Tuesday, May 31, 2016

The 25 Top-Selling Subdivisions in the U.S.

Central Florida and Dallas-Fort Worth boast some of the subdivisions with the highest number of closings last year. Metrostudy recorded home closings data from 2015 to pinpoint the communities that had the highest number of homes sold.
Here are the top 25 subdivisions nationwide:
1. The Villages – Dunedin/Central Florida: 587 closings
2. The Villages – Labelle/Central Florida: 492
3. Nine at Mary Brickell Village / South Florida: 390
4. 1100 Millecento / South Florida: 317
5. Richwoods / Dallas-Fort Worth: 309
6. Paloma Creek South / Dallas-Fort Worth: 309
7. Icon Bay / South Florida: 300
8. Insignia / Seattle: 294
9. Leyden Rock / Denver-Colorado Springs: 266
10. Walnut Creek / Charlotte: 256
10. Riverstone / Avalon/Houston: 256
12. Wildwood at NorthPointe / Houston: 253
13. The Villages – Hillsborough / Central Florida: 252
14. Cross Oak Ranch / Dallas-Fort Worth: 249
15. Carolina Arbors / Raleigh-Durham: 246
16. Cypress Creek Lakes / Houston: 244
17. Carolina Lakes-Sun City / Charlotte: 239
18. Sun City / Austin: 232
19. Castle Hills / Dallas-Fort Worth: 228
20. Hidden Cove/ Dallas-Fort Worth: 221
21. Trilogy at Bio Vista / Northern California: 208
22. The Villages – Lake Deaton / Central Florida: 203
23. Stillwater Ranch / San Antonio: 200
24. Sunset Pointe / Dallas-Fort Worth: 199
25. Frisco Hills / Dallas-Fort Worth: 198
25. Grand Mission Estates / Houston: 198
Source: “The 25 Top-Selling Subdivisions of 2015,” BUILDER (May 25, 2016)

Pop-Up Staging Furniture Gets Modern Twist

Staging professionals are revisiting pop-up furniture, as many of the new options appear more like the real thing. Lightweight, flat-pack faux furniture is helping potential buyers envision what an otherwise empty house would look like furnished and real estate professionals are finding the pop-up furnishings are easier to store and deliver to properties.
You can find more staging tips on our Styled, Staged & Sold blog.
A recent open house in New York City was filled with contemporary furniture that was actually made of corrugated plastic, from the large boxy sofa to the desk with faceted legs, sculptural coffee table, bed, and even the artwork hanging on the walls.
For those who don’t want to spend a lot on renting furniture for staging, the faux options are seeming like a good fit, according to a recent article by The New York Times. What’s more, home owners say they like the stand-ins better than virtual staging since home buyers can see it when they visit the property rather than just viewing properties of what the empty space would look like online.
Companies such as inFormed Space are offering plastic furniture for home buyers who are looking for a more affordable solution to outfitting an empty space for staging.
“I love conventional staging; it always looks lovely,” Douglas Pinter, who owns inFormed Space, told The New York Times. “But it’s very expensive to execute, because of logistical costs,” notably the storage and delivery costs often associated. His company offers lightweight, collapsible pieces that can easily be delivered and stored.
Another company named Dandy Pack, formerly NextStage Furniture, offers flat-pack furniture made of cardboard and that is then covered with slipcovers for home staging.
Dandy Pack’s reusable products include armchairs ($246 each), sofas ($341) and beds (starting at $255), covered with slipcovers in a variety of colors. The company also makes a nonfunctional dining table out of wood veneer ($326) that is held up by built-in faux chairs.
“They were shipped to my office, and I threw them into the back of a cab,” Lee Presser, an associate broker with the Corcoran Group, told The New York Times. “I was totally set up in less than an hour.”
Source: “Pop-Up Home Staging,” The New York Times (May 26, 2016)

