This Week in Real Estate: April 17, 2017

image001

The spring selling season is in full swing This Week in Real Estate, as mortgage rates hit the lowest mark of 2017 and the preliminary April report of consumer sentiment advanced to a three month high. Below are a few highlights from the second week of April that influence our business:

* Q1 2017 Foreclosure Activity Below Pre-Recession Levels. ATTOM Data Solutions released its Q1 and March 2017 U.S. Foreclosure Market Report on Thursday, which shows first quarter foreclosure activity was below pre-recession levels nationwide. Nationwide the report shows foreclosure filings – default notices, scheduled auctions and bank repossessions – were reported on 234,508 U.S. properties in the first quarter of 2017, down 11 percent from the previous quarter and down 19 percent from a year ago to the lowest level since Q3 2006. The first quarter foreclosure activity total was 16 percent below the pre-recession average of 278,912 properties with foreclosure filings each quarter between Q1 2006 and Q3 2007. “U.S. foreclosure activity on a quarterly basis first dipped below pre-recession averages in the fourth quarter of last year, and this report shows that trend continuing for the second consecutive quarter,” said Daren Blomquist, ATTOM Data Solutions senior vice president.
Full Story… http://www.realtytrac.com/news/foreclosure-trends/march-and-q1-2017-u-s-foreclosure-market-report/

* Mortgage Rates Hit Lowest Mark of 2017. Freddie Mac released the results of its Primary Mortgage Market Survey on Thursday, showing the 30-year mortgage rate dropping for the fourth consecutive week and hitting a new low for 2017. 30-year fixed-rate mortgage averaged 4.08 percent with an average 0.5 point for the week ending Thursday. A year ago at this time, the 30-year fixed rate mortgage averaged 3.58 percent. 15-year fixed rate mortgage this week averaged 3.34 percent with an average 0.5 point. A year ago at this time, the 15-year fixed rate mortgage averaged 2.86 percent. 5-year adjustable rate mortgage averaged 3.18 percent this week with an average 0.4 point. A year ago, the 5-year ARM averaged 2.84 percent.
Full Story…  http://freddiemac.mwnewsroom.com/press-releases/mortgage-rates-hit-lowest-mark-of-2017-otcqb-fmcc-1304919?feed=429e0be3-9aef-4a3a-9775-43f8e470d510

* Affordability, Tight Supply Cause Vacation Home Sales to Plummet in 2016; Investment Sales Climb 4.5%. Last year’s strongest pace of home sales in a decade included a sizable drop in activity from vacation buyers and a jump from individual investors. NAR’s 2017 Investment and Vacation Home Buyers Survey revealed that vacation home purchases last year descended to an estimated 721,000, down 21.6 percent from 2015 (920,000) and the lowest since 2013 (717,000). Investment-home sales in 2016 rose 4.5 percent to 1.14 million from 1.09 million in 2015. Owner-occupied purchases jumped 12.5 percent to 4.21 million last year from 3.74 million in 2015 – the highest level since 2006 (4.82 million). “Sales to individual investors reached their highest level since 2012 (1.20 million) as investors took advantage of record low mortgage rates and recognized the sizable demand for renting in their market as renters struggle to become homeowners,” said Lawrence Yun, NAR chief economist. Vacation sales accounted for 12 percent of all transactions in 2016, which was the lowest share since 2012 (11 percent) and down from 16 percent in 2015. The portion of investment sales remained unchanged for the third consecutive year at 19 percent, and owner-occupied purchases increased to 70 percent (65 percent in 2015).
Full Story… https://www.nar.realtor/news-releases/2017/04/affordability-tight-supply-cause-vacation-home-sales-to-plummet-in-2016-investment-sales-climb-45

Have a productive week!
Jason


This Week in Real Estate: April 10, 2017

image001

As home prices continue to surge, ADP reported This Week in Real Estate that the labor market continues to strengthen, recording the best month for new jobs since December 2014. Below are a few highlights from the first week of April that influence our business:

* New Homes Strengthen Economy, Spur Job Growth. As the housing industry celebrates New Home Month in April, newly released data from the U.S. Commerce Department confirms the significant contribution that residential construction has on the U.S. economy. Final estimates of fourth quarter 2016 gross domestic product (GDP) growth show that housing’s share of GDP stands at 15.6%. “Home building is a key driver of the American economy,” said Granger MacDonald, chairman of the National Association of Home Builders (NAHB). “Housing creates new income and jobs, purchases of goods and services, and revenue for local governments.” NAHB research shows that building 100 single-family homes in a typical metro area creates 297 full-time jobs and generates $28 million in wage and business income and $11.1 million in federal, state and local tax revenue.
Full Story… http://www.nahb.org/en/news-and-publications/press-releases/2017/04/new-homes-strengthen-economy-spur-job-growth.aspx

