Lawrence Yun is the Chief Economist at the National Association of Realtors and usually brings a fairly realistic perspective to current real estate issues. Here, he helps us understand that even with the downturn in the real estate market, the leverage produced by investing in real estate is still far better than options like the stock market...
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December 1, 2007
“How much have real estate investors lost due to the housing market bust?”
That was the question posed to me by a major evening news producer, who wanted to depict the pains in the housing market during a nationally broadcast show.
Hmm. An investor who bought a property in Las Vegas five years ago would be ahead by $150,000 today. The gain would be $200,000 in Miami, and $54,000 on average in the United States as a whole.
Only people who bought in a few markets that experienced extreme overheating during the boom and who are trying to sell quickly face a potential loss. And that loss on average would be 1 percent to 2 percent.
Lenders and hedge funds with large exposure to subprime loans have lost big. Investors in homebuilder stocks also have lost.
But real estate investors who plan to hold for a reasonable period of time are doing fine.
For the entire article, please click here.
07 December 2007
30 November 2007
Interest Rates Hit Two-Year Low
With home prices bottoming and low interest rates, this is a great time opportunity for investors...
SAN FRANCISCO (MarketWatch) -- U.S. fixed-rate mortgages fell again in the latest week, according to Freddie Mac's survey released Thursday. The national average interest rate on the benchmark 30-year, fixed-rate loan averaged 6.10% in the week ending Thursday; it hasn't been lower since the week ended Oct. 13, 2005, when it averaged 6.03%. The current rate is down from 6.20% a week ago and 6.14% a year ago. The 15-year fixed-rate loan averaged 5.73%, down from 5.83% a week ago and 5.87% a year ago. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.86%, compared with 5.88% a week ago and 5.95% a year ago. "Interest rates for U.S. Treasury securities have been drifting lower this month over market concerns that the housing slump and stress in the credit markets could slow future economic growth," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a result, interest rates for fixed-rate mortgages had room to slip lower this week."
SAN FRANCISCO (MarketWatch) -- U.S. fixed-rate mortgages fell again in the latest week, according to Freddie Mac's survey released Thursday. The national average interest rate on the benchmark 30-year, fixed-rate loan averaged 6.10% in the week ending Thursday; it hasn't been lower since the week ended Oct. 13, 2005, when it averaged 6.03%. The current rate is down from 6.20% a week ago and 6.14% a year ago. The 15-year fixed-rate loan averaged 5.73%, down from 5.83% a week ago and 5.87% a year ago. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.86%, compared with 5.88% a week ago and 5.95% a year ago. "Interest rates for U.S. Treasury securities have been drifting lower this month over market concerns that the housing slump and stress in the credit markets could slow future economic growth," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a result, interest rates for fixed-rate mortgages had room to slip lower this week."
28 November 2007
NO CHANGE FOR CONFORMING LOAN LIMITS IN '08
The Office of Federal Housing Enterprise Oversight (OFHEO) announced Tuesday it will keep conforming loan limits at current levels of $417,000 for single-family mortgages in 2008, and also hinted it could lower the limits in 2009 if home prices continue to decline.
The conforming loan limit determines the maximum size of a mortgage that Fannie Mae and Freddie Mac can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan, increasing the monthly payment and negatively impacting affordability for households in California.
"At more than $568,000, the median price of a home in California is more than 2.5 times the U.S. median of $221,000, yet California is not recognized by OFHEO as a high-cost state," said C.A.R. President William E. Brown. "California still has the third highest home price in the nation, compared with Hawaii at seventh, and Alaska, which ranks 39th in terms of median home price. Yet Alaska, Hawaii, Guam, and the U.S. Virgin Islands are recognized by OFHEO as high-cost areas."
"Now is the time for the U.S. Senate to pass legislation allowing regional adjustments to Fannie Mae and Freddie Mac loan limits and to modernize FHA loan programs," Brown said. "This critical legislation is a key step to allowing families in California an opportunity to climb the first rung of the homeownership ladder."
For more information, go to http://www.car.org/index.php?id=MzgwMTE=. To read the OFHEO press release, go to http://www.ofheo.gov/newsroom.aspx?ID=397&q1=1&q2=None
The conforming loan limit determines the maximum size of a mortgage that Fannie Mae and Freddie Mac can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan, increasing the monthly payment and negatively impacting affordability for households in California.
