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Chappaqua NY

New homes selling at slowest pace in seven months | Chappaqua Real Estate

Sales of new single-family homes dropped in June to the slowest pace in seven months, according to data released Friday that signaled a hiccup for the market.

The annual sales pace for new single-family homes in the U.S. fell 6.8% last month to 482,000, with drops in three of four regions, the U.S. Commerce Department. Only the Northeast saw the sales pace rise.

Economists polled by MarketWatch had expected a June sales rate of 550,000, compared with an original May estimate of 546,000. On Friday the government revised May’s rate to 517,000.
While June’s result is disappointing, economists caution over reading too much into a single monthly report. A confidence interval of plus-or-minus 12.5% for June’s drop of 6.8% shows that the government isn’t sure whether the sales pace rose or fell last month.

Trends signal improvement, with June’s sales pace up 18.1% from a year earlier.

“Even the disappointing June reading still represents progress over a longer time horizon,” said Stephen Stanley, chief economist at Amherst Pierpont Securities. “I view today’s reading for the typically volatile new home sales data as statistical noise.”

The median price of new homes fell to $281,800 in June, down 1.8% from a year earlier.

Recent new-home sales and building rates remain far below long-term averages. But a strong jobs market is expected to support rising home sales by helping more families afford ownership. Earlier this week, mortgage-finance giant Fannie Mae raised its 2015 expectations for U.S. home sales, upping its forecast for new and used homes. A mortgage-industry group also cranked up its forecast this week, raising its expectations for mortgage originations.

Elsewhere in the housing market, a recent report on existing homes, which make up the bulk of the residential-sales market, showed strong growth for June. However, economists warned about getting too excited over that flurry of activity, noting that some of the recent buying growth may reflect buyers rushing to lock in mortgage rates before they rise further.


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30 Year #Mortgage Rate 4.04% | #Chappaqua Real Estate

Freddie Mac  today released the results of its Primary Mortgage Market Survey® (PMMS®), showing an investor flight to safety for U.S. Treasuries is pushing average fixed mortgage rates lower and helping to keep buyer activity strong toward the close of the spring homebuying season.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 4.04 percent with an average 0.6 point for the week ending July 9, 2015, down from last week when it averaged 4.08 percent. A year ago at this time, the 30-year FRM averaged 4.15 percent.
  • 15-year FRM this week averaged 3.20 percent with an average 0.5 point, down from last week when it averaged 3.24 percent. A year ago at this time, the 15-year FRM averaged 3.24 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.93 percent this week with an average 0.4 point, down from last week when it averaged 2.99 percent. A year ago, the 5-year ARM averaged 2.99 percent.
  • 1-year Treasury-indexed ARM averaged 2.50 percent this week with an average 0.3 point, down from last week when it averaged 2.52 percent. At this time last year, the 1-year ARM averaged 2.40 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.

“Yields on Treasury securities declined this week in response to investor concerns about events in Greece and China. Mortgage rates fell as well, although not by as much as government bond yields. The rate on 30-year fixed-rate mortgages fell 4 basis points to 4.04 percent.”

“Overseas volatility is likely to persist for some time, providing some restraint on potential U.S. rate increases. In addition, the minutes of the June meeting of the Federal Open Market Committee suggest the Federal Reserve will proceed cautiously — monitoring events both overseas and in the U.S. to ascertain the appropriate moment to begin raising short-term interest rates. As a result, mortgage rates may remain in the neighborhood of 4 percent for a while.”

Mortgage Modifications have changed | Chappaqua Real Estate

There’s been a dramatic change in the assistance offered to struggling homeowners.

In February, 49% of borrowers with a loan backed by federally controlled housing-finance giants Fannie Mae and Freddie Mac received modifications that only extended the length of their mortgage. That share was up 20 percentage points from a year earlier, according to a report from the Federal Housing Finance Agency, which regulates the government sponsored enterprises. Over that same time period, the share of borrowers receiving a modification that combined an extended term with other actions, such as a rate reduction and principal forbearance, fell by 19 percentage points.