Rent Out of Reach for Many Americans

The rental picture is getting more grim for many Americans working full time on local minimum wage. In fact, according to a new study from the National Low Income Housing Coalition, there isn't a single state where a minimum-wage worker working 40 hours a week can afford even a one-bedroom rental.
The study also reveals that the wage needed to afford a modest two-bedroom rental in the U.S. is $20.30 per hour.
To put this in perspective, "The average hourly wage for Americans is actually $15.42 per the report, which is not nearly enough to afford a two-bedroom," says CityLab in its analysis of this study. "And the federal minimum wage, at $7.25, is around a third of what’s required. That means minimum-wage workers would have to work three jobs, or 112 hours a week, to be able to afford a decent two-bedroom accommodation."
Average Americans wanting to buy a home are feeling stifled by the rental affordability problem as well. "Rising rents are making it difficult for potential first-time buyers to become owners, especially since rent increases are outpacing wage gains," says Lawrence Yun. "That means more of a tenant’s income is being eaten up in rent, making it harder to save for a down payment."
Since the price of rentals and hourly wages varies by state, the National Low Income Housing Coalition created a map showing the minimum wage needed to afford a two-bedroom in each state:

Mortgage Rates Push Upward

Average fixed-rate mortgages climbed slightly this week from their 2016 lows, Freddie Mac reports in its weekly mortgage market report.
"U.S. Treasury yields moved up in response to the Fed minutes release, which kept alive the possibility of a summer rate-hike,” says Sean Becketti, Freddie Mac’s chief economist. “Mortgage rates followed, with the 30-year fixed-rate mortgage increasing 6 basis points to 3.64 percent. Despite this increase, May ends the month averaging only 3.60 percent, 1 basis point below April's average, and the lowest monthly average in 3 years. Home buyers are taking advantage of these historically low rates with April's new-home sales increasing by 16.6 percent, the fastest pace since January 2008."
Freddie Mac reports the following national averages with mortgage rates for the week ending May 26:
  • 30-year fixed-rate mortgages: averaged 3.64 percent, with an average 0.5 point, rising from last week’s 3.58 percent average. Last year at this time, 30-year rates averaged 3.87 percent.
  • 15-year fixed-rate mortgages: averaged 2.89 percent, with an average 0.5 point, up from last week’s 2.81 percent average. A year ago, 15-year rates averaged 3.11 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.87 percent, with an average 0.5 point, up from last week’s 2.80 percent average. A year ago, 5-year ARMs averaged 2.90 percent.
Source: Freddie Mac

Banks Rush to Offer 3% Down Payment Loans

As some banks veer from Federal Housing Administration loans, they're offering their own low down payment mortgages to appeal to home shoppers struggling to save enough to buy a home. Wells Fargo made headlines this week when it debuted its 3 percent down payment loan.
JPMorgan Chase also announced its offering called the “Standard Agency 97%” program, a 3 percent down payment loan geared for first-time home buyers and requires a FICO score of 680. Chase also has a loan program called “DreaMaker Mortgage,” which offers a 5 percent down payment – 3 percent of which can come from the borrower as well as flexible funding options for closing costs and reduced mortgage insurance requirements.
Other banks have recently announced their low down payment offerings. Earlier this year, Bank of America began offering a 3 percent down payment loan that did not involve the Federal Housing Administration and does not require mortgage insurance. The bank requires a minimum FICO score of 660.
Wells Fargo’s newly launching lending program, “yourFirstMortgage,” requires a 620 FICO minimum score and minimum down payment of 3 percent for a fixed-rate conventional mortgage of up to $417,000. Down payment assistance also can come from gifts and community assistance programs. Customers who complete a homebuyer education course can earn a 1/8 percent interest rate reduction, although the course is not required.
Brad Blackwell, executive vice president and portfolio business manager at Wells Fargo, says the monthly payment for the loan will be less than a government-insured FHA loan.
"We've taken all the complexity of the home mortgage lending process, removed it from the front-line consumer, so that it's easy for them to understand and Wells Fargo is taking care of all the capital markets and other types of complexities behind the scenes," says Blackwell.
Bank giants have been leery of FHA loans lately, with JPMorgan Chase CEO Jamie Dimon’s calling FHA lending “too costly and too risky” to pursue extensively.
“We have dramatically reduced FHA originations,” Dimon wrote in his yearly letter to shareholders. “Currently, it simply is too costly and too risky to originate these kinds of mortgages. Part of the risk comes from the penalties that the government charges if you make a mistake – and part of the risk is because these types of mortgages default frequently.”
Dimon acknowledges Chase’s new low down payment lending program also carries some of those risks, but he believes it responds to customers’ needs.
“Mortgages are important to our customers,” Dimon wrote in the letter. “For most of our customers, their home is the single largest purchase they will make in their lifetime. More than that, it is an emotional purchase – it is where they are getting their start, raising a family, or maybe spending their retirement years. As a bank that wants to build lifelong relationships with its customers, we want to be there for them at life’s most critical junctures.”
Source: “Wells Fargo Launches 3% Down Payment Mortgage,” CNBC (May 26, 2016) and “Chase Quietly Launches Its Own 3% Down Mortgage Lending Program,” HousingWire (May 26, 2016)

