Pending sales drop | Waccabuc Real Estate

The Pending Home Sales Index decreased 2.5% in November 2016 to its lowest level since January 2016, and is 0.4% below November 2015. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), decreased to 107.3 in November 2016 from 110.0 the previous month.

The PHSI increased 0.6% in the Northeast, but fell 1.2% in the South, 2.5% in the Midwest and 6.7% in the West. Year-over-year, the PHSI increased 5.7% in the Northeast, but decreased 1.0% in the West, 1.3% in the South and 2.4% in the Midwest.

NAR recently reported a decline in confidence among renters who are contemplating the best time to buy a home. The election boosted the U.S. 10-year Treasury note from 1.83% the day before the election to 2.54% on December 28, 2016, and mortgage rates followed quickly. The Freddie Mac Weekly Survey reported a 30-year commitment rate of 3.54% on November 3, which increased to 4.30% for the week ending December 22, 2016. However, November existing sales continued a solid year-end path, and total 2016 existing sales are expected to reach the highest level since 2006. As the economy adds jobs, increased demand among first-time buyers will help fuel existing sales into 2017.

 

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http://eyeonhousing.org/2017/01/pending-sales-retreat-2/

Where are the Nation’s Second Homes? | South Salem Real Estate

According to NAHB estimates, the total count of the second home stock reached 7.5 million in 2014, an increase of 0.6 million over 2009 when NAHB Economics last produced these estimates. The share of second homes among the total housing stock also increased from 5.4% to 5.6%.

It is worthwhile to understand the patterns of second homes because they could have a significant economic impact on local housing markets and thus have important policy implications. This analysis focuses on the number and the location of second homes qualified for the home mortgage interest deduction using the Census Bureau’s 2014 American Community Survey (ACS).

The county with the largest share of second homes is Hamilton County, NY with 79.3%, followed by Forest County (74%), PA, and Rich County (72.7%), UT. As one might expect, the top 10 counties with the largest share of second homes are mostly tourist destinations.

Slide1

In-depth analysis, however, shows that the concentration of second homes is not simply restricted to conventional locations like beachfront areas. There were 913 counties spread over 49 states, where second homes accounted for at least 10% of the local housing stock. Only Connecticut and Washington D.C. were exceptions. 357 counties, 11% of all counties in the U.S., had at least 20% of housing units that were second homes.

27 counties in 14 states had over half of housing units qualified as second homes. Of these counties, five counties are in Michigan, four in Colorado and Wisconsin, two in California, Massachusetts, Pennsylvania, Utah, and one county each in Idaho, Missouri, North Carolina, New Jersey, New Mexico, and New York. These national patterns are mapped below.

sechome

Of course, the geographic locations of second homes also correspond to population density. Counties with more than 25,000 second homes are mostly located in or near metropolitan areas. The table below lists the top 10 counties with the most second homes. States with at least one such county are Arizona, Florida, California, Massachusetts, Illinois, New York, New Jersey, Nevada, South Carolina, Delaware, Texas, Michigan, and Maryland.

Slide2

sechome_num

NAHB estimates are based on the definition used for home mortgage interest deduction: a second home is a non-rental property that is not classified as taxpayer’s principal residence. Examples could be: (1) a home that used to be a primary residence due to a move or a period of simultaneous ownership of two homes due to a move; (2) a home under construction for which the eventual homeowner acts as the builder and obtains a construction loan (Treasury regulations permit up to 24 months of interest deductibility for such construction loans); or (3) a non-rental seasonal or vacation residence. However, homes under construction are not included in this analysis because the ACS does not collect data on units under construction.

 

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http://eyeonhousing.org/2016/12/top-posts-of-2016-where-are-the-nations-second-homes/

Mortgage rates average 4.09% | Waccabuc Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average mortgage rates moving lower for the third consecutive week.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 4.09 percent with an average 0.5 point for the week ending Jan. 19, 2017, down from last week when it averaged 4.12 percent. A year ago at this time, the 30-year FRM averaged 3.81 percent.
  • 15-year FRM this week averaged 3.34 percent with an average 0.5 point, down from last week when it averaged 3.37 percent. A year ago at this time, the 15-year FRM averaged 3.10 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.21 percent this week with an average 0.4 point, down from last week when it averaged 3.23 percent. A year ago, the 5-year ARM averaged 2.91 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

Quote
Attributed to Sean Becketti, chief economist, Freddie Mac.

