- ELIZABETH CHASE, Realtor, ABR HARBOURTOWNE REAL ESTATE Contact: email@example.com "Helping You Unlock the Home of Your Dreams"
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In about two-thirds of the country – or 66 percent of the largest U.S. counties – it’s more affordable to buy a home than to rent one, according to a report by ATTOM Data Solutions.
They compared the monthly rents of three-bedroom apartments to monthly payments on median-priced homes (including the mortgages, property taxes, and insurance) across 540 counties.
Read more: Housing Markets Move More Into Buy Zone
“It feels like buying a home is getting tougher and tougher from an affordability standpoint,” says Daren Blomquist, ATTOM’s senior vice president. “But the low interest rates have really helped.”
Mortgage rates, however, are expected to rise in the near future. That could dampen the affordability prospects in the future.
“Even a fairly slight increase in mortgage rates could flip the equation and make it more affordable to rent than to buy,” Blomquist says.
According to the report, rents have been surging faster than home prices in about 27 percent of the markets measured.
In the country’s most populated counties, the following places topped the list as most affordable to buy than rent: Cook County (Chicago), Ill.; Maricopa County (Phoenix), Arizona, Miami-Dade County, Fla.; San Bernardino County, Cal. in inland Southern California; Clark County (Las Vegas), Nev.; Tarrant County, Texas in the Dallas metro area; Wayne County (Detroit), Mich.; Broward County, Fla. in the Miami metro area; Bexar County (San Antonio), Texas; and Philadelphia County, Pa.&amp;lt;a href=’http:&amp;amp;#47;&amp;amp;#47;www.realtytrac.com&amp;amp;#47;news&amp;amp;#47;home-prices-and-sales&amp;amp;#47;2017-rental-affordability-report&amp;amp;#47;’&amp;gt;&amp;lt;img alt=’Buy or Rent in 2017? ‘ src=’http:&amp;amp;#47;&amp;amp;#47;public.tableau.com&amp;amp;#47;static&amp;amp;#47;images&amp;amp;#47;Bu&amp;amp;#47;BuyorRent2017&amp;amp;#47;Dashboard1&amp;amp;#47;1_rss.png’ style=’border: none’ /&amp;gt;&amp;lt;/a&amp;gt;
Source: “Buying a Home May Be More Affordable Than You Think,” realtor.com® (Jan. 5, 2017) and ATTOM Data Solutions
Mortgage rate increases are chipping away at home buyer sentiment, shows the latest reading from Fannie Mae’s Home Purchase Sentiment Index. For the fifth consecutive month, consumer sentiment dropped in December and most of that centered on perceptions over rising borrowing costs.
The share of consumers expecting mortgage rates to drop over the next 12 months, as well as those who believe their household income is significantly higher today compared to a year ago, dropped four and five percentage points, respectively, according to the index.
“Despite the post-election bump in general consumer attitudes, a rapid rise in mortgage rate expectations has tamped down home purchase sentiment, at least in the near term,” says Doug Duncan, Fannie Mae’s chief economist.
That could change, Duncan says. The spike in interest rates reflects, in part, the market’s anticipation of “pro-growth policies from the incoming administration,” Duncan adds. “If this optimism comes to fruition, it should translate into stronger income growth and increased job security for consumers – the two HPSI components that could help support housing sentiment this year.”
Here are some more highlights from the latest reading:
- 32 percent of Americans surveyed in December say it is a good time to buy a home, an increase of 2 percentage points from November.
- 13 percent of consumers say now is a good time to sell, unchanged from the prior month. Thirty-eight percent of consumers say it’s a bad time to sell.
- 35 percent of consumers believe home prices will go up.
- 68 percent of respondents say they are not concerned about losing their job, a 4 percentage point month-over-month increase.
- 10 percent who say their household income is significantly higher than it was 12 months ago, a 5 percentage drop from November.
Source: Fannie Mae
Bed bugs can make a home inhospitable. They can be a huge cost to remove as well.
Orkin, a nationwide pest control services company, says its revenue from bed bugs treatments are up more than 10 percent over last year. The problem is growing.
“We have more people affected by bed bugs in the United States now than ever before,” says Ron Harrison, Orkin entomologist and director of technical services. “They were virtually unheard of in the U.S. 10 years ago.”
