Author Archives: Robert Paul

About Robert Paul

Robert is a realtor in Bedford NY. He has been successfully working with buyers and sellers for years. His local area of expertise includes Bedford, Pound Ridge, Armonk, Lewisboro, Chappaqua and Katonah. When you have a local real estate question please call 914-325-5758.

Mortgage rates hit two year low | South Salem Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing that the 30-year fixed-rate mortgage rate fell to 3.82 percent, the sixth consecutive weekly decline and its lowest level since September 2017.

Sam Khater, Freddie Mac’s chief economist, says, “While the drop in mortgage rates is a good opportunity for consumers to save on their mortgage payment, our research indicates that there can be a wide dispersion among mortgage rate offers. By shopping around and getting a single additional mortgage rate quote, a borrower can save an average of $1,500.”

“These low rates are also good news for current homeowners. With rates dipping below four percent, there are over $2 trillion of outstanding conforming conventional mortgages eligible to be refinanced – meaning the majority of what was originated in 2018 is now eligible,” he says.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.82 percent with an average 0.5 point for the week ending June 6, 2019, down from last week when it averaged 3.99 percent. A year ago at this time, the 30-year FRM averaged 4.54 percent. 
  • 15-year FRM averaged 3.28 percent with an average 0.5 point, down from last week when it averaged 3.46 percent. A year ago at this time, the 15-year FRM averaged 4.01 percent. 
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.52 percent with an average 0.4 point, down from last week when it averaged 3.60 percent. A year ago at this time, the 5-year ARM averaged 3.74 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.

More people moving to the Exurbs | Armonk Real Estate

construction

Welcome to the exurbs: remote areas just beyond the more affluent suburbs that have seen a wave of activity from builders and home shoppers.

According to a recent report by the National Association of Home Builders, the exurbs were the only regions that saw an annual increase in single-family permits in the first quarter of 2019.

Posting a 1.6% year-over-year gain, the exurbs are home to just 9% of the nation’s single-family construction. But while this might not seem like much, its share is growing – a fact that some analysts say is raising red flags.

Why? The last time the exurbs saw activity increase was during the housing boom, when speculators got a bit over-excited about the opportunity to make the big bucks by flipping homes on the cheap. But when the bubble burst, these areas were largely abandoned, and builders were left deep in the red.

renewed surge of activity in exurban areas is a key indicator of a general lack of affordability that is plaguing the housing market.

“A shortage of buildable and affordable lots is forcing builders to increasingly look further outside of suburban and metropolitan areas to find cheaper land that provides more building opportunities,” explained NAHB Chairman Greg Ugalde.

NAHB Chief Economist Robert Dietz said the data highlights the fact that housing costs are increasing at a faster pace in large metro suburban counties.

“Supply-side issues that are hurting affordability and raising costs for builders include excessive regulations, labor shortages, rising material costs and a dearth of buildable lots in mid- to high population centers,” Dietz said.

read more…

https://www.housingwire.com/articles/49154-priced-out-of-the-housing-market-more-americans-move-to-the-exurbs

European real estate bubble a ‘real possibility’ | Mt Kisco Real Estate

The euro area is at risk of a new real estate bubble as a result of expansionary monetary policy from the European Central Bank (ECB), Commerzbankanalysts have warned.

The ECB council meets on Thursday June 6, and is likely to decide on the details of the third edition of its targeted longer-term refinancing operations (TLTRO-III) program, a series of Eurosystem operations that provide financing to credit institutions for periods of up to four years.

TLTROs offer long-term funding at attractive conditions to banks in order to encourage them to lend capital to the real economy.

The central bank has faced calls from some corners of the market for fresh stimulative measures to aid the anemic European economy, and the third round of TLTROs represent a continuation of its expansionary monetary course.

“With a view to low core inflation, some policies are often passed off as a free lunch,” a note from Commerzbank senior economists Dr Ralph Solveen and Dr Jorg Kramer said in a note Friday.

