February 22, 2016 rummy

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey. Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number. The results of their latest survey: Home values will appreciate by 3.7% over the course of 2016, 3.3% in 2017 and 3.2% in the next two years, and finally 3.1% in 2020 (as…

February 18, 2016 rummy

During the recession, many young adults graduating from college were forced to move back in with their parents. This caused new household formations to drop dramatically from the long term average of 1.2 million formations annually to half that number. However, this may be the year this turns back around. According to the Urban Land Institute’s report, Emerging Trends in Real Estate, household formations will increase dramatically. They project that 3.68 million additional households will be formed in the next three years. This brings household formations back to pre-recession numbers of 1.2 million a year. What will happen in 2016? One of…

February 17, 2016 rummy

  Every three years the Federal Reserve conducts a Survey of Consumer Finances in which they collect data across all economic and social groups. The latest survey, which includes data from 2010-2013, reports that a homeowner’s net worth is 36 times greater than that of a renter ($194,500 vs. $5,400). In a Forbes article the National Association of Realtors’ (NAR) Chief Economist Lawrence Yun predicts that in 2016 the net worth gap will widen even further to 45 times greater. The graph below demonstrates the results of the last two Federal Reserve studies and Yun’s prediction:   Put Your Housing Cost to Work For You Simply put, home ownership is a form of ‘forced savings’. Every time you…

February 10, 2016 rummy

You’ve decided to sell your house. You begin to interview potential real estate agents to help you through the process. You need someone you trust enough to: 1.    Set the market value on possibly the largest asset your family owns (your home) 2.    Set the time schedule for the successful liquidation of that asset 3.    Set the fee for the services required to liquidate that asset An agent must be concerned first and foremost about you and your family in order to garner that degree of trust. Make sure this is the case. Be careful if the agent you are…

February 5, 2016 rummy

Recently, on CNBC’s Closing Bell, Shark Tank investor Kevin O’Leary, also known as “Mr. Wonderful,” said Millennials “don’t give a poo-poo about owning a house.” This thinking couldn’t be further from the truth. Let’s give a few examples to make this point. 1.) In the recent National Housing Market Survey conducted by Fannie Mae, it was revealed that: “…data indicates that millennial renters today have as much desire to own a home as the general population of renters. According to NHS data, the substantial majority of renters age 25-34 say that owning makes more sense than renting from a financial perspective. A majority also agree that…

February 3, 2016 rummy

First American Title issues a quarterly report, the Real Estate Sentiment Index (RESI), which “measures title agent sentiment on a variety of key market metrics and industry issues”. Their 2015 4th Quarter Edition revealed some interesting information regarding possible challenges with appraisal values as we head into 2016. “The fourth quarter RESI found that title agents continue to believe that property valuation issues will be the most likely cause of title order cancellation over the coming year.”  This shouldn’t come as a surprise. In a housing market where supply is very low and demand is very high, home values increase rapidly. One major challenge in…

January 22, 2016 rummy

Fannie Mae recently released their “What do consumers know about the Mortgage Qualification Criteria?” Study. The study revealed that Americans are misinformed about what is required to qualify for a mortgage when purchasing a home. Here are three takeaways: § 59% of Americans either don’t know (54%) or are misinformed (5%) about what FICO score is necessary § 86% of Americans either don’t know (59%) or are misinformed (25%) about what an appropriate Back End Debt-to-Income (DTI) ratios is § 76% of Americans either don’t know (40%) or are misinformed (36%) about the minimum down payment required To help correct these misunderstandings, let’s…

January 19, 2016 rummy

Whether you are buying or selling a home, it can be quite an adventurous journey. You need an experienced Real Estate Professional to lead you to your ultimate goal. In this world of instant gratification and internet searches, many sellers think that they can For Sale by Owner or FSBO. The 5 Reasons You NEED a Real Estate Professional in your corner haven’t changed, but have rather been strengthened due to the projections of higher mortgage interest rates & home prices as the market continues to recover. 1. What do you do with all this paperwork? Each state has different regulations regarding the…

January 13, 2016 rummy

People often ask whether or not now is a good time to buy a home. No one ever asks when a good time to rent is. However, we want to make certain that everyone understands that today is NOT a good time to rent. The Census Bureau recently released their third quarter median rent numbers. Here is a graph showing rent increases from 1988 until today: A recent Wall Street Journal article reports that rents rose “faster last year than at any time since 2007, a boon for landlords but one that has stoked concerns about housing affordability for renters.”  The article also cited results from a…

January 4, 2016 rummy

In a recent post, Trulia examined whether homeownership was again being seen by adults in the US as a “part of their personal American Dream.” Over the last five years: § The percentage of U.S. adults who believe homeownership is part of their American Dream increased from 70% to 75% § The percentage of 18-34 Year-olds who believe homeownership is part of their American Dream increased from 65% to 80% Here is a graph of the survey over the last five years: Bottom Line As the housing industry recovers from the crisis of 2008-2010, Americans belief in homeownership as part of their own personal American…