Yajnesh Rai

Existing-Home Sales Gains Strongest in Decade | Realtor Magazine

For the third consecutive month, existing-home sales were on the rise, with all major regions of the country except the West posting a “significant hike in sales activity” last month, the National Association of REALTORS® reported Wednesday.

Total existing-home sales—which includes completed transactions for single-family homes, townhomes, condos, and co-ops—increased 5.6 percent in November to a seasonally adjusted annual rate of 5.81 million. Sales are now 3.8 percent higher than a year ago and are at the strongest pace since December 2006.

“Faster economic growth in recent quarters, the booming stock market, and continuous job gains are fueling substantial demand for buying a home as 2017 comes to an end,” says Lawrence Yun, NAR’s chief economist. “As evidenced by a subdued level of first-time buyers and increased share of cash buyers, move-up buyers with considerable down payments and those with cash made up a bulk of sales activity last month. The odds of closing on a home are much better at the upper end of the market, where inventory conditions continue to be markedly better.”

Here’s a closer look at November’s numbers:

Home prices: The median existing-home price for all housing types in November was $248,000, increasing 5.8 percent from a year ago.

Supply: Total housing inventory at the end of November dropped 7.2 percent to 1.67 million existing homes available for sale. Inventories are now 9.7 percent lower than a year ago. Unsold inventory is at a 3.4-month supply at the current sales pace. “The anticipated rise in mortgage rates next year could further cut into affordability if these staggeringly low supply levels persist,” Yun says. “Price appreciation is too fast in a lot of markets right now. The increase in home builder optimism must translate to significantly more new construction in 2018 to help ease these acute inventory shortages.”

Cash purchases: All-cash sales comprised 22 percent of transactions in November, up from 21 percent a year ago. That makes up the highest share of all-cash sales since May. Individual investors are the biggest source of cash sales. They purchased 14 percent of homes in November, unchanged from a year ago. “The elevated presence of investors paying in cash continues to add a layer of frustration to the supply and affordability headwinds aspiring first-time buyers are experiencing,” Yun says. “The healthy labor market and higher wage gains are expected to further strengthen buyer demand from young adults next year. Their prospects for becoming homeowners will only improve if more lower-priced and smaller-sized homes come onto the market.” 

First-time home buyers: This group accounted for 29 percent of sales in November, down from 32 percent a year ago.

Days on market: Properties remained on the market for an average of 40 days in November, down from 43 days a year ago. Forty-four percent of homes sold in November were on the market for less than a month.

Distressed properties: Foreclosures and short sales made up 4 percent of sales, down from 6 percent a year ago. Broken out, 3 percent of sales in November were foreclosures while 1 percent were short sales.

 

 

7 Tips for Brightening a Home This Winter | Realtor Magazine

The winter may bring colder and cloudier days ahead, but you can still make your listing look inviting, bright, and cheerful. HouseLogic recently featured several ideas, including: 

Take the screens off your windows. 

HouseLogic notes that you’ll get 30 percent more sunlight shining indoors without the screens on your window. Store your screens where they won’t get damaged so you can put them back on in the spring. 

Change your bulbs. 

Replace incandescent bulbs with LEDs for a whiter light. Note: The higher the K rating on the bulb, the cooler and whiter its light, HouseLogic notes. 

Hang mirrors. 

Mirrors reflect light. Try a large, convex mirror—or a fish-eye mirror—which can amplify light better than a flat one. Consider hanging a gallery wall of small mirrors. 

Replace heavy curtains with blinds or roman shades. 

Fabric curtains block light and can make a room look smaller. Instead, try Roman shades or a valance with blinds to let in the maximum amount of natural light. 

Swap out the front door for one with glass inserts. 

A solid front door can make a home feel dark. But one that contains glass sidelights and a glass transom, for example, will brighten up the entryway. As a bonus, a new door will add curb appeal, too. 

Trim branches and bushes that block light. 

Take a look out the windows. If you see tops of bushes, it’s time to start pruning. Don’t let bushes or trees block sunlight from getting in if you want to brighten up your interiors. 