The 20 Hottest Housing Markets for May 2016

California continues to dominate the list of the hottest housing markets in the country, but a few surprises are sneaking in this month. Realtor.com®’s list ranks the busiest and most in-demand real estate markets in medium-to-large metro areas.
Notably, Colorado – with Denver and Colorado Springs – is maintaining a strong hold within the top 20 list while Detroit and Ann Arbor in Michigan re-emerged this month.
“It’s a very affordable market now, benefiting from economic growth and a bit of renaissance,” says Jonathan Smoke, realtor.com®’s chief economist.
Taking into account median days on the market and listing views on realtor.com®, the real estate site reports the following 20 real estate markets are the ones to watch right now:  
  1. Vallejo, Calif.
  2. San Francisco
  3. Denver
  4. Santa Rosa, Calif.
  5. Stockton, Calif.
  6. Dallas
  7. Sacramento, Calif.
  8. San Diego
  9. San Jose, Calif.
  10. Columbus, Ohio
  11. Ann Arbor, Mich.
  12. Kennewick, Wash.
  13. Colorado Springs, Colo.
  14. Fort Wayne, Ind.
  15. Santa Cruz, Calif.
  16. Eureka, Calif.
  17. Boston
  18. Modesto, Calif.
  19. Detroit
  20. Raleigh, N.C.
Source: “America’s 20 Hottest Real Estate Markets for May 2016,” realtor.com® (May 26, 2016)

Friday, May 27, 2016

New York's Zero-Interest Loans Help Fight Foreclosures

The state of New York is offering up a $100 million expansion in zero-interest loans in order to prevent homes from falling into foreclosure. The state funds are coming from Goldman Sachs and are a part of the firm’s agreement to pay $5 billion from a mortgage settlement over toxic mortgage bonds.
New York Attorney General Eric Schneiderman says the state will use the funds to expand its Mortgage Assistance Program, which provides zero-interest loans to New Yorkers who are struggling to make their mortgage payments. The money allocated will help an estimated 3,000 New York families avoid foreclosure, Schneiderman says.
The program also sets out to salvage nearby property values, which can be hampered by foreclosures in the area. So far, $18 million loans distributed under the program, which launched in 2014, have helped to preserve an estimated $153 million in property values of nearby home owners, according to an analysis conducted by Schneiderman’s office. Every $1 in loans preserves about $8.50 in property values for home owners within 750 feet of a Mortgage Assistant Program loan recipient, according to the analysis.
“Since taking office, my number one priority has been getting New Yorkers the resources they need to rebuild from the housing crisis,” Schneiderman says. “This new investment in the MAP program will help thousands of New York families keep their homes and rebuild their communities. This program is already having an incredible impact in communities throughout the state and I am excited to expand it to even more families.”

How to Have a Budget-Friendly Move

The excitement of getting a new place can dampen when remembering that a part of that process is the move itself, which can be stressful and expensive. While moving to a new residence can be costly, there are a few things your clients can do to make their move cost-effective.
How to Make that Move
Since May marks the start of the prime moving season, in which 45 percent of all moves in the United States occur, Jane Dollinger and Real Estate Today radio shared a few moving hacks that can make the process easier for people who can't afford movers.
1. No boxes? No problem.Don't waste your money buying new boxes. Most grocery stores will give you produce boxes for free. When using produce boxes, however, make sure to use a lot of packing material to keep your stuff safe and secure.
2. Use your clothes. "Do not use old newspaper to packing anything that you want clean," says Dollinger. "The ink will bleed over everything and you will spend the next two days scrubbing the sports section off of your nice plates." Instead use your clothes to wrap your delicate items.
2. Purge your stuff. The more items you take to your new place, the more expensive and stressful it will be to move. Moving is a great opportunity to get rid of items by selling or donating them to a local charity.
3. Enlist friends. While no one enjoys moving, it can be surprisingly easy and cheap to get friends and family to help in a move. Make sure to entice them with free food or drinks as a thanks for their time.
Source: "Ask The Millennial with Jane Dollinger," Real Estate Today Radio (May 2016)

