El experto discute hoy los siguientes temas:
Best Home Sales in Five Years Signal Building Gain: Economy
Sales of new U.S. homes rose in June to the highest level in five years, pointing to gains in residential construction that will support the economic expansion in the second half of the year.
Purchases climbed 8.3 percent to an annualized pace of 497,000 homes, the highest level since May 2008, the Commerce Department said today in Washington. The medianestimate of 77 economists surveyed by Bloomberg called for a gain to 484,000.
What’s the biggest mistake a real estate investor can make?
What’s the biggest mistake a real estate investor can make?
Not hiring a realtor.
Yes, they can be a big expense, but a realtor can be an invaluable asset when scoping out properties that you plan on investing a lot of money into.
- Cycles are part of any market of the economy.
- What is next? House scarcity and expensive rentals.
- Uneven recovery: Major Hubs recovered faster than rural areas and suburbs
- Residential has improved. Commercial by segments.
The Real Estate Expert answers the following questions:
1. Why aren’t they accepting my offer if I am sending full price?
2. What do you mean by “Multiple Offers” and “Highest and Best”?
3. Why the properties that I finding in RedFin.com or Realtor.com are gone when I try to schedule appointments?
4. Are they lying about the rentals in Craiglist? Bait and Switch scam
5. Is this a good time to buy? Procastination nation.
Looking to buy, sell or rent? Contact the Real Estate Expert to email@example.com
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Home sales in December dropped by 1% from November, the National Association of Realtors reported on Tuesday, but still stood nearly 13% above the levels of one year ago. That means home sales have risen from the year-ago month for 18 straight months.
For 2012 as a whole, sales were up 9% to 4.65 million units, the highest annual total since 2007.
Prices, meanwhile, are picking up because the number of homes for sale continues to drop despite the sales volume gains. The number of homes for sale fell to 1.82 million at the end of 2012, an 8.5% drop from November and a 21.6% decline from one year earlier, the Realtors’ group said on Tuesday.
Here’s a breakdown of why inventory has continued to drop this year:
Many homeowners are underwater: More than 10 million homeowners owe more on their mortgage than their homes are worth, according to CoreLogic Inc. CLGX -1.83% That pencils out to around 22% of homeowners with a mortgage, or 15% of all homeowners (since not every homeowner has a mortgage). Underwater owners aren’t likely to sell unless they need to move due to changing life (marriage, divorce) or financial circumstances, and they’ll take a hit on their credit for pursuing a short sale, where the bank allows the home to sell for less than the amount owed.Data from CoreLogic show that inventory has been the most constrained in housing markets where there’s the largest concentration of underwater borrowers.
Others don’t have enough equity to “trade up”: Another 10 million homeowners have less than 20% equity in their current residence, meaning they can’t easily “trade up” to their next house. Traditionally, homeowners have relied on home equity to make the down payment on their next home, and to pay their real-estate agent to sell their current home and buy their next one. These “under-equitied” homeowners—meaning they don’t have enough equity to make a move to a more expensive home—have added to the drag on inventory.
Everyone wants to buy at the bottom, but few want to sell: Even those people who do have plenty of home equity are likely reluctant to sell if they think prices will be higher tomorrow. Would you sell your largest asset today if you thought it might be worth 5% more next year? This helps explain why markets such as Denver and Dallas, which didn’t have huge housing bubbles and thus had smaller shares of underwater borrowers, have also seen double-digit inventory declines.
More purchases from investors of all stripes: From the big institutional investors that have been grabbing all the headlines, to the mom-and-pop landlords that have traditionally played a much larger role renting out homes, investors have increasingly bought homes that can be rented out rather than flipped and resold for quick profits. This is further keeping inventory off the market in two ways: homes that are bought at courthouse foreclosure auctions never show up on multiple-listing services when they’re initially sold. They’re also held out of the for-sale pool because they’re being rented out.
Banks have been slower at foreclosing: Banks and other companies that process delinquent mortgages have had trouble proving that they’ve followed state law in taking title to homes ever since the “robo-signing” scandal surfaced in late 2010, and they’ve also had to meet a host of new state and federal rules governing loan modifications and foreclosures from settlements spawned by the robo-scandal. Banks have also become better about approving short sales and loan modifications, which has curbed the flow of foreclosed properties onto the market.