“Yet the ECB’s expansionary monetary policy has a cost and it comes in the form of higher house prices, which already appear expensive in some countries, and the threat of a property price bubble is a real possibility.”Rising house prices

Commerzbank highlighted that house prices have been rising rapidly in the majority of eurozone economies, including the large economies of Germany, Belgium and France. With an increase of around 4.5% in the course of 2018, Germany was slightly above average in terms of rising house prices, while Slovenia and Latvia saw double-digit rises. Portugal, the Netherlands and Luxembourg all rose at almost 10% rates.

Yet Commerzbank analysts anticipate that ECB interest rates will remain in negative territory for the foreseeable future, further heightening the threat of a real estate bubble.

“The relation between house prices and rents, a frequently used measure for the valuation of real estate, has risen by more than 10% since early 2015. This is less than 5% below its level at the beginning of 2008, when the housing market in some euro area countries had formed considerable bubbles,” the note stated.

Commerzbank expects that if the ECB maintains its monetary policy stance until the end of 2020, average house prices will exceed pre-crisis levels.Falling debt and no building boom

Solveen and Kramer pointed out that the strength of impact of a bursting price bubble on the real economy depends, in part, on the extent to which rising house prices are accompanied by rising debt and a construction boom.

The euro zone as a whole is not yet in this position, the analysts suggested, with private household debt relative to GDP falling steadily across most of Europe’s Economic and Monetary Union (EMU), although Belgium and France were noted as exceptions.

There is also no question of a construction boom, the economists highlighted, and the share of residential construction investment in eurozone GDP is now significantly lower than at the beginning of 2008.

“The situation is somewhat different in Germany, where the rise in prices in recent years has been accompanied by a sharp rise in construction investment and bottlenecks are increasingly occurring in the construction sector,” the Commerzbank note stated.

“However, the share of residential construction investment in GDP is still lower than at the beginning of the monetary union, and there was certainly no construction boom in Germany at that time.”

read more…

https://www.cnbc.com/2019/05/31/european-real-estate-bubble-a-real-possibility-commerzbank-says.html

Mortgage rates average 3.99% | South Salem Real Estate

Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing that the 30-year fixed-rate mortgage rate dropped below four percent for the first time since January 2018.

Sam Khater, Freddie Mac’s chief economist, says, “While economic data points to continued strength, financial sentiment is weakening with the spread between the 10-year and the 3-month Treasury bill narrowing as fears of the impact of the trade war with China grow. Lower rates should, however, give a boost to the housing market, which has been on the upswing with both existing and new home sales picking up recently.”

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.99 percent with an average 0.5 point for the week ending May 30, 2019, down from last week when it averaged 4.06 percent. A year ago at this time, the 30-year FRM averaged 4.56 percent. 
  • 15-year FRM averaged 3.46 percent with an average 0.5 point, down from last week when it averaged 3.51 percent. A year ago at this time, the 15-year FRM averaged 4.06 percent. 
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.60 percent with an average 0.4 point, down from last week when it averaged 3.68 percent. A year ago at this time, the 5-year ARM averaged 3.80 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.

Davis Love’s house on Georgia coast will not sell | North Salem Real Estate

davis-love-iii-house
realtor.com; Michael Reaves/Getty Images

All that glitters is gold when you’re talking about high-end real estate along the Atlantic Ocean. The Golden Isles are a chain of barrier islands sitting midway between Savannah, GA, and Jacksonville, FL.

If you’re unfamiliar with names like St. Simons Island, Little St. Simons Island, Sea Island, Jekyll Island, and Brunswick, that’s because they’re hidden gems along Georgia’s oft-overlooked coastline.

The island chain offers just the right blend of notoriety and privacy and was tabbed last year as “The Secluded Island Hideaways for America’s Rich and Famous” by the Wall Street Journal. In addition to seclusion, the allure of these isles is intimately tied to golf. In fact, the golf tradition of the Golden Isles dates back at least a century.

