5 Projections of Where the Housing Market’s Headed

June 25, 2012 By EmmanuelFonte Leave a Comment

Real estate markets across the country are inching their way to a slow recovery after bottoming out, according to several real estate economists who spoke at a forum hosted by the National Association of Real Estate Editors.

National Association of REALTORS®’ Chief Economist Lawrence Yun, Zillow Chief Economist Stan Humphries, and National Association of Home Builders Chief Economist David Crowe shared their views on the direction of the housing market during the forum.

"Last year was the worst year on record for [new] house sales, for 60 years of housing-sale info," Crowe said.

But things are picking up, the economists note, despite several challenges still threatening that recovery. Yun says that appraisal issues are holding back up to 20 percent of home sales and that lenders’ tightened mortgage underwriting standards are likely holding back another 15 to 20 percent of potential home deals.

Here are some of the economists’ forecasts:

1. New-home market: The NAHB predicts a 19 percent increase in single-family housing starts this year over last (from 434,000 last year to a projected 516,000 this year).

2. Single-family rental market: This could be the next housing market bubble, Humphries warns. He expects this sector to cool as rental rates continue to increase and as home ownership looks more attractive to the public again.

3. Distressed home sales: The percentage of distressed homes sales is projected to drop by 25 percent in 2012 and 15 percent in 2013, Yun says.

4. Home price appreciation: Yun says it’s possible some markets may see a 10 percent rise in home-price appreciation next year due to an increase in demand, or a 60 to 70 percent increase in housing starts. Yun argues it won’t be both, however, but rather one or the other. He notes it greatly depends on whether lawmakers reach an agreement once again on the looming debt-ceiling deadline.

5. Home owners’ negative equity: About a third of home owners are underwater, owing more on their mortgage than their home is currently worth. As such, the housing recovery will likely be “stair stepped,” Humphries says. He says home owners with negative equity will gradually begin to list their homes as they see prices inch up, but when they do, that may temporarily swell the housing supply and cause a brief pause to the recovery.

Source: “Economists: 2012 Marks the End of a Long Bottom,” Inman News

Filed Under: Blog, Economy, real estate financing, Real Estate Updates Tagged With: housing market

First-Time Buyers Find Housing Market Tough

June 20, 2012 By EmmanuelFonte Leave a Comment

First-time home buyers are increasingly saying they are getting shut out of the market, losing out on bids on for-sale homes to investors who are willing to pay all cash or home buyers willing to pay larger down payments.

"I thought it was a buyer’s market ripe for the picking," says Washington, D.C., home buyer Jason Leggett, 25. Leggett says he lost out on six previous bidding wars for a home before finally snagging a home after beating out four other bidders.

More than 53 percent of first-time home buyers use Federal Housing Administration loans, which have a minimum down payment of 3.5 percent. But FHA loans can sometimes require home sellers to do home repairs, so sellers may be more tempted to consider other offers they receive than FHA offers, real estate professionals report. FHA loans also can take buyers longer to close than buyers coming with all-cash or conventional loans.

"FHA buyers are getting pushed to the bottom of the pile," Brian Cross with Keller Williams Realty in the Phoenix area, told USA Today. "It’s much different than a year ago."

First-time home buyers generally account for a big bulk of the market, about 40 to 45 percent, according to the National Association of REALTORS®. More recently, they’ve made up about 35 percent of home buyers. The tightening of credit by many banks continues to keep many out, says Lawrence Yun, NAR’s chief economist.

Source: “Housing Isn’t a Buyer’s Market for Many First-Timers,” USA Today

Filed Under: Blog, Real Estate Updates Tagged With: affordable homes, buying first home, firt time home buying

Builder confidence levels at highest since May 2007

June 19, 2012 By EmmanuelFonte Leave a Comment

construction worker Builder confidence levels at highest since May 2007

Builders in the West and Midwest are feeling more confident, while the South and Northeast remain less sure, as their confidence levels dip.

Home builders’ confidence edges up slightly

According to the National Association of Home Builders (NAHB)’ Housing Market Index (HMI) report, builder confidence rose one point to 29 in the month of June, the highest level since May of 2007, well before the housing market took a nosedive. The NAHB notes that only when the index rises above 50 points to more builders view sales conditions as good than as poor.

“This month’s modest uptick in builder confidence comes on the heels of a four-point gain in May and is reflective of the continued, gradual improvement we are seeing in many individual housing markets as more buyers decide to take advantage of today’s low prices and interest rates,” said Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla.

“While the June HMI is in keeping with our forecast for gradually improving single-family home sales this year, recent economic reports that have shown some weakening in the pace of recovery likely factored into the marginal gain,” said NAHB Chief Economist David Crowe. “In addition, builders across the country continue to report that overly tight lending conditions and inaccurate appraisals are major obstacles to completing sales at this time.”