"At more than $568,000, the median price of a home in California is more than 2.5 times the U.S. median of $221,000, yet California is not recognized by OFHEO as a high-cost state," said C.A.R. President William E. Brown. "California still has the third highest home price in the nation, compared with Hawaii at seventh, and Alaska, which ranks 39th in terms of median home price. Yet Alaska, Hawaii, Guam, and the U.S. Virgin Islands are recognized by OFHEO as high-cost areas."
"Now is the time for the U.S. Senate to pass legislation allowing regional adjustments to Fannie Mae and Freddie Mac loan limits and to modernize FHA loan programs," Brown said. "This critical legislation is a key step to allowing families in California an opportunity to climb the first rung of the homeownership ladder."
For more information, go to http://www.car.org/index.php?id=MzgwMTE=. To read the OFHEO press release, go to http://www.ofheo.gov/newsroom.aspx?ID=397&q1=1&q2=None
07 November 2007
Mortgage Rates Hit 6-Month Low
The 30-year fixed-rate mortgage averaged 6.26 percent for the week ending Nov. 1, its lowest point since May, compared with 6.33 percent a week earlier, and 6.31 for the same period a year ago. The five-year Treasury-indexed adjustable-rate mortgages averaged 5.98 percent for the week, down from the previous week from 6.03 percent, and 6.05 for the same period a year ago.
"Continued market concerns about weaker economic growth and further declines in the housing market have kept mortgage rates low over the last few weeks," said Frank Nothaft, Freddie Mac vice president and chief economist.
"Continued market concerns about weaker economic growth and further declines in the housing market have kept mortgage rates low over the last few weeks," said Frank Nothaft, Freddie Mac vice president and chief economist.
Beneath Market Punditry, Underlying Strength
Here's an interesting interview with the National Association of Realtors vice president of research, Larwence Yun. He certainly has a different view than most of the media regarding the near future of real estate sales. After seeing improvement in many markets throughout the US in the third quarter of 2007, NAR expects 2008 to see some growth in number of sales and a light increase in prices. That's probably not what you're reading in the newspaper these days....
For the complete interview, click here.
For the complete interview, click here.
24 October 2007
C.A.R. REPORTS SALES DECREASE 38.9 PERCENT, MEDIAN HOME PRICE FALLS 4.7 PERCENT
Home sales decreased 38.9 percent in September in California compared with the same period a year ago, while the median price of an existing home fell 4.7 percent, C.A.R. reported today.
"While it is typical for the median price to dip seasonally as we move from August to September, this decline -- which was both the largest month-to-month percentage decline on record and the first year-to-year decline in more than 10 years -- was mainly the result of the credit or liquidity crunch, which also drove sales below the 300,000 mark," said C.A.R. President Colleen Badagliacco.
"California's sales fell more steeply than those of the U.S. as a whole because of its heavy reliance on jumbo loans -- those above the conforming loan limit of $417,000," she said. "This speaks to the need to raise the conforming loan limit in higher-cost states like California to more accurately reflect the cost of housing."
"While it is typical for the median price to dip seasonally as we move from August to September, this decline -- which was both the largest month-to-month percentage decline on record and the first year-to-year decline in more than 10 years -- was mainly the result of the credit or liquidity crunch, which also drove sales below the 300,000 mark," said C.A.R. President Colleen Badagliacco.
"California's sales fell more steeply than those of the U.S. as a whole because of its heavy reliance on jumbo loans -- those above the conforming loan limit of $417,000," she said. "This speaks to the need to raise the conforming loan limit in higher-cost states like California to more accurately reflect the cost of housing."
11 October 2007
C.A.R.'S 2008 CALIFORNIA HOUSING MARKET FORECAST
Home prices throughout most of California will post modest declines next year while sales of existing homes will stabilize from the precipitous decrease experienced in 2007, according to C.A.R.'s "2008 California Housing Market Forecast" released today.
The median home price in California will decline 4 percent to $553,000 in 2008 compared with a projected median of $576,000 this year, while sales for 2008 are projected to decrease 9 percent to 334,500 units, compared with 367,500 units (projected) in 2007.
"Tighter credit standards, affordability concerns, and a continued standoff between buyers and sellers will contribute to continued weakness in the market going into next year," said C.A.R. President Colleen Badagliacco. "Now is not the time for homeowners to test the waters, only serious sellers should put their homes on the market in what will continue to be a challenging sales environment."
The median home price in California will decline 4 percent to $553,000 in 2008 compared with a projected median of $576,000 this year, while sales for 2008 are projected to decrease 9 percent to 334,500 units, compared with 367,500 units (projected) in 2007.