With a backdrop of golf history and award-winning courses, it’s no surprise that pro golfers have snapped up homes in the Golden Isles.

Golf Hall of Famer Davis Love III is one such linksman. The 21-time PGA Tour winner owns a pristine plantation-style home on St. Simons Island.

Exterior
Exteriorrealtor.com

Love’s 5-acre spread is located in a private, serene neighborhood and includes a fully functioning farm. Known as Sinclair Farm, Love’s summery sanctuary is way, way above par.

It’s currently on the market for $4.48 million and eagerly awaits a buyer in search of a place with a golden reputation.

Aerial view
Aerial viewrealtor.com

There’s only one divot—the golfer’s home has been up for sale for sixlong years. We’ll spare you the albatross jokes.

In 2013, Love’s property landed on the market at a price of $5.5 million. So what’s the holdup? Why aren’t buyers swooning over Love’s beautiful island compound?

St. Simons Island offers the best of island life. The plantation-style house is gorgeous. The property is enormous and lush. We’re talking endless summer, twinkling stars on clear nights with fireflies flitting around. The beach right around the corner.

To dig in to the reasons, we spoke with a couple of local agents.

An abundance of options

On Sea Island and St. Simons Island, there are over 50 listings priced between $1 million and $14 million, according to Rhonda NeSmith, an agent with Coldwell Banker Platinum Partners.

Entryway
Entrywayrealtor.com

“People who can afford to buy in this price range have options,” she said. “This property is really nice and private, but a lot of people come to the area to be either in a golf community or on the water.”

Love’s secluded property is located in an area with only six other homes, and the street to reach the home is quite dark and winding, NeSmith said.

With an abundance of waterfront and golf course properties available, this lovely island spread might be … too remote?

Living space
Living spacerealtor.com

The listing mentions views of a marsh in the distance. NeSmith said “distance” is a bit of an understatement: “There’s a 50-acre property in between this one and the marsh, so there’s not much to see in that regard.”

However, the views of the sky are unparalleled. NeSmith told us, “I can guarantee the view of the night sky from this property is an amazing sight.”

Dining room
Dining roomrealtor.com

The home is also competing with luxury homes on the other Golden Isles, and many of those options are gated, private islands for residents only.

New construction in the area also plays a role. Even though Love’s home is only two decades old, many high-end buyers want a place with no previous owners.

“This home was built in 1999,” said Maria Jennings, real estate agent with DeLoach Sotheby’s International Realty. “There’s a fair amount of new construction in the area. This presents some competition for this kind of home.”

The vacation vibe

Jennings told us the Golden Isles are a popular destination for vacationers, retirees, and owners of second homes.

Kitchen
Kitchenrealtor.com

“The island tends to attract retirees that want to downsize,” Jennings said. “They’re looking for something that’s easy to maintain, and this property requires a lot of upkeep.”

Five acres aren’t going to tend to themselves. And with a fully functioning farm, upkeep is a daily commitment, which runs counter to the idea of having a low-key retreat.

Vacationers, she said, are looking for something similar: a place to stay that requires little maintenance and has enough space to spread out and relax, but not so much that keeping things clean, tidy, and in working order takes the fun out of the experience.

Bedroom
Bedroomrealtor.com

“The farm makes this property really unique, which is good, but it also narrows down the kind of buyer looking for this kind of home.”

You can’t hurry Love

For someone like Love, a native of the Golden Isles area and a professional athlete with presumably a sizable nest egg, selling the property quickly isn’t a top priority. He ranks among the top 20 money earners all-time in the world of professional golf, having pulled down nearly $45 million in career earnings.

“I tend to think he built this as his forever home, but obviously something changed,” says NeSmith. “Still, he probably doesn’t need to sell it for the money.”