Remodeling Spending in 2016 By State

Washington, D.C., home owners must have caught a remodeling bug. The ZIP code 20854 – a close-in suburb of Washington, D.C. – tops the list of estimates home owners will spend on remodeling projects this year.
Owners in this area are on track to spend more than $68 million on home improvements this year – the highest of any of the 25,000 ZIP codes analyzed by the National Association of Home Builders. Part of the reason for that ZIP code's remodeling surge is that 53 percent of the homes there were built between 1960 and 1980, known as a “sweet spot” for remodeling.
Their analysis looked at total spending on home improvements, the number of owner-occupied homes, and the average spending per improvement for 2016, and found that on average, home owners will spend $5,800 on home improvements this year. However, a few pockets across the country will spend about triple that, up to $18,000.
Areas with the most remodeling expenditures tend to have the highest number of homes built between 1960 and 1980, but hot remodeling pockets have also been equated with high levels of highly educated and high-income residents.
For example, ZIP code 10007 – which is lower Manhattan and contains the World Trade Center – topped the list for highest spending per improvement at more than $22,000. In the area, 99 percent of home owners have a college degree and their average income is well over half a million dollars.
“On the other hand, in the fifth ZIP code on the list (94028, Portola Valley in California), the average remodel is a little over $17,000, and this is driven in part by the age of the owner-occupied housing stock (with a third of it built between 1960 and 1980), although home owners in Portola Valley are also relatively wealthy and well-educated,” NAHB researchers note on the builder tradegroup’s Eye on Housing blog.
Source: “NAHB Releases Remodeling by ZIP Code Estimates for 2016,” National Association of Home Builders’ Eye on Housing blog (May 25, 2016)

Facebook Is Motivating Home Buying Decisions

Facebook friends can be a powerful motivator when it comes to home ownership, according to a report by the National Bureau of Economic Research. Researchers found that Facebook users whose friends had a positive home ownership experience are more likely to be influenced to buy a home of their own.
Consumers who had online networks post about their home values rising more than 5 percent over the past two years, for example, are 3.1 percent more likely to buy a home over the next two years, researchers found. What’s more, they are 1.7 percent more likely to purchase a bigger home, 3.1 percent more likely to pay a higher price for it, and 7 percent more likely to make a larger down payment.
In the study, researchers evaluated nearly 1,250 responses to a housing market survey distributed to Facebook users in Los Angeles as well as LA public deed records of nearly 434,000 renters and more than 1 million home owners.
“You hear everyone’s making money in the housing market and suddenly you think it’s a better investment,” says researcher Johannes Stroebel, a New York University finance professor. The study “shows that your social network and your experiences within your social network are an important factor of your financial decision making.”
Source: “How Your Facebook Friends Can Push You to Buy a Home,” realtor.com® (May 25, 2016)

Single Men vs. Women: Who Fares Best in Housing?

Home ownership is more profitable for single men than for single women, according to a new study by RealtyTrac.
Housing's Girl Power
Indeed, researchers found that homes owned by single men are valued 10 percent higher, on average, than homes owned by single women. Also, homes owned by single men have gained an average of $63,921 since purchase, which equates to a 33 percent return on purchase price. That is $10,112 – or 16 percent – higher than average gains single women have seen from their home purchase.
The current value of homes owned by single men averages $255,226 – 10 percent above the current market value average of homes owned by single women ($229,094).
“Women earn less than men on average — 19 percent less in 2015 according to the Bureau of Labor Statistics — giving them less purchasing power when it comes to buying a home,” says Daren Blomquist, senior vice president at RealtyTrac. “So it’s not surprising to see the 10 percent gender gap in average home values between single men and single women home owners. However, the slower home price appreciation for homes owned by single women demonstrates that less purchasing power is also having on a domino effect on their ability to build wealth through home ownership as quickly as single men.”
The following markets have the largest housing gender gap, where average values of homes owned by single men were the highest above the average values of homes owned by single women:
  • District of Columbia: 14% higher
  • Florida: 12% higher
  • West Virginia: 12% higher
  • Wisconsin: 12% higher
  • Texas: 10% higher
  • Alabama: 10% higher
Meanwhile, in three states, the average values of homes owned by single women were higher than the values of homes owned by single men: Massachusetts (11 percent higher), Kentucky (2 percent higher), and Kansas (1 percent higher).
Source: RealtyTra