"Tighter credit standards, affordability concerns, and a continued standoff between buyers and sellers will contribute to continued weakness in the market going into next year," said C.A.R. President Colleen Badagliacco. "Now is not the time for homeowners to test the waters, only serious sellers should put their homes on the market in what will continue to be a challenging sales environment."
Fast Facts
Calif. median home price - August 07: $588.970(Source: C.A.R.)
Calif. highest median home price by C.A.R. region August 07: Santa Barbara So. Coast $1,262,500(Source: C.A.R.)
Calif. lowest median home price by C.A.R. region August 07: High Desert $287.39(Source: C.A.R.)
Calif. First-time Buyer Affordability Index - Second Quarter 07: 24 percent (Source: C.A.R.)
Mortgage rates - week ending 10/04: 30-yr. fixed: 6.37%; Fees/points: 0.5% 15-yr. fixed: 6.03%; Fees/points: 0.5% 1-yr. adjustable: 5.58%; Fees/points: 0.7% (Source: Freddie Mac)
Calif. highest median home price by C.A.R. region August 07: Santa Barbara So. Coast $1,262,500(Source: C.A.R.)
Calif. lowest median home price by C.A.R. region August 07: High Desert $287.39(Source: C.A.R.)
Calif. First-time Buyer Affordability Index - Second Quarter 07: 24 percent (Source: C.A.R.)
Mortgage rates - week ending 10/04: 30-yr. fixed: 6.37%; Fees/points: 0.5% 15-yr. fixed: 6.03%; Fees/points: 0.5% 1-yr. adjustable: 5.58%; Fees/points: 0.7% (Source: Freddie Mac)
20 September 2007
Bodega Bay Sales Price Drops Average 9%
The average price of a home in Bodega Bay as of August 2007 was down to $906,000 from $998,000 in 2006. This represents a 9% decline. The median price dropped even more significantly during this period - from $980,000 in 2006 to $815,000 in 2007 or nearly 17% down. This drop is probably what has contributed to recently growing buyer interest levels as the lender business stabilizes.
The discrepancy in average versus median prices indicates that lower priced homes are dominating the market right now, although there have been a few sales in the high end lately (over $1.5M).
The discrepancy in average versus median prices indicates that lower priced homes are dominating the market right now, although there have been a few sales in the high end lately (over $1.5M).
18 September 2007
Fed cuts rates by a half point
The Federal Reserve lowers the target on a key short-term interest rate for the first time in four years from 5.25% to 4.75%
September 18 2007: 2:18 PM EDT
NEW YORK (CNNMoney.com) -- The Federal Reserve cut the target on a key short-term interest rate by a half of a percentage point Tuesday to 4.75%, further acknowledgment from the central bank that the mortgage meltdown plaguing Wall Street and Main Street could have a negative impact on the economy.
The cut to the federal funds rate, the first since June 2003, was widely anticipated by investors and followed a surprise cut to the Fed's discount rate on August 17. The only question was whether the Fed would lower the federal funds rate by 25 basis points or 50 basis points. (There are 100 basis points in a full percentage point.)
The federal funds rate, an overnight lending rate that banks charge each other, is important since it influences the amount of interest consumers must pay for various types of debt, such as credit cards, home equity lines of credit and auto loans. The rate cut should help some beleaguered home borrowers who are set to see monthly payments on adjustable rate mortgages rise later this year.
September 18 2007: 2:18 PM EDT
NEW YORK (CNNMoney.com) -- The Federal Reserve cut the target on a key short-term interest rate by a half of a percentage point Tuesday to 4.75%, further acknowledgment from the central bank that the mortgage meltdown plaguing Wall Street and Main Street could have a negative impact on the economy.
The cut to the federal funds rate, the first since June 2003, was widely anticipated by investors and followed a surprise cut to the Fed's discount rate on August 17. The only question was whether the Fed would lower the federal funds rate by 25 basis points or 50 basis points. (There are 100 basis points in a full percentage point.)
The federal funds rate, an overnight lending rate that banks charge each other, is important since it influences the amount of interest consumers must pay for various types of debt, such as credit cards, home equity lines of credit and auto loans. The rate cut should help some beleaguered home borrowers who are set to see monthly payments on adjustable rate mortgages rise later this year.
13 September 2007
Bodega Bay Bicycle & Pedestrian Trail
ATTEND THE MEETING IN SEBASTOPOL ON SEPTEMBER 27 TO ADVOCATE FOR FUNDS IN BODEGA BAY. Meeting at Sebastopol Veterans Hall (282 High Street) from 6:30 to 8:30.
