 74, the West remained unchanged at 81, and Northeast fell two points to 56.

Have a productive week.

Jason

This Week in Real Estate: February 12, 2018

This Week in Real Estate, Fannie Mae released the results of it’s January Home Purchase Sentiment Index, which recorded an all-time survey high. Below are a few highlights from the first week of February that influence our business:

* LMI Indicates Continued Improvement Across the Country. According to the NAHB/First American Leading Markets Index (LMI), 82%, 277 metropolitan statistical areas, recorded growth in their LMI Score over the fourth quarter of 2017 compared to a year ago. The index uses single-family housing permits, employment, and home prices to measure proximity to a normal economic and housing market. The index is calculated for 337 local markets, metropolitan statistical areas (MSAs), as well as the entire country. A value of 1.0 means the three components have achieved a level of recovery that combined averages 1.0. Of the 337 metro areas tracked by the LMI, 195 of them have an LMI Score that exceeds 1.0. House prices continue to be a key driver of the LMI results. Of the 337 markets tracked by the LMI, house prices in 333 areas have normalized or are above 1.0. The LMI Score for the country as a whole reached 1.04. However, at 1.58, only the house price component is above 1.0. Meanwhile, the employment component sits at 0.98 and single-family permits are currently at 0.56. One interpretation of these metrics is that the slower recovery in housing supply coupled with strong demand is contributing to house price appreciation.
* Americans Gain Confidence in Housing as Home Prices Rise. Americans continue to gain confidence in the housing market, not just despite, but even because of rising home prices, according to the latest Home Purchase Sentiment Index from Fannie Mae. Over the past year, home prices have continued to rise, threatening affordability, and housing inventory is falling dangerously low. However, despite these setbacks, Americans continue to hold a positive view of the housing economy. Fannie Mae’s HPSI rose 3.7 points in January to 89.5, reversing the decrease seen the month before and an all-time survey high. This rise is due to increases in five of the six HPSI components. “HPSI rebounded from last month’s dip to a new survey high in January, in large part due to the spike in consumers’ net expectations that home prices will increase over the next year,” said Doug Duncan, Fannie Mae senior vice president and chief economist.
* Housing Affordability Remains Flat in 2017. Data for all four quarters of 2017 show housing affordability remaining essentially flat throughout the year, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI). In all, 59.6 percent of new and existing homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $68,000. This is just slightly up from the 58.3 percent of homes sold that were affordable to median-income earners in the third quarter, and effectively the same rate as in the fourth quarter of 2016, when the HOI stood at 59.9 percent. The national median home price fell to $255,000 in the fourth quarter of 2017 from $260,000 in the previous quarter. Meanwhile, average mortgage rates inched down four basis points in the fourth quarter to 4.06 from 4.1 in the third quarter. Youngstown-Warren-Boardman, Ohio-Pa. and Syracuse, NY tied as the nation’s most affordable major housing market. In both metros, 88.3 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the area’s median income of $54,600 and $68,000, respectively. San Francisco, which had been the nation’s least affordable housing market for 19 straight quarters before being displaced by Los Angeles in the third quarter of 2017, once again assumed the mantle as the least affordable market. There, just 6.3 percent of the homes sold in the last quarter of 2017 were affordable to families earning the area’s median income of $113,100.

Have a productive week.

Jason

This Week in Real Estate: January 29, 2018

Despite inventory pressure, which in turn has driven continued price appreciation as a result of buyer demand, the National Association of Realtors announced This Week in Real Estate that 2017 existing home sales recorded the best year in 11 years. Below are a few highlights from the fourth week of January that influence our business:

* Cash Sales Tie Post-Recession High. NAHB analysis of the most recent Quarterly Sales by Price and Financing published by the Census Bureau reveals that cash sales accounted for 11,000 new home sales in the fourth quarter of 2017. Cash purchases made up 7.9% of purchases in the fourth quarter, a mark not seen since 2014. 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 December 2017, according to estimates from the National Association of Realtors. Conventional financing contracted sharply following the Great Recession, but has expanded as the recovery has continued. In 2006, conventional financing accounted for 90% of new home purchases, falling to 59% in 2010. Conventional loans accounted for 72% of new home sales in 2017, on average, the highest annual average since 2008.