Pending Sales Soar to Highest Level in Decade

Contract signings for home purchases rose for the third consecutive month, with upticks in the South and West regions of the country providing the bulk of the increase, according to the latest NAR’s latest Pending Home Sales Index.
Overall, the index climbed 5.1 percent month-over-month in April to a 116.3 reading. The index is now 4.6 percent higher than a year ago.
“The ability to sign a contract on a home is slightly exceeding expectations this spring even with the affordability stresses and inventory squeezes affecting buyers in a number of markets,” says Lawrence Yun, NAR’s chief economist. “The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers into the market.” 
Mortgage rates have remained below 4 percent in 16 of the past 17 months, a boon to home buyers. Yun predicts that rates for home purchases will continue to hover around 4 percent in the coming months, but he cautions inflation could potentially cause rates to jump suddenly.
“Even if rates rise soon, sales have legs for further expansion this summer if housing supply increases enough to give buyers an adequate number of affordable choices during their search,” Yun says.
The Midwest was the only major region of the country to see contract activity slip in April, albeit slightly. Here’s a closer look at how pending home sales fared across the country last month:
  • Northeast: pending home sales rose 1.2 percent to 98.2 in April, and are now 10.1 percent above a year ago.
  • Midwest: pending home sales dropped slightly by 0.6 percent to 112.9 in April, but are still 2 percent above April 2015.
  • South: pending home sales increased 6.8 percent to an index of 133.9 in April, and are 5.1 percent higher than last April.
  • West: pending home sales rose 11.4 percent in April to 106.2, and are now 2.8 percent above a year ago.

Why You Need a Buyer Questionnaire

Buyer questionnaires may help you pinpoint the clients who are ready to make a move sooner rather than later. What's more, you'll also be able to glean insights to assess the individual needs of each buyer as you hunt through listings to help them find a perfect match.
It's important to be strategic with your buyer questionnaires. In a recent article at RISMedia, Mike Brown, CEO of ScoreApprove, offered some of the following tips in crafting one:
  • Make it short: You’ll annoy buyers by making your questionnaire too time consuming to fill out. For example, instead of asking for contact information like a street address, two or three phone numbers, employment address, etc., Brown suggests just asking for the e-mail address.
  • Omit too detailed of questions: Skip details like job location, current living conditions, lease expiration date, and convenient times to view a house. “Those may be nice to know, but they feel invasive, and make the cost of asking far outweigh the benefit,” Brown writes. Instead, the most important details for many buyers is the lot and house size, front and back yard, choice of neighborhood, price range, and down payment.
  • Use close-ended questions: “Stick with concrete questions that direct buyers to fill out the specific information you want,” Brown says. “Open-ended questions are intimidating, and often lead to ambiguous answers.” So replace questions like “what size house are you looking for?” with “how many bedrooms and bathrooms are you looking for?”
  • Offer up a short introduction: Explain why you’re doing the questionnaire and why it’s a benefit to them. Inform them that their answers will help you be more effective in finding the right home for them.

5 Top Motivations for Selling

Inventories of homes are tight nationwide. So what’s going to get home owners to finally sell? In a recent survey, realtor.com® researchers found some of the top motivations to sell:
1. Want to be in a different neighborhood (40%)
2. Need a home with different features (28%)
3. Need a bigger home (22%)
4. Want location with better weather, views, or lifestyle (19%)
5. Need to lower cost of living (17%)
Different motivators are more pressing to various age groups. Realtor.com® research found that households between the ages of 35 and 44 tend to be driven by the desire to be in a different neighborhood and have a bigger home. On the other hand, households of those 65 and older are more motivated by retirement and tend to be looking for a home with different features or trying to improve their weather, views, or lifestyle.
However, “the biggest factors standing in the way of today’s sellers are time, making necessary improvements in their existing home in order to sell, and finding a replacement home to purchase,” says Jonathan Smoke, realtor.com®’s chief economist.
Source: “It’s a Great Time to Sell a Home – and to Buy Again,” realtor.com® (May 18, 2016)

