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Positive Signs Abound for Housing

Positive Signs Abound for Housing


Daily Real Estate News
Thursday, May 17, 2012

The first quarter of 2012 was the best first quarter for real estate in five years, and pending contracts suggest that the second quarter of 2012 will be the best second quarter in five years, NAR Chief Economist Lawrence Yun said this morning at the Residential Economic Update during the NAR Midyear Legislative Meetings & Trade Expo.



Moreover, he said the second half of this year could be even better than the first, in part because of continued increases in rental costs and record affordability of homes. "Renters are getting squeezed, and they don't want to rent anymore," Yun explained. "This could be the year we see the release of pent-up demand."



Home prices have been skipping along the bottom for about a year now, Yun said, a trend that has drawn investors into the market. These investors have helped housing through a couple of difficult years and partly mitigated the dysfunctional mortgage market.



"Right now is the time to buy low," he said. "Investors are coming in to take advantage. Second homes started to recover nicely last year because of investors."



However, home values are poised for a rebound as more traditional buyers move back into the market, Yun said. In fact, this has already started to happen in areas such as Phoenix and Miami, which have seen year-over-year (March 2011 to March 2012) double-digit percentage increases in home prices.



As real estate improves, consumer psychology around home ownership will change, he added. Coupled with the recent — if relatively modest — job growth and stock market gains, conditions are right for a sustained housing recovery.



Future Challenges

Nonetheless, there are issues that could restrain a turnaround in housing. Mortgages are still too hard to come by, the shadow inventory — while declining — remains historically high, and price inflation is rising "above the Fed's comfort level," Yun said.



To address that last problem, the Federal Reserve will likely raise rates in 2013 and 2014. Yet Yun contends a modest rise in interest rates wouldn't necessarily be a bad thing for the housing market. That's because an increase in rates would cause financial institutions to focus their mortgage servicing departments on purchase loans instead of refis.



The biggest challenge, though, remains the murky political and regulatory environment, particularly the repeated threats from legislators and policymakers to alter or eliminate the mortgage interest deduction. Additionally, the country is racing toward a "fiscal cliff" on Jan. 1, 2013, the date by which a compromise federal budget must be approved. If this is delayed, there will be automatic government spending cuts, which would probably create a fallout effect in the financial markets.



U.S. Migration Patterns

In a presentation preceding Yun's, Fed Economist Raven Molloy went over data that showed migration within the United States had fallen across practically all demographic categories since the 1980s. This has significant implications for real estate, as a decline in the number of people moving around within the country can translate into a decline in home-purchase activity.



There were no sharp moves downward in internal migration during the recession, which suggests the trend is not connected to the housing market or macro-economic cycles, Molloy said. If this was the case, migration would likely increase in the next few years as the job market improves and household formation picks up. Instead, it could remain flat or fall as the economy recovers.



In his presentation, Yun said this trend, which doesn't have a clear source, is a problematic development.



"It’s troubling," he said. "We want to have a very dynamic society where people can move up and trade up."



— Brian Summerfield, REALTOR® Magazine

Foreclosure filings up in most markets

Foreclosure filings up in most markets



DAILY REAL ESTATE NEWS

April 27, 2012


Foreclosure filings up in most markets

RealtyTrac: distressed homes 'coming out of hibernation'
By Inman News
Inman News®

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The number of homes hit with foreclosure-related filings picked up during the first three months of the year in more than half of markets tracked by public records aggregator RealtyTrac, "an early sign that long-dormant foreclosures are coming out of hibernation in many local markets," the company said. 

The number of homes subjected to some type of foreclosure filing increased in 114 of 212 markets with populations of 200,000 or more, compared to the fourth quarter of 2011. 

Foreclosure-related filings were up from quarter-to-quarter in 26 out of 50 of the nation's largest metropolitan areas, including Pittsburgh (up 49 percent), Indianapolis (up 37 percent), Philadelphia (up 30 percent), New York (up 24 percent), Raleigh, N.C. (up 23 percent), and Virginia Beach, Va. (up 22 percent).

