Case-Shiller: Home Prices Step Up

Standard

Case-Shiller: Home Prices Step Up

By RISMedia Staff

Home prices stepped up 6.2 percent in January, according to the S&P CoreLogic/Case-Shiller Indices.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index’s 10-City Composite, which is an average of 10 metros (Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington, D.C.), rose 6 percent year-over-year, unchanged from December.

The 20-City Composite—which is an average of the 10 metros in the 10-City Composite, plus Atlanta, Charlotte, Cleveland, Dallas, Detroit, Minneapolis, Phoenix, Portland, Seattle and Tampa—rose 6.4 percent year-over-year, an increase from 6.3 percent in November. Month-over-month, both the 10-City Composite and the 20-City Composite rose, each 0.3 percent.

“The home price surge continues,” says David M. Blitzer, chairman of the Index Committee and managing director at S&P Dow Jones Indices. “Since the market bottom in December 2012, the S&P Corelogic Case-Shiller National Home Price index has climbed at a 4.7 percent real—inflation adjusted—annual rate. That is twice the rate of economic growth as measured by the GDP.

“While price gains vary from city to city, there are few, if any, really weak spots,” Blitzer says. “Seattle, up 12.9 percent in the last year, continues to see the largest gains, followed by Las Vegas up 11.1 percent over the same period. Even Chicago and Washington, the cities with the smallest price gains, saw a 2.4 percent annual increase in home prices. Two factors supporting price increases are the low inventory of homes for sale and the low vacancy rate among owner-occupied housing. The current months-supply—how many months at the current sales rate would be needed to absorb homes currently for sale—is 3.4; the average since 2000 is 6.0 months, and the high in July 2010 was 11.9. Currently, the homeowner vacancy rate is 1.6 percent compared to an average of 2.1 percent since 2000; it peaked in 2010 at 2.7 percent.

“Despite limited supplies, rising prices, and higher mortgage rates, affordability is not a concern,” says Blitzer. “Affordability measures published by the National Association of REALTORS® show that a family with a median income could comfortably afford a mortgage for a median-priced home.”

The complete data for the 20 markets measured by S&P Dow Jones:

Atlanta, Ga.
Month-Over-Month (MoM): 0.7%
Year-Over-Year (YoY): 6.5%

Boston, Mass.
MoM: 0.2%
YoY: 5.3%

Charlotte, N.C.
MoM: 0.4%
YoY: 6%

Chicago, Ill.
MoM: 0%
YoY: 2.4%

Cleveland, Ohio
MoM: 0%
YoY: 3.5%

Dallas, Texas
MoM: 0.2%
YoY: 6.9%

Denver, Colo.
MoM: 0.7%
YoY: 7.6%

Detroit, Mich.
MoM: 0.1%
YoY: 7.6%

Las Vegas, Nev.
MoM: 0.6%
YoY: 11.1%

Los Angeles, Calif.
MoM: 0.6%
YoY: 7.6%

Miami, Fla.
MoM: 0.6%
YoY: 4%

Minneapolis, Minn.
MoM: 0.1%
YoY: 5.9%

New York, N.Y.
MoM: 0%
YoY: 5.2%

Phoenix, Ariz.
MoM: 0.3%
YoY: 5.9%

Portland, Ore.
MoM: 0.4%
YoY: 7.1%

San Diego, Calif.
MoM: 0.8%
YoY: 7.4%

San Francisco, Calif.
MoM: 0.4%
YoY: 10.2%

Seattle, Wash.
MoM: 0.7%
YoY: 12.9%

Tampa, Fla.
MoM: 0.4%
YoY: 6.7%

Washington, D.C.
MoM: -0.4%
YoY: 2.4%

Silverthorne announces date for parade celebrating Olympic success of Red Gerard and others

Standard

Redmond Gerard, of the United States, jumps during the men’s Big Air snowboard qualification competition at the 2018 Winter Olympics in Pyeongchang, South Korea on Feb. 21, 2018. (AP Photo/Dmitri Lovetsky)

 

 

Silverthorne will celebrate its three local Olympians, as well as a pair of Paralympians, at 11 a.m. April 28, the last Saturday of the month.

Many people in town all but demanded a celebration of some kind when Silverthorne snowboarder Red Gerard became the first American to win gold at the 2018 Winter Games. He did so after stomping multiple landings during the men’s slopestyle competition.

About two weeks later, Kyle Mack, another snowboarder from Silverthorne, won silver in the big air contest. A third local rider, Chris Corning, also qualified for the final round but did not medal in the contest.

In addition to Silverthorne’s three Olympians, U.S. Paralympians Amy Purdy and Jimmy Sides, both of Silverthorne, will be honored during the celebration, according to town staff.

Purdy became a two-time Paralympic medalist Monday after she finished second in the snowboard cross – lower limb 1 impaired race.

Source

99% of Experts Agree: Home Prices Will Increase

Standard

Some believe that the combined effects of the new tax code and rising mortgage rates will have an adverse impact on residential real estate prices in 2018. However, the clear majority of recently surveyed housing experts believe that home values will continue to rise this year.

What is the Home Price Expectation Survey?

Each quarter, Pulsenomics surveys a nationwide panel of economists, real estate experts and investment & market strategists. Those surveyed include experts such as:

  • Daniel Bachman, Senior Manager, U.S. Economics at Deloitte Services, LP
  • Kathy Bostjancic, Head of U.S. Macro Investors Service at Oxford Economics
  • David Downs, Real Estate Finance Professor at VCU
  • Edward Pinto, Resident Fellow at American Enterprise Institute
  • Albert Saiz, Director at MIT Center for Real Estate

Where do these experts see home values headed in 2018?

Here is a breakdown of where they see home values twelve months from now:

  • 21.6% believe prices will appreciate by 6% or more
  • 71.6% believe prices will appreciate between 3 and 5.99%
  • 5.7% believe prices will appreciate between 0 and 2.99%
  • Only 1.1% believe prices will depreciate

Bottom Line

Almost ninety-nine percent of the top experts studying residential real estate believe that prices will appreciate this year, and over 93% believe home values will appreciate by at least 3%.

Source

5 Reasons Why to Sell This Spring!

Standard

Here are five reasons listing your home for sale this spring makes sense.

1. Demand Is Strong

The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase…and are in the market right now! More often than not, multiple buyers are competing with each other to buy a home.

Take advantage of the buyer activity currently in the market.

2. There Is Less Competition Now

Housing inventory has declined year over year for the last 32 months and is still under the 6-month supply needed for a normal housing market. This means that, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in the market. This is good news for homeowners who have gained equity as their home values have increased. However, additional inventory could be coming to the market soon.

Historically, the average number of years a homeowner stayed in their home was six but has hovered between nine and ten years since 2011. There is a pent-up desire for many homeowners to move as they were unable to sell over the last few years because of a negative equity situation. As home values continue to appreciate, more and more homeowners will be given the freedom to move.

The choices buyers have will continue to increase. Don’t wait until this other inventory comes to market before you decide to sell.

3. The Process Will Be Quicker

Today’s competitive environment has forced buyers to do all they can to stand out from the crowd, including getting pre-approved for their mortgage financing. This makes the entire selling process much faster and much simpler as buyers know exactly what they can afford before home shopping. According to Ellie Mae’s latest Origination Insights Report, the average time it took to close a loan was 45 days.

4. There Will Never Be a Better Time to Move Up

If your next move will be into a premium or luxury home, now is the time to move up! The inventory of homes for sale at these higher price ranges has forced these markets into a buyer’s market. This means that if you are planning on selling a starter or trade-up home, your home will sell quickly, AND you’ll be able to find a premium home to call your own!

Prices are projected to appreciate by 4.8% over the next year according to CoreLogic. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait.

5. It’s Time to Move on With Your Life

Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

Only you know the answers to the questions above. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire.

That is what is truly important.

Source

What Impact Will The New Tax Code Have On Home Values?

Standard

Every month, CoreLogic releases its Home Price Insights Report. In that report, they forecast where they believe residential real estate prices will be in twelve months.

Below is a map, broken down by state, reflecting how home values are forecasted to change by the end of 2018 using data from the most recent report.

What Impact Will the New Tax Code Have on Home Values? | Keeping Current Matters

As we can see, CoreLogic projects an increase in home values in 49 of 50 states, and Washington, DC (there was insufficient data for HI). Nationwide, they see home prices increasing by 4.2%.

How might the new tax code impact these numbers?

Recently, the National Association of Realtors (NAR) conducted their own analysis to determine the impact the new tax code may have on home values. NAR’s analysis:

“…estimated how home prices will change in the upcoming year for each state, considering the impact of the new tax law and the momentum of jobs and housing inventory.”

Here is a map based on NAR’s analysis:

What Impact Will the New Tax Code Have on Home Values? | Keeping Current Matters

 

Bottom Line

According to NAR, the new tax code will have an impact on home values across the country. However, the effect will be much less significant than what some originally thought.

Source

The Impact Of Tight Inventory On The Housing Market

Standard

The housing crisis is finally in the rear-view mirror as the real estate market moves down the road to a complete recovery. Home values are up, home sales are up, and distressed sales (foreclosures and short sales) have fallen to their lowest points in years. It seems that the market will continue to strengthen in 2018.

However, there is one thing that may cause the industry to tap the brakes: a lack of housing inventory. While buyer demand looks like it will remain strong throughout the winter, supply is not keeping up.

Here are the thoughts of a few industry experts on the subject:

National Association of Realtors

“Total housing inventory at the end of November dropped 7.2 percent to 1.67 million existing homes available for sale, and is now 9.7 percent lower than a year ago (1.85 million) and has fallen year-over-year for 30 consecutive months. Unsold inventory is at a 3.4-month supply at the current sales pace, which is down from 4.0 months a year ago.”

Joseph Kirchner, Senior Economist for Realtor.com

“The increases in single-family permits and starts show that builders are planning and starting new construction projects, that’s a good thing because it will help to relieve the shortage of homes on the market.”

Sam Khater, Deputy Chief Economist at CoreLogic

Inventory is tighter than it appears. It’s much lower for entry-level buyers.”

Bottom Line 

If you are thinking of selling, now may be the time. Demand for your house will be strong at a time when there is very little competition. That could lead to a quick sale for a really good price.

Source

Tax code overhaul

Standard

Changes the Republican Party is looking to make to the tax code could shift the calculus for people considering buying a second home.

As part of their tax code overhaul, Republican lawmakers have taken aim at the mortgage interest deduction. While the deduction will be retained, they plan to modify it substantially — and some of the proposed changes would squarely hit people who own second or vacation homes.

Under the proposed legislation, people with a second home will no longer be able to deduct the interest paid on a mortgage for that property. Currently, people are allowed to deduct mortgage interest paid on two properties up to $1 million in debt.

Additionally, the new provision would no longer allow taxpayers to deduct interest paid on home equity loans. Taxpayers currently can deduct interest on up to $100,000 in home equity indebtedness. This change appeared likely to limit a popular strategy among vacation-home buyers — taking out a home equity loan on their primary residence to fund a down payment on a vacation property or pay for it outright.

As with other changes made to the tax code, it appears that the new provisions will only apply to people who finance the purchase of a second home in the future. And people who own a second home should be able to continue deducting what they pay in property taxes for their additional home. Still, these changes will alter how financially feasible owning a vacation home might be.

This change doesn’t just impact wealthy people

While vacation homes might be more commonly associated with people who live lavish lifestyles, these changes will hit middle-class homeowners too. “It’s not as sympathetic a cause as impacting your traditional owner-occupant, but it is a very real aspect of what’s going on,” said Rick Sharga, executive vice president of online real-estate marketplace Ten-X.

The median income of vacation-property buyers in 2016 was $89,900, according to data from the National Association of Realtors, which was significantly higher than the median among people who were buying homes they would primarily live in ($75,000).

Still, the vast majority of vacation property buyers don’t necessarily live the lifestyles of the rich and famous: Only 34% of vacation-home buyers have a household income of more than $100,000 annually, while 10% earned less than $45,000 a year.

Consequently, critics of the changes made to the mortgage interest deduction argued that the new provision was still more likely to affect middle-class folks even in the vacation-home market. “They’re the ones who really needed that deduction,” said Brian Koss, executive vice president at Mortgage Network, a lender headquartered in Danvers, Mass.
Not all vacation communities will be affected equally

Real-estate experts have argued that the changes Republicans have proposed could depress home prices in some housing markets if they became law —at least in the short-term. And that theory applies to vacation communities, too.

But don’t expect to see the poshest getaways being the hardest hit by this change, Koss said. “Your really high-end vacation areas aren’t going to feel the pinch,” Koss said. “It’s not going to be Aspen and Nantucket, it’s going to be the Jersey Shore.”

Consequently, the new tax plan could depress sales in some of these markets at a time when sales have already suffered because of rising home prices. Vacation-home sales have already taken a hit in recent years: The share of vacation-home buyers dropped for the third straight year in 2016 to 12% from 16% the year before, according to data from the National Association of Realtors.

The market-related effects the tax plan could have won’t just affect vacation-home buyers though — it could also extend to those who live year-round in these communities.

People looking to offset these tax-code changes need to be careful

Though mortgage financing is less common among vacation property buyers, it’s still important to this market. Nearly a third of vacation-home buyers (28%) didn’t use a mortgage, versus just 13% of those who were purchasing a primary residence.

Experts predicted that some people considering buying a second home might consider alternative means of offsetting the costs of a mortgage. “This change doesn’t necessarily apply to homeowners who have a second home that they rent out the majority of the time,” said Danielle Hale, chief economist at Realtor.com. “It might cause more people to shift to rent those types of properties.” (Realtor.com is operated by News Corp subsidiary Move Inc., and MarketWatch is a unit of Dow Jones, which is also a subsidiary of News Corp.)

Homeowners considering listing their vacation property on a site like Airbnb could quickly find themselves in a taxation quagmire if they’re not careful. People who own a second home can rent it out for up to 14 days each year without needing to pay taxes on the rental income, according to HouseLogic. After that point, what they earn from renting would be taxable.

Some owners might see greater deductions if they classify their home as a business property — particularly because they could write-off expenses related to renting it out including utilities, repairs and insurance.

There’s a trade-off to this strategy though: Homeowners need to be careful that they don’t stay at the home too often. These individuals need to restrict personal use of their property to fewer than 15 days or 10% of the total number of days they rent it out, whichever is more, according to HouseLogic. If they stay longer than that, the Internal Revenue Service will consider it a personal property, meaning they’d be on the hook for taxes on their rental income and be limited to state and local property taxes as their only deduction.

Before You Make an Offer, Here Are 4 Tips for Success!

Standard

So, you’ve been searching for that perfect house to call a ‘home,’ and you finally found it! The price is right, and in such a competitive market, you want to make sure that you make a good offer so that you can guarantee that your dream of making this house yours comes true!

Freddie Mac covered “4 Tips for Making an Offer” in their Executive Perspective. Here are the 4 tips they covered along with some additional information for your consideration:

1. Understand How Much You Can Afford

“While it’s not nearly as fun as house hunting, fully understanding your finances is critical in making an offer.”

This ‘tip’ or ‘step’ should really take place before you start your home search process.

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and will allow you to make your offer with the confidence of knowing that you have already been approved for a mortgage for that amount. You will also need to know if you are prepared to make any repairs that may need to be made to the house (ex: new roof, new furnace).

2. Act Fast

“Even though there are fewer investors, the inventory of homes for sale is also low and competition for housing continues to heat up in many parts of the country.” 

The inventory of homes listed for sale has remained well below the 6-month supply that is needed for a ‘normal’ market. Buyer demand has continued to outpace the supply of homes for sale, causing buyers to compete with each other for their dream homes.

Make sure that as soon as you decide that you want to make an offer, you work with your agent to present it as soon as possible.

3. Make a Solid Offer

Freddie Mac offers this advice to help make your offer the strongest it can be:

“Your strongest offer will be comparable with other sales and listings in the neighborhood. A licensed real estate agent active in the neighborhoods you are considering will be instrumental in helping you put in a solid offer based on their experience and other key considerations such as recent sales of similar homes, the condition of the house and what you can afford.”

Talk with your agent to find out if there are any ways that you can make your offer stand out in this competitive market!

4. Be Prepared to Negotiate

“It’s likely that you’ll get at least one counteroffer from the sellers so be prepared. The two things most likely to be negotiated are the selling price and closing date. Given that, you’ll be glad you did your homework first to understand how much you can afford.

Your agent will also be key in the negotiation process, giving you guidance on the counteroffer and making sure that the agreed-to contract terms are met.”

If your offer is approved, Freddie Mac urges you to “always get an independent home inspection, so you know the true condition of the home.” If the inspector uncovers undisclosed problems or issues, you can discuss any repairs that may need to be made with the seller, or cancel the contract.

Bottom Line 

Whether you’re buying your first home or your fifth, having a local professional on your side who is an expert in their market is your best bet in making sure the process goes smoothly. Happy House Hunting!

Source