Monthly Archives: July 2015

Underwater borrowers increased for two straight quarters | North Salem Real Estate

Home prices are still rising, and the economy is improving, but the ills of the housing crash are far from cured: 7.4 million borrowers were still “seriously” underwater on their mortgages at the end of June, according to RealtyTrac.

The real estate information company defines that as the loan amount being at least 25 percent higher than the property’s estimated market value.

Over 13 percent of all properties with a mortgage are in this predicament, and that is actually a slight increase from the first quarter of this year.

House underwater

Cherezoff | Getty Images

How can this be when home prices are still rising? It depends on how you read those prices. The National Association of Realtors reported that the median price of a home sold in June reached its highest level in history. The median, however, means half the homes sold for more and half sold for less, so if higher-priced homes are selling more, which they are, that skews the median higher. S&P/Case Shiller, which measures repeat sales of similarly priced homes, shows price gains have been shrinking in general but are still higher than a year ago.

Still, another report from Weiss Residential Research digs deeper in local areas and finds that nearly half the homes in the nation’s top markets are actually losing value.

“Don’t be fooled by averages,” said Allan Weiss, founder and CEO of Weiss Residential Research. “All of the largest metro indexes are rising more slowly than they were a year ago though market reports give the impression that values are rising across the board. However, people don’t own the entire market, they own one house.”

Larger, more expensive homes, are sitting on the market longer and seeing more price cuts than smaller homes with two bedrooms or less, according to Weiss. That is likely because there is so much less supply on the lower end of the market than on the high end.

Home prices are most often measured in terms of sale price, but RealtyTrac’s numbers are based on estimates of home all home values, not just the ones for sale.


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Smart Watering Tips for Every Gardener | Armonk Real Estate

Tired of watering all the time, while praying for rain and smaller water bills? If your garden is planned, prepared, planted and watered properly, you can have a beautiful yard and save thousands in the long run. Here’s how to get the most from your water this summer.

Start from the ground up

Plan your preemptive strike against drought. Get to know your yard, and note which areas tend to dry out quickly or develop puddles after it rains. Places that are especially prone to drying out include the soil under large and thirsty trees, or under the eaves of your roof.

Your soil type plays a big part in how often you’ll need to water. Loose, sandy soil holds very little moisture, so much of the water you dump on it slips away and goes to waste.

Treat runoff as if it’s money — don’t let it slip through your fingers.

Treat runoff as if it’s money — don’t let it slip through your fingers.

The soil you’re after is the rich, dark crumbly stuff called loam. Adding topsoil (good), composted manure (better) or compost (best) to your soil makes it loamy and performs some pretty amazing feats. It encourages beneficial organisms, improves the soil structure and texture, aerates the soil and helps it retain moisture.

If your garden is too big to amend with better dirt, consider growing vegetables in a raised bed, where you can easily focus your watering efforts and amend the soil without breaking the bank.

Choose the right plants

When it comes right down to it, you have to look at your water bill and ask yourself: Is that tomato vine really worth the absurd amount of money you spend each month?

If growing your own food is what motivates you to shell out for those big bills, consider raising cowpeas, hot peppers, okra or other edibles that require less water. Choose drought-tolerant plants whenever possible, unless you’re planting in a space that rarely dries out.

Texas sage is just one of the many plants that thrives without irrigation.

Texas sage is just one of the many plants that thrives without irrigation.

If you simply have to grow thirsty plants, group them together so you can easily water them without wasting a drop. You might even choose to submerge a perforated pond liner so water has a better chance to collect.

Native plants are often, but not always, good choices for a drought-tolerant landscape since they’re well adapted to the unique conditions of your region. Succulents and cacti are well equipped to handle drought because they store moisture in their leaves and stems.

If you have a lawn that requires regular irrigation, save money by replacing it with a mass of groundcovers like wooly thyme or liriope.


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Home Prices are now only 6.5 Percent below Peak | Cross River Real Estate

In terms of national averages, the recovery has raised prices within a hair of their highest peaks reached during the boom nearly ten years ago, but on a market-by-market basis, median prices in fewer than half of the nation’s larger markets have fully rebounded from the housing crash.

At $251,000, US home prices are now just 6.5 percent off June 2006 peak of $268,000, and up over 25 percent from the market”s bottom, according to May data released today by Black Knight Financial Services.  Black Knight reported that its HPI index rose 1.1 percent in May over April and 5.1 percent over May 2014.

