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Tag: New York City Real Estate

The Return Of The Gen X Home Buyer

Generally, Generation X is used to refer to people born in the 1960s and ’70s. Because they reached peak home buying age right around the time home prices began to drop, many found themselves underwater on their mortgage and unable to sell their house and upgrade to a larger home. Now, according to the National Association of Realtors 2017 Home Buyer and Seller Generational Trends study, there is evidence that there are an increasing number of Gen X home buyers active in the market. In fact, the most recent increase in buyers from this category was the largest since 2014. Lawrence Yun, NAR’s chief economist, says Gen X homeowners have been in their homes a median of 10 years but may now finally be in a position to put their homes on the market. “Fortunately, the much stronger job market and 41 percent cumulative rise in home prices since 2011 have helped a growing number build enough equity to finally sell and trade up to a larger home.” And, because the number of homes available for sale is low in many markets, a growing number of Generation X homeowners ready to sell could provide the needed inventory boost that helps balance the market and moderate future home price increases. More here.

 

Americans Feel Good About The Housing Market


Each month, Fannie Mae uses the results of their National Housing Survey to determine Americans’ views about housing market conditions and their personal economic outlook. The resulting Home Purchase Sentiment Index breaks down consumers’ responses about the state of their financial prospects, whether or not they feel it is a good time to buy or sell a house, and whether they think home prices and mortgage rates will rise or fall. In February, the index hit a new high and saw five of its six components increase. In fact, the number of respondents who said now was a good time to buy a house was up 11 percent, while 7 percent more participants said it was a good time to sell than did the month before. Increasing optimism was especially noticeable among younger buyers, according to Fannie Mae’s senior vice president and chief economist, Doug Duncan. “Millennials showed especially strong increases in job confidence and income gains, a necessary precursor for increased housing demand from first-time home buyers,†Duncan said in a press release. “Preliminary research results from our team find that millennials are accelerating the rate at which they move out of their parents’ homes and form new households.†More here.

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What New Homeowners Say They’d Do Differently


Buying a house is no small purchase. So you definitely don’t want to find yourself regretting your choice after you’ve signed the papers and settled in. But though we all know it’s an important decision and one to be taken seriously, a lot of new homeowners say they’d do things differently if they had the chance to go through the buying process all over again. This is especially true for younger buyers, according to a new survey from NerdWallet. In fact, outside of baby boomers, a majority of recent buyers said they had regrets. So what are the main things that recent buyers said they’d change if they could? Well, nearly 30 percent of participants said they’d save more money before beginning the buying process. This is likely true for a number of reasons. Among them, the most obvious is the down payment. Though you don’t need to have a 20 percent down payment, the less you invest upfront the more you’ll pay on a monthly basis. In other words, the more you save, the better. Respondents also said they’d have done more research before buying a house. Buyers said they wished they had learned more in advance about both getting a mortgage and the home buying process. More here.

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How Inflation Might Affect The Housing Market


The dictionary definition of inflation is a “substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.†In other words, inflation means you get less bang for your buck. And, according to a new outlook from Freddie Mac, it has shown signs it may be about to increase, which could have an impact on the housing market. “Which course inflation takes over the next year will have important implications for housing and mortgage markets,†says Sean Becketti, Freddie Mac’s chief economist. If inflation heads higher – the outlook imagines – interest rates could also rise and lead to falling home sales and mortgage originations. The good news, however, is that Freddie Mac believes inflation will rise only modestly over the next two years. That’s encouraging for potential home buyers worried about deteriorating affordability conditions. “With the housing market on the verge of the spring home buying season, this is good news in an environment where historically low mortgage rates will help offset the pace of house price growth and lack of for-sale inventory in many markets,†Becketti says. In short, there is a chance inflation could rise depending on upcoming trends and economic policy but, more than likely, the increase will be gradual and shouldn’t affect housing market activity in the near term. More here.

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Lower Rates Give Buyers Spring Fever


The Mortgage Bankers Association’s Weekly Applications Survey is a measure of both mortgage rates and demand for loan applications. Conducted weekly since 1990, the survey is a good source for tracking market trends. According to the most recent survey, average mortgage rates fell last week across all loan categories. Rates declined for 30-year fixed-rate mortgages with both conforming and jumbo balances, 15-year fixed-rate loans, and mortgages backed by the Federal Housing Administration. MBA economist, Joel Kan, said the rate drop was largely due to events overseas. “Rates declined last week as investors favored U.S. Treasury bonds due mainly to political concerns from abroad,†Kan told CNBC. Regardless of the reason rates moved lower, prospective buyers took advantage. In fact, demand for loans to buy homes rose 7 percent from the week before. But because spring is typically the busiest time of year for home buyers, some of that spike might have to do with the approaching sales season more than the rate drop. Also in the report, refinance activity climbed 5 percent over the previous week. It is now at its highest level so far this year. The week’s results contain an adjustment for the Presidents’ Day holiday. More here.