Builders have been putting up fewer homes: Housing starts were severely depressed from 2009 through 2011 and have only recently rebounded off of those low levels. Consequently, there’s been much less new home inventory being added to the market at a time when demand (boosted by increases in household formation) is picking up. If more homes are held off the market—for any of the five reasons above—you can bet that builders will move in to fill the void.
Many of these factors that have been dragging down inventory aren’t signs of “normal” or “healthy” housing markets—but then, we probably haven’t had a normal market for around a decade now. If anything, declining inventory shows that normal supply-and-demand dynamics are returning, which is an important step towards putting a floor under home prices and giving markets time to get back to health.
Source: “Six Reasons Housing Inventory Keeps Declining,” The Wall Street Journal (Jan. 22, 2013)
The Consumer Financial Protection Bureau is planning a Thursday morning announcement of new lending rules that it hopes will move the mortgage market toward a sustainable middle ground, somewhere in between the free-wheeling days of no-documentation loans and the current, restrictive environment.
For most borrowers, the rules will mean no more interest-only mortgages, no more loans where the principal due increases over time, no more loans that carry a balloon payment and no more loan terms of more than 30 years. In addition, would-be borrowers will be less likely to qualify for a mortgage unless their total debts account for no more than 43 percent of their monthly gross income.
These so-called qualified mortgages are expected to be embraced by lenders, because by following the criteria, they will have a better chance of shielding themselves from lawsuits from consumers whose loans go bad.
The provisions of the Ability-to-Repay rule, which follow closely the lines of protections called for in 2010’s Dodd-Frank legislation, will take effect in January 2014. Richard Cordray, the bureau’s director, is expected to detail the regulations at a public hearing Thursday in Baltimore.
A senior official of the consumer protection bureau, the agency charged with implementing the new mortgage requirements, said the lending standards are not much different than the guidelines currently in place. Still, while the rules might ease uncertainty among lenders who have worried about the scope of the regulations, it could cause additional anxiety for consumers trying to qualify for a home loan.
“It will add some certainty to the mortgage industry about what the rules of the road are going forward,” said Guy Cecala, president and CEO of Inside Mortgage Finance, a trade publication. “But it basically says we want everybody to make plain-as-vanilla mortgages.
“The legitimate concern is that this will cement the tight mortgage underwriting standard that we currently have in place, and most people agree, from (Federal Reserve Chairman) Ben Bernanke to the person on the street, that they’re too tight.”
To not upend the housing market’s recovery and assist consumers who can’t meet the 43 percent debt-to-income threshold, the agency said it was establishing a second, temporary category of qualified mortgages that meet most of the new guidelines but also would qualify to be purchased, guaranteed or insured by Fannie Mae, Freddie Mac or various other federal agencies. The temporary provision would end as those agencies issue their own qualified mortgage guidelines or if Fannie and Freddie end their government conservatorship or in seven years.
The bureau wanted to give the mortgage market time to adjust to the new standards and ensure that well-qualified people could still buy homes, the agency official said.
For all types of mortgages, to help determine a borrower’s ability to repay, lenders must look at eight factors. They include current income and assets, employment status, credit history, the mortgage’s monthly payment, other loan payments associated with the property, monthly payments for such things as property taxes, other debt obligations and a borrower’s monthly debt-to-income ratio.
Teaser interest rates no longer will be allowed to be used to judge a borrower’s creditworthiness. For homebuyers who apply for adjustable-rate mortgages, the monthly payments no longer can be computed using just an introductory rate that might be artificially low. Instead, the monthly payment must be computed using whichever is higher, the fully indexed rate or the introductory rate.
In addition to the other rules defining a qualified mortgage, the bureau also mandated that a qualified loan cannot charge to the consumer points and fees that exceed 3 percent of the total loan amount.
The mortgage lending industry has worried for months about the rules and heavily lobbied for protection from lawsuits brought by borrowers.
Under the new rules, lenders who make qualified mortgages to well-qualified borrowers that carry a lesser chance of defaulting could be shielded from lawsuits from these prime borrowers who say the lender did not satisfy the ability-to-repay requirements. Riskier, subprime borrowers could challenge the lender’s assessment of their ability to repay the loan but borrowers would have to prove that a lender didn’t adequately factor in living expenses and other debts.