Many industry analysts expect loan servicers to step up the pace of foreclosures in some markets as they put the "robo-signing" controversy behind them.

But foreclosure filings have dropped off dramatically in other markets. The total number of homes subjected to foreclosure-related filings nationwide fell 2.25 percent from the fourth quarter of 2011 to the first quarter of 2012, and 15.9 percent from the same time a year ago.

During the first quarter, a total of 572,928 housing units -- 1 in every 230 -- were subjected to a foreclosure-related filing, either a default notice, scheduled auction or bank repossession. That was the lowest total since the fourth quarter of 2007,  RealtyTrac said in a report earlier this month.

The biggest quarterly decreases in foreclosure activity among the 50 largest metro areas were in Portland, Ore. (down 28 percent), Las Vegas (down 26 percent), Providence, R.I. (down 24 percent), Salt Lake City (down 22 percent), Boston (down 21 percent), and San Jose, Calif. (down 21 percent).

Eight of the top 10 metros with the highest foreclosure rates during the first quarter were in California. Stockton and Modesto topped the list with foreclosure filing rates of 1 in 60 housing units each.

Stockton topped the list despite a 13.3 percent decline in the foreclosure rate from the previous quarter, and an 18.9 percent drop from a year ago. Modesto saw similar improvement, with an 8.14 percent drop in foreclosure activity for the quarter and a 21.48 percent plunge for the year.

Top 10 U.S. metros with highest foreclosure rates, first quarter 2012

Area Foreclosure rate (First Quarter 2012)
U.S. 1 in 230 housing units
Stockton, Calif. 1 in 60
Modesto, Calif. 1 in 60
Riverside-San Bernardino-Ontario, Calif. 1 in 62
Vallejo-Fairfield, Calif. 1 in 63
Merced, Calif. 1 in 72
Sacramento-Arden Arcade-Roseville, Calif. 1 in 77
Bakersfield, Calif. 1 in 81
Las Vegas-Paradise, Nev. 1 in 82
Phoenix-Mesa-Scottsdale, Ariz. 1 in 87
Visalia-Porterville, Calif. 1 in 89
Source: RealtyTrac

Riverside-San Bernardino, Calif., topped RealtyTrac's list of foreclosure activity in the nation's 50 largest metros, with 1 in 62 of its housing units in some stage of foreclosure during the first quarter of 2012. 

Seven other metros among the nation's 50 largest had foreclosure rates more than twice the national average: Sacramento, Calif. (one in 77 housing units), Las Vegas (one in 82 housing units), Phoenix (one in 87 housing units), Atlanta (one in 90 housing units), Miami (one in 95 housing units), Orlando (one in 101 housing units), and Chicago (one in 107 housing units).

HouseLogic Announces Spring Cleaning Pinaway Pinterest Contest

HouseLogic Announces Spring Cleaning Pinaway Pinterest Contest

The arrival of spring often means spring cleaning, and to help, HouseLogic.com is holding a “Spring Cleaning Pinaway Pinterest” contest. Registered users of the award-winning site have a chance to win one of two iPod Touches™ by creating a Pinterest pin board featuring their favorite cleaning tips, images and articles from HouseLogic.com and other sources.

“Owning a home is an investment in your future, and maintaining your home is an important part of preserving that investment,” said National Association of REALTORS® President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami.“As NAR’s consumer-facing website, HouseLogic helps homeowners make informed decisions about enhancing and improving their homes. The Spring Cleaning Pinaway Pinterest contest encourages homeowners to share tips and resources as well as learn more about other resources HouseLogic has to offer.”

To get started, visit HouseLogic’s Spring Cleaning Pinterest Board and follow these four steps:

·         Create a Pinterest board titled “HouseLogic Spring Cleaning Pinaway” and categorize it under “Home Décor.”