 

* Best Year For Home Sales Since 2006, Despite Headwinds. Existing home sales in 2017 increased 1.1 percent for the best year in 11 years. According to the National Association of Realtors® (NAR), the 5.51 million sales of existing single-family homes, townhomes, condos, and cooperative apartments surpassed the 5.45 million sales in 2016 to have the highest number of transactions since 6.48 million were sold in 2006. Lawrence Yun, NAR chief economist, says the housing market performed remarkably well for the U.S. economy in 2017, but wasn’t as good as it might have been.  The year brought substantial wealth gains for homeowners and historically low distressed property sales. “Existing sales concluded the year on a softer note, but they were guided higher these last 12 months by a multi-year streak of exceptional job growth, which ignited buyer demand,” he said. “At the same time, market conditions were far from perfect. New listings struggled to keep up with what was sold very quickly, and buying became less affordable in a large swath of the country. These two factors ultimately muted what should have been a stronger sales pace.” The median existing-home price for all housing types in December was $246,800, a 5.8 percent rate of appreciation for the year and was the 70th straight month of year-over-year gains. The inventory of available homes fell another 11.4 percent in December to 1.48 million and is now 10.3 percent lower than a year ago (1.65 million).  The inventory has declined year-over-year for 31 consecutive months and is currently estimated at a 3.2-month supply, the lowest level since NAR began tracking in 1999. Existing-home sales in the West declined 0.8 percent below a year ago.

 

* Purchase Mortgage Applications Hit 8-Year High. Mortgage applications continue on the tear they started during the first week of 2018. The Mortgage Bankers Association’s (MBA’s) Market Composite Index, a measure of loan application volume, increased 4.5 percent on a seasonally adjusted basis during the week ended January 19. The gain came on the heels of 8.3 percent and 4.1 percent increases in the first two weeks of the year. Both the Refinancing and Purchase Indexes saw gains.  The seasonally adjusted Purchase Index was up 6 percent from the week ended January 12, its fourth straight increase, and was the highest since April 2010.
Have a productive week.

 

Jason

This Week in Real Estate: January 22, 2018

Prior to investing in a home improvement project, would it be beneficial to know which remodeling projects net the highest return on investment (ROI)? Remodeling Magazine released This Week in Real Estate it’s Cost vs. Value Report for 2018. Below are a few highlights from the third week of January that influence our business:

* Cost vs. Value: The Home Improvement Projects With The Highest ROI in 2018. Remodeling Magazine’s newly released Cost vs. Value Report for 2018, which measures the average cost of 21 popular remodeling projects and their average resale value one year later, found that average return on investment (ROI) for home improvement projects dipped across the board, with “upscale” projects taking the biggest hit. Garage door replacement has the highest ROI at 98.3 percent (up from 85 percent year-over-year). Backyard patio jobs garner the lowest ROI, at 47.6 percent (down from 54.9 percent year-over-year). The reason for the sweeping decrease in ROI isn’t immediately obvious, but Remodeling magazine’s editor-in-chief (and manager of the report) Craig Webb notes that it’s likely related to the strength of the housing market currently. However, a silver lining from the report relates to when the data was compiled. Remodeling magazine put all the cost information together before the country was struck with several natural disasters, including massive forest fires and several hurricanes. Since then, building supplies and the price of skilled labor has increased, but that’s expected to change over the course of 2018. As a result, expect to see the ROI of most of these projects level out by the end of the year. Despite these events, some longtime trends continued through the new year. Remodeling is still far more cost-effective than replacement, but, according to real estate pros, replacing is still the way to go. This year, there’s a 20-point difference in ROI: 76.1 percent for replacement jobs, versus 56 percent for remodeling. Nationally, when it comes to renovation ROI, curb appeal still wins out.