“After trending down for most of the week, the 10-year Treasury yield rose following the release of the CPI report. In contrast, the 30-year mortgage rate fell three basis points to 4.09 percent, the third straight week of declines.”

Time to Build a Single-Family Home | Cross River Real Estate

With the end of 2016 approaching, NAHB’s Eye on Housing is reviewing the posts that attracted the most readers over the last year. In July, Na Zhao examined typical construction durations for various types of single-family homes and regions.


The 2015 Survey of Construction (SOC) from the Census Bureau shows that the average completion time of a single-family house is around 7 months, which usually includes almost a month from authorization to start and another 6 months to finish the construction. The timeline from authorization to completion, however, is not consistent across the nation, depending on the housing category, the geographic location, and metropolitan status.

Among all the single-family houses completed in 2015, houses built for sale took the shortest time, 6 months to completion after obtaining building permits, while houses built by owners required the longest time, almost a year. Homes built for rent took 9 months from permit to completion, and those built by hired contractors normally needed around 8 months. A large proportion of single-family homes built for sale and on owners’ land built by contractors began construction within the same month after obtaining building authorizations. However, homes built for rent and built by owners had a one-month lag between permits and construction start in 2015.

Slide1

The average time from authorization to completion also varies across the nation. New England division had the longest time of 10 months, followed by the Middle Atlantic of 9.6 months, East South Central, East North Central, and Pacific of 8 months in 2014. These four divisions all had above average time from permit to completion. The shortest period, 6 months, happened in the Mountain division, which also had the shortest waiting period from permit to construction start.

permit_compper_start

 

 

The metropolitan status indicates how long it takes to build a single-family home. Houses in metropolitan areas, on average, took nearly 7.5 months to completion, which was 2 months shorter than those in non-metropolitan areas. This pattern was quite consistent across the nation, except for the Middle Atlantic division where the average month to completion in metropolitan areas was longer than in non-metropolitan areas in 2015.

Slide2

The SOC also collects sale information for houses built for sale, including the sale date when buyers sign the sale contracts or make a deposit. In 2015, the share of single-family sold while under construction was 66%, with 32% even sold before construction start and 12% sold during the same month of completion. The percent of single-family houses completed in 2015 stayed unsold at the first quarter of 2016 was only 6%.

 

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http://eyeonhousing.org/2016/12/top-posts-of-2016-time-to-build-a-single-family-home-in-2015/

Regulation is 24.3 Percent of the Average New Home Price | Katonah Real Estate

An NAHB study shows that, on average, regulations imposed by government at all levels account for 24.3 percent of the final price of a new single-family home built for sale.  Three-fifths of this—14.6 percent of the final house price—is due to a higher price for a finished lot resulting from regulations imposed during the lot’s development.  The other two-fifths—9.7 percent of the house price—is the result of costs incurred by the builder after purchasing the finished lot.

Reg Post 01NAHB’s previous 2011 estimates were fairly similar, showing that regulation on average accounted for a quarter of a home’s price.  However, the price of new homes increased substantially in the interim.  Applying percentages from NAHB’s studies to Census data on new home prices produces an estimate that regulatory costs in an average home built for sale went from $65,224 to $84,671—a 29.8 percent increase during the roughly five-year span between NAHB’s 2011 and 2016 estimates.

Reg Post 02In comparison, during that time, disposable income per capita in the U.S. increased by 14.4 percent.  In other words, the cost of regulation in the price of a new home is rising more than twice as fast as the average American’s ability to pay for it.