·         Pin five favorite cleaning articles and photos. Three of the pins must be from HouseLogic.com and the rest can be anything that motivates or informs spring cleaning.

·         “Follow All” HouseLogic boards.

·         Copy and paste the link to their Pinterest board into the comment section of the HouseLogic Spring Cleaning Pinaway blog post within the contest period.

The contest begins today and ends on April 29, 2012, at 11:59 p.m. CT. Winners will be chosen at random and announced during the week of April 30. For questions or an invitation to Pinterest, email HouseLogic.Contest@gmail.com.

For more information on tips to make smart decisions and take responsible actions to maintain, protect and enhance the value of your home, visit www.houselogic.com.

www.EmilyLeeRealty.com

Mortgage Rates Inch Up for the Week

Mortgage Rates Inch Up for the Week



Mortgage Rates Inch Up for the Week

DAILY REAL ESTATE NEWS | FRIDAY, APRIL 20, 2012
After reaching or hovering near all-time lows last week, fixed-rate mortgages edged up slightly during the week, Freddie Mac reports in its weekly mortgage market survey. The 5-year adjustable-rate mortgage, however, hit a new all-time low of 2.78 percent this week. 

Here’s a closer look at average mortgage rates from Freddie Mac for the week ending April 19: 

30-year fixed-rate mortgages: averaged 3.90 percent, with an average 0.8 point, up slightly from last week’s 3.88 percent average. A year ago at this time, 30-year rates averaged 4.80 percent. 
15-year fixed-rate mortgages: averaged 3.13 percent, with an average 0.7 point, rising after last week’s all-time low of 3.11 percent. Last year at this time, 15-year rates averaged 4.02 percent.
5-year ARMs: averaged a new all-time low of 2.78 percent this week, with an average 0.7 point, dropping from last week’s 2.85 percent average. The 5-year ARMs previous record low was 2.80 percent, which was reached during the first week of February. Last year at this time, 5-year ARMs averaged 3.61 percent. 
1-year ARMs: averaged 2.81 percent, with an average 0.6 point, rising slightly from last week’s 2.80 percent average. A year ago at this time, 1-year ARMs averaged 3.16 percent. 
Source: Freddie Mac


www.EmilyLeeRealty.com

New-Home Building Permits Soar to 2008 Levels

New-Home Building Permits Soar to 2008 Levels

New-Home Building Permits Soar to 2008 Levels


Daily Real Estate News
Tuesday, April 17, 2012

Permits for new-home building — a gauge of future demand — reached its highest level last month since September 2008, the Commerce Department reported Tuesday.



New housing permits rose 4.5 percent in March, reaching an annualized level of 747,000.



But while the future of home building shows signs of picking up, actual construction started last month slowed, the second consecutive month for declines.



Builders broke ground in March on a seasonally adjusted annual rate of 654,000 homes, a 5.8 percent drop from February, the Commerce Department reported. The construction of multifamily homes — those with at least two units — posted a 16.9 percent drop last month while construction of single-family homes dropped slightly at 0.2 percent.



New-home building declined the most in the South — posting a 15.9 percent decline in March — while the Northeast saw a 32.8 percent gain and the Midwest saw a 1 percent increase.



The new-home market continues to struggle to compete against foreclosures and short sales plaguing many markets, which are often sold at big discounts. Coupled with that, new homes tend to be priced about 30 percent higher than previously occupied homes.



While builder confidence has been increasing in recent months, confidence showed a slight decrease in April, the first time it's declined in seven months, according to the National Association of Home Builders/Wells Fargo Housing Market Index.



"Although builders in many markets are noting increased interest among potential buyers, consumers are still very hesitant to go forward with a purchase, and our members are realigning their expectations somewhat until they see more actual signed sales contracts," says Barry Rutenberg, NAHB chairman.