* Builder Confidence Remains Strong as New Year Starts. Builder confidence in the market for newly-built single-family homes dropped two points to a level of 72 in January on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) after reaching an 18-year high in December 2017. Builders confidence remained strong given changes to the tax code will promote the small business sector and boost broader economic growth. Nonetheless, home builders continue to face building material price increases and shortages of labor and lots. In a recent NAHB survey, 84% of builders cited concerns regarding cost and availability of workers as a key challenge for 2018, matching the 84% who cited rising building material prices. The HMI gauge of future sales expectations has remained in the 70s, a sign that housing demand should continue to grow in 2018. As the overall economy strengthens, owner-occupied household formation increases, and the supply of existing home inventory tightens, we can expect the single-family housing market to make further gains this year. The three HMI components registered relatively minor losses in January. The index gauging current sales conditions dropped one point to 79, the component charting sales expectations in the next six months fell a single point to 78, and the index measuring buyer traffic fell four points to 54. Looking at the three-month moving averages for regional HMI scores, the West rose two points to 81, the South increased one point to 73, the Midwest inched up a single point to 70 and Northeast climbed five points to 59.


* U.S. Foreclosure Activity Drops to 12-Year Low in 2017. Attom Data Solutions released its Year-End 2017 U.S. Foreclosure Market Report on Thursday, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 676,535 U.S. properties in 2017, down 27 percent from 2016 and down 76 percent from a peak of nearly 2.9 million in 2010 to the lowest level since 2005. Those 676,535 properties with foreclosure filings in 2017 represented 0.51 percent of all U.S. housing units, down from 0.70 percent in 2016 and down from a peak of 2.23 percent in 2010 to the lowest level since 2005. “Thanks to a housing boom driven primarily by a scarcity of supply, which has helped to limit home purchases to the most highly qualified — and low-risk — borrowers, the U.S. housing market has the luxury of playing a version of foreclosure limbo in which it searches for how low foreclosures can go,” said Daren Blomquist, senior vice president at ATTOM Data Solutions.
Have a productive week.

Jason

Portland Metro Weekend Events Planner: January 19-21, 2018

PORTLAND METRO WEEKEND EVENTS PLANNER
JANUARY 19-21, 2018

 

REEL MUSIC FESTIVAL

Through January 30 – Whether your passion is jazz, blues, folk, rock, electronic, world, classical—or anything between—we hope you find something to discover and inspire in this eclectic mix of films that celebrate great artists, sound, and image, and connect music and culture. Various locations around Portland.

FERTILE GROUND ARTS FESTIVAL

THURS through January 28 – Discover compelling indoor landscapes of many hues and disciplines cultivated in Fertile Ground. This 11-day sampling illuminates the verdant and abundant acts of creation that bubble and catalyze yearlong in Portland.

PORTLAND’S MINI MUSICAL FESTIVAL

THURS through January 21 – Check out six-brand new 15-minute musicals by local writers and composers. Join us for the perfect night out for every musical theater lover! Part of the 2018 Fertile Ground Festival.

ROSE CITY CLASSIC

WED-SUN – One of the biggest dog shows in America that attracts top dogs from virtually all breeds and varieties. Fun for the whole family, come early and plan to stay all day.

STRANGER THAN FICTION

Through January 28 – Various short pieces performed by a multi-generational cast, combining circus arts, narrative, dance, and physical theater. (Part of the 2018 Fertile Ground Festival) 

LEWIS BLACK

FRI – One of the angriest men in the history of stand-up makes his annual pilgrimage to Portland as part of his “The Joke’s on Us” tour.  

80’s VIDEO DANCE ATTACK

Every FRI & SAT – Dig out your neon mesh shirts, crimping iron and striped legwarmers to travel back to the 1980s! Classic music videos projected on giant screens complimented with a thumping sound system and light show, this dance extravaganza is sure to get the blood pumping!

PORTLAND CIDER HOUSE’S CIDER-MOSA SATURDAY

EVERY SAT – Enjoy a liquid brunch and try a variety of delicious and fun cider-mosas.

FLASHBACK DANCE CRUISE
Through SAT – Gather your crew & rock your best retro threads from the 70’s, 80’s and 90’s!

DUELING PIANO SHOW
FRI & SAT (All Month) – The Barrel Room lays claim to the longest running dueling piano shows in Portland. The show, which at times can get a “little cheeky,” isn’t just two players banging on pianos for five hours. They boast a Vegas style, request driven, interactive show complete with bits, games, sing-a-longs, comedy and some of the best players in the U.S.