* U.S. Home Price Report Shows Prices Up 7 Percent in February. CoreLogic released its Home Price Index (HPI) and HPI Forecast for February 2017 on Tuesday which shows home prices are up both year over year and month over month. Home prices nationwide, including distressed sales, increased year over year by 7 percent in February 2017 compared with February 2016 and increased month over month by 1 percent in February 2017 compared with January 2017. The CoreLogic HPI Forecast indicates that home prices will increase by 4.7 percent on a year over year basis from February 2017 to February 2018, and on a month over month basis home prices are expected to increase by 0.4 percent from February 2017 to March 2017. “Home prices and rents have risen the most in local markets with high demand and limited supply, such as Seattle, Portland and Denver,” said Dr. Frank Nothaft, chief economist for CoreLogic. The CoreLogic Home Price Index is projecting an additional 5 percent rise in home prices nationally over the next 12 months.
Full Story…  http://www.corelogic.com/about-us/news/corelogic-us-home-price-report-shows-prices-up-7-percent-in-february-2017.aspx

* ADP: U.S. Companies Hire Most Workers in Over Two Years. U.S. companies added 263,000 workers in March, the most since December 2014, suggesting further tightening of the labor market, payrolls processor ADP said on Wednesday. ADP’s March figure easily beat the median forecast of 187,000 increase among economists surveyed by Reuters. Strong job gains in the coming months will likely add upward pressure on wages, supporting the Federal Reserve’s view for at least two more interest rate increases by the end of 2017.
Full Story… http://reut.rs/2ojmJKT

Have a productive week!
Jason


This Week in Real Estate: April 3, 2017

image001

As Q1 comes to a close and we welcome in the spring selling season, This Week in Real Estate, we do so at a time when consumer confidence reaches a decade and a half high. Below are a few highlights from the last week of March that influence our business:

* Consumer Confidence Surges to 16-Year High. Consumer confidence leapt forward in March to the highest level in 16 years, according to the Consumer Confidence Survey conducted by The Conference Board by Nielsen. The Consumer Confidence Index improved significantly in March to 125.6, up from 116.1 in February. The Present Situation Index increased from 134.1 to 143.1 and the Expectations Index increased to 113.8, up from 103.9 last month. “Consumer confidence increased sharply in March to its highest level since December 2000,” said Lynn Franco, The Conference Board director of economic indicators. “Consumers’ assessment of current business and labor market conditions improved considerably. Consumers also expressed much greater optimism regarding the short-term outlook for business, jobs and personal income prospects. Thus, consumers feel current economic conditions have improved over the recent period, and their renewed optimism suggests the possibility of some upside to the prospects for economic growth in the coming months.”
Full Story… https://www.conference-board.org/data/consumerconfidence.cfm

* Pending Sales Spring Up. The Pending Home Sales Index increased 5.5% in February 2017 to its highest level since April 2016, and the second highest since May 2006. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), increased to 112.3 in February, up from 106.4 in January and up 2.6% from the same month a year ago. The PHSI increased in all four regions, ranging from 11.4% in the Midwest to 3.1% in the West. Year-over-Year, the PHSI increased 6.6% in the Northeast and 4.2% in the South, while falling slightly in the West and Midwest. February existing sales were slowed by inventory constraints, and these shortages are expected to continue, especially in the lower- and mid-market price ranges. However, builder sentiment remains strong, and new home sales are trending positive. As the economy continues to add jobs, increased demand among first-time buyers will help fuel new and existing sales in 2017.
Full Story…  http://eyeonhousing.org/2017/03/pending-sales-spring-up/

* Home Prices in the First Month of 2017. S&P Dow Jones Indices released the Home Price Index for January 2017 on Tuesday. The Case-Shiller U.S. National Home Price Index rose at a seasonally adjusted annual growth rate of 7.9%, slower than the 9.2% increase in December. House prices dropped to the lowest level in the first month of 2012. Five years later, house prices surpassed the pre-recession peak of 2006 and hit the highest level historically. Of the twenty (20) major U.S. metropolitan areas highlighted in the report Seattle had the highest annual home price appreciation growth rate at 22.6%, followed by Chicago (16.5%), Denver (14%), Washington D.C. (12.7%) and Portland (12.2%).
Full Story… http://eyeonhousing.org/2017/03/home-prices-in-the-first-month-of-2017/

