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Bedford Corners Real Estate

Consumer Confidence Rises | Bedford Corners Real Estate

The Consumer Confidence Index, reported by the Conference Board, rose in September. Compared with last month, consumers were more optimistic about both the current situation and the near term outlook.

The Consumer Confidence Index rose to 104.1, from 101.8 in August. The present situation index rose to 128.5, from 125.3, and the expectations index increased to 87.8, from 86.1.

Consumers’ assessments of current business conditions were mixed. Assessments shifted from both “good” and “bad” to “normal”. The share of respondents rating business conditions “normal” rose by 4.9 percentage points from 51.5% to 56.4%. A net decline of 2.9 percentage points in assessments of “good” combined with a 2.0 percentage point net decline in assessments of “bad” for the total.

Similar to consumers’ assessments of current business conditions, expectations of business conditions over the next six months were mixed. The share of respondents expecting future business conditions to be the same rose from 71.0% to 73.3%. About half of the increase was the result of a net decline in respondents expecting future business conditions to be worse, an upgrade, while the rest was the result of a net decline in respondents expecting future business conditions to be better, a downgrade.

Consumers’ assessments of current employment conditions improved. The share of respondents reporting that jobs were “hard to get” dropped to 21.6%, from 22.8%. Most of the 1.2 percentage point decline (1.1 percentage point) upgraded to “jobs plentiful”.

Also, consumers’ expectations of employment over the next six months were more upbeat than in August. The share of respondents expecting “more jobs” rose to 15.1%, from 14.4%. Most of the 0.7 percentage point increase (0.5 percentage point) shifted from “fewer jobs”, while the rest shifted from “same jobs”.


The Conference Board also reports the share of respondents planning to buy a home within six months. The share of respondents planning to buy a home declined to 5.1%, from 6.9%. The share of respondents planning to buy a newly constructed home and an existing home were 0.6% and 3.5%, respectively; the share of respondents who were “uncertain” whether they would buy a newly constructed or an existing home was 1.0%.


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Mortgage rates average 3.42% | Bedford Corners Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates largely unchanged ahead of this week’s employment report.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.42 percent with an average 0.5 point for the week ending October 6, 2016, unchanged from last week. A year ago at this time, the 30-year FRM averaged 3.76 percent.
  • 15-year FRM this week averaged 2.72 percent with an average 0.5 point, unchanged from last week. A year ago at this time, the 15-year FRM averaged 2.99 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.80 percent this week with an average 0.4 point, down from last week when it averaged 2.81 percent. A year ago, the 5-year ARM averaged 2.88 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.

Attributed to Sean Becketti, chief economist, Freddie Mac.

“The 10-year Treasury yield leaped to a two-week high following reports of the European Central Bank retreating from its bond-buying program ahead of its initial March deadline. In contrast, the 30-year fixed-rate mortgage remained unchanged at 3.42 percent. Over the past two weeks, mortgage rates have remained fairly flat while Treasury yields have fallen and risen. This Friday’s jobs report will provide clarity on whether or not mortgage rates follow the recent upward trend in Treasury yields.”



Pending Sales Expand | Bedford Corners Real Estate

Led by the West, the Pending Home Sales Index increased 1.3% in July to the highest level since April, and increased 1.4% year-over-year. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), increased to 111.3 in July from a downwardly revised 109.9 in June.

Pending Home Sales July 2016

The PHSI surged to 108.7 in the West from 101.3 in June. The Northeast and South increased by 0.8% in July, while the Midwest declined by 2.9%. Year-over-year, the PHSI increased 6.2% in the West, 1.1% in the Northeast and 0.4% in the South, but decreased 1.1% in the Midwest.

Although existing sales decreased 3.2% in July, there was a 2.5% increase in the West last month. The housing recovery is reaching the point in the cycle when new residential construction is adding smaller entry-level homes into inventory. Townhouse construction outpaced the rest of the single-family market during the second quarter of 2016. That trend toward smaller and less expensive new single-family construction has begun to improve affordability in the West, sparking momentum that suggests increasing sales among first-time buyers across a wider range of markets in 2016.


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Sales of previously owned houses surge | Bedford Corners Real Estate

Sales of previously owned houses surged 14.7 percent to a seasonally adjusted annual rate of 5460 thousand in December of 2015, better than market expectations of 5.2 million.

Sales of single family went up 16.1 percent and those of condos grew 4.9 percent. The average price increased 1.9 percent and the months’ worth of supply fell to 3.9.

Considering full 2015, existing homes sales rose 6.5 percent to 5.26 million units, the highest since 2006. Existing Home Sales in the United States averaged 3842.52 Thousand from 1968 until 2015, reaching an all time high of 7250 Thousand in September of 2005 and a record low of 1370 Thousand in March of 1970.

Existing Home Sales in the United States is reported by the National Association of Realtors.

Why the Housing Boom is Good for Minority Homeownership | Bedford Corners Real Estate

Fourteen years ago, improving minority homeownership was front burner issue.  In 2002, the Bush Administration even set a goal of expanding the number of minorities who owned their own homes by 5.5 million—approximately the number of existing homes sold in a very good year.