Bed bugs can travel from place to place relatively easily, attaching themselves to your luggage, purse, or other belongings and ultimately then settling into your home or apartment.
“Anyone can get bed bugs in their home. They are not a sign of uncleanliness,” Harrison says. “Bed bugs only need blood to survive. We have treated for bed bugs in everything from million-dollar homes to public housing.”
Bed bugs are small (about the size of an apple seed, fully grown), so they can be difficult to detect. Also, they can survive up to a year without feeding.
They often hide around seams of a mattress, behind headboards and in cracks and crevices, usually within a five-foot radius of the bed, Orkin notes. One of the first signs is spotting a bed bug or evidence of a small dark stain that they may have left behind.
“People may have bed bugs and not know it, because many people have no physical reaction to bed bug bites,” Harrison says. “That’s why it’s important for people everywhere to inspect for bed bugs regularly.”
Orkin recommends homeowners and travelers do the following to prevent bed bugs spreading at their home:
- Inspect your home regularly for any signs of bed bugs. Check locations where bed bugs hide during the day, including mattress seams and behind baseboards, headboards, electrical outlets, and picture frames.
- Inspect all secondhand furniture carefully before bringing it inside your home.
- Wash any potentially infested bed linens, curtains, and stuffed animals on the hottest temperature allowed for the fabric.
- Contact a pest management company if you spot any signs. Bed bugs can quickly elevate to a major problem if they spread from room to room and start to multiply.
States With the Most Bed Bug Cases
Orkin recently released its list of top bed bug cities. The list is based on treatment data from the metro areas where Orkin preforms the most bed bug treatments for residential and commercial buildings from December 2015 to Nov. 30, 2016. The cities that topped its list are:
- Washington, D.C.
- New York
- Columbus, Ohio
- Los Angeles
- San Francisco-Oakland-San Jose, Calif.
- Richmond-Petersburg, Va.
- Raleigh-Durham, N.C.
- Cleveland-Akron-Canton, Ohio
Rising mortgage rates continue to shoulder most of the blame for the decrease in mortgage applications in recent weeks. Total mortgage applications, including for refinancings and home purchases, dropped 4 percent on a seasonally adjusted week-over-week basis, the Mortgage Bankers Association reported Wednesday.
Broken out, applications for refinancing fell 4 percent last week. Refinancers tend to be particularly rate-sensitive, and even the slightest rise in rates could lessen incentive for homeowners to refinance.
Refinance applications are now 12 percent lower than a year ago, the MBA reports.
Applications for home purchases, viewed as a gauge of future homebuying activity, dropped 3 percent last week. Purchase applications still remain 2 percent higher than a year ago.
The average 30-year fixed-rate mortgage rose to the highest level since October 2014, averaging 4.28 percent last week, the MBA reports. Average rates for jumbo loans also inched higher.
“While jumbo 30-year fixed rates have been a bit slower to increase compared to overall fixed rate mortgage rates in recent weeks, they increased 7 basis points last week to an average of 4.29 percent,” says Lynn Fisher, the MBA’s vice president of research and economics. “At the same time, the average five-year ARM rate declined by 11 basis points to 3.28 percent, which may provide an alternative outlet for jumbo borrowers.”
Source: “Mortgage Applications Fall 4 Percent as Refinancings Hit Postelection Rates,” CNBC (Dec. 14, 2016)
Homeowners still believe their homes are worth more than what appraisers say, but their perceptions of the value are getting more in line with reality lately. The latest reading from Quicken Loans’ National Home Price Perception Index shows that homeowners’ perceptions were just 1 percent higher than appraisers’ opinions in November. This is the fifth consecutive month in which the gap between owner expectations and appraised values narrowed.
“The [index] compares the perceived gap between the homeowner and the appraiser’s opinion of a home’s value and has provided an intriguing look into the psychographics of our housing market,” says Quicken Loans Chief Economist Bob Walters. “The most recent HPPI indicates homeowners and appraisers are closer to agreeing at the end of 2016 than they were at the start of the year. It’s our hope that with this information the only surprises this holiday season are the ones wrapped under the tree.”
Appraisal values have been on the rise throughout 2016, according to the index. Appraisal valuations increased 0.42 percent in November and are up 5.28 percent year-over-year. The West continues to lead the country in home value growth, according to the index.