The above estimates are based largely on questions included in the survey for the March 2016 NAHB/Wells Fargo Housing Market Index, combined with long-run assumptions about average construction times, interest rates, profit margins, etc.  The survey questionnaire and an appendix describing each additional assumption and the data on which it’s based can be found in the full study.  The full study also contains substantial additional detail on the different types of regulatory costs and where and how they impact the development-construction process.

 

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http://eyeonhousing.org/2016/12/top-posts-of-2016-regulation-is-24-3-percent-of-the-average-new-home-price/

Average Boston-area rent falls for the first time in almost 7 years | Bedford Hills Real Estate

Boston, Mass - 06/20/2016 - Construction workers work on the Pierce apartment under construction at corner of Boylston and Brookline Streets in Boston, Mass, June 20, 2016. (Keith Bedford/Globe Staff)

After years of going up, rents in Boston’s super heated real estate market may have finally reached a peak.

Data released Thursday show that apartment rental prices fell slightly at the end of 2016 — the first drop since 2010 — amid a surge of new buildings that have opened in Boston and neighboring cities such as Cambridge, Chelsea, and Somerville.

The decline was modest, just 1.7 percent — or $36 a month on the average lease of $2,038, according to the rental-tracking firm Reis Inc. But it was the latest and clearest sign that the flood of construction in Boston is putting a lid on prices, at least at the upper end of the market.

“When you put that much supply on the market, you’re going to disrupt the equilibrium,” said Sue Hawkes, chief executive of Collaborative Cos., a real estate marketing firm in Boston. “That’s what’s happening.”

During the first nine months of 2016, more than 5,100 apartments, most renting for top dollar, opened in the heart of the Boston area. Another 7,200 are under construction in Boston alone, according to city figures.

While rents may no longer be uniformly escalating, city apartments remain unaffordable for many people, something unlikely to change over the next few years.

Only New York City and San Francisco have higher average rents than Boston.

Still, the expanding supply of rental units is clearly having an effect on the balance of supply and demand, according to Hawkes.

That means renters —at least well-heeled ones — can be choosers for a change.

To woo tenants, some landlords of new luxury buildings are offering free rent for a month or more, covering brokers’ fees and dangling gift cards or other goodies in front of prospective tenants.

But those kinds of perks aren’t available to the majority of renters, especially outside of the immediate Boston area. In parts of the region where there hasn’t been as much construction, rents continue to climb — in some places, far faster than in the market as a whole.

In Malden, for instance, rents are up 5 percent over the last year, according to separate data from the website ApartmentList.com.

Rents in Allston/Brighton and Mission Hill have climbed about 8 percent over the same period, said Ishay Grinberg, president of the Somerville-based website RentalBeast.

“People are getting priced out of downtown,” Grinberg said. “But all it’s doing is pushing rents up higher in areas that may have been slightly less desirable a couple of years ago.”

Over the last year, large apartment buildings have opened up in Chelsea and Quincy, Jamaica Plain, and Dorchester. In Brighton, a wave of new projects is getting underway, and renting at a brisk clip.

In November, Hamilton Co. opened a 49-unit building on Malvern Street in Allston, with two-bedroom units starting at $2,500 a month — less than half the going rate at new complexes in the Seaport District. It was nearly full in a week.

“That’s a very good sign for a working-class building,” said Hamilton’s president, Carl Valeri.

But the demand is also leading to a surge in land and construction prices in Boston’s outer neighborhoods. That’s putting financial pressure on projects that are aiming for a modest price point. If developers believe they won’t hit their projected rents when they open in two years, they might pull back on construction projects, said Travis D’Amato, a broker who specializes in multifamily investments at the real estate firm JLL.

“We are at an inflection point in the market,” D’Amato said. “If construction costs continue to rise and rents don’t continue to rise, we could see some slowdown in development.”

So far, there’s little evidence of that happening.

A number of major projects in outlying neighborhoods — such as the 650-unit Washington Village development near Andrew Square — are poised to get underway later this year.

More proposals, such as a plan to build 680 graduate student-oriented apartments on the grounds of St. Gabriel’s Monastery in Brighton, are going through the city’s approval process.