The subprime crash and housing depression put a sudden end to that effort.  Minority homeownership plummeted and, surprisingly, never achieved the attention from top policy makers in two Obama administrations that it enjoyed under their predecessor.

For homeownership in general, the housing depression was depressing.  For minorities, it was a disaster.  For African-American households, the homeownership rate peaked at 49.4 percent in 2004 and bottomed out at 41.9 in the first quarter of this year, a decline of 7.5 points.  Hispanic American homeownership reached a high of 49.8 percent in 2006 and fell to 44.1 percent in the first quarter of this year, down 5.7 points.  By comparison, white non-Hispanic homeownership peaked at 76 percent in 2004 and fell to 73.4 percent by 2013 when the housing recovery officially began, a decline of only 2.6 points.

Do Higher Prices Help Minorities?

Conventional wisdom maintains that rising prices are bad for minorities because they are priced out of affordable housing, especially in gentrifying urban neighborhoods where today young Millennial whites are driving prices sky high.  However, a new study by two economists at the Federal Trade Commission published in the Journal of Housing Economics this month suggest the exact opposite is the case.  Higher prices mean better times for minorities.

Rising prices are good for minorities, the economists argue, because they are accompanied by a loosening of lending standards.  Rising values alter lenders; judgments about acceptable levels of risk and expected rates of return on housing-related assets.  “This variation may then translate into changes in the out-comes experienced by minority borrowers relative to non-minorities,’ they concluded

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Consumers Aren’t Quite Ready for a Smart Home | Bedford Corners Real Estate

  • 71% would consider purchasing a smart home product; smart thermostats garnered the most interest
  • Most consumers expect newly built homes in the next five years to include smart home technology
  • Consumer familiarity with smart home technology is still low; price, security and lack of standardization are key barriers


The “Internet of Things” is fast becoming a reality as more and more products and things contain sensors and/or microprocessors, and are connected to wireless networks. The near ubiquity of high speed internet access in homes, as well as smartphones, has set the stage for a new class of do-it-yourself smart home technology products, including smart thermostats, home security and monitoring systems, and smart lighting, to name just a few. The number of smart home product offerings has grown rapidly in the past few years, and will continue to do so as a diverse set of companies and industries vie for leadership in this space. But while consumers and business alike see greater technology in the home as inevitable, a new report from The Demand Institute finds that a truly “smart home” is still a ways off for the masses.


Smart Home Technology: Not Ready for Prime Time (Yet) is the latest publication fromThe Demand Institute, a non-advocacy, non-profit think tank jointly operated by The Conference Board and Nielsen. The report finds that more than 7 in 10 consumers would consider purchasing a smart home product, and that most consumers expect newly constructed homes in the next five years to include smart home technology. At the same time, consumers are in no rush to purchase smart home technology – just 36% of consumers say they are excited to incorporate smart home technology into their home.

“Smart home products need to demonstrate clear value and solve unmet consumer needs before most will make the investment,” said Louise Keely, president of The Demand Institute. “Some of these products do meet that bar, but many still feel these products are gimmicky, even though 64% concede that they really do not know much about smart home technology.”

The report found that smart thermostats, wireless speakers and home security and monitoring are currently the most popular and well-known smart home products, but that interest in other smart home products, like smart lighting, door locks and other categories is also strong.

“Consumers are starting small when it comes to smart home technology,” according to Jeremy Burbank who is a vice president at The Demand Institute and leads the American Communities Demand Shifts Program. “The typical smart home product user has just one or two products. Many of these products still cost several times what traditional models do, and a lack of industry standardization and interoperability means most consumers will add smart home technology slowly.”

Custom Home Building Flat | Bedford Corners Real Estate

NAHB’s analysis of Census Data from the Quarterly Starts and Completions by Purpose and Design survey indicates that the number of custom home building starts (homes built on an owner’s land, with either the owner or a builder acting as the general contractor) posted a slight increase on a year-over year basis as of the third quarter of 2015.

Over the last four quarters, there were 157,000 construction starts of custom homes, compared to 154,000 for the four quarters prior that began with the fourth quarter of 2013.

Note that this definition of custom home building does not include homes intended for sale, so this analysis uses a narrow definition of the sector.

As measured on a one-year moving average, the market share of custom home building in terms of total single-family starts is now 22.2%, down from a cycle high of 31.5% set during the second quarter of 2009.

custom bldg_3q15

The onset of the housing crisis and the Great Recession interrupted a 15-year long trend away from homes built on the eventual owner’s land. As housing production slowed in 2006 and 2007, the market share of this not-for-sale new housing increased as the number of starts declined. The share increased because the credit crunch made it more difficult for builders to obtain AD&C credit, thus producing relatively greater production declines of for-sale single-family housing.