Source: Quicken Loans
The national housing market is largely predicted to moderate in 2017, but a handful of metros are expected to beat expectations. In fact, 10 markets are looking like hot-beds for growth in the new year.
Realtor.com®’s research team has flagged markets that will likely see average price gains of 5.8 percent and sales growth of 6.3 percent in 2017. Those gains would exceed next year’s anticipated national growth of 3.9 percent in home prices and 1.9 percent in home sales.
As such, real estate professionals in these 10 markets should expect a booming business in 2017. Realtor.com® notes these are the hottest housing markets to watch in the new year, based on price and sales gains:
1. Phoenix-Mesa-Scottsdale, Ariz.
2. Los Angeles-Long Beach-Anaheim, Calif.
3. Boston-Cambridge-Newton, Mass.-N.H.
4. Sacramento–Roseville–Arden-Arcade, Calif.
5. Riverside-San Bernardino-Ontario, Calif.
6. Jacksonville, Fla.
7. Orlando-Kissimmee-Sanford, Fla.
8. Raleigh, N.C.
9. Tucson, Ariz.
10. Portland-Vancouver-Hillsboro, Ore.-Wash.
Why are expectations so high for these 10 markets? Realtor.com®’s research team notes that strong local economies and population growth are helping to fuel sales. Also, the top 10 housing markets have other commonalities, such as relatively affordable rental prices, low unemployment, and large populations of millennials and baby boomers.
Source: “Realtor.com® Forecasts Post-Election Economy to Result in Higher Mortgage Rates While Housing Delivers Slower Gains in 2017,” realtor.com® (Nov. 30, 2016)
Despite skyrocketing rental prices in recent years, renters appear to be in better financial shape today than they were immediately following the last recession, according to a new study by TransUnion, which analyzed renters’ credit behavior. The study found that renters are lower-risk and more credit-active than they were in 2010. Nearly 39 percent had a prime-or-better credit score — which VantageScore 3.0 rates as a score of 660 or above — in 2015 compared to 26 percent in 2009.
“Our findings indicate that we are not on the cusp of rental affordability issues, as the vast majority of renters do have some excess liquidity once their monthly debt service obligations are met,” says Mike Doherty, senior vice president of TransUnion’s rental screening solutions group.
Renters have skewed older since 2009, when about 23 percent were younger than 25. By 2015, that group made up 20 percent of all renters. On the other hand, renters ages 45 and older rose from 24 percent of the renting population in 2009 to 31 percent in 2015.
“Following the recession, younger consumers may have been underemployed or have chosen to live at home with their parents,” says Doherty. “Older consumers may have opted to stay in a rental unit instead of purchasing a home. The good news for property managers is that renters of all ages are managing their credit obligations well. Property managers can help renters build their credit history by reporting rental payments to the credit bureaus, giving renters the credit they deserve for on-time payments.”
Source: “From Recession to Boom Times: Renter Profile Shifts,” TransUnion (Dec. 7, 2016)
President-elect Donald Trump has nominated retired neurosurgeon Ben Carson to be the next U.S. Secretary of Housing and Urban Development. If confirmed by the U.S. Senate, Carson will replace Julian Castro, who has served in the position since July 2014.
The National Association of REALTORS® has expressed a commitment to work with the new administration to support HUD and its mission.
“We congratulate Dr. Carson on accepting this important challenge, and wish him the very best of luck in meeting the task ahead,” said NAR President William E. Brown in a statement released Monday. “REALTORS® know that the incoming secretary of Housing and Urban Development has a big job ahead. Potential homebuyers face a range of hurdles. While we’ve made great strides in recent years, far more can be done to put the dream of homeownership in reach for more Americans.”
In his announcement, Trump praised Carson as “a brilliant mind … passionate about strengthening communities and families within those communities,”
Carson is a native of Detroit and a graduate of Yale University and the University of Michigan Medical School. He was a celebrated pediatric neurosurgeon with Johns Hopkins before catapulting himself onto the national stage with a run for the Republican Party nomination for president. After leaving the race in March, he endorsed Trump.
The HUD secretary oversees the Federal Housing Administration and other programs addressing the country’s housing needs, community development, and fair housing law. The department is also tasked with supporting homeownership for low- and moderate-income families through mortgage insurance and other subsidies. According to the White House, the HUD secretary oversees approximately 9,000 employees and a $40 billion budget.