The Coastal Conservancy will be meeting on September 20 to consider authorizing a grant to Sonoma County Regional Parks to its review of the potential trail through Bodega Bay.
The purpose of this project is to develop a safe alternative to the automobile for bicyclists and pedestrians throughout the community of Bodega Bay.
There is a lengthy but informative conceptual improvement plan by LandPeople on the Sonoma County website - click here for further updated information and the project report.
Financial projections run from $6M-10M for the trail that would run from Salmon Creek to Doran Park with a wooden boardwalk over the harbor from Porto Bodega to Lucas Wharf.
01 September 2007
NAR Predicts Improved Home Sales
Even with wacky and unpredictable factors influencing the real estate market these days, NAR has confidence that many important factors are aligned to indicate good potential for a much-improved 4th quarter and beyond...
Click here for the article.
Click here for the article.
Existing-Homes Sales Stable In July
WASHINGTON, August 27, 2007 -
Existing-home sales were essentially unchanged in July, with increases in the West and Northeast offset by a decline in the Midwest, according to the National Association of Realtors®.
Lawrence Yun, NAR senior economist, said the market is holding on despite temporary mortgage disruptions. “Home sales probably would be rising in the absence of the mortgage liquidity issues of the past two months,” he said. “Some buyers with contracts have been scrambling when loan commitments did not materialize at the last moment, while other potential buyers are simply waiting for the mortgage market to stabilize.
For more detail, click here for the entire article.
Existing-home sales were essentially unchanged in July, with increases in the West and Northeast offset by a decline in the Midwest, according to the National Association of Realtors®.
Lawrence Yun, NAR senior economist, said the market is holding on despite temporary mortgage disruptions. “Home sales probably would be rising in the absence of the mortgage liquidity issues of the past two months,” he said. “Some buyers with contracts have been scrambling when loan commitments did not materialize at the last moment, while other potential buyers are simply waiting for the mortgage market to stabilize.
For more detail, click here for the entire article.
30 August 2007
Fast Facts for August
Calif. median home price - June 07: $594,260(Source: C.A.R.)
Calif. highest median home price by C.A.R. region June 07: Santa Barbara So. Coast $1,375,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region June 07: High Desert $306,310 (Source: C.A.R.)
Calif. First-time Buyer Affordability Index - Second Quarter 07: 24 percent (Source: C.A.R.)
Mortgage rates - week ending 8/23: 30-yr. fixed: 6.52%; Fees/points: 0.4% 15-yr. fixed: 6.18%; Fees/points: 0.5% 1-yr. adjustable: 5.60%; Fees/points: 0.6% (Source: Freddie Mac)
Calif. highest median home price by C.A.R. region June 07: Santa Barbara So. Coast $1,375,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region June 07: High Desert $306,310 (Source: C.A.R.)
Calif. First-time Buyer Affordability Index - Second Quarter 07: 24 percent (Source: C.A.R.)
Mortgage rates - week ending 8/23: 30-yr. fixed: 6.52%; Fees/points: 0.4% 15-yr. fixed: 6.18%; Fees/points: 0.5% 1-yr. adjustable: 5.60%; Fees/points: 0.6% (Source: Freddie Mac)
07 August 2007
Pending Home Sales See Biggest Gain in 3 Years
The market is likely to stabilize in the months ahead, according to the NATIONAL ASSOCIATION OF REALTORS®’ forward-looking indicator on pending home sales.
The Pending Home Sales Index, based on contracts signed in June, was 5 percent higher from the downwardly revised May index of 97.5, but is still 8.6 percent below June 2006 when it stood at 112. The 5 percent monthly gain is the largest in more than three years, since a 6.1 percent increase was recorded in March 2004.
Lawrence Yun, NAR senior economist, says it’s encouraging that the increase occurred in all four major regions of the United States. “However, it is too early to say if home sales have already passed bottom,” he says. “Still, major declines in home sales are likely to have occurred already and further declines, if any, are likely to be modest given the accumulating pent-up demand.”
The index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed.
What Happened Regionally
Here’s a breakdown of what the PHSI showed across the country:
West: the PHSI increased 8.6 percent in June to 103.6, but was 5.5 percent below a year ago.
Northeast: the index rose 3.1 percent from May to 96, which is 2.4 percent lower than June 2006.
South: the index increased 4.7 percent in June to 111.6, but was 12.7 percent below a year ago.
Midwest: the PHSI rose 3.5 percent in June to 92.5, which is 8.2 percent lower than June 2006.