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Home Buyer Demand Hits Post-Recession High

Though this year’s real estate market may not look as buyer friendly as it has in recent years, demand is at its highest level since the Great Recession, according to the National Association of Realtors’ chief economist, Lawrence Yun. Yun says Americans are feeling more confident about their financial status due to better job prospects and recent stock market gains. That, of course, is positive news. But the flip side of increasing buyer demand is more competition for available homes at a time when for-sale inventory is lower than normal in many markets. “Buyer traffic is easily outpacing seller traffic in several metro areas and is why homes are selling at a much faster rate than a year ago,” Yun says. “Most notably in the West, it’s not uncommon to see a home come off the market within a month.” So what does this mean for the spring season? Well, if you’re a prospective buyer, it means you should be ready to move quickly when you find a house you’re interested in. It also means you should be on the lookout for rising prices. Where there are more home buyers than available houses, price increases will accelerate. Yun warns that, especially in expensive markets, “prospective buyers will feel this squeeze in their budget and will likely have to come up with additional savings or compromise on home size or location.” More here.

Market For New Homes Strong In January


In January, sales of newly built single-family homes increased 3.7 percent over the previous month and are now 5.5 percent higher than last year at the same time, according to new numbers released by the U.S. Census Bureau and the Department of Housing and Urban Development. But though the improvement was solid, it didn’t meet economists’ expectations. Surveyed economists were predicting a 6.3 percent sales increase. Weather could be among the possible reasons sales didn’t perform as well as expected. For example, a look at regional results shows sales up by double digits in the Northeast and Midwest. The South also saw gains, rising 4.3 percent from the month before. In the West, however, sales fell – which may be due to the fact that the west coast has had an unusually rainy winter. Overall, though, the news was positive, with sales signaling a boost in consumer confidence and a healthy level of demand among prospective buyers. It also shows that interested buyers have not been deterred by the rise in mortgage rates. The median sales price of new homes sold in January was $312,900. The average sales price was $360,900. More here.

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What You Need To Know About Property Taxes

There are a lot of things to focus on when you’re shopping for a house. Just for starters, you have to find the right house at the right price. That isn’t necessarily going to be easy. But you also need to figure out how much of a down payment you’re going to have, how much you’ll need for closing costs, how you’re going to move your things, and what you’ll have left over once the dust settles. For that reason, a lot of prospective buyers forget to think about how much they’ll be paying each year in property taxes. This can lead to some unwelcome surprises down the road. So what should you expect? Well, the way property taxes are calculated can vary widely depending on where you live – so can the amount. In fact, a recent state-by-state analysis from CoreLogic found taxes, as a percentage of total property value, can range anywhere from less than half a percent to nearly three percent. Illinois is home to the country’s highest property taxes, with a median rate of 2.67 percent. Other states with taxes over two percent include New York, New Hampshire, New Jersey, Connecticut, and Texas. On the other end of the spectrum, the lowest property taxes in the country are found in Hawaii, where the median tax rate is 0.31 percent. South Carolina, Wyoming, Alabama, Colorado, and South Dakota, among others, were also found to have property tax rates of less than one percent. More here.

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Is January’s Sales Spike A Sign For Spring?

There has been a lot of discussion lately about what the housing market will look like this year. Will higher mortgage rates and rising prices hold off buyer demand or will consumer confidence and a better job market fuel a spike in sales regardless of what rates and prices do? One early answer comes in the form of the National Association of Realtors’ latest home sales figures. In January, for example, the number of previously owned homes that were sold was 3.3 percent higher than the month before and reached its strongest pace in a decade. This could be a sign that this spring’s real estate market will continue to build on last year’s strength. Lawrence Yun, NAR’s chief economist, says the January report shows that consumers are coming out despite the changing landscape for home buyers. “Much of the country saw robust sales activity last month as strong hiring and improved consumer confidence at the end of the year appear to have sparked considerable interest in buying a home,” Yun said. “Market challenges remain, but the housing market is off to a prosperous start as home buyers staved off inventory levels that are far from adequate and deteriorating affordability conditions.” Regionally, home sales saw strong gains in the West, South and Northeast but fell 1.5 percent in the Midwest. Also in the report, home prices experienced their biggest increases over last year in the West, South, and Midwest. The Northeast, on the other hand, only saw a modest increase year-over-year. More here.

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Mortgage Rates See Slight Increase Last Week

Average mortgage rates were up last week, according to the Mortgage Bankers Association’s Weekly Applications Survey. Mortgage rates increased across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, 15-year fixed-rate loans, and mortgages backed by the Federal Housing Administration. Despite the increase, however, rates remain roughly within the same range they’ve been since they jumped last November. Joel Kan, MBA’s associate vice president of industry surveys and forecasting, says last week’s increase was related to expectations that the Fed might raise interest rates soon. “Rates were up last week as markets assessed that the Fed might increase rates sooner than expected on the strength of a recent pick-up in inflation readings” Kan told CNBC. Whatever the reason, higher mortgage rates have taken a toll on refinance activity, which dropped again last week. Demand for loans to buy homes also fell last week and, according to Kan, isn’t as high as it usually is at this time of year. Typically, buyers are beginning the mortgage process in anticipation of the spring season. This year’s lull may be due to higher interest rates, though it may also be the result of there being fewer homes available for sale in many markets across the country. More here.

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