Similar trends are seen in quarterly data from the Office of the Comptroller of the Currency, which publishes a snapshot of the U.S. mortgage market. According to the OCC, the chance that a modification included a term extension rose by 10% in 2014. Meanwhile, the likelihood dropped 15% for a rate reduction and 66% for a principal deferral.
The reason? The big rise in home prices since 2012.

“As the market improves, the number of borrowers who are in deep distress goes down, so the average modification tends to get lighter because they don’t need to provide as much relief,” said Jim Parrott, a former housing-policy adviser for the White House’s National Economic Council and a senior fellow at the Urban Institute, a Washington think tank.

Also, as time has passed, the pool of borrowers who are eligible for the most rigorous modifications has narrowed.

Officials have tweaked mortgage-help programs since the bubble burst, including an important change in 2014 to enable borrowers with loan-to-value ratios under 80% to receive a GSE modification that will generally only extend the term of a mortgage. Thanks to rising home prices — they bottomed out in early 2012 and are now about 9% down from a bubble peak — owners have become increasingly likely to have equity.

“The practice of providing a modification to somebody with significant equity is fairly new,” said Julia Gordon, senior director for housing and consumer finance at the Center for American Progress, a left-leaning think tank in Washington. “The assumption in the past, pre-crisis, was if you get into terrible trouble with your mortgage, your solution was to downsize.”


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Weekly mortgage applications drop as rates jump | Chappaqua Real Estate

A sharp jump in mortgage rates last Friday took its toll on home lending, leaving mostly high-end home buyers on the playing field.

Total mortgage application volume fell 1.3 percent week-to-week on a seasonally adjusted basis for the week ending March 6th, according to the Mortgage Bankers Association (MBA). The fall was driven by a 3 percent drop in applications to refinance. Refinance volume is now at its lowest level since January and accounts for just 60 percent of all applications. Refinances had seen as much as an 80 percent share of all applications in recent years, as rates dipped and home buying stalled.

Mortgage applications to purchase a home rose two percent for the week and are two percent higher than a year ago. The slight increase, however, was largely due to higher-end home buyers. The average purchase loan size last week soared to $294,900, the highest level ever recorded on the MBA survey. The median price of a U.S. home sold in January was $199,600, according to the National Association of Realtors.

“The record high average loan size indicates that the strength of the market remains at the high end. We have not yet seen an influx of first-time homebuyers,” noted Michael Fratantoni, chief economist for the MBA.

A stronger-than-expected February employment report last Friday pushed interest rates higher, as investors now expect the Federal Reserve to increase its lending rate by mid-year. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.01 percent, the highest level since the week ending January 2, 2015, from 3.96 percent, with points increasing to 0.39 from 0.30 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans, according to the MBA.

Interest rates edged back a bit Tuesday, as the stock market sold off, but 4 percent may be the new normal now for 30-year fixed rate loans, with the expectation that they would move higher later this year. While these moves may seem small, they can take away significant purchasing power, especially for lower income borrowers using small down payments. With home price gains accelerating, and still tight supply of homes for sale, home buyers are especially sensitive to every potential penny lost or gained.


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Use of Depreciation Deductions in Real Estate and Construction | Chappaqua Real Estate

Examination of IRS data demonstrates the importance of various depreciation deductions for the construction and real estate sectors. These rules include the Section 179 small business expensing option, bonus depreciation, and normal tax depreciation. The data also illustrate what classes of property are most common, including the 5-year class for construction equipment and apartment property. This information is useful for the industry to consider as discussions of possible business tax reform take place during 2015. Some tax reform plans would increase the use of expensing, while others would extend depreciation periods, in some cases significantly.


Claiming deductions for the depreciation of business assets is an important part of most enterprises’ income tax calculation. Tax law permits deductions that allow recovery of the cost of tangible property used for business purposes. These deductions reflect an allowance for the wear and tear of the property. Depreciation deductions also encourage reinvestment into older residential units.

IRS tax data allow us to examine the use of these deductions by class of property and business sector. There are some important limitations however. First, the data examined in this post are limited to businesses organized as C Corporations. Thus, the data do not reflect businesses organized as pass-through entities, such as S Corporations and LLCs, which constitute the majority of real estate-related firms.  Nonetheless, this smaller set of data can be viewed as a sample of the sector, with a bias toward larger businesses that organize as C Corporations.


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Finding Alien Beauty in ‘Strange and Sublime’ Water Towers | Chappaqua Real Estate

colerne.jpgPhoto courtesy of Richard Lloyd Lewis

Welsh photographer Richard Lloyd Lewis was first attracted to water towers because of their “somewhat science-fictional design,” and because they are generally considered to be a blight on the landscape. His otherworldly photographs of the “alien” towers, taken across the United Kingdom, highlight the “strange and sublime” beauty of these “architectural anomalies,” the artist wrote in an email.

Glowing “alien” water towers, this way. >>

Far from the clinical gaze of Bernd and Hilla Becher’s celebrated photographic survey of industrial architecture, including water towers, Lloyd Lewis’ work is concerned with showcasing the bizarre but appealing aesthetics of these single-purpose industrial structures. The photographs were all taken at dusk, when the light colored towers contrast with the night sky, and are impossible to ignore. The effect is eerily lovely.


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Somebody Actually Lives on This Remote Pillar of Rock | Chappaqua Real Estate

08a7b805-03af-483a-be29-7a49eacb5825-2060x1322.jpegPhoto by Amos Chapple via The Guardian

The Katskhi Pillar, a towering limestone monolith in the Republic of Georgia with the ruins of two Byzantine churches on top of it, has so many legends swirling around it that it’s hard to tell which ones are fact, and which are (admittedly very appealing) fictions. In this case, however, the truth of the matter reads a lot like fiction: a survey of the cliff a few years back revealed a pair of monasteries dating from the sixth to ninth centuries, where members of an ascetic religious order called the Stylites lived until around 1400. In the ruins of the churches, researchers found three hermit cells, a crypt, and a wine cellar. To this day, the locals of the village of Katskhi venerate the rock formation as the “Pillar of Life,” a symbol of the cross where Jesus was crucified, and some believe the monastery on the surface was once connected by a long iron chain to the dome of another nearby church.

It was uninhabited for centuries. Then a monk moved there in 1993. >>

The first mention of the ancient monastery was in the 18th century, when a Georgian scholar and prince described it thusly: “There is a rock within the ravine standing like a pillar, considerably high. There is a small church on the top of the rock, but nobody is able to ascend it; nor know they how to do that.”

For centuries, it was uninhabited. In the 1990s, a local monk named Maxim Qavtaradze moved in and began to restore the vertiginous churches himself. He enters and leaves via a 131-foot iron ladder; it takes him about 20 minutes to climb. Qavtaradze had been motivated to change his life after a stint in prison, and actually slept in an old fridge for his first two years, until some supporters built him a cottage.


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It May Be Cheaper To Buy Than Rent | #Chappaqua Real Estate

Renting is becoming unaffordable in many metropolitan cities, a new report reveals.

According to Zillow, renting is more expensive than buying in 94 of the country’s 100 biggest metropolitan areas.

The report suggests the rental market didn’t see a precipitous drop in prices stemming from the financial crisis, as illustrated in the housing market, which explains the slow and steady upward trend in rents. Plus, the study says consumers spent an average of 29.5% of their income on rent, compared to 15.3% for home buyers with mortgages.

Home buying affordability stems from the low interest environment, which isn’t expected to last, especially as the Federal Reserve scales back its bond stimulus, known as quantitative easing.