The Pending Home Sales Index, based on contracts signed in June, was 5 percent higher from the downwardly revised May index of 97.5, but is still 8.6 percent below June 2006 when it stood at 112. The 5 percent monthly gain is the largest in more than three years, since a 6.1 percent increase was recorded in March 2004.
Lawrence Yun, NAR senior economist, says it’s encouraging that the increase occurred in all four major regions of the United States. “However, it is too early to say if home sales have already passed bottom,” he says. “Still, major declines in home sales are likely to have occurred already and further declines, if any, are likely to be modest given the accumulating pent-up demand.”
The index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed.
What Happened Regionally
Here’s a breakdown of what the PHSI showed across the country:
West: the PHSI increased 8.6 percent in June to 103.6, but was 5.5 percent below a year ago.
Northeast: the index rose 3.1 percent from May to 96, which is 2.4 percent lower than June 2006.
South: the index increased 4.7 percent in June to 111.6, but was 12.7 percent below a year ago.
Midwest: the PHSI rose 3.5 percent in June to 92.5, which is 8.2 percent lower than June 2006.
11 July 2007
NAR FORECAST: HOME SALES, PRICES TO PICK UP IN 2008
It's always difficult to interpret coastal real estate in terms of what's going on nationally but it does have some impact due to people throughout the country being able to leverage their home's value in the purchase of a home on the Coast. Below, you'll see that there is some optimism for 2008 - although we're already seeing a positive direction here (we're up more than 50% compared to the first half of 2006)....
From NAR:
Lower levels of home-building activity throughout the nation will help existing home sales improve later this year and into 2008, according to NAR's most recent forecast. "Buyers now have an overwhelming advantage given the wide selection of homes available in many markets," said NAR Senior Economist Lawrence Yun. "But with profit margins coming under pressure, home builders will limit new construction well into 2008. This should help the overall inventory level to move steadily into a more balanced state." Existing-home sales are projected to total 6.11 million in 2007 and 6.37 million in 2008, down from last year's total of 6.48 million.
According to the report, prices also are expected to pick up in 2008 as inventory levels decrease. The median price of an existing single-family home is expected to drop 1.4 percent to $218,800 this year but increase 1.8 percent to $222,700 in 2008.
From NAR:
Lower levels of home-building activity throughout the nation will help existing home sales improve later this year and into 2008, according to NAR's most recent forecast. "Buyers now have an overwhelming advantage given the wide selection of homes available in many markets," said NAR Senior Economist Lawrence Yun. "But with profit margins coming under pressure, home builders will limit new construction well into 2008. This should help the overall inventory level to move steadily into a more balanced state." Existing-home sales are projected to total 6.11 million in 2007 and 6.37 million in 2008, down from last year's total of 6.48 million.
According to the report, prices also are expected to pick up in 2008 as inventory levels decrease. The median price of an existing single-family home is expected to drop 1.4 percent to $218,800 this year but increase 1.8 percent to $222,700 in 2008.
06 June 2007
Pending Homes Sales Stabilize
I realize that the news is all over the place regarding the near future of real estate prices, and while the doomsayers are certainly out there we are seeing signs of a stabilizing housing market - we've actually seen that for months here on the Coast. Here's the latest from the National Association of Realtors...
While pending home sales continued to edge down this month amidst the subprime fallout, NAR expects activity in the housing market to stabilize in the near-term, according to a recent report. The Association's Pending Home Sales Index (PHSI), a forward-looking indicator that gauges home sales activity for upcoming months, declined for the second consecutive month in April, falling 10.2 percent from a year ago to a reading of 101.4. While a PHSI of 100 or more generally indicates a high level of home sales activity, the April PHSI was the lowest reading in four years. "It looks like we may be leaving a period of market disruptions, and for the past two months the pending home sales index has been similar in year-ago comparisons, which means home sales might ease but should be fairly stable in the months ahead," said NAR Senior Economist Lawrence Yun.
While pending home sales continued to edge down this month amidst the subprime fallout, NAR expects activity in the housing market to stabilize in the near-term, according to a recent report. The Association's Pending Home Sales Index (PHSI), a forward-looking indicator that gauges home sales activity for upcoming months, declined for the second consecutive month in April, falling 10.2 percent from a year ago to a reading of 101.4. While a PHSI of 100 or more generally indicates a high level of home sales activity, the April PHSI was the lowest reading in four years. "It looks like we may be leaving a period of market disruptions, and for the past two months the pending home sales index has been similar in year-ago comparisons, which means home sales might ease but should be fairly stable in the months ahead," said NAR Senior Economist Lawrence Yun.