Source: “U.S. March Housing Starts -5.8% to 654K,” Dow Jones International News (April 17, 2012) and National Association of Home Builders

New Home vs. Old: How Do You Know Which is Right for You

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New Houses vs. Old: How Do You Know Which is Right for You?
Finding your perfect home is not always as easy process. With the surplus of homes for sale in most cities, buyers may find there are many properties –both new and old - that meet their search criteria. Choosing whether to renovate an old house or buy a new one can be a tricky decision for some.
Should I Completely Renovate an Old House or Buy a New House?

When deciding on which type of house is right for you, it’s important to take into consideration the following factors:


Style – For many, the allure of an older home is its character and uniqueness. Many of the homes being built today are tract houses that lack personality and quality of construction. An older home will have the charm that many buyers are looking for, rather than being a “cookie cutter” model that someone else has. However, they require a lot of TLC that many buyers aren’t cut out for. Knowing whether to choose an old house or buy a new one largely depends on your style preferences. Do you prefer clean lines, open concepts and a modern look, or are you into a more traditional floor plan with closed rooms, built-ins and nooks?


Lifestyle – Think about how you like to spend your free time. Do you enjoy working on projects, building or creating things at home? Or would you rather spend the evenings and weekends outside of the house, traveling, hiking or shopping? If you answered the latter, an old house may not make sense for you in the long-term as they typically require more maintenance and care.


Resources – Aside from the funds needed to purchase the home, do you have the budget and resources to update and maintain an old house? Even an older home that has been updated can be expensive to maintain due to scarce availability of certain building materials and original fixtures. Many buyers become “house poor” after making their down payment and buying a house. With no savings they have little budget left over for these house updates. If you don’t have the resources to dedicate to updating and maintaining the home, it may be a better choice to buy a new house. Newer houses typically need no initial repairs, no additional budget and are move-in ready.


Patience – Old houses have character, but maintaining that sense of charm doesn’t come easy. Unless they were recently updated, older homes require time and energy to restore. Because they were built in a different time period, older houses may require custom or hard-to-fit materials, appliances and fixtures that many contractors are not skilled in using. These material and construction delays can greatly extend your project deadlines.


Knowledge – Are you knowledgeable about construction and home improvement? Knowing how long restoration and maintenance projects will take and how much they will cost is a major prerequisite for purchasing an older home, especially if you’re planning to completely renovate an old home. If you’re tight on budget and resources, are you able and willing to do some of the work yourself?
An older home can be a quality investment with long-term potential and timeless style. A newer home can be a no-hassle, peaceful retreat that doesn’t require extra money or time to move in. If you do the right planning and homework ahead of time, you’ll be able to find the house that fits your needs, budget and lifestyle and relax, knowing you made the best decision in choosing your new home.

Emily Lee, Your REALTOR

Gov't Trims Half of Its Foreclosure Inventory

Gov't Trims Half of Its Foreclosure Inventory


The government was able to chip away at its foreclosure inventory in 2011, reducing it by nearly half, HousingWire reports in analyzing financial statements from three government enterprises.

From the end of 2010 to 2011, Freddie Mac, Fannie Mae, and the Department of Housing and Urban Development saw a 49 percent reduction in the number of REO properties it owns. The three government enterprises held about 150,700 properties as of Dec. 31, 2011, compared to 296,000 at the end of 2010.

“The GSEs sold REOs at a record pace in 2011,” HousingWire reports. “Combined, both sold more than 353,000 previously foreclosed property for the year.”

Here’s a closer look by how much the government enterprises trimmed their foreclosure inventories:

HUD: Reduced its foreclosure inventory to about 32,000, a 47 percent drop from more than 62,000 it held at the end of 2010. 
Fannie: Reduced its foreclosure inventory to more than 118,000, which is down 27 percent from about 162,000 at the end of 2010.
Freddie: Reduced its REO inventory to 60,500, down 16 percent from more than 72,000 in 2010.
Source: “Government-held REO Halved During Robo-Signing Freeze,” HousingWire (March 9, 2012)

Emily Hickman Lee

call or text: 865-278-0361

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