However, on a market-by-market basis, only 47 percent of the nation’s top 300 markets have met or exceeded their peaks in 2007., which tracks price rebounds by market, reported that in May 139 of the nation’s 300 largest markets had achieved full price recovery. reported that:

  • Dallas-Fort Worth-Arlington, TX (115.17% rebound percentage), Austin-Round Rock, TX (113.15%), and Denver-Aurora-Lakewood, CO (113.04%) led the nation’s top 100 markets  in rebound percentage in May.  In fact, nine of the top ten leading rebound markets were in the West.
  • Three of the nation’s beste online casino largest markets had at least a 7% increase yearly while seven markets had an annual percentage increase of at least 6%. Five markets are from California which is the most from a single state.
  • The West was home to nine of the top ten markets achieving the greatest year over year price appreciation in May.

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Sellers are Pocketing their Biggest Profits since the Peak | Waccabuc Real Estate

Single family home and condo sellers in the first half of 2015 sold for more above their purchase price in the first half of this year than any time since prices were at the peak of the boom.

Homes sold for an average of 13 percent above their original purchase prices, the highest average percentage in home price gains realized by sellers since 2007, when it was 30 percent, according to RealtyTrac.

Major markets where sellers in the first half of 2015 realized the biggest average home price gains were San Jose, California (41 percent); San Francisco (37 percent); Denver (29 percent); Portland (25 percent); Los Angeles (25 percent); and Seattle (20 percent).

“Sales activity has been strong this year and the metrics point to a solid foundation for steady growth. Growing boomerang buyer interest and first time buyer participation combined with smarter lending requirements are fostering a sustainable market,” said Mark Hughes, chief operating officer with First Team Real Estate, covering the Southern California market. “Lower investor, cash, and distressed activity are three reliable indicators that peripheral buying and selling activity is settling back down and the traditional owner occupied residential market is back on solid ground and healthy.”

There were six major markets where sellers in the first half of 2015 on average sold below their original purchase price: Chicago (7 percent below); Cleveland (7 percent below); Hartford, Connecticut (3 percent below); Jacksonville, Florida (2 percent below); St. Louis (1 percent below); and Orlando (1 percent below).

Zillow and Case-Shiller both reported strong appreciation in their first quarter reports, Zillow at 5.2 percent year over year for its 20-city composite and Case-Shiller at 5.0 percent.

“Home price appreciation has settled into a nice groove over the past few months, and ought to remain there going forward. This is still more proof that the for-sale market, while certainly not yet fully healed, is continuing to return to normal,” said Zillow Chief Economist Dr. Stan Humphries when the first quarter results were released May 26. “But relative strength in one indicator shouldn’t be confused with full recovery. Inventory is very low and the housing market is still very much out of balance, particularly on the rental side, where rapid rent increases and tepid wage gains are contributing to a deepening rental affordability crisis. This will make it more difficult for current renters to save up and make the transition into homeownership, particularly for younger would-be buyers the market so sorely lacks and needs.”

Single family homes and condos in June sold for an average of $291,450 compared to an average $287,634 estimated market value for those same homes at the time of sale – a 101 percent price-to-value ratio. June was the first time since July 2013 that the national price-to-value ratio exceeded 100 percent.

Major metro areas with the highest price-to-value ratios — where homes sold the most above estimated market value — were San Francisco (106 percent); Hartford, Connecticut (105 percent); Baltimore (105 percent); Rochester, New York (104 percent); and Providence, Rhode Island (103 percent).


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Nearly Half of Homes in Top Markets are Losing Value | South Salem Real Estate

Despite market reports of strong median home price appreciation this spring, gains are very uneven and nearly half of homes in ten of the nation’s largest markets actually lost value in May. On a house-by-house basis, about one-third fewer homes in the largest markets gained value during the heart of the spring buying season this year compared to last, according to Weiss Residential Research’s Indexes.

Only 54 percent of homes in the markets appreciated during May compared to 81 percent in May 2014, a sign that the downward trend may continue in the coming months.  In Denver, the hottest market in the nation, 84 percent of houses appreciated in May compared to 95 percent last year.  In the Washington, DC market, weakest of the top ten, only 34 percent of houses gained value in May compared to 57 percent in May 2014.

