Citadel Property Management Archives

Economy Has Americans Thinking About Buying

Deciding to buy a house is mainly a money decision. You either feel secure enough financially to make a move or you don’t. This helps explain the current real estate market. After all, survey after survey shows Americans think home prices and mortgage rates are moving higher and making it less affordable to buy. And yet, home buying demand remains high. Why? Well, mostly because, at the same time, people also feel more secure in their jobs and money due to a stronger economy and job market. Take Fannie Mae’s most recent Home Purchase Sentiment Index as an example. The survey found a rising number of respondents who said it was a good time to buy a home, despite increasing numbers who also say they believe mortgage rates and prices will continue to rise. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says the economy explains it. “Downside risk to housing is limited by broader economic strength, which helped boost perceptions of current home buying conditions,” Duncan said. “For consumers who say now is a good time to buy, the share citing overall economic conditions as a reason rose to a survey high.” More here.

Green Features Add Value To Homes

In order for a home to be considered truly green, there are six elements it needs to contain, according to the Appraisal Institute, a professional association of real estate appraisers. These include water efficiency, energy efficiency, indoor air quality, materials, and operations and maintenance. Put simply, to retrofit a home to meet those standards would require a lot of work. But that doesn’t mean you can’t improve your home’s performance through smaller measures. And Appraisal Institute president, James L. Murrett, says, if you do, you’ll not only be able to lower your bills but you may also be able to sell your house for more when the time comes. “The latest research shows that green and energy-efficient home improvements have the potential to pay dividends for buyers and sellers,” Murrett says. “However, it depends on the improvements made. Some green renovations, such as adding Energy Star appliances and extra insulation, are likely to pay the homeowner back in lowered utility bills relatively quickly.” Whether you’re searching for a home to buy or thinking about selling one, a home’s efficiency and performance is an important factor to consider. More here.

Which Cities Have The Country’s Biggest Houses?

When looking for a house to buy, you aren’t necessarily always looking for the biggest house. After all, the size of the home you choose will be determined, in part, by things like the size of your family, storage needs, how many bathrooms and bedrooms, etc. Mostly, though, it’ll be determined by your budget. Because, when it comes down to it, we all would like a little more space. For that reason, a recent study looked at the largest 45 cities in the country and calculated the median home size and cost per square foot, in an effort to figure out which cities have the biggest homes and which give buyers the most space for the best price. The results show that the South has the biggest homes, with three of the top five cities located in Texas. In fact, Houston was the city with the largest median home size at 1,952 square feet, with Atlanta, Washington DC, Dallas, and Austin rounding out the top five. Southern cities also tend to have a lower price per square foot. For example, while Houston has the biggest homes, the median price per square foot was $100. By comparison, cities like San Francisco, Boston, and Denver have smaller homes but higher prices, mostly due to the fact that the housing stock in those areas is older. More here.

More Americans Think Now’s The Time To Sell

Nearly 80% of Americans say now is a good time to sell a house, according to a recent survey from the National Association of Realtors. This may be good news for buyers. These days, there are more home buyers than there are homes for sale, which is the primary factor causing prices to rise. But rising prices have also caused homeowners to think about the benefits of selling their home. And, if the results of the NAR’s Housing Opportunities and Market Experience survey are any indication, a growing number of them are beginning to consider putting their home on the market. If so, it’ll help provide additional choices for home buyers while also slowing the rate at which prices move upward. Lawrence Yun, NAR’s chief economist, says he believes American homeowners were waiting to see if the gains got any better before making a decision. “With prices having risen so quickly, many consumers were deciding to wait to list their homes hoping to see additional price and equity gains,” Yun said. “However, with indications that buyers are beginning to pull out, price gains are going to decelerate and potential sellers are considering that now is a good time to list and bring more properties to the market.” More here.

New Home Sales Rebound, Up 13% Over Last Year

Sales of newly built single-family homes rose 3.5 percent in August over the month before and are now 12.7 percent higher than they were at the same time one year ago, according to new numbers from the U.S. Census Bureau and the Department of Housing and Urban Development. The increase is welcome news at a time when the new home market plays an important role in balancing the overall housing market. Because building new homes is the quickest way to add inventory to markets where too few homes are available for sale, any increase in sales is encouraging, as it can help spur more residential construction which helps moderate prices. The increase was also better than expected. Economists polled prior to the release had predicted sales to be mostly flat in August. Regionally, sales were up in the Northeast, Midwest, and West, with only the South seeing a decline from the month before. However, since the South accounts for a large share of the total new home market, the decline helped hold back more significant gains despite notable improvements in the West and Northeast. More here.