“They appear to favor lenders’ interests above consumers,” said Diane Thompson, of counsel at the National Consumer Law Center. “You have to prove what’s in the creditor’s records. It may be that no homeowners are able to challenge it. Otherwise, you’re relying on regulatory oversight, and we saw how well that worked.”
The rules, in various forms, have been in the works for years. Other agencies continue to formulate their own rules, and one still in development about what constitutes a qualified residential mortgage might increase a consumer’s mortgage down payment in order to ensure that borrowers have more “skin in the game.”
By Mary Ellen Podmolik, Chicago Tribune reporter
January 10, 2013 Chicago Tribune Company, LLC
Among renters who one day hope to own a home, a poll finds a dramatic increase in the number who now say that they intend to buy in the near future. Offering more evidence of a swing toward homeownership as the housing market continues to recover, the survey by PulteGroup reports that about 6 in 10 of those renters plan on buying a home in the next two years.
That’s a 60 percent increase among those potential homebuyers in the past year, PulteGroup reports. “We’re definitely seeing a renewed sense of optimism,” said PulteGroup spokeswoman Jacque Petroulakis.
The PulteGroup survey’s results fit other findings in 2012 that bode well for home prices and sales in 2013, according to Jed Kolko, chief economist of listing service Trulia.
Kolko attributes the reported rise in renters’ interest in homebuying to an improved economy, which has helped potential buyers save for down payments, as well as to rising home prices, which have bolstered consumer confidence in the housing market. A Trulia survey conducted in 2012 also showed a significant increase in renters who intend to buy, he said.
The top reasons renters polled in the survey cited for wanting to buy in the near future were:
• They like being able to call themselves homeowners (49 percent).
• They view it as a good financial investment (44 percent).
• They need more space for their family/children (36 percent).
The PulteGroup survey also found that, compared to two years ago, twice as many homeowners now expect to have adult children or aging parents living with them.
Thirty-one percent of respondents to the 2012 survey said that they anticipate at least one adult child moving back home in the future, while 32 percent expect to take in an aging parent.
The demographic shift to multigenerational homes is likely to spark construction of more “smart” homes that break from recent tradition, Petroulakis said. “What’s important is that the home is planned smart … that it really maximizes your communal space.”
Extra bathrooms, downstairs bedrooms and large kitchens are examples of features that characterize these homes, she said.
Multigenerational homes share of total households already has swelled over the past decade. They are up by 30 percent between 2000 and 2010, according to the U.S. Census Bureau.
PulteGroup says its survey of renters was conducted online in March 2012 among 506 adults who rent a home or apartment across the United States and intend to purchase a home in the future. The survey on multigenerational housing was conducted online in September 2012 among 511 homeowners across the U.S., ages 35 and older, with children between the ages of 16-30 and among 550 U.S. homeowners, ages 18-65, with living parents. The margin of sampling error is reported as 4.3 percent.
The next 10 years may bring five to six million new renter households. Or at least that’s what a recent infographic by the Bipartisan Policy Center is saying. So in the midst of a recovering housing market, why the shift toward a rise in rentals?
Although housing starts are up, construction will take some time to complete and the low inventory of houses may push many potential homeowners to consider renting.
“There is clearly an unmet demand for homeownership among young households,” Barry Zigas, director of Housing Policy for Consumer Federation of America, told HousingWire. “Those households are running up against a number of constraints.”
Factors such as tighter credit, larger down payments and decreased income with the rising generation will all play into the increase in renters in the years ahead.
“Credit for homeownership borrowing will likely be tighter and potentially more expensive, relative to earlier times,” Zigas said. “Families will likely have less wealth because the rising generation is starting with less wealth. If down payments are at any significant level, it will be a barrier to acquiring a home for longer than may have been the case in the past.”
There are several key groups that will be the driving force behind the rental demand, according to the below infographic. The growing number of seniors looking to downsize their homes, the young adults moving out on their own yet not ready for homeownership, the post-foreclosure homeowners and the growing number of immigrants in the U.S. will all play a significant role in the rising rental remand.
“We expect to see an increase in household formation and for a variety of reasons that household formation is likely to be more heavily concentrated among renters and households who are likely to be renters for somewhat longer than was the case for the last 20 years,” Zigas said.
Source: “Small Housing Inventory May Push Rental Demand for Years,” HousingWire (Dec. 31, 2012)