—By REALTOR® Magazine
Glass-enclosed wine cellars are growing in popularity as home owners’ wine collection takes center stage in a home. The trend is most notably catching on in new homes in Southern California.
“You are seeing them in more homes, especially as designers are realizing they can be a real showpiece,” says Brahm Callahan, beverage director for Boston’s Himmel Hospitality Group.
Realtor.com® notes the popularity of wine storage in general in homes: Of the nearly 2.6 million homes currently for sale at its site, about 10,000 tout wine cellars.
Most private wine cellars are located in a home’s lower level or basement to ensure proper storage. But some cellars are moving up inside a home. The new glass wall cellars are not being made for long-term storage but more serving as artwork for walls. Joey Kleinhans, managing director at the Sommelier Company of Austin, Texas, recommends a glass cellar only be used for wines that will be consumed within two years.
“Wine as a design element has surged over the past two decades,” says Joseph Spellman, master sommelier for Landmark Vineyards in Sonoma, Calif. “Homebuilders are following the fashions of certain showy restaurants that like to display their rare bottles and huge collections.”
Source: “See the Light: Glass Wine Cellars Are Having a Moment,” realtor.com® (Nov. 2, 2016)
With growing concern over soaring allergies and child asthma rates, more Americans are taking a closer look at their homes and how they may be affecting their health. It’s prompted some home buyers to look at the amount of toxins a home may be emitting as well as its air quality.
In 2009, a survey conducted by homebuilder Meritage Homes revealed a growing concern among homeowners about the impact a home could have on their health. It motivated the builder in 2014 to add features to improve airflow and reduce toxins in its homes, such as improved air filters, whole-house water treatment, and low-emitting materials.
It also prompted more salespeople to ask buyers about any respiratory issues too when helping them to locate the right home. In the U.S., 17.7 million adults and 6.3 million children have asthma and more than 50 million Americans suffer from allergies.
Evolutionary Home Builders has made building a healthy home its primary focus. The company’s Evolutionary Pro Homes are marketed to meet the physical needs of professional athletes and designed to provide more oxygen, fresh air, and negative ions than traditional homes. The builder also claims it reduces the levels of toxins and allergens in its homes. Brandon Weiss, the founder of the company, says doctors have shown, via pre- and post-occupancy, how improved indoor environments can enhance performance.
More homebuilders are considering whether healthier building standards should be added to their homes too. However, the extra costs associated with building this way has been a big area of concern. But costs are heading down, which has prompted more builders to consider what elements they can offer.
Some builders are opting to become a partner in EPA’s voluntary Indoor airPLUS certification program. The certification program was launched in 2009 to provide construction specifications that protect indoor air quality. It’s recognition for builders who go “above and beyond” building standards in creating healthier indoor environments, says Bob Axelrad, EPA senior policy adviser for indoor environments.
Participants see indoor air quality and health as “the next important value proposition that they have to offer home buyers,” Axelrad says.
Other programs to help home owners determine the health of a home include WELL Building Standard, LEED for Homes, International Living Future Institute, the Healthy Building Network and BuildingGreen’s Health Product Declaration Open Standard, Greenguard, and Cradle to Cradle.
“Overall, health is a strong purchase driver, and there’s increasing concern about indoor air quality,” says Lee Ann Head, Shelton Group’s vice president of research. “But there’s work to be done to better communicate about the topic.”
Meritage Homes says at first they promoted a home’s health-based benefits along with energy efficiency. But they found the message wasn’t resonating. Buyers also were getting intimidated by the jargon, such as MERV (maximum efficiency rating value) air filters and low-VOC (volatile organic compound) materials. Now, its sales team focuses on “reminding consumers that they can and should have a better functioning home than they’ve had,” says C.R. Herro, vice president of energy efficiency and sustainability for Meritage.
Indeed, “we’re starting a conversation to get people to realize, wouldn’t it be great to have fresh air to breathe? Wouldn’t it be great to have a new house that doesn’t smell like a new car?” says Carl Grimes, managing director of the Hayword Healthy Home Institute. “It’s possible, and it doesn’t have to cost much more or even more to build a lot of these features into homes now.”
Source: “The Next Big Thing: Healthy Homes,” BUILDER (Nov. 30, 2016)