Clean windows. 

This can make a big difference. Dirty windows block natural light. Clean the glass inside at least once a month and the glass outside once a year, HouseLogic recommends. 

Mortgage Rates Up Slightly This Week | Realtor Magazine

 

 

Average mortgage rates inched up, but the 30-year fixed-rate mortgage remains below 4 percent and continues to offer home buyers and refinancers historically low rates.

“Thirty-year fixed mortgage rates have been bouncing around in a narrow 10 basis points range since October,” says Len Kiefer, Freddie Mac’s chief economist. “The U.S. average 30-year fixed mortgage rate increased 1 basis point to 3.94 percent in this week’s survey. The majority of our survey was completed prior to the surge in long-term interest rates that followed the passage of the tax bill. If those rate increases stick, we’ll likely see higher mortgage rates in next week’s survey. But even with yesterday’s increase, the 10-year Treasury yield is down from a year ago, and 30-year fixed mortgage rates are 36 basis points below the level we saw in our survey last year at this time. Mortgage rates are low.”

Freddie Mac reports the following national averages for the week ending Dec. 21:

• 30-year fixed-rate mortgages: averaged 3.94 percent, with an average 0.5 point, rising from last week’s 3.93 percent average. Last year at this time, 30-year-rates averaged 4.30 percent.
• 15-year fixed-rate mortgages: averaged 3.38 percent, with an average 0.5 point, increasing from last week’s 3.36 percent average. A year ago, 15-year rates averaged 3.52 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 3.39 percent, with an average 0.3 point, increasing from last week’s 3.36 percent average. A year ago, 5-year ARMs averaged 3.32 percent.

3 Ways to Prevent Costly Wear and Tear | Realtor Magazine

The winter season brings more foot traffic, which can be risky on a home—holiday parties, family gatherings and even open houses in the winter can bring tears and marks on the floors. How do you prevent scratches and stains that result in costly floor repairs?

After all, refinishing hardwood floors could cost more than $1,000. A carpet repair could cost about $200, according to HomeAdvisor, which provides average cost estimates of repair and remodeling projects nationwide.

Here are a few tips from a recent article at realtor.com®:

Take note of the front door.

Set a “No shoes in the house” rule to reduce scratches or stains to your flooring. The front door likely will see the most mix of dirt, snow, and mud as people enter. Add a mat near the front and back doors to the house to catch some of the grime. “Rock salt can leave white residue that, over time, can dull the finish of your floors,” Dave Murphy, director of training at N-Hance Wood Renewal and Refinishing in Nashville, told realtor.com®. “When it’s tracked into your house, it gets dragged across the floors, creating deep scratches in the wood.”

Protect the floor from the Christmas tree.

Watch the water if you have a real tree. Water can damage not only hardwood flooring but also carpeting and laminate flooring. “Place a plastic bag underneath the tree stand to catch any spilled water,” suggests Debra Johnson, a home cleaning expert with Merry Maids. “Don’t fret about the look: Your tree skirt will hide it.” A tree skirt can also catch fallen tree needles, which can scratch flooring.

Turn down the heat.

When the weather turns cold, try to avoid turning the heat up too high—it can damage your floors, particularly your hardwoods. “Heaters in your home can really dry out hardwood, leading to problems like shrinkage and cracked floorboards,” Murphy cautions. Murphy suggests running a humidifier in your home to keep moisture in the air.

15 Features That Help Listings Sell Faster | Realtor Magazine

“Renovating a home with the right features can not only recoup the cost—it can help you sell your place much faster,” advises Jessica Lautz, managing director of survey research at the National Association of REALTORS®. “That means a quick transition into your dream home.” But which amenities are in highest demand?

Hardwood flooring remains the biggest draw among buyers of all generations, according to a new realtor.com® analysis of popular home features. Listings with hardwood floors have appreciated 14.8 percent since 2015, the analysis shows. “The first thing buyers look at are the floors … and when they take in beautiful hardwood, their eyes light up,” says Zelda Sheldon, a sales associate with Village Real Estate Services in Nashville, Tenn.

