Demand is forcing home prices out West to keep ticking up, even though the home-buying and -selling season is winding down, according to the September Zillow® Real Estate Market Report. Appreciation is highest in the San Jose, Calif., and Seattle, Wash., metropolitan areas, where prices have rocketed (in order) 10.3 percent, to a median $1,052,500, and 12.4 percent, to a median $455,800, year-over-year. Appreciation nationally is 6.9 percent, to a median $202,700.
Rents out West are also on a swift upswing. Rents in Riverside, Calif. have climbed 6.0 percent year-over-year—the most of the metro areas in the report—to a median $1,833. Rents in Seattle have gone up 5.5 percent to a median $2,189; rents in Portland, Ore., have increased 4.7 percent to a median $1,863; and rents in Los Angeles, Calif., have risen 4.5 percent to $2,714. Appreciation nationally is 2 percent, to a median $1,430.
“In these West Coast markets, heightened demand is being met with limited supply of homes for sale, which naturally causes prices to rise,” says Dr. Svenja Gudell, chief economist at Zillow. “That limited supply and high demand dynamic is a widespread phenomenon impacting high-growth metros like Seattle, as well as slower-moving markets, like Indianapolis.
“It might be easy to assume another bubble is emerging, with home values growing 10 or 12 percent per year, but don’t worry—the market is reacting to basic economic laws, and is behaving exactly the way we would expect it to given good overall growth, limited supply of homes for sale and decent housing affordability thanks to low mortgage interest rates,” Gudell says.
Nationally, there are now 12 percent fewer homes for sale compared to one year ago, the report shows.
article written by Suzanne De Vita, RISMedia’s online news editor.
Nearly 4.5 million borrowers are eligible to refinance and could lock in savings on their monthly mortgage payments but have not taken advantage, according to a new report from Black Knight Financial Services.
The average borrower stands to save $260 a month. Nearly 700,000 borrowers could save $400 or more per month, the report shows.
“The recent pause in the upward movement of interest rates continues to encourage late-to-the-game borrowers to refinance,” says Lynn Fisher, the Mortgage Banker Association’s vice president of research and economics.
But many owners are not refinancing, despite the potential savings.
“Our data doesn’t tell us about motivation,” says Ben Graboske, senior vice president of data and analytics at Black Knight Financial Services. “It leaves us to surmise that the reason is apathy, lack of awareness, and education.”
Some homeowners may still be underwater on their home loans, owing more than what the home is currently worth. Other owners may have a low credit score that is blocking them from taking advantage of lower rates.
Still, owners likely will have more time to take advantage. “I don’t think this will be the last opportunity [to refinance into a low rate], but I don’t have a crystal ball,” says Graboske. “There are enough pressures in the market—lenders getting more efficient—that we’re going to have competitive rates around for awhile.”
Source: “Reason to Refinance: 4 Million Homeowners Are Leaving $1 Billion on the Table,” CNBC (June 22, 2017)
Whether you are a first time home buyer or a seasoned homeowner these suggestions make sense and we can all hear this information from time to time.
“In many ways, housing is an invisible crisis,” says Jonathan Reckford, CEO of Habitat for Humanity International. “There are still too many families without access to safe, secure, and affordable housing. This survey highlights the value all of us place on a decent place to call home and underscores the critical need to increase access to affordable housing.”
According to the survey, nine out of 10 Americans say owning a home is one of their greatest achievements in life. Also, 68 percent of U.S. renters say owning a home is one of their chief goals, according to the survey. PSB, on behalf of Habitat for Humanity, surveyed 1,000 people in the U.S. and Canada to gauge their perceptions of and challenges to affordable housing.
Ninety-one percent of American homeowners credited owning a home with making them more responsible, and 44 percent said it helped them build a nest egg. Forty-one percent say homeownership has given them stability.
But homeownership remains out of reach for many. Nine out of 10 Americans and Canadians say it’s important to find solutions to the lack of affordable housing. At 59 percent, concerns regarding U.S. affordability in particular easily topped other housing issues like safety (16%) and quality (11%).
One major barrier to homeownership cited among survey respondents: the high costs of rent. Eighty-four percent of survey respondents said the high cost of rent was preventing them from buying, followed by 75 percent who said obtaining a mortgage was proving to be a big barrier.
Many of the survey respondents said they’ve struggled to pay housing costs at some point in their life. Among U.S. respondents, 27 percent of respondents said they struggled to pay housing costs in their 20s; 22 percent in their 30s; 11 percent in their 40s; and 9 percent in their 50s.
Source: “Nine Out of 10 Americans and Canadians Call for Affordable Housing Solutions,” Habitat for Humanity (June 20, 2017)
Shared from DAILY REAL ESTATE NEWS
It seems hard to believe in our market here in Colorado and how housing prices have been increasing over the past 3 years but here is a short list of areas in the country where housing prices are actually dropping.