Have a productive week!
Jason


This Week in Real Estate: March 27, 2017

image001

A theme of highs and lows This Week in Real Estate. The value of the housing market hits a 10-year high while both cash and distressed sales totals hit nine-year lows in 2016. Below are a few highlights from the third full week of March that influence our business:

* Value of the Housing Market Hits a 10-Year High. The value of the housing market hit a 10-year high in 2016 as equity reached new levels, according to the Urban Institute’s latest report. The Federal Reserve’s Flow of Funds report has consistently indicated an increasing total value of the housing market driven by growing household equity since 2012, and 2016 was no different. Total debt and mortgages held steady at $10.3 trillion, but household equity reached a new high of $14 trillion. The total value of the housing market increased to $24.3 trillion, surpassing even the pre-crisis peak of $23.9 trillion in 2006.
Full Story… http://www.housingwire.com/articles/39669-value-of-housing-market-hits-10-year-high

* 2016 Cash and Distressed Sales Totals Hit Nine-Year Lows. The share of homes sold for cash fell to the lowest level in nearly a decade in full-year 2016. CoreLogic said that 32.1 percent of all home sales in the 12-month period ending in December closed without the benefit of a mortgage. This was a decrease of 2.2 percentage points from the 2015 share. The previous low point for such sales was in 2007 when cash sales accounted for a 27 percent of sales. CoreLogic also noted that distressed home sales, a total of both short sales and sales of lender-owned real estate (REO) accounted for 8.9 percent of all sales for the year, also the lowest share since 2007. At its peak in January 2009, distressed sales totaled 32.4 percent of all sales with REO sales representing 27.9 percent of that share.
Full Story…  http://www.mortgagenewsdaily.com/03222017_corelogic_distress_cash_sales.asp

* Positive Trend For New Home Sales. Contracts for new home sales expanded by 6.1% in February, according to estimates from the joint data release of HUD and the Census Bureau. The growth in sales continues along a positive trend for the market, which is supported by solid job growth, improving household formations, continuing favorable housing affordability conditions, and tight existing home inventory. The seasonally adjusted annual pace for February new single-family home sales was 592,000. This is 6.1% better than January and a 12.8% gain over a year ago. The most recent data also indicate a growing share of homes not-yet-started in builder inventory. For example, on a year-over-year basis, homes under construction in inventory have increased by almost 6% over the last year. Completed, ready-to-occupy homes (there are only 63,000) are up 5% since February of last year. In contrast, homes not-yet-listed in inventory have increased 42%, from 36,000 in February of 2016 to 51,000 last month. Regionally, all areas except the Northeast saw monthly growth in sales, with notable growth of 31% in the Midwest. Sales in the Northeast were down 21%. Smaller growth of 4% and 8% was recorded in the South and West respectively.
Full Story… http://eyeonhousing.org/2017/03/positive-trend-for-new-home-sales/

Have a productive week!
Jason


This Week in Real Estate: March 20, 2017

image001

Favorable news This Week in Real Estate from the new construction sector as builder confidence hits a 12-year high and single-family housing starts reach its highest level since late 2007. Below are a few highlights from the second full week of March that influence our business:

* Builder Confidence Hits 12-Year High. Builder confidence in the market for newly-built single-family homes jumped six points to a level of 71 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This is the highest reading since June 2005. All three HMI components posted robust gains in March. The component gauging sales conditions increased seven points to 78 while the index charting sales expectations in the next six months rose five points to 78. Meanwhile, the component measuring buyer traffic jumped eight points to 54. Looking at the three-month moving averages for regional HMI scores, the Midwest increased three points to 68 and the South rose one point to 68. The West dipped three points to 76 and the Northeast edged one point lower to 48.
Full Story… http://www.nahb.org/en/news-and-publications/press-releases/2017/03/builder-confidence-hits-twelve-year-high.aspx