“Don’t be fooled by averages,” said Allan Weiss, founder and CEO of Weiss Residential Research.  ‘All of the largest metro indexes are rising more slowly than they were a year ago though market reports give the impression that values are rising across the board.  However people don’t own the entire market, they own one house.”

Larger homes are having a harder time than smaller homes with two bedrooms or less.  In Denver, larger homes appreciated 5.8 percent on a year over year basis in May compared to smaller homes.  In Washington, DC, larger homes actually fell -0.7 percent.  Smaller homes declined less, -0.2 percent year over year.


Same Pattern as the Housing Crash

In a metro like DC with a median price increase of 1.2 percent in the past year according to Case-Shiller, 60 percent of the houses are rising and the other 40 percent are stagnant or falling.  Since the ones that are appreciating outnumber the ones falling the average is a low positive number, Weiss said.

“The same pattern occurred before the great housing meltdown ten years ago.  The percent of houses rising in DC declined from 100 percent to 60 percent while the metro index showed a slowdown but did not go negative.  Once the population of houses that had been rising fell below 50 percent, the index began its descent,” Weiss said.


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Condos gaining popularity in Greenwich real estate market | Katonah Real Estate

Greenwich is traditionally known for its sprawling multi-million dollar estates and a community that provides escape from the compact living associated with nearby Manhattan.

But what happens when those expansive single-family homes are no longer the preferred abode for Greenwich elite?

Jonathan Miller, president of Miller Samuel Real Estate Appraisers and Consultants, said an influx of luxury condos on the market — and a rush of city dwellers seeking homes with little upkeep in the suburbs — is changing the way people think about Greenwich real estate.

“We’re seeing this in Westchester, we’re seeing this in the Hamptons … where the development is luxury condo products,” Miller said. “We’re seeing this city-to-suburban path where people coming from the city are used to this —not having to take care of the exterior of the property, etc. — and we’re seeing this pop up in a lot of New York City metropolitan area suburbs, including Greenwich.”

Miller prepares an independent quarterly report for real estate firm Douglas Elliman, which recently entered the Greenwich market. The Elliman Report details the changing trends in the region, particularly as it relates condominium and townhouse sales to single-family homes. The first quarter report showed the ongoing change in the Greenwich real estate market — mansions were struggling to sell while condos with less upkeep (and a lower price tag) were more popular among buyers.


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Pending Home Sales Dip in June | Bedford Hills Real Estate

After five consecutive months of increases, pending home sales slipped in June but remained near May’s level, which was the highest in over nine years, according to the National Association of Realtors®. Modest gains in the Northeast and West were offset by larger declines in the Midwest and South.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, fell 1.8 percent to 110.3 in June but is still 8.2 percent above June 2014 (101.9). Despite last month’s decline, the index is the third highest reading of 2015 and has now increased year-over-year for ten consecutive months.

Lawrence Yun, NAR chief economist, says although pending sales decreased in June, the overall trend in recent months supports a solid pace of home sales this summer. “Competition for existing houses on the market remained stiff last month, as low inventories in many markets reduced choices and pushed prices above some buyers’ comfort level,” he said. “The demand is there for more sales, but the determining factor will be whether or not some of these buyers decide to hold off even longer until supply improves and price growth slows.”

According to Yun, existing-home sales are up considerably compared to a year ago despite the share of first-time buyers only modestly improving1. The reason is that the boost in sales is mostly coming from pent-up sellers realizing their equity gains from recent years.

“Strong price appreciation and an improving economy is finally giving some homeowners the incentive and financial capability to sell and trade up or down,” adds Yun. “Unfortunately, because nearly all of these sellers are likely buying another home, there isn’t a net increase in inventory. A combination of homebuilders ramping up construction and even more homeowners listing their properties on the market is needed to tame price growth and give all buyers more options.”

The PHSI in the Northeast inched 0.4 percent to 94.3 in June, and is now 12.0 percent above a year ago. In the Midwest the index declined 3.0 percent to 108.1 in June, but is still 5.0 percent above June 2014.

Pending home sales in the South also decreased 3.0 percent to an index of 123.5 in June but are still 7.8 percent above last June. The index in the West increased 0.5 percent in June to 104.4, and is now 10.4 percent above a year ago.