Confidence measurements varied

Confidence regarding current sales conditions rose two points in June to 32, their highest level since April of 2007, while confidence in sales expectations for the next six months and traffic of prospective buyers held unchanged at 34 and 23, respectively.

Regionally, the HMI results were mixed in June, with two areas of the country posting gains and two posting declines. The Midwest registered a five-point gain to 31 and the West registered a four-point gain to 33, while the Northeast and South each posted two-point declines, to 29 and 26, respectively.

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Filed Under: Blog, Economy, Real Estate Updates Tagged With: home builders

National Housing Survey

June 15, 2012 By EmmanuelFonte Leave a Comment

Filed Under: Blog, Real Estate, Real Estate Updates Tagged With: rent vs. own

Is It 2007 All Over Again?!

June 13, 2012 By EmmanuelFonte Leave a Comment

May of 2007 was a hot month for real estate, 7311 units went pending that month. May 2012, 7295 units went pending and was the second hottest month since then, just off the peak month of April 2011.

All of King county is crying for more inventory and median prices are creeping and in some areas leaping up! Area 530 saw an increase of nearly 20%. Countywide median prices bumped up 4.93% and Eastside 1.22%

Some outlying areas are not feeling the boost. As always real estate prices are neighborhood specific.

Multiple offers continue to be the trend while 48.25% of listings sold in the first month during April. Both buyers and sellers require preparation, not everyone is aware the bottom was hit last fall and most of the screaming deals are gone. Several sellers who could not sell last year or in 2010 have been pleasantly surprised with quick sales this year enabling them to move up.

June sales may tick down in units, typical most years but the current pace does not feel typical so stay tuned.

	Residential	Condo
Current Residential Active Eastside/King County Listings	1788/5039	572/1553
New Eastside/King Listings in The Month	1011/2928	253/674
% of change in Active Listings 2011-2012 East/King	-34.29/-37.44	-21.25/-32.32
Pending Eastside 2012	1012 +25.71%	291 +21.25%
Closed Eastside 2012	651 +19.01%	222 +18.72%
Closed King 2012	2056 +24.3%	562 +24.89%
Median Sales Price Eastside/King	$500,000/$362,000	$230,000/$210,000
% Change in Median Price Eastside/King	1.22 /4.93	1.1 /-2.33

When you know someone that I can help, please let me know.

Filed Under: Blog, Real Estate Updates Tagged With: bellevue homes, eastside real estate, king county real estate

Obama’s May Housing Scorecard: Market Stabilizing

June 7, 2012 By EmmanuelFonte Leave a Comment

The latest Housing Scorecard from the Obama administration showed real estate stabilizing in every region of the country, but it still has a long way to go in the road toward full recovery.

Existing-home sales increased 2.4 percent in April, according to the Obama administration’s Housing Scorecard for May. Sales also continued to outpace inventory levels. The inventory of homes for sale decreased to 5.1 month supply in April from 5.2 months in March. Also, according to the report, the inventory of newly constructed homes rose for the first time since April 2007.

HUD Acting Assistant Secretary Erika Poethig also notes that more borrowers are taking advantage of the government’s refinance programs to lower their mortgage payments, and adds foreclosure starts are declining.

“But with so many households still struggling to make ends meet it’s clear that we have more work ahead," Poethig says.

Underwater mortgages continue to threaten the market recovery, the report notes. The number of borrowers who owe more than their home’s current value rose to more than 11 million. Seriously delinquent subprime mortgages also are on the rise.

To read the full report, visit www.hud.gov/scorecard.

Source: U.S. Department of the Treasury

Filed Under: Blog, Economy, Real Estate Investment, Real Estate Updates

Seattle-Area Rentals By the Numbers

June 6, 2012 By EmmanuelFonte 1 Comment

In recent years, builders pulled back on apartment construction, unsure how much demand they’d see from young adults, relocation cases, and downsizing boomers. But that’s all slowly changing. As more jobs emerge in tech and other sectors, renters are filling the market. Low rental inventory means that asking rents are rising. Asking rents rising makes for rising cranes: A new wave of apartment construction is expected to add more than 20,000 units of housing to the region in the next two years in downtown, Belltown, the Eastside, and West Seattle.

Chart Source: Dupre and Scott Apartment Investment Research and Consulting

Filed Under: Blog, Real Estate Updates

New Single Family Homes: 2011 vs. 2006

June 6, 2012 By EmmanuelFonte Leave a Comment

The Census Bureau just released their findings on new single family residential construction built in 2011. Here is a table comparing last year to 2006: