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Bedford Hills Real Estate

Composition of New Home Sales Financing Shifts in Third Quarter | Bedford Hills Real Estate

NAHB analysis of the most recent Census estimates concerning sources of financing for new home salesreveals that the composition of mortgages by financing method shifted over the third quarter of 2016. The share of new home sales financed with conventional loans expanded at the expense of FHA-insured and VA-backed mortgages. The shift to conventional mortgages indicates continued return to health in the mortgage market.

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The Census Bureau’s Quarterly Sales by Price and Financing reports that the conventional share fell to 57% in the third quarter of 2010. Since then, the conventional share has trended upward, reaching 74% in the third quarter of 2016, 6 percentage points above its level in the previous quarter, 68%. However, as Figure 1 illustrates, in quarters prior to the most recent one, the conventional share remained relatively steady.

The expanded conventional share of new home sales over the third quarter of 2016 was partially offset by a decline in the percentage of sales financed with FHA-insured mortgages. After rising from 10% in the fourth quarter of 2014 to 17% in the second quarter of 2016, largely reflecting a decline in the annual MIP, the share held steady at or near this level until second quarter of 2016 before falling 3 percentage points to 14% in the third quarter.

In addition, the share of new home sales backed by VA mortgages fell to 7% over the third quarter after holding steady at or near 9% since the fourth quarter of 2014. Meanwhile, the share of homes financed with all cash was unchanged over the third quarter at 5% near its average level in 2002, 4%. However, while cash sales account for 5% of total new home sales, new construction accounts for 15% of all-cash sales.

The future evolution of the financing composition remains is worth tracking. On the one hand, the compositional shift recorded over the third quarter of 2016 may point to return to the mix of financing seen in the years just prior to the most recent recession. On the other hand, the shift in composition may be a temporary occurrence and components may return to the steady proportions that steadily prevailed over 2015 and the first half of 2016.

 

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http://eyeonhousing.org/2016/10/composition-of-new-home-sales-financing-shifts-in-third-quarter/

Homeownership Rate Edges Up | Bedford Hills Real Estate

According to the Census Bureau’s Housing Vacancy Survey (HVS), the U.S. homeownership rate rose to 63.5% in the third quarter 2016, reversing the downward trend of homeownership rate nationwide. It is 60 basis points higher than the rate in the second quarter 2016, which is largely driven by the increase in the millennial and 65+ homeownership rates.

Compared to the peak at the end of 2004, the homeownership rate has steadily decreased by 5.7 percentage points and remains below the 25-year average rate of 66.2%.
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The millennial homeownership rate increased by 1.1% after reaching its own historically lowest level of 34.1% in the second quarter 2016. It suggests that millennials are gradually returning to the housing market.

Compared to a year ago, homeownership declined among all age groups except for those ages 35 to 44 and over 65 since a year ago. The homeownership rate for 44-45 age group decreased from 69.9% in the third quarter of 2015 to 69.1%, which is the largest drop among all age groups.

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The nonseasonally adjusted homeowner vacancy rate remained low at 1.8% in the third quarter 2016. At the same time, the national rental vacancy rate held at 6.8%, around the historical lowest level ever since 1990s.
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The HVS also provides a timely measure of household formations – the key driver of housing demand. Although it is not perfectly consistent with other Census Bureau surveys (Current Population Survey’s March ASEC, American Community Survey, and Decennial Census), the HVS remains a useful source of relatively real-time data.

The housing stock-based HVS revealed that the number of households increased to 118.6 million for the third quarter 2016. This is 1.2 million higher than a year ago and sustains gains recorded at the end of 2015. Growth in household formations will spur rental housing demand first, and ultimately, home sales.

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http://eyeonhousing.org/2016/10/homeownership-rate-edges-up/

U.S. mortgage application activity falls to five-month low | Bedford Hills Real Estate

A measure of U.S. mortgage application activity decreased for a second week to a five-month low as 30-year mortgage rates rose to their highest since June, data from the Mortgage Bankers Association released on Wednesday showed.

The Washington-based industry group’s mortgage market index fell 1.2 percent to 486.2 in the week ended Oct. 28, which was the lowest level since the week of May 27.

Interest rates on 30-year fixed-rate mortgages, which are the most widely held type of U.S. home loans, averaged 3.75 percent in the latest week, matching the level last seen in June, MBA said.

Mortgage rates increased with higher U.S. Treasury yields with 10-year yields hitting their highest levels in about five month last week. US10YT=RR

U.S. bond yields climbed on speculation about whether overseas central banks may refrain from injecting more monetary stimulus to help their economies.

The group’s seasonally adjusted index on weekly applications to buy a home edged down 0.4 percent to 207.0 last week, which was the lowest since January.

The purchase activity gauge is seen as a proxy on home sales.

MBA’s weekly barometer on refinancing requests declined by 1.6 percent to 2,088.0, which was the weakest since June

 

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http://www.reuters.com/article/us-usa-mortgages-idUSKBN12X1I0?il=0

New York requires maintenance of zombie homes | Bedford Hills Real Estate

The state of New York is taking its fight against zombies homes to the next level, as the state announced a series of new regulations for mortgage lenders and servicers that aim to hold the companies “accountable” for the maintenance of abandoned foreclosures.

Earlier this year, New York Gov. Andrew Cuomo signed what the state called “sweeping” legislation to reform the state’s foreclosure process and address the state’s issues with zombie homes.

The state’s new laws impose a pre-foreclosure duty on banks and servicers to maintain zombie homes, creates an electronic registry of abandoned properties, and expedites foreclosure for vacant and abandoned properties to get them back on the market, among other requirements.

Cuomo’s office announced Tuesday what lenders and servicers will be required to do under the new laws and what punishment the companies will face if they don’t comply.

According to Cuomo’s office, the New York Department of Financial Services proposed a new regulation that mandates lenders and mortgage services report vacant and abandoned properties, in accordance with the state’s new laws.

Under the state’s new laws, lenders and mortgage servicers must complete an inspection of a property subject to delinquency within 90 days and must secure and maintain the property where the bank or servicer has a reasonable basis to believe that the property is vacant and abandoned, the NYDFS said.

Additionally, lenders and mortgage servicers will now be required to report all vacant and abandoned properties to the NYDSFS and submit quarterly reports detailing their efforts to secure and maintain the properties and any foreclosure proceedings.

According to the announcement, if the NYDFS determines that an abandoned or vacant house not “properly maintained” by the lender or mortgage servicer, the NYDFS will “exercise its authority” to hold the bank or mortgage servicer “accountable.”

According to the NYDFS, that means that lenders and servicers will face a civil penalty of $500 per day per property for violations of the new regulations.

“Under Governor Cuomo’s leadership, New York passed groundbreaking ‘zombie’ legislation that will provide real relief to communities all across the state,” NYDFS Superintendent Maria Vullo said. “DFS will take necessary and appropriate action to make sure this law is followed and those responsible are held accountable.”

These new laws and regulations aren’t the only steps undertaken recently by New York in its fight against zombie homes and neighborhood blight.

In July, New York Attorney General Eric Schneiderman announced a new program that will help New York’s city governments track and address zombie homes in their respective cities.

According to Schneiderman’s office, the Zombie Remediation and Prevention Initiative will provide $13 million in grants to local governments to fight zombie homes.

And earlier in July, New York City announced plans to launch a “first of its kind” program to buy a number of delinquent loans from the Federal Housing Administration as part of an effort to keep struggling homeowners from losing their homes to foreclosure.

 

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http://www.housingwire.com/articles/38149-new-york-announces-new-requirements-for-maintenance-of-zombie-homes?eid=311691494&bid=1541935

Marcel Breuer-Designed House Hits The Market | Bedford Hills Real Estate

A three-bedroom, two-bathroom single-family house designed by Marcel Breuer was quietly listed by ReeceNichols in June, according to real estate firm’s website. The asking price for the Snower Residence at 6701 Belinder Ave. in Mission Hill’s, Kan., is $925,000.

Completed in 1954, the polygonal residence features an open floor plan atop a cantilever base, a now-ubiquitous structural design element that Breuer first championed in furniture design and later in architecture. The Bauhaus alum also designed the home’s interior, much of which remained intact when the residence was purchased by Rob Barnes and Karen Bisset in 2013, according to the Kansas City Star. Furnishings include a Herman Miller rocking chair designed by Charles and Ray Eames and Ludwig Mies van der Rohe’s Barcelona Sofa for Knoll Furniture (below). The couple installed a new roof, refinished the cedar-plank ceilings, and repainted the exterior to its original blue and orange hues.

The current owners restored the living room's cedar-plank ceilings and kept much of Breuer's furnishings, including Mies' Barcelona Sofa (left.)
ReeceNicholsThe current owners restored the living room’s cedar-plank ceilings and kept much of Breuer’s furnishings, including Mies’ Barcelona Sofa (left.)
A bedroom in the Snower Residence with Breuer's signature sliding windows and an Eames Rocking Chair (right.)
ReeceNicholsA bedroom in the Snower Residence with Breuer’s signature sliding windows and an Eames Rocking Chair (right.)

According to ReeceNichols’ website, Robert Snower asked Breuer to design a house that would stand alone among the sea of his Ranch-style neighbors. “Of course I am asking the impossible,” wrote Snower, who first saw Breuer’s residential work in the 1952 edition of House and Home Magazine. “[My wife and I] hope for a house which we will consider exceedingly handsome, yet which will not too seriously offend what in our opinion are duller eyes than our own. Most of the newer houses around here fit the description of what I believe are called ‘Sunset Ranch Homes,’ ” a variation of the Colonial Ranch style that was popular at the time. “This we do not want.” Snower owned the home until his death in 2013.

 

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http://www.residentialarchitect.com/projects/marcel-breuer-designed-house

Mortgage rates average 3.41% | Bedford Hills Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates dropping further to new 2016 lows in the wake of the Brexit vote. At 3.41 percent, the 30-year fixed-rate mortgage is just 10 basis points from its November 2012 all-time record low of 3.31 percent.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.41 percent with an average 0.5 point for the week ending July 7, 2016, down from last week when it averaged 3.48 percent. A year ago at this time, the 30-year FRM averaged 4.04 percent.
  • 15-year FRM this week averaged 2.74 percent with an average 0.4 point, down from last week when it averaged 2.78 percent. A year ago at this time, the 15-year FRM averaged 3.20 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.68 percent this week with an average 0.5 point, down from last week when it averaged 2.70 percent. A year ago, the 5-year ARM averaged 2.93.

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.

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Attributed to Sean Becketti, chief economist, Freddie Mac.

“Continuing fallout from the Brexit vote drove Treasury yields lower again this week. The 30-year fixed-rate mortgage followed Treasury yields, falling 7 basis points to 3.41 percent in this week’s survey. Mortgage rates have now dropped 15 basis points over the past two weeks, leaving them only 10 basis points above the all-time low.”

CHICAGO HOME SALES JUMP TO 9-YEAR HIGH | Bedford Hills Real Estate

The city that used to be second is staging something of a comeback, at least as far as home sales are concerned.

Chicagonow.com reports this: After a weak March and several other months of languishing sales activity the Chicago real estate market came roaring back in April with the highest home sales in 9 years and the largest year over year gain in 9 months. Check out the graph below to see these numbers in their historic context. All the April data points are flagged in red and the blue line is a 12 month moving average. However, that blue line is still not quite flashing an upward trend again.

April Chicago home sales were up a whopping 10.1% over last year but when the Illinois Association of Realtors announces the official numbers in a little less than 2 weeks they are going to report it as a 7.9% increase.

 

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http://www.builderonline.com/newsletter/chicago-home-sales-jump-to-9-year-high_c

Millennials Move to the Burbs for Price and Choice | Bedford Hills Real Estate

More affordable and better choice are driving more millennials to buy in the suburbs and fewer in city neighborhoods, according to the 2016 National Association of Realtors® Home Buyer and Seller Generational Trends study.

The share of millennials buying in an urban or central city area decreased to 17 percent in 2016 from 21 percent a year ago while more than half (51%) of buyers under age 35 bought in the suburbs, up from 49 percent a year ago, the study found.

2016-03-09_10-47-16However, younger buyers are not making a permanent commitment to the suburban lifestyle.  Buyers 35 years and younger expect stay in their new homes only ten years—the same tenure as last year– compared to the median of 14 years for all age groups, an increase from 12 years in 2015.

Lawrence Yun, NAR chief economist, said while millennials may choose to live in an urban area as renters, the survey reveals that most aren’t staying once they are ready to buy. “The median age of a millennial homebuyer is 30 years old, which typically is the time in life where one settles down to marry and raise a family,” he said. “Even if an urban setting is where they’d like to buy their first home, the need for more space at an affordable price is, for the most part, pushing their search further out.”

 

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http://www.realestateeconomywatch.com/2016/03/millennials-move-on-out-to-the-burbs-for-price-and-choice/

Housing Starts and Sales Stumble | Bedford Hills Real Estate

Home building data for January showed declines for new home sales and housing construction. Builder confidence also declined but remains in positive territory. NAHB’s forecast is for continued, modest growth for single-family construction and a slowing of the growth rate for multifamily development in 2016.

The NAHB/Wells Fargo Housing Market Index measure of single-family builder sentiment declined three points in February to 58 – still well above the tipping point of 50, and three points above last February, but down from a recent peak of 65 in October 2015. Builders reported more consumer concern over the price of new homes relative to existing homes as builders face higher costs for labor, land and materials.

Total housing starts fell 3.8% in January, according to estimates from the Census Bureau and the U.S. Department of Housing and Urban Development. The rate of single-family construction declined 3.9% from December to a seasonally adjusted annual rate of 731,000 units. However, there are currently 421,000 single-family homes under construction, a 15% increase from one year ago.

Multifamily starts (units with five or more properties) were down 2.5% in January to a seasonally adjusted annual rate of 354,000. But the 557,000 apartments currently in production is an increase of almost 19% on a year-over year basis.

New homes sales posted an unexpected decline in January, as consumers signed contracts to purchase new homes at an annual rate of 494,000 in January, a 9.2% decline in the rate compared to an elevated December. There was a significant decline in the West, which fell 32% compared to December. It appears that some sales accelerated into the final month of the year, resulting in December gains and January declines.

 

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http://eyeonhousing.org/2016/02/eye-on-the-economy-starts-and-sales-stumble/

CoreLogic: Home prices maintain pace, increase 6.3% | Bedford Hills Real Estate

Home prices nationwide, including distressed sales, posted similar results to last month, increasing year-over-year by 6.3% in December 2015 compared with December 2014, according to the most recent report from housing data and analytics provider, CoreLogic.

On a monthly basis, home prices are up 0.8% in December 2015 compared to November 2015.

The below chart shows the home price index going back to 2002.

Click to enlarge

home prices

(Source: CoreLogic)

“Nationally, home prices have been rising at a 5% to 6% annual rate for more than a year,” said Frank Nothaft, chief economist for CoreLogic.

“However, local-market growth can vary substantially from that. Some metropolitan areas have had double-digit appreciation, such as Denver and Naples, Florida, while others have had price declines, like New Orleans and Rochester, New York,” said Nothaft.

Looking ahead, CoreLogic’s HPI Forecast predicts that home prices will increase by 5.4% on a year-over-year basis from December 2015 to December 2016, and on a month-over-month basis home prices are expected to increase 0.2% from December 2015 to January 2016

 

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http://www.housingwire.com/articles/36187-corelogic-home-prices-maintain-pace-increase-63?eid=311691494&bid=1299330