The lack of urgency is reflected in the years the home has spent on the market and the relative lack of price cuts. The asking price was cut in 2015, 2017, and then again earlier this year to its present price.

Pool
Poolrealtor.com

“The house is worth its current asking price,” said NeSmith. “So that’s not the issue here. The property is just really unique for the area.”

So what kind of buyer will fall in love with an island farm?

“It’s probably going to be someone middle-aged that’s relocating that wants to be close to the water but still have the farm feel,” said Jennings. “That’s a pretty unique buyer.” If you fit the very specific bill, Love is still waiting for you to take a swing.

read more…

https://www.realtor.com/news/celebrity-real-estate/why-wont-anyone-buy-davis-love-iii-gorgeous-georgia-property/

Case Shiller prices up 2.7% annually | Waccabuc Real Estate

GS: New Home sales house for sale prospective buyers San Rafael Ca.

Real estate agents arrive at a brokers tour showing a house for sale in San Rafael, California.Getty Images

National home prices rose 3.7% annually in March, down from 3.9% in February, according to the S&P CoreLogic Case-Shiller home price index.

Prices had been seeing double-digit annual gains, but they are gone. The largest annual gain was 8.2% in Las Vegas; one year ago, Seattle had a 13% gain a year ago but has dropped dramatically to just 1.6%. The 20-City Composite dropped from 6.7% to 2.7% annual gains over the last year.

“Given the broader economic picture, housing should be doing better,” David Blitzer, managing director and Chairman of the Index Committee at S&P Dow Jones Indices, wrote in the report. He noted that mortgage rates and unemployment were low, along with low inflation and moderate increases in real incomes.

“Measures of household debt service do not reveal any problems and consumer sentiment surveys are upbeat. The difficulty facing housing may be too-high price increases,” he added.

The 10-City Composite rose 2.3% annually, down from 2.5% in the previous month. The 20-City Composite gained 2.7%, down from 3.0% in the previous month.

Even with today’s smaller gains, prices are still rising almost twice as fast as inflation. In the last 12 months, the S&P Corelogic Case-Shiller National Index is up 3.7%, double the 1.9% inflation rate.

Prices are still higher annually in all of the 20 major cities measured by the indices, but some are getting very close to negative territory. Prices in Los Angeles, Seattle, Chicago, San Diego and San Francisco are just over 1% higher than March 2018.

Las Vegas, Tampa and Phoenix are seeing the biggest gains. These were the markets hit hardest during the housing crash and therefore still have the farthest to go to fully recover.

Other housing indicators are also weaker than expected this year. Existing home sales have been relatively flat all spring, despite falling mortgage rates.

read more…

https://www.cnbc.com/2019/05/28/home-price-gains-weaken-yet-again-in-march-sp-case-shiller-index.html

New home sales fall | Cross River Real Estate

Sales of new U.S. single-family homes fell from near an 11-1/2-year high in April as prices rebounded, but demand for housing remains underpinned by declining mortgage rates and a strengthening labor market.FILE PHOTO: A new apartment building housing construction site is seen in Los Angeles, California, U.S. July 30, 2018. REUTERS/Lucy Nicholson

The Commerce Department said on Thursday new home sales dropped 6.9% to a seasonally adjusted annual rate of 673,000 units last month. March’s sales pace was revised up to 723,000 units, the highest level since October 2007, from the previously reported 692,000 units.

April’s decline followed three straight monthly increases

Economists polled by Reuters had forecast new home sales, which account for about 10% of housing market sales, would decrease 2.8% to a pace of 675,000 units in April.

Sales increased 7.0% from a year ago. The median new house price increased 8.8% from a year ago to $342,200 in April, the highest level since December 2017.

New home sales had in recent months outperformed other housing market indicators, including building permits, which had dropped for five straight months in April. New home sales are drawn from permits.

Economists attributed the recent strength in new home sales to declining mortgage rates. The new housing market has not been severely constrained by an inventory shortage, which has crippled sales of previously owned homes.