URBAN SCAVENGER HUNT
ALL MONTH – Smartphone clues lead you on a fun & engaging walking tour of the city. Clues start you in the heart of downtown at Pioneer Courthouse Square and will take you on a scavenger hunt through the Arts District, on a streetcar ride and among the famous food carts.

SHANROCK’S TRIVIOLOGY
ALL MONTH – Various Portland Locations: Triviology pub quizzes are free to play, last a couple of hours, and are composed of seven short rounds, giving teams instant gratification for their efforts. Team size can range from one to five players, with prizes for everyone on the winning team.

GUIDED NATURE HIKES
EVERY DAY – Park guides lead nature hikes to explore the forest, stream ecosystems and natural history of the natural area. Tryon Creek State Park & more.

HAUNTED PUB TOUR
All Month – This spine-tingling ghost tour explores Portland’s historic Old Town District, a vibrant area with beautiful 1800’s buildings, cobblestone streets and a wicked past.

GEEKS WHO DRINK PUB QUIZ
ALL MONTH – Anyone can grab a deck of Trivial Pursuit cards and run a “trivia night.” Geeks Who Drink’s smartass quizmasters run fast-paced, interactive and beer-soaked pub quiz events all over Portland.

PORTLAND ESCAPE ROOMS
All Month THURS-SUN – Cedar Hills/Beaverton Locations: Real-life room escape games are a type of physical adventure game in which people are locked in a room with other participants and have to use elements of the room to solve a series of puzzles, find clues, and escape the room within a set time limit.

 

VANCOUVER METRO EVENTS

ANTIQUE & COLLECTIBLES SHOW

FRI-SUN – Stroll 400 booths filled with estate jewelry, vintage clothing, period lighting, furniture, 40s kitchenware, old tools, toys, prints, old watches, BB guns, and more.

ROSE & THORN WINTER BREWFEST

SAT – Featuring 17 breweries and cider companies local to the Pacific Northwest, small bar bites available for sale, live acoustic entertainment by Fire Lily, a complimentary tasting glass included with ticket and raffle prizes to win!

OPEN SATURDAY AT PEARSON AIRBASE

SAT – Free educational experience, Flight Simulator lab, vertical wind tunnel, a glider-building station, historic airplanes on-site for viewing, collections on display, and educational programs to propel students of all ages.

NEW MOVIES OUT THIS WEEK
· 12 Strong
· Forever My Girl
· Den of Thieves
· Mom and Dad
· Showdown in Manila
· The Leisure Seeker
· The Final Year

Click here for movie times and theaters.

CLICK HERE TO VIEW THIS WEEK’S OPEN HOUSES

For a monthly online listing of upcoming Portland metro events, click here.

Top 7 Interior Design Trends for 2018

 

The modern home is always evolving. To get an idea of what it’s evolving to, look no further than what’s happening within its walls today. Here are 7 of the top design trends for 2018.

1) Bold colors

Rich jewel tones are making their way onto our walls and moldings in a big way—think ‘English library,’ but with peacock teal, black, or rich burnt orange colors.

The proof is in the paint: Sherwin-Williams’ 2018 Color of the Year (Oceanside SW 6496) is an intense shade of blue-green, while Pantone recently announced the rich and regal Ultra Violet will reign supreme in the coming year.

2) Mixed metallics

Buyers really love to see modern, eclectic choices such as a hammered copper light fixture above the kitchen island paired with sleek chrome faucets and cabinet hardware.

To warm up the industrial feel of some metals, pair them with a natural stone like marble or limestone, and look for unexpected finishes like matte black, satin brass, black nickel, and unlacquered brass.

3) Bright yellow

As designers, fashionistas, and millennials will all tell you, the hue that’s being dubbed “Gen Z yellow” is the one to watch.

It’ll certainly make an impression, whether a bright ‘minion’ color or a burnt shade resembling turmeric.

If you can’t quite warm up to a bright yellow sectional, test the waters with an accent chair or painted side table.

4) Quartz

In the kitchen, sleek quartz is taking the place of the ubiquitous granite and hard-to-clean marble. Quartz products are appealing to the ease of living that we all crave, and the surfaces are much more modern, clean, and versatile.

5) Light textured wood floors

Flooring trends are moving toward lighter color palettes in domestic American woods such as maple, pine, or hickory.