On Thursday, Freddie Mac said the average rate on a 30-year fixed mortgage held steady at 4.10%, compared to 4.51% during the same time last year.

Rising rents could prove to be a vicious cycle for the real estate market.

“As rents keep rising, along with interest rates and home values, saving for a down payment and attaining homeownership becomes that much more difficult for millions of current renters, particularly millennial renters already saddled with uncertain job prospects and enormous student debt,” said Zillow Chief Economist Dr. Stan Humphries. “In order to combat this phenomenon, wages need to grow more quickly than they are, particularly for renters, and growth in home values will need to slow.”

Wages aren’t showing robust growth, and rising inflation is making matters worse. The Bureau of Labor Statistics said that while average hourly wages grew 2% year-over-year in July, the consumer price index also grew 2% during the same period.



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Meet the investors behind NYC’s hottest real estate startups | Chappaqua Real Estate

It’s no surprise that Uber, Instagram and Buzzfeed are attracting big-name technology investors. The three upstart businesses are rattling the cages of established industries and possess an undeniable ‘cool’ factor. But what may surprise some is that many of the early backers of these companies are also betting big on startups in the New York real estate scene.

Josh Kushner’s venture capital firm Thrive Capital, a backer of Uber and Instagram, is also an investor in leasing platform Hightower, real estate marketplace Honest Buildings and residential brokerage Urban Compass. Founder Collective, which backs Buzzfeed, also bankrolls office search marketplace 42Floors and real estate information firm CompStak. This cross-pollination by investors, sources said, shows that real estate is now truly on the tech industry’s radar.

“For too long, the real estate and tech industries were not communicating with each other and that’s what’s really changed over the past few years,” said Jared Kushner, CEO of Kushner Companies and an active player in the space through an investment in Thrive. “As a result, tech startups are starting to solve important problems, which has led to the creation of better companies and more investor interest.” That interest is translating into a lot of cash, too.

Globally, real estate tech startups pulled in more than $740 million in funding between July 2012 and July 2014, as The Real Deal reported last month. That number doesn’t take into account recent capital raisings in New York, such as Urban Compass’ $40 million Series B funding round and Hightower’s $6.5 million Series A round.




– See more at: http://therealdeal.com/blog/2014/08/25/meet-the-investors-behind-nycs-hottest-real-estate-tech-startups/#sthash.6MTRoAcm.dpuf

Valuation Fraud Soared 27 Percent in Q1 | Chappaqua Real Estate

The national Property Valuation Fraud Risk Index rose 27 percent in the first quarter and 17 percent from a year ago, evidence that an epidemic of fraudulent home valuations is sweeping certain real estate markets on the East and West Coasts.

Property valuations are increasingly being manipulated by individuals who purchase and list multiple properties in the same neighborhoods to dominate values in hyper local markets ienabling them to set fraudulent sales prices to their advantage, according to a report from Interthinx, a subsidiary of First American that helps lenders minimize risk and review appraisals.

Another contributing factor observed is the rise in the number of properties being appraised well above traditional valuation thresholds to artificially create equity.




“This quarter’s report is a reminder that lenders need to be aware of emerging fraud risks. The rise in property valuation risk is troublesome because collateral values are a critical element in making sound lending decisions,” said Jeff Moyer, president of Interthinx. “To make lending decisions with increased confidence in the loan’s quality, we recommend that lenders use automated tools early in the valuation process to double check opinions of value, quality of work and regulatory compliance on issues such as licensing.”

California continues to be the riskiest state with a Mortgage Fraud Risk Index of 146, and it contains eight of the 10 riskiest Metropolitan Statistical Areas, (MSAs) and eight of the 10 riskiest ZIP codes. California also continues to dominate the type-specific lists with four of the 10 riskiest MSAs for property valuation fraud, seven of the 10 riskiest MSAs for identity fraud, six of the 10 riskiest MSAs for occupancy fraud and eight of the 10 riskiest MSAs for employment/income fraud.


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