A report on Tuesday showed existing home sales fell for a second straight month in April, weighed down by a chronic shortage of more affordable houses.

The overall housing market hit a soft patch year and has contracted for five straight quarters. With the 30-year fixed mortgage rate dropping to around 4.07% from near an eight-year high of 4.94% in November, there is reason to be cautiously optimistic about the housing market.

New home sales in the South, which accounts for the bulk of transactions, declined 7.3% in April. Sales in the Midwest dropped 7.4% and those in the West tumbled 8.3%. But sales in the Northeast jumped 11.5%.

There were 332,000 new homes on the market last month, down 0.9% from March. While builders have stepped up construction of more affordable homes to meet strong demand in this market segment, land and labor shortages remain a challenge.

At April’s sales pace it would take 5.9 months to clear the supply of houses on the market, up from 5.6 months in March.

read more…

https://www.reuters.com/article/us-usa-economy-housing/u-s-new-home-sales-fall-more-than-expected-in-april-idUSKCN1ST1QP

Finding a deal in the Hamptons after tax reform | Waccabuc Real Estate

“We just loved it, and all our friends and family loved it,” said Mr. Nordquist, 51, a retired financier from Manhattan. “It had to be here, and it had to be now.”

David and Sindhu Nordquist deliberated for years about where to buy a second home, and thenlast summer, while renting a house in the Hamptons for the first time, they decided to find a place on the East End of Long Island to call their own.

With Timothy O’Connor, an agent at Halstead, the Nordquists looked at more than 60 listings, searching for “a beach house in the woods,” Mr. Nordquist said. “We wanted privacy and didn’t want neighbors around us.”

Their timing was fortunate. In the usually high-flying Hamptons, the housing market is in a rut. Inventory is up; prices are down. The median sale price of a single-family home in the Hamptons has dropped 7.9 percent, from $933,750 in the first quarter of 2018 to $860,000 during the first three months this year, according to a report from Douglas Elliman Real Estate.

After searching for several months, the Nordquists found the serenity they were looking for down a long gravel driveway: a 1991 contemporary home with 3,300 square feet, a heated pool and a pool house, on a woodsy 1.82 acres. Initially listed at $1.825 million in August 2017, the property went on and off the market. When the couple visited last December, the price had dropped to $1.6 million. They bought it this spring for $1.35 million, with plans to paint, change the windows and convert the wood-burning fireplaces to gas.David Nordquist at his new Hamptons home, which sits on 1.82 acres and has a heated pool and a pool house.CreditDaniel Gonzalez for The New York Times


“We negotiated pretty hard on the price,” Mr. Nordquist said. “I bargained a lot. I felt the market was softening.”

As Aspasia G. Comnas, the executive managing director of Brown Harris Stevens, observed, “Sellers in the Hamptons are used to the market always going up every year, and if they priced aggressively it didn’t matter.” But in today’s market, homes that are not priced competitively “are going to have to go through a series of price reductions” before they sell, she said — at all levels of the market, not just at the high end.

Buyers seem to be staying on the sidelines. The number of single-family homes on the market during the first three months of 2019 was nearly double that of a year earlier: 2,327, up from 1,201. And sales of single-family homes have dropped, to 287 from 350 in 2018.

One thing making buyers hesitate, said Jonathan J. Miller, the president of the appraisal firm Miller Samuel and the author of the Douglas Elliman report, is the new federal tax code approved by Congress in late 2017, which makes it more expensive to own luxury property because homeowners can deduct only up to $10,000 in state and local taxes from their federal income taxes.

“The Hamptons are trending much like the New York City metro area,” Mr. Miller said, noting that the situation is similar in other parts of the Northeast and in California, where real estate is pricey and property taxes are high.