If those projects come to fruition, rents should eventually flatten in the outlying neighborhoods, just as they appear to be doing downtown, said Sheila Dillon, the city’s housing chief.

“What’s playing out is, really, exactly what we want,” Dillon said. “We want to see investors continue to build housing, and that’s taking pressure off the existing housing stock.”

Meanwhile, the market for high-end living downtown will soon face more tests.

Two huge rental buildings, 832 units in all, are set to open this spring in the Seaport.

In addition, a 585-unit complex in the South End is under construction, and a 45-story apartment tower is planned to break ground soon atop the Government Center Garage.

Builders who have recently launched downtown apartment projects say they’re not worried. Avalon North Station, a 38-story tower that opened in November, has leased 85 of its 503 units. That’s an impressive showing, especially during the holidays, said Scott Dale, senior vice president of development for the developer, Avalon Bay.

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http://www.bostonglobe.com/business/2017/01/05/average-boston-area-rent-falls-for-first-time-almost-years/2JMoK39bFND08wKhQT2BnM/story.html?s_campaign=email_BG_TodaysHeadline&s_campaign=

Zillow 2017 real estate predictions | Bedford Real Estate

This year is nearly over, and 2017 will being in just a few short weeks. As the year comes to a close, predictions for next year are pouring in.

It’s hard to say what the new year will bring with the newly-elected President-elect Donald Trump. Zillow points out in its predictions how some of his policies could affect housing next year.

Here are Zillow’s six predictions for 2017:

1. Cities will focus on denser development of smaller homes close to public transit and urban centers.

2. More millennials will become homeowners, driving up the homeownership rate. Millennials are also more racially diverse, so more homeowners will be people of color, reflecting the changing demographics of the United States.

3. Rental affordability will improve as incomes rise and growth in rents slows.

4. Buyers of new homes will have to spend more as builders cover the cost of rising construction wages, driven even higher in 2017 by continued labor shortages, which could be worsened by tougher immigration policies under President-elect Trump.

5. The percentage of people who drive to work will rise for the first time in a decade as homeowners move further into the suburbs seeking affordable housing — putting them further from adequate public transit options.

6. Home values will grow 3.6 percent in 2017, according to more than 100 economic and housing experts surveyed in the latest Zillow Home Price Expectations Survey. National home values have risen 4.8 percent so far in 2016.

U.S. EPA settles with firm for failure to protect residents from lead-based paint | Bedford Corners Real Estate

The U.S. Environmental Protection Agency announced a settlement with Powerstar Home Energy Solutions for failing to comply with federal lead-based paint rules at several residential properties in Southern California.  The company will pay a civil penalty of $11,429.

Powerstar has also agreed to spend about $34,000 to purchase equipment to test blood lead levels in children. Blood lead analyzers will be donated to ten community health clinics in San Bernardino and Orange counties. The analyzers measure lead in blood samples and give results in as little as three minutes, allowing immediate follow-up by health care providers. The clinics will receive enough kits to test 480 children.

“Children are highly susceptible to lead-based paint and symptoms are not easily recognized,” said Alexis Strauss, EPA’s Acting Regional Administrator for the Pacific Southwest. “This settlement will give hundreds of families the opportunity to have their children tested, giving parents the information they need to protect their loved ones.”

Powerstar Home Energy Solutions, a trade name of Smithlum & Friend, Inc., is headquartered in Anaheim and offers residential coatings and window replacements. In 2014, EPA found the company violated EPA’s Renovation, Repair and Painting rule by renovating five homes built before 1978 in the cities of Anaheim, Brea, Chino and Redlands without following practices required to reduce lead exposure. The company failed to:

  • Become certified by EPA to perform residential work;
  • Distribute the “Renovate Right” brochure to educate occupants about lead-safe work practices;
  • Keep complete records documenting whether the work followed lead-safe practices.

Common renovation activities like sanding, cutting, and demolition can create hazardous lead dust and chips. When companies fail to follow lead-safe practices, the resulting lead dust and chips can contaminate home surfaces. Contractors who disturb painted surfaces in pre-1978 homes and child-occupied facilities must be trained and certified, provide educational materials to residents, and follow safe work practices. The U.S. banned lead-based paint from housing in 1978 but EPA estimates that more than 37 million older homes in the U.S. still have lead-based paint.