The national median existing-home price for all housing types in 2015 is expected to increase around 6.5 percent to $221,900, which would match the record high set in 2006. Total existing-home sales this year are forecast to increase 6.6 percent to around 5.27 million, about 25 percent below the prior peak set in 2005 (7.08 million).


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Mortgage Rates drop to 3.98% | Bedford Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates moving down with the average 30-year fixed mortgage rate ducking just under four percent.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.98 percent with an average 0.6 point for the week ending July 30, 2015, down from last week when it averaged 4.04 percent. A year ago at this time, the 30-year FRM averaged 4.12 percent.
  • 15-year FRM this week averaged 3.17 percent with an average 0.6 point, down from last week when it averaged 3.21 percent. A year ago at this time, the 15-year FRM averaged 3.23 percent.
  • 1-year Treasury-indexed ARM averaged 2.52 percent this week with an average 0.3 point, down from last week when it averaged 2.54 percent. At this time last year, the 1-year ARM averaged 2.38 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 links for theRegional and National Mortgage Rate Details and Definitions. Borrowers may still pay closing costs which are not included in the survey.

Attributed to Sean Becketti, chief economist, Freddie Mac.

Monday’s 8 percent decline in Chinese stock prices triggered similar — though smaller — sell-offs in global equity markets. The associated flight to quality drove U.S. Treasury yields down nearly 5 basis points. Accordingly, 30-year fixed-rate mortgages fell 6 basis points to 3.98 percent. The mortgage rate has bounced between 3.98 and 4.09 percent since the first full week of June, falling a bit when events overseas take a turn for the worse and rising when the clouds appear ready to part. With no clear direction coming from the Fed this afternoon, we expect more of the same in coming weeks.

“Recent housing data exhibited the same good news/bad news pattern as overseas developments. Coming into this week, existing home sales for June and the latest FHFA house price measures both suggested a stronger tone in the housing market. However this week brought nothing but bad — or at least weaker-than-expected — news. New homes salesand pending home sales both weakened and the Case-Shiller house price indices, while positive, fell below the lower end of expectations. Finally, the inadvertent release of Fedstaff projections increased uncertainty over the timing of future Fed rate moves.”

As housing prices skyrocket in New Orleans, miniature houses are the answer | Pound Ridge Real Estate

This house in the Irish Channel is being built on an 880-square-foot lot. It goes on sale next month.


This house in the Irish Channel is being built on an 880-square-foot lot. It goes on sale next month.

Tiny houses veer between fad and architectural fascination in cities across the world, but in New Orleans ­— where waterways and old plantantion lines make frequent curiosities out of the street grid — they may be finding a natural home.

With undeveloped standard-sized lots increasingly scarce among the most sought-after neighborhoods along the Mississippi River, architects and developers are looking for building opportunities on small parcels that have been overlooked until now. While planners around the country tout the urban-infill trend as a counterweight to suburban sprawl, some New Orleanians worry the smaller structures may congest their neighborhoods.

Architect Jonathan Tate and developer Charles Rutledge say they have identified more than 5,000 irregularly-shaped vacant lots traditionally seen as too tiny to be built upon. In the hopes of transforming some of these parcels into new small-but-affordable housing stock, they are building their first “starter home,” a house on an 880-square-foot lot in the 3100 block St. Thomas Street in the Irish Channel.

“The lot on St. Thomas ‘wasn’t worthy of a house’ is what the neighbors said,” Tate says.

Irish Channel real estate has skyrocketed in value over the past few years, but Tate and Rutledge say it has 20 to 30 irregularly sized empty lots that measure less than 900 square feet. They think if they could use the land to build smaller houses, they could utilize empty space and also open up an increasingly expensive neighborhood to first-time homebuyers.

“The Irish Channel is particularly interesting because the value is going way up, and it’s pushing people out,” Rutledge says. “We want to see how to make housing more affordable without cheap architecture.”

The solution on St. Thomas Street has been to buy a smaller plot of land and build a smaller house, which will have lower construction costs. The house looms tall and thin on a sliver of land between a Creole cottage and a warehouse. That’s the practice of cash house buyers in Knoxville.

“If we’re working with odd lots, we can be inventive with how we use space and [take advantage of] all parts of the lot,” Tate says. “Stylistically, its contemporary, but there’s enough familiarity to them.”

Real estate agent Tracey Moore, who will put the house on the market in August, has said the team is filling a particular niche in the real estate market that has yet to be addressed.