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Catch up and prep for the week ahead with this newsletter of the most important business insights, delivered Sundays.SIGN UPThe four-bedroom house in Water Mill that Keith Baltimore bought is an “upside-down” house, with living space on the upper level.CreditDaniel Gonzalez for The New York Times

















The four-bedroom house in Water Mill that Keith Baltimore bought is an “upside-down” house, with living space on the upper level.CreditDaniel Gonzalez for The New York Times

“The slowdown in sales represents the disconnect between sellers, who are anchored to better times, and buyers, who have a lot of changes to process,” Mr. Miller said.

Any sense of urgency was further quelled by the “intense volatility of the financial markets at the end of last year, along with the close linkage of Wall Street to the Hamptons,” he added.

A 17 percent dip in bonuses in the finance industry in 2018 likely also discouraged Wall Street workers from buying second homes in the Hamptons. The average bonus for financial market employees in 2017 was $184,400; in 2018, it dropped to $153,700, according to a report from the New York State Comptroller.

Those who did buy, though, found bargains.

Figuring it didn’t hurt to look, Maria and Stephen Zak, of Saddle River, N.J., toured a 2007 harbor-front house with four bedrooms, four and a half bathrooms, a heated pool and a hot tub, on an acre in East Hampton, listed for $3.2 million. “We loved it, but it was way out of our budget,” said Mr. Zak, 53, the chief financial officer of a boutique investment bank.

They had been looking for a second home for about a year. The price of the 3,400-square-foot house had already been reduced from the original 2017 asking price of $3.995 million. So “we threw out an offer we were comfortable with,” Mr. Zak said. And in November, the Zaks closed on the house, for $2.735 million.The bedrooms of Mr. Baltimore’s 1970s house are on the lower level. CreditDaniel Gonzalez for The New York Times

The bedrooms of Mr. Baltimore’s 1970s house are on the lower level. CreditDaniel Gonzalez for The New York Times

“It’s like the dog that chases the car and actually catches it,” Mr. Zak said. “It’s still not cheap, but it was fair and it was in move-in condition.” They have since installed a new kitchen, painted and brought in new rugs.

In the shifting luxury real estate market, the highest priced homes are taking longer to sell, said Laura Brady, the president and founder of Concierge Auctions, in Manhattan. The company’s Luxury Homes Index report, released earlier this month, noted that the 10 most expensive homes sold in the Hamptons last year had an average sale price of $24,079,286, and spent an average of 706.7 days on the market. Luxury homes that lingered on the market tended to go for less, selling at discounts of nearly 40 percent after six months, Ms. Brady said.

In Montauk, the 20-acre oceanfront estate that belongs to Dick Cavett, the former talk show host, has been on the market for two years. The 7,000-square-foot, six-bedroom, four-bathroom house, which was listed for $62 million in June 2017, was designed by McKim, Mead & White in the 1880s and rebuilt in 1997 after a fire, using “forensic architecture techniques” to replicate the original house with a wraparound porch and a bell tower, said Gary DePersia, an associate broker with Corcoran. The price dropped to $48.5 million last August, then Mr. DePersia re-listed it in February, for $33.95 million.

“They are motivated sellers,” Mr. DePersia said. “Where are you going to get 20 acres with 900 feet of oceanfront and utter privacy with a historic house for that kind of money in the Hamptons? You are not.”

According to a first quarter report from Bespoke Real Estate, which deals exclusively with $10 million-plus properties, 122 homes priced over $10 million were on the market at the end of March, with 13 between $30 and $40 million.

Most $10 million-plus buyers already have a home in the Hamptons, said Zachary Vichinsky, a principal at Bespoke Real Estate, and have spent “in some cases the better part of two years exploring the market and defining what works best for them,” whether that means upgrading or building a new home closer to the water.

“There is a lack of urgency on their part, in a lot of cases, but the special inventory continues to move pretty quickly,” Mr. Vichinsky said.

In 2018, a total of 41 homes sold for $10 million or more in areas that brokers refer to as the “alpha market,” which includes East Hampton, Southampton, Water Mill, Bridgehampton, Sagaponack and Wainscott.