12 May 2007
Survey Says . . . Buy!
Eight great reasons to buy that dream vacation home right now...
RISMEDIA, May 14, 2007-So you want to buy a vacation home. You've been daydreaming about a cabin in the mountains, perhaps, or a charming cottage near the sea.
Maybe you even have the property picked out. You know you can swing it financially, but you're not quite sure you're ready to take the plunge. Is this the right time to buy real estate … really? Vacation property expert Christine Karpinski says absolutely yes-and backs up her answer by citing the results of a new report by the National Association of Realtors®.
For the complete story, click here...
RISMEDIA, May 14, 2007-So you want to buy a vacation home. You've been daydreaming about a cabin in the mountains, perhaps, or a charming cottage near the sea.
Maybe you even have the property picked out. You know you can swing it financially, but you're not quite sure you're ready to take the plunge. Is this the right time to buy real estate … really? Vacation property expert Christine Karpinski says absolutely yes-and backs up her answer by citing the results of a new report by the National Association of Realtors®.
For the complete story, click here...
05 April 2007
Fundamentals and an Upswing
It appears that our perception of an improving market is supported by some industry experts. As activity increased here on the Coast in Q1, it seems to have done the same nationwide as a whole.
The following quote comes from Camille Kazas' newsletter - she can be found at North American Title (www.nat.com) in Sebastopol...
Existing-home sales rose strongly in February according to the National Association of Realtors®. February’s increase was the biggest monthly rise in three years – matching the 3.9 percent sales of March 2004.
Here’s what some industry experts are saying:
David Lereah, NAR’s chief economist - “Fundamentals have improved in the housing market and buyers see a window now with historically-low mortgage interest rates and competitive pricing by sellers.”
NAR President Pat Combs - “Overall, home prices should rise slowly this year, and many buyers have an opportunity now that was only a dream during the five-year boom.”
Federal Reserve Chairman Ben Bernanke -"Overall, the economy appears likely to continue to expand at a moderate pace over coming quarters.”
The potential for investing in a new home or income property is excellent now.
The following quote comes from Camille Kazas' newsletter - she can be found at North American Title (www.nat.com) in Sebastopol...
Existing-home sales rose strongly in February according to the National Association of Realtors®. February’s increase was the biggest monthly rise in three years – matching the 3.9 percent sales of March 2004.
Here’s what some industry experts are saying:
David Lereah, NAR’s chief economist - “Fundamentals have improved in the housing market and buyers see a window now with historically-low mortgage interest rates and competitive pricing by sellers.”
NAR President Pat Combs - “Overall, home prices should rise slowly this year, and many buyers have an opportunity now that was only a dream during the five-year boom.”
Federal Reserve Chairman Ben Bernanke -"Overall, the economy appears likely to continue to expand at a moderate pace over coming quarters.”
The potential for investing in a new home or income property is excellent now.
18 March 2007
How To Find 'Green' Contractors
by Broderick Perkins of Realty Times
Greening up your home can come with energy savings, a value boost, tax benefits and a smaller carbon footprint.
Not only do you and your household's bottom line benefit from green home improvements, so does the planet.
Unless the work is quality work, however, you may not get the personal financial benefits you seek, nor the pinch of planet cooling the Earth could use.
Click here for more tips on building green.
Greening up your home can come with energy savings, a value boost, tax benefits and a smaller carbon footprint.
Not only do you and your household's bottom line benefit from green home improvements, so does the planet.
Unless the work is quality work, however, you may not get the personal financial benefits you seek, nor the pinch of planet cooling the Earth could use.
Click here for more tips on building green.
U.S. mortgage reset may boost foreclosures
By Ilaina Jonas
NEW YORK, March 19 (Reuters) - About 1.1 million additional home foreclosures are expected over the next six years as adjustable-rate mortgages -- which made home buying more affordable to U.S. buyers in recent years -- reset to higher payments, according to a study by research firm First American CoreLogic.
The expected $112 billion in losses won't break the mortgage industry but will inflict pain on lenders and borrowers affected by the defaults, said the study, released on Monday.
"It's less than we spend on alcohol. It's less than we spend on the lottery and gambling," said Christopher Cagan, director of research and analytics, and author of the report Mortgage Payment Reset, The Issue and the Impact.
"The price of gasoline has far more impact. We have $60 billion a month in trade deficit that dwarfs this," he added.
Click to see the entire article.
NEW YORK, March 19 (Reuters) - About 1.1 million additional home foreclosures are expected over the next six years as adjustable-rate mortgages -- which made home buying more affordable to U.S. buyers in recent years -- reset to higher payments, according to a study by research firm First American CoreLogic.
The expected $112 billion in losses won't break the mortgage industry but will inflict pain on lenders and borrowers affected by the defaults, said the study, released on Monday.
"It's less than we spend on alcohol. It's less than we spend on the lottery and gambling," said Christopher Cagan, director of research and analytics, and author of the report Mortgage Payment Reset, The Issue and the Impact.
"The price of gasoline has far more impact. We have $60 billion a month in trade deficit that dwarfs this," he added.
Click to see the entire article.
04 March 2007
New Stability Takes Hold
Last year’s correction in housing markets was sorely needed after five years of a booming expansion. But now there are signs that the correction is behind us and a year of stability lies ahead.
A quick recap: By the end of 2005, home prices were inflated, and property investors and speculators were ubiquitous, pushing to the sidelines home buyers who couldn’t afford lofty prices in boom regions. Some households also postponed buying because they believed prices would eventually drop. Then property speculators fled, dumping inventories. And home owners looking to sell remained stubbornly wedded to their listing prices.
The sky never fell in 2006. There were no bursting bubbles. But air came out of some over inflated balloons those markets that experienced frothy appreciation. Final 2006 figures show existing-home sales down 8.4 percent for the year, new-home sales down 17.3 percent, and housing starts down 12.9 percent.
This year will be better. Home sales appear to have bottomed out, reaching a cyclical low in September 2006. Since then, home sales have been inching up, albeit modestly. Inventories have stabilized, with the national months’ supply hovering around 7.3 months since July 2006.
For the entire Realtor.org article, click here.
A quick recap: By the end of 2005, home prices were inflated, and property investors and speculators were ubiquitous, pushing to the sidelines home buyers who couldn’t afford lofty prices in boom regions. Some households also postponed buying because they believed prices would eventually drop. Then property speculators fled, dumping inventories. And home owners looking to sell remained stubbornly wedded to their listing prices.
The sky never fell in 2006. There were no bursting bubbles. But air came out of some over inflated balloons those markets that experienced frothy appreciation. Final 2006 figures show existing-home sales down 8.4 percent for the year, new-home sales down 17.3 percent, and housing starts down 12.9 percent.
This year will be better. Home sales appear to have bottomed out, reaching a cyclical low in September 2006. Since then, home sales have been inching up, albeit modestly. Inventories have stabilized, with the national months’ supply hovering around 7.3 months since July 2006.
For the entire Realtor.org article, click here.
28 February 2007
LUXURY HOME MARKETS SLOW IN CALIFORNIA
There are a significant number of "luxury" homes on the Coast and the trend for most of California appears to be relevant to us here. This article comes to us from the California Association of Realtors...
During last year's fourth quarter, luxury home prices in Los Angeles, San Diego, and San Francisco declined on a quarter-to-quarter basis for the first time since 2004, according to the First Republic Prestige Home Index™, which tracks homes valued at more than $1 million in key California markets. Despite the quarterly decreases, limited inventories continue to drive the luxury markets, and prices appreciated by single digits on an annual basis in all three areas.
In Los Angeles, fourth quarter luxury home prices were up 2.9 from a year ago and the average luxury home is now valued at $2.35 million. High-end homes in San Diego and San Francisco also recorded modest annual gains last quarter, rising 3.3 percent and 1.5 percent, respectively. According to the index, the average luxury home in San Francisco is now valued at $2.92 million, while the average luxury home value in San Diego is $2.15 million
During last year's fourth quarter, luxury home prices in Los Angeles, San Diego, and San Francisco declined on a quarter-to-quarter basis for the first time since 2004, according to the First Republic Prestige Home Index™, which tracks homes valued at more than $1 million in key California markets. Despite the quarterly decreases, limited inventories continue to drive the luxury markets, and prices appreciated by single digits on an annual basis in all three areas.
In Los Angeles, fourth quarter luxury home prices were up 2.9 from a year ago and the average luxury home is now valued at $2.35 million. High-end homes in San Diego and San Francisco also recorded modest annual gains last quarter, rising 3.3 percent and 1.5 percent, respectively. According to the index, the average luxury home in San Francisco is now valued at $2.92 million, while the average luxury home value in San Diego is $2.15 million
Big Rise in Home Sales
From the National Association of Realtors. It appears that the reduction in prices are bringing buyers back into the market...
Sales of existing homes rose in January by the largest amount in two years, raising hopes that the worst of the severe slump in housing may be coming to an end. Median home prices, however, fell for a sixth straight month.
The National Association of Realtors reported this week that sales of previously owned homes rose by three percent last month, the biggest one-month increase since a 3.3 percent increase in January 2005. Sales of existing U.S. homes rose three percent to a seasonally adjusted annual rate of 6.46 million in January, the highest in seven months.
Sales of existing homes rose in January by the largest amount in two years, raising hopes that the worst of the severe slump in housing may be coming to an end. Median home prices, however, fell for a sixth straight month.
The National Association of Realtors reported this week that sales of previously owned homes rose by three percent last month, the biggest one-month increase since a 3.3 percent increase in January 2005. Sales of existing U.S. homes rose three percent to a seasonally adjusted annual rate of 6.46 million in January, the highest in seven months.
12 February 2007
Selling Your Home May Be Tax Free
Your home may not always be your “castle,” but if it is your principal residence, there is one very significant tax benefit when you decide to sell. In general, if you file a joint tax return with your spouse, you can exclude up to $500,000 of your profit ($250,000 if you file a separate return).
Two real estate tax benefits -- the "roll-over" and the "once in a lifetime" -- are no longer with us. However, their memory will linger on, at least for some taxpayers who have made a lot of profit over the years and who were buying and selling their homes prior to l997.
Click here for the entire article...
Two real estate tax benefits -- the "roll-over" and the "once in a lifetime" -- are no longer with us. However, their memory will linger on, at least for some taxpayers who have made a lot of profit over the years and who were buying and selling their homes prior to l997.
Click here for the entire article...
Sales to Rise
NAR chief economist David Lereah said today that existing home sales have likely hit bottom in the final quarter of last year. He projects a gradual rise in home re-sales in 2007 however sales tallies will likely remain below the 6.48 million unit pace set in 2006. Forecasts are for existing home sales to reach a level of 6.64 million in 2008. Weakness in new home sales is expected to persist this year and next. New home sales are expected to come in at 961k in 2007 and 971k in 2008, both below the 1.06 million units sold in 2006.
01 February 2007
U.S. Home Buyers Will Pay Premium For ‘Green’ Homes, 11-25 Percent Mor
RISMEDIA, Feb. 1, 2007-A survey released this week by Green Builder(R) Media and Imre Communications reveals that U.S. home buyers are willing to pay a premium for more environmentally friendly, green-built homes.
The study surveyed more than 250 residential builders across the United States. A wide range of builders was included from the affordable, market rate, luxury/semi-custom, custom, multi-family and developer categories.
More than half of homebuilders surveyed report that buyers are willing to pay a premium of between 11-25% for green-built homes. The same builders report that the average green home buyer is between the ages of 35-50 with a college degree and fair understanding of green products. Continues..
The study surveyed more than 250 residential builders across the United States. A wide range of builders was included from the affordable, market rate, luxury/semi-custom, custom, multi-family and developer categories.
More than half of homebuilders surveyed report that buyers are willing to pay a premium of between 11-25% for green-built homes. The same builders report that the average green home buyer is between the ages of 35-50 with a college degree and fair understanding of green products. Continues..
30 January 2007
Construction Finally Starts at Harbor View
As noted in the previous post, the developer who is buying Porto Bodega is finally under construction in the Harbor View subdivision. It's been about 20 years and five developers in the making, but the hurdles have been jumped and the heavy equipment is ready to roll.
RJB Development will begin construction on the required affordable housing units initially - 20% of subdivisions in Sonoma County must meet low-income guidelines - so we'll see about 14 of the 70 units designed for that purpose.
See Bodega Bay Navigator's article for more info.
RJB Development will begin construction on the required affordable housing units initially - 20% of subdivisions in Sonoma County must meet low-income guidelines - so we'll see about 14 of the 70 units designed for that purpose.
See Bodega Bay Navigator's article for more info.
Porto Bodega Sold
After several years on the market, the 15-acre marina, RV park and Sandpiper Restaurant site is being purchased by the Newport Beach developer who owns the Harbor View subdivision (previously Romancia). See the Bodega Bay Navigator article.This area has the potential to be the town center that Bodega Bay so desperately needs with it's off-highway location and available acreage. Of course, that would require a lot of cooperation from the County and local citizens...
29 January 2007
Existing-Home Sales Ease, Supplies Tighten in December; 2006 Historically High
RISMEDIA, Jan. 29, 2007-Existing-home sales eased but prices stabilized as inventories tightened in December, while 2006 was the third-highest sales year on record, according to the National Association of Realtors®. Click here for more...
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