Broker Public Portal Gets More Accessible

The Broker Public Portal, a collaborative venture between real estate brokerages and MLSs, will launch a nationwide ad-free home search that aims to provide a mobile-first solution in which consumers have access to real-time listing data directly from real estate professionals.
The BPP, a project first started in 2005, has taken a major step forward in its nationwide launch by entering into an agreement with Homesnap, the creator of real estate apps for consumers and agents, industry officials say. The program will be marketed under the Homesnap brand.
“In essence, the Broker Public Portal operates very much like a local MLS consumer-facing website, but is a nationwide collaboration,” the WAV Group explains. “We have learned from our years of research about MLS consumer websites that consumers really like these sites because they are unbiased, simple, and allow them to connect directly to the brokerage and listing agent that is most familiar with the property. The consumers that use these sites are not looky-loos. They are the more serious buyer that is further down the sales funnel and serious about buying or selling a home.”
With the BPP’s search, consumers will be able to collaborate with their agent or connect instantly to the listing agent. The BPP launch also will include an iPhone app, Android app, and mobile and desktop website.
Specifically for real estate professionals, the BPP launch will include Homesnap Pro so that agents can access real-time listing information as well as collaborate with their clients and other agents. Homesnap Pro already boasts more than 300,000 users compared to 100,000 Zillow and Trulia Premier Agents.
“We selected Homesnap because it is a young, innovative company with a track record of creating highly engaging real estate apps and websites that align with our mission to deliver a straightforward consumer experience with a direct connection to real estate professionals,” says Merle Whitehead, chairman of the BPP and CEO of Realty USA, a real estate brokerage operating in New York and Pennsylvania. “The Homesnap team is extremely bright, has proven that it can earn the respect of the MLSs that provision and safeguard real estate listings data, and absolutely has what it takes to build an outstanding product.”
The BPP is backed by 115 MLSs and real estate companies, including franchises, independent brands, large and small brokers, and represents more than 50,000 real estate professionals. The BPP will be funded by local MLSs.
Prior to the announcement, only BPP MLS Board members could sign up for the BPP. Four MLSs have announced their intent to participate in the BPP at launch: Midwest Real Estate Data (MRED), an MLS with nearly 40,000 real estate professionals in greater Chicago; Connecticut MLS (CTMLS), with 10,700 agents and brokers across Connecticut; Northstar MLS, with 16,300 agents and brokers in Minnesota and Western Wisconsin; and Buffalo Niagara Association of REALTORS® (BNAR), with more than 3,000 agents and brokers in Western New York. More MLSs are expected to sign on following the Homesnap partnership, officials say.
“For 20 years, how people find properties online has been imagined and defined by those who sell ads, not homes,” says John Mosey, BPP vice-chair and CEO of Northstar MLS. “This is our turn to speak, to imagine and to deliver a better experience for consumers and the agents that help them in their real estate decisions. Most importantly, the BPP is organized to be for the industry, by the industry and owned exclusively by the brokers and MLSs that supply quality listing content to power the industry.”
Source: Broker Public Portal and “Broker Public Portal Reveals Partnership and Plan,” WAV Group (May 18, 2016)

Average Time to Close: 44 Days

For the second consecutive month, the average time to close all loans stayed at 44 days, suggesting that new mortgage rules that took effect this fall are having less of an impact on delaying loans, according to Ellie Mae’s latest Origination Insight Report.
Here’s a breakdown of averages from the report:
  • The average time to close a purchase remained at 45 days in April.
  • The average time to refinance rose to 44 days in April (up from 41 days in March).
  • The average time to close FHA loans rose to 45 days (up from 44 days in March).
  • The average time to close VA loans stayed steady at 48 days.
The closing rates for all loans dropped to 69 percent in April, retreating from the high of 71 percent in March, according to Ellie Mae’s report. More specifically, purchase closing rates dropped to 73 percent in April, down from 75 percent in March.
Credit scores remain high among applicants. Sixty-eight percent of purchases and 69 percent of refinances had FICO credit scores of 700 or above. Thirty-one percent of purchases had a FICO score between 600 to 699.
Additional highlights from the report:
  • The average 30-year rate for all loans dropped from 4.12 in March to 4.10 in April.
  • Debt-to-Income remained steady at 25/38 and Loan-to-Value stayed at 80.
Source: Ellie Mae