Why? Light-hued woods, including natural tones and blond and whitewashed woods, brighten interior spaces and easily hide scratches and imperfections, making them a great choice for families and households with pets. For extra credit, choose a distressed or wire-brushed wood, which offers vintage appeal with a less aggressive look than a scraped floor, and choose 5-inch-wide planks, which create a sense of openness and space.

6) Black fixtures

Black fixtures will take the place of brass as the new hot home hardware, predicts Ryan Brown of Brown Design Group in Southern California. The first reason is easy: Black pretty much goes with everything. The second? Black fixtures—especially in matte finishes—are much easier to clean (and don’t need to be cleaned as often) than lighter, polished metals, with no water spots to clean.

7) Large tiles

Larger tile has less grout and is both easier to install and maintain.

Clients want a really clean look for their homes and that doesn’t appear to be a trend that’s going away.

Article courtesy of Realtor.com.

This Week in Real Estate: January 15, 2018

No end of year slow down in 2017 for newly constructed homes, according to the Mortgage Bankers Association’s Builder Applications Survey results, that were released This Week in Real Estate. Below are a few highlights from the second week of January that influence our business:

* New Home Sales Defy Holiday Lull, Rising in December. Despite the usual holiday lull in overall mortgage applications, the demand for newly constructed homes increased in December. The Mortgage Bankers Association (MBA) said its Builder Applications Survey (BAS) found those applications were up 18 percent from November. The applications were 7.8 percent higher than in December 2016. “Looking at all of 2017, applications increased by 7.1 percent compared to 2016. Based on December applications, we forecast that new home sales fell in December but remained nearly 16 percent higher than a year ago, and we are anticipating only modest year over year growth for new home sales in 2018. Despite robust demand, a lack of labor and land will continue to constrain homebuilders,” said Lynn Fisher, MBA Vice President of Research and Economics.
* Home Equity Hits Record High, and Here’s How Homeowners are Spending It. Homeowners are racking up record amounts of home equity, thanks to fast-rising values in today’s competitive housing market. No surprise, more people are now starting to tap that cash. What are they spending it on? Mostly making their homes even more valuable. Renovation spending is soaring, and 80 percent of borrowers taking out home equity lines of credit say they would consider using that money to renovate, according to a survey released in December by TD Bank. “We’re not only seeing more requests for proposals, but more committed projects from home owners,” said Steve Cunningham, a remodeler from Williamsburg, Virginia, in a report from the National Association of Home Builders. “In addition to regular updates and repairs, there’s been an uptick in more ambitious large remodel requests.” Remodeling spending topped $152 billion in 2017, and renovations for owner-occupied single-family homes will increase 4.9 percent in 2018 over 2017, according to the NAHB. That does not include remodeling done by investors looking to flip or rent properties, both of which are increasing as well.
* Property Tax Revenue Increases for 22nd Consecutive Quarter. NAHB analysis of the Census Bureau’s quarterly tax data shows that $556 billion in taxes were paid by property owners over the four quarters ending in Q3 2017. It has now been five and a half years since four-quarter property tax revenues last declined. Property taxes accounted for 40.1% of state and local tax receipts and the share has remained above 40.0% for the consecutive quarters for the first time since 2012-2013.  In terms of the share of total receipts, property taxes are followed by individual income taxes (28.3%), sales taxes (27.7%), and corporate taxes (3.8%). After increasing as a share of state and local tax receipts for six consecutive quarters, property taxes have since held steady at 40.1%.
Have a productive week.

Jason

This Week in Real Estate: January 8, 2018

Per Bloomberg’s Consumer Comfort Index, released This Week in Real Estate, American consumers were more upbeat in 2017 than at any other time since 2001. Below are a few highlights from the first week of 2018 that influence our business:

* Experts: 2018 Set To Be Best Economic Year Since Housing Crisis. Although December’s job report numbers disappointed experts’ expectations, many explained that the end-of-year increase in construction jobs is just what the housing market needed. “Overall, the job market performed well in 2017 and is a key reason why the economy is poised for its best year since the crisis in 2018,” said Curt Long, National Association of Federally Insured Credit Unions chief economist. “One bright spot we saw in the report is the biggest monthly rise in residential construction employment in 2017, raising hopes for some supply relief for housing this year,” Fannie Mae Chief Economist Doug Duncan said. “Residential construction jobs rose to the highest since 2008 as builders work to add supply given the tight inventory and rising home prices,” LendingTree Chief Economist Tendayi Kapfidze said. “Construction employment increased by 210,000 in 2017, compared with a gain of 155,000 in 2016.”
* Consumer Comfort in U.S. Advanced in 2017 to a 16-Year High. American consumers last year were more upbeat on average than at any time since 2001, reflecting more favorable views of the economy, personal finances and the buying climate, according to the Bloomberg Consumer Comfort Index released Thursday. Sentiment in 2017 got a boost from the combination of a solid labor market that’s pushed unemployment to an almost 17-year low, limited inflation and record stock prices. Such optimism should help keep consumers spending after a bright holiday-shopping season. Retail sales during the year-end holidays may have been the strongest in more than a decade, according to calculations from research firm Customer Growth Partners. Optimism about the economy increased as the jobless rate declined and economic growth exceeded 3 percent annualized rates in the second and third quarters of 2017.
 
* Private Residential Spending Is On The Rise. NAHB analysis of Census Construction Spending data shows that total private residential construction spending rose 1% in November to a seasonally adjusted annual rate of $530.8 billion. It was the highest level since February 2007. Total private residential construction spending was 7.9% higher than a year ago. The monthly gains are largely attributed to the strong growth of spending on single-family. Single-family construction spending rose to a $270.1 billion annual pace in November, up by 1.9%. It was the highest monthly annual rate since November 2007. This is in line with the strong readings of single-family housing starts and solid builder confidence.

Have a productive week.

Jason

This Week in Real Estate: January 2, 2018

2017 closed with momentum, as evidenced by NAR’s release that the November Pending Home Sales Index (PHSI) remains at its highest level since June, and the Case-Shiller Home Price Index (HPI) set an all-time high in October. Below are a few highlights from the final week of 2017 that influence our business:

* Home Price Increases Outpace Inflation by 3X. The S&P CoreLogic Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, rose 6.2 percent on a year-over-year basis in October. Seattle continues to soar. The city had another annual increase that was nearly double that of the nation as a whole, at 12.7 percent.  Las Vegas also saw a gain in the double digits at 10.2 percent. San Diego had the third highest rate of appreciation at 8.1 percent. Nationally, home prices are up 6.2 percent in the 12 months to October, three times the rate of inflation. Sales of existing homes dropped 6.1 percent from March through September; they have since rebounded 8.4 percent in November. Inventories measured by months-supply of homes for sale dropped from the tight level of 4.2 months last summer to only 3.4 months in November. In what has become a monthly occurrence, the National Index set another new all-time high; 195.63.
 
* Pending Home Sales Inch Up 0.2% in November. Pending home sales were mostly unmoved in November, but did squeak out a minor gain both on a monthly and annualized basis, according to the National Association of Realtors. The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 0.2 percent to 109.5 in November from 109.3 in October. With last month’s modest increase, the index remains at its highest reading since June (110.0), and is now 0.8 percent above a year ago. Lawrence Yun, NAR chief economist, says contract signings mustered a small gain in November and were up annually for the first time since June. “The housing market is closing the year on a stronger note than earlier this summer, backed by solid job creation and an economy that has kicked into a higher gear,” he said. The PHSI in the Northeast jumped 4.1 percent to 98.9 in November, and is now 1.1 percent above a year ago. In the Midwest the index rose 0.4 percent to 105.8 in November, and is now 0.8 percent higher than November 2016. In the South the index decreased 0.4 percent to 123.1 in November but are still 2.5 percent higher than last November. The index in the West declined 1.8 percent in November to 100.4, and is now 2.3 percent below a year ago.
 
* The Tax Cuts and Jobs Act – What it Means for Homeowners and Real Estate Professionals. The final bill includes some big successes. NAR efforts helped save the exclusion for capital gains on the sale of a home and preserved the like-kind exchange for real property. Many agents and brokers who earn income as independent contractors or from pass-through businesses will see a significant deduction on that business income.

 

Have a productive week.

Jason

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