“Smaller lots are hard to deal with, but because they’re small, they’re still somewhat affordable,” Moore says. “Most of the time, these lots are just sitting there with grass growing or people are putting trash on them.”

Moore says for someone trying to break into the housing market in a trendier neighborhood such as the Irish Channel or Bywater, smaller lotsare the only things left. Though the thought of developing irregularly sized lots isn’t necessarily new, developers often overlook them because they may not turn as much of a profit, Moore adds. Tate and Rutledge acknowledge this, and say their first house on St. Thomas may need to sell for more to make up for the potential of losing money on the sale of future starter homes in the area.

They bought the 16-by-55-foot lot on St. Thomas for $22,000. By comparison, a regular-sized lot in the area recently sold for $285,000, and that’s not including the price of building a house. Houses in the area have sold for up to $400 per square foot. The team hopes to sell starter homes for around $200 per square foot.

“We’re trying to provide an alternative option for someone with a price point that doesn’t exist in this part of the city,” Tate adds.

Affordability is a major reason tiny houses have drawn increasing interest around the country. Gregory Paul Johnson, founder of the Small House Society in Iowa City, Iowa, told The New York Times the notion of very small houses becoming popular would have been absurd in the early 2000s.

“But there are so many powerful forces at work right now, like rising energy costs and the mortgage crisis,” Johnson told the newspaper. “I think people want small homes because they cost less to purchase, maintain, heat.”

But one person’s innovation may be another’s imposition. Several neighbors recently turned out to protest another narrow home on a small lot on Chestnut Street.

The developer, Logistics Park LLC of New Orleans, is planning a two-story home for the lot at 4621 Chestnut St. The house would be 12-feet, 10-inches wide, 65 feet long, and 28 feet tall, for a total floor area of approximately 1,500 square feet.

The lot itself measures 21 feet across, nearly half the 40 feet normally required, but the city granted a construction permit in March because “a single-family lot can be developed on by right” under usual circumstances, said Leslie Alley of the City Planning Commission. City officials, however, did not notice that the lot had been commonly owned with the neighboring lot property until just last year, Alley said, which means a variance should have been required.

When neighbors pointed out the prior common ownership of the neighboring lots, a stop-work order was issued and a hearing set before the Board of Zoning Adjustments. Anne Raymond, representing the developer, told the board that the lot width dates back nearly a century.

“The lot area and width are the historical lot area and width from 1908,” Raymond said. “It is how it is.”

The July 13 hearing also brought a number of neighbors in opposition. Justin Chopin, who lives on the Valence Street side of the block, said the lot is too small to be independently developed, and the developer should have known that when they bought it.

“They had to do so knowing it was never going to be conforming to the zoning regulations,” Chopin said. “There’s not ample parking. It doesn’t fit with the construct of the other houses.”

Lorraine Neville, whose husband is musician Art Neville, said the lot was always part of the neighboring home as a side yard.

“I know this to be true; it was never an independent lot,” Lorraine Neville said, noting that she had a letter signed by 15 adjacent neighbors opposing the construction.


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Susan Macarz

Weak home purchase contracts hint at pause in sales activity | Bedford Corners Real Estate

Contracts to buy previously owned U.S. houses unexpectedly fell in June after five straight months of increase, suggesting some cooling in home resales activity after recent hefty gains.

The decline in contracts, which came on the heels of reports showing the pace of home price appreciation stalling in major cities and new home sales dropping, did little to change perceptions that the housing market recovery was on track given a tightening labor market.

“The June decline is a hiccup. It is important to bear in mind that there is still plenty of fundamental support for the housing market,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto.

The National Association of Realtors said on Wednesday its Pending Home Sales Index, based on contracts signed last month, declined 1.8 percent to 110.3.

Still, the index was the third highest reading for this year and contracts were up 8.2 percent from a year ago.

Pending home contracts become sales after a month or two, and last month’s drop pointed to a pause in sales of existing homes after they reached a near 8-1/2-year high in June.

Economists had forecast pending home sales rising 1.0 percent last month.

U.S. financial markets were little moved by the data as investors awaited the outcome of the Federal Reserve’s two-day policy meeting. The housing index .HGX was up 0.97 percent.

The U.S. central bank’s statement will be scrutinized for clues on the timing of the first rate hike, which is expected later this year. The Fed has kept its short-term interest rate near zero since December 2008.


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