The Fastest-Growing Cities

More people are moving to Texas. In fact, the Lone Star State boasts five of the 11 fastest-growing cities over the past year, according to the Census Bureau’s annual analysis of population trends in America’s cities.
Georgetown, Texas, part of Austin’s metro area, is the nation’s fastest-growing city. Its population has surged 7.8 percent in the past year alone. Austin also is seeing booming growth in Pflugerville, which is the nation’s 11th fastest-growing city.
According to the U.S. Census, the following are the fastest-growing cities and towns between July 2014 and July 2015:
  1. Georgetown, Texas: 7.8% growth
  2. New Braunfels, Texas: 6.6%
  3. Ankeny, Iowa: 6.5%
  4. Frisco, Texas: 6.3%
  5. South Jordan, Utah: 6%
  6. Dublin, Calif.: 5.5%
  7. Pearland, Texas: 5.3%
  8. Milpitas, Calif.: 5.3%
  9. Broomfield, Colo.: 5.2%
  10. Mount Pleasant, S.C.: 4.7%
  11. Pflugerville, Texas: 4.5%
  12. Fort Myers, Fla.: 4.4%
  13. Murfreesboro, Tenn.: 4.4%
  14. Goodyear, Ariz.: 4.3%
  15. Buckeye, Ariz.: 4.3%
The latest Census statistics show the following are the nation’s largest cities:
  1. New York: 8,550,405
  2. Los Angeles.: 3,971,883
  3. Chicago: 2,720,546
  4. Houston: 2,296,224
  5. Philadelphia: 1,567,442
Source: “Census Spots America’s Fastest Growing Cities…” BUILDER (May 19, 2016)

Wednesday, May 25, 2016

Millennials Choose Parents’ Homes Over Romance

Mom and dad must make cool roommates. Young adults between the ages of 18 to 34 are more likely to live with a parent than to get married or move in with a romantic partner, according to a newly released analysis of Census data by the Pew Research Center. 
This is the first time in more than 130 years in which young adults have chosen their parents’ homes over forming their own households, the study notes. In 2014, 32.1 percent of young adults were living with a parent. On the other hand, slightly fewer—31.6 percent—were living in a household formed upon a “romantic relationship,” either with a spouse or a partner, according to Pew’s analysis.
What do you think? The National Association of Home Builders recently issued a report, “Missing Young Adult Households,” which attributes the lack of demand for single-family homes to millennials opting to live with their parents longer.
The trend for young adults to live with their parents longer grew more pronounced after the Great Recession in 2008. Fewer job opportunities forced some young adults to move back home. Also, young professionals are delaying marriages longer (with one in four young adults who may never marry), and the trend of young adults living together has “substantially fallen since 1990,” according to researchers.
Young men are living at the family home at the greatest numbers. About 35 percent of young adult men were living with a parent compared to 29 percent of women. About 14 percent of 18 to 34 year olds live alone, the study shows.
Source: “Living with Parents Is Most Common Arrangement for Young Adults,” Chicago Tribune (May 25, 2016)

The Buyers Are Coming

Mortgage rates may have inched up slightly but that didn’t seem to deter home buyers from shopping for a loan last week. Mortgage application volume rose 2.3 percent week-over-week on a seasonally adjusted basis, driven by an uptick in home purchase applications, the Mortgage Bankers Association reports. Mortgage applications are nearly 24 percent higher than they were a year ago.
After a short dip, mortgage applications for home purchases reversed course last week and rose 5 percent. Purchase applications are 17 percent higher than a year ago.
"Purchase applications got back on track last week, resuming the level of activity observed throughout most of April and May," says Lynn Fisher, MBA vice president of research and economics. MBA also reported that the average loan size for purchase applications rose to a survey high last week, reaching $307,700.
Meanwhile, applications for refinancings mostly held flat last week, budging just 0.4 percent during the week. MBA reports the average on a 30-year fixed-rate mortgage rose to 3.85 percent last week, up from 3.82 percent the prior week.

U-Haul Names Top Destination Cities

For the seventh consecutive year, Houston nabbed the number one spot as top destination city among movers, according to a newly released annual list by the moving company U-Haul.
U-Haul Destination Cities report highlights the top drop-off locations for one-way U-Haul truck rentals. The migration trends report was compiled from more than 1.7 million one-way U-Haul truck transaction during 2015.
The upcoming Memorial Day weekend kicks off moving season, with about 45 percent of all moves occurring from now through Labor Day, according to U-Haul’s survey.
The following cities topped U-Haul’s destination list:
  1. Houston
  2. Chicago
  3. Orlando
  4. Austin, Texas
  5. San Antonio, Texas
  6. Las Vegas
  7. Brooklyn, N.Y.
  8. Philadelphia
  9. Kansas City, Mo.
  10. Phoenix
Source: U-Haul