Realtor.com® looked at 40 of the most common home features and analyzed applicable listings to find which homes sold in the fewest number of days. For this study, researchers used days on market as an indication of demand for a home feature. The following were the top features uncovered in the survey:

1. Smart-home features (smart thermostats, refrigerators, and locking systems)
2. Finished basements
3. Patios
4. Walk-in closets
5. Granite countertops
6. Eat-in kitchens
7. Hardwood floors
8. Laundry rooms
9. Open kitchens
10. Front porches
11. Dining rooms
12. Energy Star appliances
13. Two-car garages
14. Fireplaces
15. Security systems

Lending Scam Targets California Consumers | Realtor Magazine

The California Department of Business Oversight issued a warning to consumers to beware of email scams purporting to be from representatives of Impac Mortgage Co.

The emails originate from a fake email address, impacmortgagecorp@gmail.com, and appear legit, using Impac Mortgage’s logo and invoking the name of CEO Joseph Tomkinson. The scammers are sending unsolicited emails to recipients, offering them loans and requesting that the recipient pay money before the loan is provided.

Consumers should “exercise extreme caution before responding to any solicitation promoting loans or other offers,” the California Department of Business Oversight said in a recent bulletin. The real Impac Mortgage Corp. was founded in 1995 in Irvine, Calif., and has originated and purchased more than $90 billion in residential and commercial loans.

Buyers Making Record-High Down Payments | Realtor Magazine

Home buyers are putting more money down on a home, as the median down payment for a single-family home or condo in the third quarter was $20,000—a new record high, according to ATTOM Data Solutions’ Q3 2017 U.S. Residential Property Loan Origination Report. The average down payment equaled 7.6 percent of the median home sales price of $263,000, according to the report.

“Buying a home has become a full-contact sport in many markets across the country, and buyers with the beefiest down payments—not to mention all-cash buyers—are often able to muscle out those with scrawnier savings,” says Daren Blomquist, senior vice president at ATTOM Data Solutions. “Despite the increasingly competitive nature of home buying, the number of residential property purchase loans nationwide increased to a 10-year high in the third quarter.”

The median down payment was more than $50,000 in 12 of 99 metro markets analyzed by ATTOM Data Solutions, including:

• San Jose, Calif.
• San Francisco
• Los Angeles
• Oxnard-Thousand Oaks-Ventura, Calif.
• Boulder, Colo.
• San Diego
• New York
• Fort Collins, Colo.
• Bridgeport, Conn.
• Boston
• Seattle
• Naples, Fla.

The Share of Co-Borrowers Increases

About 23 percent of all loan purchase originations for single-family homes in the third quarter involved co-borrowers, considered to be multiple unmarried borrowers listed on a mortgage or deed of trust, according to ATTOM Data Solutions’ report. That’s up from 21 percent a year ago.

The metros with the largest co-borrowing increases from a year ago are:

• Las Vegas
• Houston
• San Antonio
• Phoenix
• Colorado Springs, Colo.

Overall, the cities with the highest share of co-borrowers are:

• San Jose, Calif. (51.1%)
• Miami (42.7%)
• Seattle (36.7%)
• Los Angeles (30.4%)
• Portland, Ore. (30.1%).

4 Ways to ‘Fireproof’ a House | Realtor Magazine

More than 1,000 structures and 260,000 acres across Southern California have been charred since massive wildfires broke out earlier this month. With the blazes still threatening 25,000 more homes, is there anything homeowners can do to protect their houses from a fire? You may not be able to fireproof a home completely, but building experts say there are several measures homeowners can take to lower the risks of sustaining damage. Realtor.com® offers these tips:

Take extreme caution with eucalyptus trees. The oil in eucalyptus trees—which are common in Southern California—is highly flammable and can cause the trees to explode when on fire, warns Los Angeles real estate developer Tyler Drew. He says homeowners should remove these and other large trees near a home’s structure to help prevent fires from spreading to the house.