Mortgage Rate Increase Doesn’t Slow Demand

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates were up across all loan categories last week, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The increase continues a trend upward led, in part, by a stronger economy and job market. Joel Kan, an MBA economist, told CNBC that many of the underlying factors showed improvement. “Rates rose last week as investors looked past US-China trade tariffs and towards this week’s Fed meeting,” Kan said. “Treasury yields increased 8 basis points for the week, as the growth outlook for the US remained positive, and data on housing starts and home sales showed a reprieve after a few months of weak results.” But though average rates were up, it didn’t slow demand. In fact, the number of requests for mortgage loans last week rose nearly 3 percent overall, with the Purchase Index 4 percent higher than it was at the same time last year. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Foreclosures Offer Savvy Buyers A Good Deal

After the market crashed, there was a period of time when foreclosed properties were plentiful and savvy buyers and real estate investors seized on the opportunity to get a good house at a bargain price. Naturally, as time went on, the economy improved, foreclosed properties were purchased, and the ability to find a significantly discounted house became more difficult. But that doesn’t mean there aren’t still foreclosures available for the buyer or investor that wants to seek them out. In fact, according to a recent report, the foreclosure market is hot and there are a number of places around the country that have repossessed homes for sale at a good price. For example, the top foreclosure markets right now are found in New Jersey, Maryland, Nevada, Delaware, Illinois, South Carolina, and Connecticut. Those states have the highest number of available foreclosures. But that doesn’t mean they necessarily have the best deals. That’s why the report separates volume and profitability. In Chicago, Philadelphia, Cleveland, Miami, and Houston, according to the report, buyers have the greatest possibility of finding a foreclosure at a price that puts them in a position to profit off their purchase. More here.

Luxury Home Market Continues To Heat Up

When it comes to real estate, most people know that location is key. Market conditions can differ from one neighborhood to the next. But location isn’t the only thing affecting the conditions you’ll encounter when shopping for a house to buy. Your price range will also have something to do with it. For example, the National Association of Realtors’ consumer website recently released its 2018 Luxury Home Index and the results show luxury home buyers face a far different market than buyers who are looking for a more affordable home. That’s because, while overall home price increases are showing signs of slowing down, in the luxury market they’re gaining speed. In fact, according to the index, there are a rising number of areas with double-digit price growth from the same time last year. In Sarasota, the nation’s fastest-growing luxury market, prices are up 21 percent from last year. Another difference between the overall market and the top 5 percent of all residential sales is the fact that luxury homes stay on the market longer. Luxury homes in the 90 counties analyzed were on the market a median of 121 days. More here.

Number Of Price Reductions Is Rising

Naturally, potential home buyers become more concerned about affordability conditions as prices and mortgage rates rise. And since the past few years have seen both things happen, there’s been increasing concern about whether or not now is a good time to buy a house. That’s not to say there hasn’t been demand for homes. In fact, there are plenty of interested buyers and not enough homes to accommodate them, which is why prices have been rising in the first place. But recently, there’s been more data suggesting that home prices are beginning to soften. In fact, one recent report shows that 26.6 percent of homes listed for sale in September dropped their price, which is a nearly 5 percent increase from the same time last year. That’s good news for buyers, as is the fact that price drops have been showing year-over-year improvement since the end of March. Added to the fact that mortgage rates, while higher than last year, are still well below what is historically normal, the news about home prices means affordability may, once again, be moving in a more balanced direction and one that benefits buyers. More here.

Inventory And Home Sales Flat In August

Sales of previously owned homes were unchanged from the month before in August, according to new data from the National Association of Realtors. The number of available homes for sale was also flat, with unsold inventory at a 4.3-month supply at the current sales pace. But, though there was little change in the numbers, Lawrence Yun, NAR’s chief economist, says buyers may be getting ready to move. “Strong gains in the Northeast and a moderate uptick in the Midwest helped to balance out any losses in the South and West, halting months of downward momentum,” Yun said. “With inventory stabilizing and modestly rising, buyers appear ready to step back into the market.” In other words, though there hasn’t been a significant change in conditions, there is a sense that price increases and low inventory are beginning to move in the right direction. This can be seen in the regional results, which show that some areas are improving at a quicker pace than others. Another indicator that relief may be on the way is how long the typical property stayed on the market in August. That’s because, the number of days homes were available before selling moved up for the first time in months. But, despite the improvement, properties are still selling quickly. In fact, the typical home sold in just 29 days in August. More here.