* MBA: Mortgage Applications Rise Three-Weeks Straight. Mortgage applications increased three-weeks straight as the market gears up for the spring home-buying season. The latest update from the Mortgage Bankers Association Weekly Mortgage Applications Survey for the week ending March 10 found that applications increased 3.1% from one week earlier. This is similar to the previous week’s 3.3% increase in applications. Both refinance and purchase applications rose, helping boost overall application volume. The Refinance Index increased 4% from the previous week, while the seasonally adjusted Purchase Index increased 2% from one week earlier. Mortgage interest rates for most products jumped close to two-year highs. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) now sits at its highest level since April 2014, growing to 4.46% from 4.36%. Also reaching its highest level since April 2014, the average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) increased to 4.44% from 4.27%.
Full Story…  http://www.housingwire.com/articles/39572-mba-mortgage-applications-rise-three-weeks-straight?eid=322520585&bid=1693359

* Single-Family Housing Starts Reach Highest Level Since Late 2007. Nationwide housing starts rose 3 percent in February from an upwardly revised January reading to a seasonally adjusted annual rate of 1.288 million units, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department. Single-family production increased 6.5 percent to 872,000 units – its highest reading in nearly a decade – while multifamily starts fell 3.7 percent to 416,000 units. “This month’s gain in single-family starts is consistent with rising builder confidence in the housing market,” said Granger MacDonald, chairman of the National Association of Home Builders (NAHB). “We should see single-family production continue to grow throughout the year, tempered somewhat by supply-side constraints such as access to lots and labor.” Regionally in February, combined single-family and multifamily housing production (starts) rose 35.7 in the West. Starts fell by 3.8 percent in the South, 4.6 percent in the Midwest and 9.8 percent in the Northeast. Regionally, overall permits rose 25.4 percent in the Midwest. Permits fell 10 percent in the West, 10.4 percent in the South and 22.3 percent in the Northeast.
Full Story… http://www.nahb.org/en/news-and-publications/press-releases/2017/03/single-family-housing-starts-reach-highest-level-since-late-2007.aspx

Have a productive week!
Jason


This Week in Real Estate: March 13, 2017

image001

As the market prepares for the spring selling season, Fannie Mae reported This Week in Real Estate that consumers have never felt better about housing than they do right now. Below are a few highlights from the first week of March that influence our business:

* Fannie Mae: Consumers Have Never Felt Better About Housing Than They Do Right Now. Consumers’ faith in the housing market is stronger than it’s ever been before, according to a newly released survey from Fannie Mae. Fannie Mae’s latest Home Purchase Sentiment Index shows that consumer confidence in housing hit an all-time high in February, continuing a climb in confidence that began in January. According to the Fannie Mae report, the Home Purchase Sentiment Index increased by 5.6 percentage points in February to 88.3, setting a new all-time high. Overall, five of the six components that make up the HPSI were up, with three hitting record highs. According to the report, the net share of Americans who said that now is a good time to buy rose by 11 percentage points, and the net share of consumers who believe that now is a good time to sell also rose by 7 percentage points.
Full Story… http://www.housingwire.com/articles/39502-consumers-have-never-felt-better-about-housing-than-they-do-right-now?eid=322520585&bid=1685872

* CoreLogic: 1 Million US Borrowers Regained Equity in 2016. CoreLogic released a new analysis on Thursday showing that U.S. homeowners with mortgages (roughly 63% of all homeowners) saw their equity increase by a total of $783 billion in 2016, an increase of 11.7 percent. Additionally, just over 1 million borrowers moved out of negative equity during 2016, increasing the percentage of homeowners with positive equity to 93.8 percent of all mortgage properties, or approximately 48 million homes. In Q4 2016, the total number of mortgaged residential properties with negative equity stood at 3.17 million, or 6.2 percent of all homes with a mortgage. That is a decrease of 25 percent year over year from 4.23 million homes, or 8.4 percent of all mortgaged properties in Q4 2015. Negative equity peaked at 26 percent of mortgage residential properties in Q4 2009. “Average home equity rose by $13,700 for U.S. homeowners during 2016,” said Dr. Frank Nothaft, chief economist for CoreLogic. “The states with the largest home-price appreciation last year, according to the CoreLogic Home Price Index, were Washington and Oregon at 10.2 percent and 10.3 percent, respectively, with average homeowner equity gains of $31,000 and $27,000, respectively.” This is doubt the pace for the U.S. as a whole. Texas had the highest percentage of homes with positive equity at 98.4 percent followed by Hawaii at 98.1 and five states, including Oregon and Washington at 97.9 percent.
Full Story…  http://www.corelogic.com/about-us/news/corelogic-reports-1-million-us-borrowers-regained-equity-in-2016.aspx

* MBA: Average Loan Size For Purchase Applications Hits All-Time High. The average loan size for purchase mortgage applications hit an all-time high last week, according to the latest data from the Mortgage Bankers Association. The data comes courtesy of the MBA’s Weekly Mortgage Applications Survey for the week ending March 3, 2017, which showed that the average loan size for purchase applications was $313,300. That’s the highest that figure has been during any week since the MBA began conducting its weekly application survey in 1990. The report showed that the refinance share of mortgage activity increased to 45.4% of total applications. The adjustable-rate mortgage share of activity also increased to 7.7% of total applications, which marks the highest level since October 2014.
Full Story… http://www.housingwire.com/articles/39512-mba-average-loan-size-for-purchase-applications-hits-all-time-high?eid=322520585&bid=1686410

Have a productive week!
Jason


This Week in Real Estate: March 6, 2017

image001

Home price appreciation continues to capture headlines. Case-Shiller reported This Week in Real Estate that the annual December number was the largest increase in 30 months, while consumer confidence reached it’s highest peak in a decade and a half to close out February. Below are a few highlights from the last week of February that influence our business:

* Case-Shiller: Home Price Appreciation Highest in 30 Months. Home prices accelerated their growth again in December. The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, rose by 5.8% compared to one year earlier. The year-over-year increase has been larger each month since July and Case-Shiller called the annual December number the largest increase in 30 months. Among the 20 cities the largest annual gains were again registered in Seattle, Portland and Denver. Seattle led the way with a 10.8 percent year-over-year price increase followed by Portland with 10.0 percent and Denver at 8.9 percent. Case-Shilled says that an analysis of prices in Portland and Seattle, which have alternated in first and second place as price increase leaders, show that, over the course of 2016, prices in the highest tier, over $532,716 for Seattle and $411,335 for Portland, to be the most stable while those in the lowest tier, (under $335,111 and $296,361) are the most volatile.
Full Story… http://www.mortgagenewsdaily.com/02282017_case_shiller_indices.asp

* Consumer Confidence Hits 15-Year High in February. Consumers are more confident in the economy than they’ve been in the previous 15 years, according to the Consumer Confidence Survey conducted by The Conference Board. The Consumer Confidence Index increased in February to 114.8, up from 111.6 in January. Similarly, the Present Situation Index increased from 130 to 133.4 and the Expectations Index increased from 99.3 to 102.4. In 1985, the index was set to 100, representing the index’s benchmark. This value is adjusted monthly based on results of a household survey of consumers’ opinions on current conditions and future economic expectations. Opinions on current conditions make up 40% of the index, while expectations of future conditions make up 60%. “Consumers rated current business and labor market conditions more favorably this month than in January,” said Lynn Franco, The Conference Board director of economic indicators. “Overall, consumers expect the economy to continue expanding in the months ahead.
Full Story…  http://www.housingwire.com/articles/39393-consumer-confidence-hits-15-year-high-in-february?eid=322520585&bid=1679504

* Pace of Residential Construction Spending Continues Positive Trend. Private residential construction got off to an auspicious start in 2017, continuing the growth trend that began in October of last year. NAHB analysis of Census Construction Spending data shows that total private residential construction spending grew 0.5% in January 2017 to a seasonally adjusted annual rate (SAAR) of $476.4 billion. Multifamily construction spending in January grew by 2.2% to a seasonally-adjusted annual rate of $63.5 billion, more than double that of December. The SAAR spending on new multi-family structures was 9.0% higher than one year prior, while single-family construction grew by 2.3%.
Full Story… http://eyeonhousing.org/2017/03/pace-of-residential-construction-spending-continues-positive-trend/

 

Have a productive week!
Jason


This Week in Real Estate: February 27, 2017

image001

The National Association of Realtor’s analysis of January existing-home sales was released This Week in Real Estate, concluding sales are at the fastest pace since early 2007, while the job market shows signs of strength as evidenced by the four week average of unemployment benefits declined to the lowest level since 1973. Below are a few highlights from the third week of February that influence our business:

* Existing-Home Sales Begin 2017 With a Bang. Existing-home sales began 2017 with a bang, growing 3.3 percent and hitting a 10-year high in January, according to the National Association of Realtors. With the exception of the Midwest, every region saw gains, with total sales reaching 5.69 million – the fastest pace since February 2007. “Much of the country saw robust sales activity last month as strong hiring and improved consumer confidence at the end of last year appear to have sparked considerable interest in buying a home,” says Lawrence Yun, NAR chief economist. “Market challenges remain, but the housing market is off to a prosperous start as homebuyers staved off inventory levels that are far from adequate and deteriorating affordability conditions.” Total housing inventory at the end of January rose 2.4 percent to 1.69 million existing homes available for sale, but is still 7.1 percent lower than a year ago (1.82 million) and has fallen year-over-year for 20 straight months. Unsold inventory is at a 3.6 month supply at the current sales pace. Existing-home sales in the West ascended 6.6 percent to an annual rate of 1.29 million in January, and are now 8.4 percent above a year ago. The median price in the West was $332,300, up 6.8 percent from January 2016.
Full Story… https://www.nar.realtor/news-releases/2017/02/existing-home-sales-jump-in-january

* Claims for Jobless Benefits in U.S. Point to Firm Job Market. A tight labor market and growing economy are prompting companies to hold on to employees. The four-week average declined to the lowest level since July 1973. The four-week moving average decreased by 4,000 to 241,000, the lowest since July 21, 1973. The latest tally marks 103 straight weeks of claims below 300,000, the level economists consider consistent with a healthy labor market. The 161-week period that ended in April 1970 was the longest such streak in records back to 1967.
Full Story…  https://www.bloomberg.com/news/articles/2017-02-23/claims-for-jobless-benefits-in-u-s-point-to-firm-job-market

* New Home Sales Post Slight Increase. New home sales contracts expanded by 3.7% in January over a soft December reading, according to estimates from the joint data release of HUD and the Census Bureau. Despite the gain, which places the January pace of sales 5.5% higher than a year ago, the current seasonally adjusted annual rate of 555,000 is slightly below the positive growth trend that has been in place over the last few years. Inventory growth continued in January. After hovering near 240,000 for most of 2016, inventory increased to 247,000 in October, 256,000 in December and 265,000 in January. The current months’ supply number stands at 5.7, higher than the existing market (3.6) estimate. Solid builder confidence and ongoing tight inventory conditions suggest continued growth for single-family construction in the months ahead. An open question is pricing, given rising construction prices and increasing interest rates. New homes will need to be competitively priced, even as prices for existing homes continue to grow. For this reason, we continue to expect a broadening of the new home inventory base and slight declines in median new home size.
Full Story… http://eyeonhousing.org/2017/02/new-home-sales-post-slight-increase/

 

Have a productive week!
Jason


This Week in Real Estate: February 21, 2017

image001

Favorable news This Week in Real Estate with respect to new construction permits as well as mortgage applications for new homes fuels optimism for this sector in the coming months. Below are a few highlights from the second week of February that influence our business:

* Commerce Department: Home-Building Down in January, but Permits Up. Home-building overall stalled in January, but more permits indicate construction will pick up in the months ahead. Single-family construction rose 1.9 percent in January to a rate of 823,000, up from 808,000 in December, according to the U.S. Census Bureau and the Department of Housing and Urban Development (HUD). Privately-owned construction fell 2.6 percent to a rate of 1,246,000, down from 1,279,000 in December – though 10.5 percent higher than the January 2016 rate of 1,128,000. “Today’s reported decline in housing starts and completions weren’t statistically significant, but the big increase in permits was a good sign that we are on track for more much-needed new construction in the months to come,” says Joseph Kirchner, senior economist at realtor.com. “For the housing market as a whole, this means we are seeing a continuing increase in permitting and starts, but not yet completions,” Kirchner says. “Eventually, the permits will turn to starts and completions – the question is whether this will occur prior to the spring market.” Permits for privately-owned housing in January rose 4.6 percent from December to a rate of 1,285,000, an 8.2 percent increase from January 2016 – movement that lays the groundwork for future construction. The National Association of Home Builders anticipates a 10 percent increase in single-family construction in 2017, and a 12 percent increase in 2018.
Full Story… http://rismedia.com/2017/02/16/commerce-department-home-building-down-january-permits-up/?utm_source=newsletter&utm_medium=email&utm_campaign=eNews