Though harmful at any age, lead exposure is most dangerous to children because their bodies absorb more lead, and their brains and nervous systems are more sensitive to its damaging effects. Babies and young children can also be more highly exposed to lead because they often put their hands and other objects that can have lead from dust or soil on them into their mouths. The effects of lead exposure can include behavior and learning problems, slowed growth, hearing problems, and diminished IQ.

Often lead poisoning occurs with no obvious symptoms, so it may go unrecognized. Parents or caregivers who think their child has been in contact with lead should notify their child’s health care provider who can help decide whether a blood test is needed or recommend treatment.

EPA enforces the federal Toxic Substances Control Act and its Renovation, Repair, and Painting rule and the lead-based paint Disclosure Rule. The Renovation, Repair, and Painting rule protects residents and children from exposure to lead-based paint hazards from activities that can create hazardous lead dust when surfaces with lead-based paint are disturbed. The Disclosure Rule requires those who sell or rent housing built before 1978 to provide an EPA-approved lead hazard information pamphlet, include lead notification language in sales and rental forms, disclose any known lead-based paint hazards and provide reports to buyers or renters, allow a lead inspection or risk assessment by home buyers and maintain records certifying compliance with applicable federal requirements for three years.

 

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https://www.epa.gov/newsreleases/us-epa-settles-anaheim-home-improvement-firm-failure-protect-residents-lead-based-paint

Facebook CEO smart house | Chappaqua Real Estate

Facebook CEO Mark Zuckerberg gave users a unique look into his home, as part of an explanation of his custom-made artificially intelligent assistant.

Building on Facebook’s internal technology for Messenger app building, Zuckerberg made an iPhone app, Jarvis, to connect the smart devices and phones around his home, similar to Amazon’s Echo. In explaining his progress in the app, Zuckerberg somewhat jokingly revealed some of the quirks of his lifestyle with his wife, Priscilla Chan.

For instance, Jarvis wakes Zuckerberg’s daughter, Max, up to a Mandarin lesson, thanks to Facebook’s visual face detection which determines when the infant is awake. This same technology helps Zuckerberg recognize who’s ringing his doorbell, he said.

We also know Zuckerberg has a pretty extensive set of Spotify playlists and someone in the family may be an Adele fan.

Zuckerberg also showed an interface to request a clean gray T-shirt — his signature look — from what he called a rigged-up ” T-shirt cannon.” He has also ginned up a special 1950’s-era toaster “that will let you push the bread down while it’s powered off so you can automatically start toasting when the power goes on.”

Creating the assistant was one of Zuckerberg’s yearly resolutions, which have also included running a mile a day, reading a new book every other week and learning Chinese.

This year’s challenge was aimed to help him learn how powerful AI can be with 100 hours of work, he wrote. For instance, Zuckerberg said that he realized texting Jarvis — especially if he was away from his home or in the middle of a task — was often more valuable than voice commands alone. That, Zuckerberg said, falls in line with trends he’s seen on Messenger and WhatsApp, where texting is growing more quickly than voice calls.

However, Zuckerberg said, with the voice bot, he learned to consider it a presence that responded more quickly and empathetically.

“It can interact with Max and I want those interactions to be entertaining for her, but part of it is that it now feels like it’s present with us,” Zuckerberg wrote. “I’ve taught it fun little games like Priscilla or I can ask it who we should tickle and it will randomly tell our family to all go tickle one of us, Max or Beast. I’ve also had fun adding classic lines like ‘I’m sorry, Priscilla. I’m afraid I can’t do that.'”

Zuckerberg said he found little bugs that showed how far AI systems are from being generalized for a wide variety of requests.

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http://www.cnbc.com/2016/12/19/how-the-other-half-lives-mark-zuckerbergs-life-inside-his-bespoke-smart-house.html?__source=newsletter%7Ceveningbrief