But there was one bright spot in the market overall: homes listed for $500,000 to $1 million. That sector of the market accounted for 34 percent of sales in the first quarter, according to a report from Brown Harris Stevens.Mr. Baltimore affectionately refers to his hexagonal house as “the hive.”CreditDaniel Gonzalez for The New York Times

Mr. Baltimore affectionately refers to his hexagonal house as “the hive.”CreditDaniel Gonzalez for The New York Times

Last November, after renting a “shack on the bay” in Sag Harbor for nine years, Keith Baltimore, an interior designer with offices in Manhattan, Port Washington, N.Y., and Boca Raton, Fla., paid $900,000 for a “quirky and campy” 1970s contemporary house with an upside-down floor plan, a circular great room with a skylight, and a pool, on an acre in Water Mill. The house was originally listed for $1.15 million.

“There were so many houses on the market, it felt like a full-time job looking at what’s out there, doing due diligence,” said Mr. Baltimore, 55, who spent weekends for a year and a half house shopping.

From Westhampton to Montauk, about 1,900 homes are available for $2 million or less, including about 900 under $1 million and 160 for around $500,000, said Mr. O’Connor, the Halstead agent.

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Housing starts fall year over year | Katonah Real Estate

US Housing Starts Rise Above Forecast

Housing starts in the US rose 5.7 percent from a month earlier to a seasonally adjusted annual rate of 1,235 thousand units in April 2019, more than an expected 1,205 thousand and following a revised 1.7 percent advance in March. 

Single-family homebuilding, which accounts for the largest share of the housing market, rose 6.2 percent to a rate of 854 thousand units in April and starts for the volatile multi-family housing segment advanced 4.7 percent to a rate of 381 thousand units. Increases in housing starts were recorded in the Northeast (84.6 percent to 144 thousand) and Midwest (42 percent to 186 thousand), while declines were seen in the South (-5.7 percent to 581 thousand) and West (-5.5 percent to 324 thousand). Starts for March were revised to 1,168 thousand from 1,139 thousand.

Building permits were up 0.6 percent to a rate of 1,296 thousand units in April, while markets had expected a 0.5 percent gain. Permits for the volatile multi-family housing segment increased 8.9 percent to 514 thousand, while single-family authorizations fell 4.2 percent to 782 thousand. Across regions, permits were higher in the West (5.3 percent to 339 thousand) and Midwest (2.2 percent to 188 thousand), but dropped in the Northeast (-4 percent to 120 thousand) and South (-1.2 percent to 649 thousand).

Year-on-year, housing starts dropped 2.5 percent and building permits decreased 5 percent.

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https://tradingeconomics.com/united-states/housing-starts

Builder confidence up | Bedford Hills Real Estate

Builder confidence in the market for newly-built single-family homes rose three points to 66 in May, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Builder sentiment is at its highest level since October 2018 after declines in late 2018 due to higher interest rates and concerns over slower growth. Builders are catching up after a wet winter and many characterize sales as solid, driven by improved demand and ongoing low overall supply. However, affordability challenges persist.

Mortgage rates are hovering just above 4 percent following a challenging fourth quarter of 2018 when they peaked near 5 percent. This lower-interest rate environment, along with ongoing job growth and rising wages, is contributing to a gradual improvement in the marketplace. At the same time, builders continue to deal with ongoing labor and lot shortages and rising material costs that are holding back supply and harming affordability.

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All the HMI indices posted gains in May. The index measuring current sales conditions rose three points to 72, the component gauging expectations in the next six months edged one point higher to 72 and the metric charting buyer traffic moved up two points to 49.

Looking at the three-month moving averages for regional HMI scores, the Northeast posted a six-point gain to 57, the West increased two points to 71, the Midwest gained one point to 54, and the South rose a single point to 68.

The HMI tables can be found at nahb.org/hmi.

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