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The Best Triangle House Since The Pyramids | Bedford Corners Real Estate

Triangles, and the sloping ceilings they create, don’t make a natural fit for human habitation. But for his idyllic wooden house in rural Sweden,architect Leo Qvarsebo embraced the triangle, creating for himself a sloping isosceles of a summer home.

Positioned between a patch of woodland and a green pastures, the Qvarsebo Summerhouse was designed like a triangle to give stunning, unobstructed views of an idyllic vista in Dalarna. Large windows frame the landscape on three separate floors, while the front of the building opens up to a gorgeous terrace, including a swing set for Qvarsebo’s children.

Qvarsebo says that despite the fact it isn’t very close to any trees, he thinks of it as a treehouse for adults. As such, there’s a rope connected to the peak of the roof, so he and his kids can scale the facade. Even inside, though, climbing the home’s central staircase is meant to feel like a treehouse. “The climb to the top is via several levels and offers both views and privacy,” he says. “From each level of the house you can see up to the next, creating a curiosity to continue to climb and once you’re up, the view is breathtaking.”


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Is the Lack of Credit Crippling Local Housing Recoveries? | Bedford Corners Real Estate

A new report from Pro Teck Valuation Services’ Home Value Forecast suggests that the availability of credit in local markers influences local housing recoveries and accounts for dramatic differences in home prices.

HVF looked at regular average sold prices versus total mortgage trends in San Francisco and Detroit and found that in San Francisco, buyers have averaged 20+% down over the last 14 years to create loan to value ratios between 67 and 82 percent.  In Detroit buyers have averaged LTVs between 86 and 101 percent.  Collateral Analytics, Pro Teck’s partner in Home Value Forecast, found that San Francisco home prices are at an all-time high while Detroit is still trying to return to pre-crash levels, suggesting a direct relationship between LTVs, one of the critical factors determining mortgage approvals, and higher prices.  Conversely, higher LTVs in Detroit may make it more difficult buyers to get financing.




The median LTV levels for closed mortgages in August was 80 for conventional purchase loans and 96 for FHA purchase loans, according to Ellie Mae.

The HVF authors also examined the Phoenix-Mesa-Scottsdale CBSA and found that LTV levels vary from neighborhood to neighborhood within the metro area. The HVF update reported that in Scottsdale, average home prices have been rebounding steadily since 2011 and now are 20 percent below all-time highs after dropping 37.5 percent. Apache Junction, AZ, another city within the CBSA, is still 36 percent below its all-time high. At the height of the housing crisis, homes in Apache Junction lost more than half their value. The community also had more homeowners with high LTV loans foreclosed, leading to a steeper drop in home prices and a slower recovery.


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Jobs, Rates and Housing | Bedford Corners Real Estate

The Labor Department posts an employment report every month, and people look at it as a ladder rung up or down on the “wall of worry” over where the fragile economic and housing’s recovery is headed.

Bottom line, as these things go, fear is bad and greed is good.

Today’s has more freight than usual. Among the people who “look at it as a ladder rung up or down” are the U.S. Federal Reserve governors, who, it’s known, have an agenda item for their Sept. 16-17 meeting that may tie directly to today’s report.

The economy added 173,000 jobs to payrolls in the month of August. This fell short of the level Wall Street’s “consensus” of economists expected. The higher range of the consensus may have worked as a harbinger of a Fed belief that it’s time to lift borrowing costs. Having come in at the “under” level of the over-under range, may equally be a signal to the Fed that raising rates would put a damper on an economy still trying to find solid footing in an uncertain international economic context.

Here’s the Labor Department top line, focusing on payroll additions and the unemployment rate, which fell.

Total nonfarm payroll employment increased by 173,000 in August, and the unemployment rate edged down to 5.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care and social assistance and in financial activities. Manufacturing and mining lost jobs…..In August, the unemployment rate edged down to 5.1 percent, and the number of unemployed persons edged down to 8.0 million.

What this means in reality is the subject of a lot of speculation. “Five things to watch” and “previews” foretell a queasy reaction among Wall Street traders. They are America’s metaphor for impulsive, over-reaction, often to mixed indicators. But with a slow-down playing out in China’s economy and an iffy scenario shaping up in the eurozone, a Labor Department jobs report takes on “lightning rod” status for people whose jobs are to bet on the direction as well as the trajectory of corporate profit capability.

What it means to home builders, one can only shrug and guess that there’ll be an immediate impulsive interpretation, a medium-term effect, and an ultimate impact, none of the three of which may have to do with one another. Likely, for large companies in the home building and development ecosystem, including investors, materials suppliers, and manufacturers, upward pressure on borrowing costs may precipitate the next slew in what many consider to be an inevitable series of consolidation moves. As local as real estate is, the industry serving it on the horizontal and vertical development and construction side of the equation is becoming a smaller, more finite world of fewer bigger players.

All of this is tangential to those who spend two of every three dollars in the United States’ $18 trillion economy, American consumers. New Strategist Press editorial director Cheryl Russell notes that an important shift in that spending came to light with the release of Consumer Expenditure Survey data for 2014.


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