Nearly 30 cities have been designated “in the clear” of the housing downtown, according to a report today by Trulia, although real estate experts in some of those markets reacted to the apparently good news with conservative-sounding forecasts for their areas – or with downright skepticism.
Amid hearty, annual asking price gains of 4 percent or more – and with relatively low foreclosure rates – Denver, San Jose, Pittsburgh, Little Rock, Austin and Colorado Springs each hammered out a “solid base for housing recovery,” said Jed Kolko, Trulia’s chief economist.
Those six cities were the only metropolitan areas specifically listed as “in the clear” by the real estate website. “We defined (‘in the clear’) as metros with positive year-on-year asking-price growth and a low or moderate share of homes in foreclosure. In all, that includes 29 metros,” Kolko added, “but we didn’t list them all out because some have only very slightly price growth. Best to focus on those six.”
The big six “in the clear markets avoided the worst of the bubble,” Kolko said. Amid the mortgage crisis, “those metros didn’t have big price declines that we saw in Miami, Phoenix and Detroit – places that still have a lot of homes left in foreclosures.”
Nationally, asking prices for homes flickered just 0.3 percent higher year-over-year in June after a flat May, Trulia reported.
Some “in the clear” cities also are enjoying robust, new-home construction, Kolko added. “But the main driver in those markets is job growth.”
At the top of Trulia’s list: Denver recorded a 7.2 percent asking-price increase year-over-year in June, according to the website’s own pricing metrics. Meanwhile, 11.9 out of every 1,000 Mile High City homes is in foreclosure, reports RealtyTrac – as compared to far steeper foreclosure rates in cities like Phoenix (25.5), Miami (33.7), Orlando (29.3) and Detroit (21.2).
While Miami (up 16.1 percent in asking price during June year-over-year), Phoenix (up 18.9 percent) and Detroit (up 5.2 percent) all won back solid ground on pricing, Trulia dubbed those metros as “at-risk” because they still have a high share of homes in foreclosure.
Kolko expects price gains in those cities to ultimately shrink or even reverse as foreclosed homes in those areas come onto the market. Ironically, seven of the 10 cities with the very highest price increases in June (also including Orlando, West Palm Beach, and Cape Coral-Fort Myers, Fla., as well as Warren-Troy-Farmington Hills, Mich.), all were deemed “at-risk” in the Trulia report.
On the sunnier side of the market, Trulia is sounding “in the clear” alerts for San Jose – with a 6.2 percent annual price spike and a foreclosure rate of 10.0 homes out of every 1,000 properties – and Pittsburgh (a 5.1 percent annual price gain and a foreclosure share of just 4.4 of every 1,000 homes).
Kolko cites the unemployment rates in Denver (8.1 percent in May, according to the federal Bureau of Labor Statistics), San Jose (8.7 percent) and Pittsburgh (6.7 percent) as critical figures in those municipal comeback equations.
The national unemployment average was 8.2 percent in May.
But given the relatively lofty unemployment rates in Denver and San Jose during May, is their job growth really good enough to attract buyers?
According to Kolko at least: yes.
“That means (those markets) are not just dependent on investors,” Kolko said. “People are moving there for jobs. Developers are betting on the future by resuming construction.”
In both Denver and San Jose, real estate brokers contacted at random by msnbc.commomentarily chuckled at the notion that their markets are “in the clear.” They then offered nuanced views of their local housing economies.
“We would be in the clear if the government got the heck out of the (real estate) business,” said Bob Stewart, the broker at Coldwell Banker, The Real Estate People, based in San Jose.
Under federal initiatives like HUD’s Neighborhood Stabilization Program – during which 400 cities and counties have received billions of dollars to slash housing blight in foreclosure-ravaged neighborhoods – “speculators” have shoved local “investors” and Realtors aside, Stewart said, gobbling up distressed San Jose properties and re-selling them on the cheap.
“Speculators went out and got their (real estate) licenses and are targeting underwater properties, getting them listed at a very low price and submitting an offer immediately to the lender. If the lender accepts it, they’ve made $300,000 to $400,000 (per house),” Stewart said. “There are enough of those here getting accepted that it’s keeping our prices” lower than they should be in San Jose.
“The powers that be in the government really don’t understand the difference between investors and speculators,” Stewart added.
In Denver, broker Heather Parness believes “we’re in the clear from the standpoint that I don’t feel we’re going to see any price declines over the next 12 to 24 months.”
Large homebuilders like Richmond and McStain have been buying up swaths of land “for the last couple of years within metro Denver,” said Parness, president and managing broker at RE/MAX of Cherry Creek. “And now that we’re seeing a shortage in existing inventory in Denver, the construction side is booming.”
“The message that we’re very careful about is: We’re not predicting any huge price increases over the next several years,” Parness added. “If we see any gains in the next 36 months, it might be a 1 to 3 percent appreciation, at most.”