New-Home Sales Surge to Post-Recession High

Sales of new single-family homes climbed 16.6 percent in April, reaching the highest sales pace since January 2008, the Commerce Department reported this week. Newly built, single-family homes rose to a seasonally adjusted annual rate of 619,000 units in April.
Find out what could hamper new-home sales in the future, according to NAHB.
"Builders remain optimistic about the housing market, and this month's jump in new home sales is a positive sign that growing demand will keep the housing sector on an upward trajectory through the spring buying season," says Ed Brady, chairman of the National Association of Home Builders.
The median sales price of new homes sold in April was $321,100. New-home sales saw the biggest jump last month in the Northeast, where sales of new homes surged 52.8 percent month-over-month. New-home sales jumped 18.8 percent in the West and by 15.8 percent in the South. The Midwest was the only major region to post a decrease in new-home sales in April, with sales falling 4.8 percent compared to the month prior.
Housing analysts expect new home sales to continue to climb in 2016. "Rising home sales combined with tight inventory will translate into increased housing production as we move onward in 2016, especially as job creation continues and mortgage rates remain low," says NAHB Chief Economist Robert Dietz.

Tuesday, May 24, 2016

NAR Pushes Back Against Patent Troll

NAR took a forceful step against patent trolls last week by filing a petition with the U.S. Patent Office challenging the validity of patent claims by a company that’s been threatening infringement lawsuits against several real estate companies.
For more information on patent litigation reform, visit realtor.org. 
For several years one company, Data Distribution Technologies, has been sending letters to real estate companies demanding payment to use old and widely available technology that the company claims infringes its patent.
Data Distribution Technologies is considered a non-practicing entity, or patent troll, because its business model is based exclusively on buying overbroad patents and sending demand or “license” letters to users of products whose technology supposedly falls under the unreasonably broad scope of the patents.  The letters demand payment of a licensing fee or face an expensive, resource-consuming patent-infringement lawsuit.
By picking off targets one by one, and settling for an amount just under the cost of litigation, trolls hope to avoid any serious scrutiny of the validity of their dubious patents. This strategy exploits the fact that no single accused target has sufficient economic incentive to fight the patent, even though the resultant damage to the industry overall vastly exceeds the cost of challenging the patent. 
“With this action we’re telling the company and other patent trolls that our industry won’t tolerate these kinds of tactics against innocent real estate professionals who use well-known, ordinary technologies and business methods,” says NAR Associate General Counsel Ralph Holmen. “NAR and its members will continue to respect legitimate claims of intellectual property, but we intend to help protect members from being forced into cost-of-litigation settlements based on overbroad, invalid patents.”
NAR has filed what’s known as an Inter Partes Review (IPR) petition with the United States Patent and Trademark Office. Under this filing, NAR asks the PTO to review the validity of the specific patent of Data Distribution Technologies, LLC, of Suffern, N.Y.
DDT claims its patent covers essentially any technology that provides emails about price changes or any other updates to listings or if new listings are available to customers who’ve provided contact information to real estate brokerages.
Before the patent application was filed, this technology was widely available and the company’s claim to patent it is open to challenge based on a number of factors, Holmen said. Among others, it appears to be a simple and obvious extension of pre-existing technology. 
By intervening with a challenge to the company’s patent now, Holmen said, NAR seeks to deter the company from proceeding with other lawsuits against real estate companies while the IPR is pending. While the IPR is pending, most courts will stay any related litigation under the same patent. And, should NAR prevail, it will make it difficult for the company to proceed against other real estate companies with similar overbroad patent claims.
“We’re sending a message to this company, and more broadly to any company that relies on overbroad, invalid patents coupled with illegitimate ‘troll’ patent litigation tactics to make money, that the real estate industry is prepared to fight back,” he said.
The Patent Office’s Patent Trial and Appeal Board is expected to respond to the Petition in about four months. When it does, it will indicate whether NAR has provided enough “prior art” evidence and expert testimony to warrant instituting an IPR trial. If an IPR trial is instituted, the Patent Office’s Patent Trial and Appeal Board will make a final decision on the patent’s validity within one year.
NAR has also been working the patent troll issue for several years on the legislative front. The association supports legislation in Congress that would make it harder for patent trolls to sue companies for patent infringement and also make it easier for companies to defend themselves. One bill, “The Innovation Act,” H.R. 9, has passed the House Judiciary Committee and must next pass the full chamber. Similar legislation is in the Senate as well.
—Robert Freedman, REALTOR® Magazine

Your Need to Know Guide to Buying a New Home

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