* January New Home Purchase Mortgage Applications Increased 9.2 Percent Year Over Year. The Mortgage Bankers Association (MBA) Builder Application Survey data for January 2017 shows mortgage applications for new home purchases increased 9.2 percent compared to January 2016. Compared to December 2016, applications increased by 22 percent relative to the previous month. “As house prices continue to rise and inventories of homes available for sale remain low, it is not surprising that mortgage applications for new homes in January came in higher than a year ago,” said Lynn Fisher, MBA’s Vice President of Research and Economics. “Alongside relatively low supply, rising household incomes and favorable demographics should continue to bolster demand for new homes, despite rising interest rates, leading to modest growth in new home sales this year.” By product type, conventional loans composed 67.2 percent of loan applications, FHA loans composed 18.6 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 13 percent.
Full Story…  https://www.mba.org/2017-press-releases/february/january-new-home-purchase-mortgage-applications-increased-92-percent-year-over-year

* New Single-Family Home Size Trends. After increasing and leveling off in recent years, new single-family home size continued along a general trend of decreasing size during the fourth quarter of 2016. This ongoing change marks a reversal of the trend that had been in place as builders focused on the higher end of the market during the recovery. According to fourth quarter 2016 data from the Census Quarterly Starts and Completions by Purpose and Design and NAHB analysis, median single-family square floor area was slightly higher at 2,453 square feet. Average square footage for new single-family homes increased to 2,661 square feet. Typical new home size falls prior to and during a recession as some home buyers tighten budgets, and then sizes rise as high-end homebuyers, who face fewer credit constraints, return to the housing market in relatively greater proportions.
Full Story… http://eyeonhousing.org/2017/02/new-single-family-home-size-trends/

Have a productive week!
Jason

 


This Week in Real Estate: February 13, 2017

image001

Consumer confidence was the theme of the week This Week in Real Estate as Gallup’s Economic Confidence Index hit a new high in January, and unemployment claims near a 43-year low. Below are a few highlights from the first full week of February that influence our business:

* Swift Gains in Fourth Quarter Push Home Prices to Peak Levels in Majority of Metro Areas. The best quarterly sales pace of the year pushed available housing supply to record lows and caused price appreciation to slightly speed up in the final three months of 2016, according to the latest quarterly report by the National Association of Realtors. For all of 2016, an average of 87 percent of measured markets saw increasing home prices, up from the averages in 2015 (86 percent) and 2014 (75 percent). Of the 150 markets NAR has tracked since 2005, 78 (52 percent) now have a median sales price at or above their previous all-time high. In the West, existing-home sales rose 1.6 percent in the fourth quarter and are 9.1 percent above a year ago. The median existing single-family home price in the West increased 7.8 percent to $348,800 in the fourth quarter from the fourth quarter of 2015.
Full Story… https://www.nar.realtor/news-releases/2017/02/swift-gains-in-fourth-quarter-push-home-prices-to-peak-levels-in-majority-of-metro-areas

* U.S. Jobless Claims Near 43-Year Low. The number of Americans filing for unemployment benefits unexpectedly fell last week to near a 43-year low, amid a further tightening of the labor market that could eventually spur faster wage growth. Other data on Thursday showed inventories at wholesalers surged in December for a second straight month and sales recorded their biggest increase since 2011, signs of confidence in the economy as domestic demand strengthens. Claims have now remained below 300,000, a threshold associated with a strong labor market, for 101 straight weeks. That is the longest stretch since 1970, when the labor market was much smaller. The labor market is at or close to full employment, with the unemployment rate at 4.8 percent after hitting a more than nine-year low of 4.6 percent in November.
Full Story…  http://www.reuters.com/article/us-usa-economy-unemployment-idUSKBN15O1MF?feedType=RSS&feedName=topNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FtopNews+%28News+%2F+US+%2F+Top+News%29

* US Economic Confidence Index Hit New High in January. American’s confidence in the U.S. economy remained strong in January. Gallup’s U.S. Economic Confidence Index averaged +11, the highest monthly average in Gallup’s nine-year trend. Some of January’s three-day averages also marked new highs in Gallup’s tracking since 2008. The index peaked at +19 for the January 21 – 23 three-day average. Gallup’s U.S. Economic Confidence Index is the average of two components: how Americans rate current economic conditions and whether they feel the economy is improving or getting worse.
Full Story… http://www.gallup.com/poll/203510/economic-confidence-index-hit-new-high-january.aspx?utm_source=tagrss&utm_medium=rss&utm_campaign=syndication

Have a productive week,
Jason


©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.