Wednesday, December 30, 2015
More Homes Come With 'Pet Suites'
More spaces are being carved out for pets today, and the trend is even inspiring new home designs.
More than half of U.S. households now own a pet, according to a survey of more than 20,000 home shoppers by John Burns Real Estate Consulting. Forty-five percent of those surveyed say they treat their pets like royalty, while 44 percent say they'd like to have a dog park within walking distance of their home.
For the Dogs
"Pet suites" are a new feature more homebuilders are starting to offer in new homes. The suites are outfitted with dog wash areas, a bed, storage, and some even have a camera so that owners can check in on their pet when they're away from home. The pet suites range in prices from $1,500 to $16,000 and come either as an upgrade or added square footage within a floor plan. Pet suites are most likely to be located in an enlarged laundry room.
Standard Pacific Homes in Sacramento, Calif., has a model that includes a pet suite within the laundry area but sectioned off by a high table. It includes a pet shower and cabinetry. Some builders are tucking the pet spaces under the stairs or other small nooks within a home.
Source: “Increased Pet Ownership Inspires New Design Trends,” John Burns Real Estate Consulting (December 2015)
Single Women Flirting With Real Estate Again
After taking a hit during the housing crisis, some analysts are expecting single women — who once made up a large piece of the housing pie — to make a strong comeback in the market in 2016.
U.S. Census data shows that single women are seeing rising incomes, which is critical because they typically stretch their budgets in order to purchase a home, Jessica Lautz, managing director of survey research for the National Association of REALTORS®, told Bloomberg. Many of these buyers are single mothers or widows.
What Women Want
"They are making sacrifices financially because they have a really strong desire to be a part of a community," Lautz says.
The environment has changed for single women since 2009, when lenders tightened their underwriting and made it tougher for many single buyers to qualify for a mortgage. The percentage of single female home buyers dropped from 21 percent of all purchasers in 2009 to 15 percent in 2015.
Single women often look for properties in the same price range as investors looking for rental properties, Lautz says. Investors receded somewhat in 2015, which could open the door to more single women to find affordable properties in the new year, she adds.
The following 10 cities saw the biggest increase of women earning more than $100,000 between 2012 and 2014:
- Boston
- San Francisco
- Seattle
- San Diego
- Charlotte, N.C.
- Baltimore
- Fresno, Calif.
- Columbus, Ohio
- Louisville, Ky.
- Los Angeles
Source: “Return of the Single Female Homebuyer,” Bloomberg (Dec. 28, 2015)
Rate Hikes May Hurt Foreign Buyers Most
The Federal Reserve's decision to gradually raise its short-term interest rates is expected to send mortgage rates higher in the new year and will likely have the biggest impact on foreign buyers from Western Europe and Canada, says Lawrence Yun, chief economist for the National Association of REALTORS®.
Read more: What the Fed's Decision Means for Housing
"The reason is [it] will make the U.S. dollar stronger," Yun writes in a column for Forbes.com. "That, in turn, will make it more costly to buy in America for foreigners. One major exception to this trend is likely to be Chinese buyers."
Higher interest rates lure foreign savings into the U.S., which strengthens the dollar, Yun adds.
For example, Canadian currency has gone down 33 percent in value against the U.S. dollar over the past three years. American properties have risen by 24.7 percent in the same period, which means Canadians need to factor in 33 percent more for the cost of a home after currency conversion. That brings the total cost change to 57.7 percent to purchase a home in the U.S., Yun notes.
Similarly, the cost of a U.S. home purchase has more than doubled for Russian or Brazilian buyers after currency conversion.
At Forbes.com, you'll find a chart that shows the change in currency for some of the biggest foreign buyers of U.S. real estate.
Source: “Fed Rate Hikes Will Dampen Sales of U.S. Homes to International Buyers,” Forbes.com (Dec. 21, 2015)
20 Markets Ending 2015 on a High Note
Residential real estate overall may have cooled as 2015 comes to a close, but the slowdown wasn't evident everywhere.
Realtor.com®'s research team identified the top 20 medium-to-large markets where homes are selling the fastest and demand remains high (based on the site's listing views). Topping the list for the second consecutive month is San Francisco, followed by San Jose.
Other 'Hot' Markets
"While California closed out our latest ranking still firmly in control of the hottest markets, the Midwest and Florida are both seeing substantial improvement," says Jonathan Smoke, realtor.com®'s chief economist. "Pent-up demand and robust economic growth combined with limited supply will keep California tight in 2016, but more markets will challenge them as demand improves elsewhere."
A few markets that are newcomers to realtor.com®'s list this month are Tampa, Fla.; Fort Wayne, Ind.; and Midland, Texas.
The following "hot" markets in December garnered about 1.4 to 2.9 times more views per listing than the national average at realtor.com®. Also, homes in these locales sold 29 to 51 days faster than the rest of the country.
- San Francisco
- San Jose, Calif.
- Vallejo, Calif.
- Dallas
- Sacramento, Calif.
- San Diego
- Denver
- Santa Rosa, Calif.
- Yuba City, Calif.
- Stockton, Calif.
- Los Angeles
- Oxnard, Calif.
- Nashville, Tenn.
- Palm Bay, Fla.
- Modesto, Calif.
- Detroit
- Boulder, Colo.
- Tampa, Fla.
- Fort Wayne, Ind.
- Midland, Texas
Source: “The Hottest U.S. Housing Markets in December 2015,” realtor.com(R) (Dec. 28, 2015)
3 Trends Sellers Should Know in 2016
There are three dominant trends in real estate that sellers should be aware of going into the new year. CNNMoney recently asked industry insiders to share what will be important when it comes to selling a home in 2016. Do you agree?
Prepare for Sellers in the New Year
- A seller's market dominates. Home prices have been climbing so much that they're even matching their 2006 highs. Seller's markets are more dominant in certain cities such as San Francisco, where bidding wars are widely reported and offers go well above asking price. "The more lucrative a region's economic future appears to be, the easier you can expect it to be to sell a home," according to the article.
- Mortgages will get pricier. Low mortgage rates have been the standard in the last few years, but that will soon change. The Federal Reserve is gradually beginning to raise rates, which will move mortgage rates higher and dampen affordability. Sellers should be aware that it may become more difficult for prospective buyers to secure financing.
- Tax benefits still abound. The largest tax break for ordinary taxpayers who qualify remains the exclusion on capital gains for the sale of personal residences. Single taxpayers are able to exclude a maximum of $250,000 in gains from the sale of a home. Joint filers get double that: $500,000.
Source: “Selling a Home in 2016? Here’s What You Need to Know,” CNNMoney/Motley Fool (Dec. 24, 2015)
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