Keep your yard clear of brush. Bushes, shrubs, dead branches, and vegetation near a home can be dangerous in a wildfire. “Clear brush away from your home, especially if you live in the hills or mountains,” Drew says. “At least 20 yards of brush clearance is what is recommended by most firefighters.”

Reinforce susceptible materials in a home. A house made of wood is more prone to catching fire than homes made from other materials, such as brick, cement block, stone, and ceramic tile, Drew says. “Stucco can work,” he notes, “but the wood beams behind stucco can still catch on fire if the wildfire burns close enough to your home.”

Replace the roof. Certain roofs are more resistant to falling embers and ash than others. “Tile and composite roofing shingles are a must these days, but some homes still use wooden shingles,” Drew says.

Despite Fed Move, Mortgage Rates Hold Steady | Realtor Magazine

Mortgage rates were in a holding pattern this week, even after the Federal Reserve voted Wednesday to hike its benchmark interest rate.

“As widely expected, the Fed increased the federal funds target rate this week for the third time in 2017,” says Len Kiefer, Freddie Mac’s deputy chief economist. “The market had already priced in the rate hike, so long-term interest rates—including mortgage rates—hardly moved. Mortgage rates held relatively flat across the board, with the 30-year fixed mortgage rate inching down 1 basis point to 3.93 percent in this week’s survey. Mortgage rates have been in a holding pattern for the fourth quarter, remaining within a 10 basis point range since October.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Dec. 14:

• 30-year fixed-rate mortgages: averaged 3.93 percent, with an average 0.5 point, dropping from last week’s 3.94 percent average. Last year at this time, 30-year rates averaged 4.16 percent.
• 15-year fixed-rate mortgages: averaged 3.36 percent, with an average 0.5 point, the same as last week. A year ago, 15-year rates averaged 3.37 percent.
• 5-year hybrid adjustable rate mortgages: averaged 3.36 percent, with an average 0.3 point, rising from last week’s 3.35 percent average. A year ago, 5-year ARMs averaged 3.19 percent.

Fed Raises Interest Rates, Hints More to Come | Realtor Magazine

The Federal Reserve voted Wednesday to increase its benchmark interest rate by one-quarter of a percentage point, marking the fourth hike in a year and indicating that more increases are likely to come in 2018. Though mortgage rates aren’t directly tied to the Fed’s benchmark interest rate, they are often influenced by it.

Economists had predicted the Fed’s move, and they say it likely won’t cause waves in the housing market. “We believe the rate increase was well-communicated to markets and had been anticipated,” Ruben Gonzaelz, an economist for Keller Williams Realty, told HousingWire. Fed officials appear to be sticking to their plan to call for three rate hikes in 2018. But interest rates remain historically low, even as the Fed has raised its benchmark rate five times since late 2015.

The Fed said in a statement that it was upbeat about the economy’s performance, adding that the labor market has “continued to strengthen, and economic activity has been rising at a solid rate. The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run.” However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data, the Committee added. 

Lawrence Yun, chief economist for the National Association of REALTORS®, predicts the economy will see an uptick in the coming months. 

“There will be juice added to the economy in the months ahead as a result of the expected passage of a massive tax cut,” says Yun. “It remains to be seen whether the effects are long-lasting or just for a short period of time. However, with the unemployment rate already at a low of around 4 percent, there is not much room to go further down. That means inflationary pressure will slowly develop. That is why the Federal Reserve today raised the short-term interest rates and will likely do so three more times in 2018. The longer-term interest rates, like the 30-year fixed mortgages rate, will therefore be nudged higher in 2018. Economic stimulus will help with job creation and housing demand, but higher interest rates threaten to cut into housing affordability in 2018.”   

Jerome Powell, governor of the Fed, will take the reins of the Federal Reserve from Chairwoman Janet Yellen in early February. Powell is largely expected to continue to follow Yellen’s plan for gradual rate increases.