The French architecture studio showed off its design to turn the damaged roof of the cathedral into a giant greenhouse, complete with an apiary that takes the place of the spire. (some 180,000 bees that had been kept in wooden boxes on the cathedral’s roof survived the fire). The renderings show a gabled roof perched atop the stately church; its golden-hued steel frame is filled with glass panels.
Inside, the architects envision rows of planters built from burnt wood from the old church’s attic. The greenhouse and apiary would act as an education hub where people can learn about horticulture and urban agriculture.
Sam Khater, Freddie Mac’s chief economist, says, “The Federal Reserve’s concern about the prospects for slowing economic growth caused investor jitters to drive down mortgage rates by the largest amount in over ten years. Despite negative outlooks by some, the economy continues to churn out jobs, which is great for housing demand. We have recently seen home sales start to recover and with this week’s rate drop we expect a continued rise in purchase demand.”
30-year fixed-rate mortgage (FRM) averaged 4.06 percent with an average 0.5 point for the week ending March 28, 2019, down from last week when it averaged 4.28 percent. A year ago at this time, the 30-year FRM averaged 4.40 percent.
15-year FRM this week averaged 3.57 percent with an average 0.4 point, down from last week when it averaged 3.71 percent. A year ago at this time, the 15-year FRM averaged 3.90 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.
U.S. home sales fell in January to their lowest level in more than three years and house prices rose only modestly, suggesting a further loss of momentum in the housing market.
The National Association of Realtors said on Thursday existing home sales dropped 1.2 percent to a seasonally adjusted annual rate of 4.94 million units last month.
That was the lowest level since November 2015 and well below analysts’ expectations of a rate of 5.0 million units. December’s sales pace was revised slightly higher.
The drop in January came after months of weakness in the U.S. housing market. Existing home sales were down 8.5 percent from a year ago.
The U.S. housing market has been stymied by a sharp rise in mortgage rates since 2016 as well as land and labor shortages. That has led to tight inventory and more expensive homes.
At the same time, the 30-year fixed mortgage rate has dipped in recent months and house price inflation is slowing.
The median existing house price increased 2.8 percent from a year ago to $247,500 in January. That was the smallest increase since February 2012.
Last month, existing home sales fell in three of the country’s four major regions, rising only in the Northeast.
There were 1.59 million previously owned homes on the market in January, up from 1.53 million in December.
At January’s sales pace, it would take 3.9 months to exhaust the current inventory, up from 3.7 months in December. A supply of six to seven months is viewed as a healthy balance between supply and demand.
The property tax rate in New York is high compared to the rest of the country. That’s according to a new report Wednesday from the financial news and opinion site 24/7 Wall St., which reviewed the effective rate — meaning the total amount of property taxes paid each year as a percentage of the total value of all occupied homes — for every state. The data is from the 2015 fiscal year and came from the conservative think tank Tax Foundation.
New York’s effective property tax rate ranked 14th highest in the country, the report found, nestled between Iowa and Kansas. On average, state and local governments across the country bring in about $1,500 a year in property taxes per person. Here are the numbers for New York:
Effective property tax rate: 1.4 percent
Median home value: $314,500
Per capita property taxes: $2,696.90
Median household income: $64,894
If those numbers seem like too much, you might consider moving to Hawaii, where the effective property tax rate was just .29 percent. If that sounds like a dream, consider this — the median Hawaiian home is worth more than $617,000 and the typical household earns about $77,000 a year, so don’t forget to bring a checkbook and perhaps buy a lottery ticket upon arrival. Alabama, Louisiana, West Virginia and Wyoming rounded out the five states with the lowest property tax rates.
On the flip side, residents in the Northeast appear to pay the highest rates, with New Jersey, New Hampshire and Vermont all appearing in the top five. New Jerseyans pay more than anyone else in the country with an effective property tax rate of 2.16 percent, the authors found. Residents pay more than $3,000 per capita and the median household income is just over $80,000 a year. A typical home in the state costs about $335,000.
Here are the 10 states with the highest effective property tax rates:Subscribe
Property taxes are the single largest money-maker for local governments and they’re spent almost entirely on a local level. Generally they are used to fund fire, police, schools, roads, cleaning and repairs.
“As a result, the United States is a patchwork of property tax codes, and depending on where you live, property taxes can be either a trivial expense or a major financial burden,” the report said.
A Union flag hangs across a street of houses in London. d
British house prices took a pre-Brexit hit in December, falling by the most in monthly terms since mid-2012 and rising by their slowest pace in nearly six years in annual terms, according to data from mortgage lender Nationwide.
House prices fell by 0.7 percent from November, the biggest monthly fall since July 2012, Friday’s data showed.
Compared with a year earlier, prices rose by just 0.5 percent compared with a 1.9 percent rise in November.
Both readings were below all forecasts in a Reuters poll of economists.
Nationwide said it expected prices to rise at a “low single-digit pace” in 2019 but its forecast was dependent on the economy continuing to grow modestly, something that looked “unusually uncertain.”
Prime Minister Theresa May is struggling to overcome deep opposition in her own Conservative Party to the Brexit divorce deal she agreed with other European Union leaders, raising the prospect of an economically damaging no-deal departure from the EU in March.
At the time of the referendum, Nationwide’s measure of house prices was rising by about 5 percent a year.
Bank of England Governor Mark Carney said last month that in the event of a “disorderly” departure from the EU — not the central bank’s base-case scenario — house prices could slump by 30 percent as part of a broader economic shock.
It’s the trillion-dollar question that everyone’s looking for an answer for. What’s housing going to do next year?
Earlier this week, we took a look at Zillow’s 2019 forecast, which stated that mortgage interest rates are going to keep rising next year, which will drive an increase in rents as people hold off on home buying.
But how much of an impact will that really have? Zillow’s sister company, Trulia, provides an answer in the form of its own 2019 forecast, which is backed up by some interesting survey data.
Trulia contracted The Harris Poll to ask 2,021 U.S. adults, ages 18 and older, earlier this month how they felt about housing right now and in the future.
And the results of the survey show that people want to buy a house, but they may not be able to afford it right now thanks to a combination of rising rates and rising home prices.
The bad news is that it’s likely only going to get worse in 2019.
According to Trulia, worsening housing affordability will slow down home buying activity next year.
“Over the past several years, home price growth has largely outpaced income growth, making for an increasingly unaffordable home-buying environment,” Trulia noted in its report.
“And next year, even as growth in home prices cools, limited supply will continue to help push prices up to some degree,” Trulia continued. “The financial impediments of homeownership are acutely felt among renters who wish to buy: 53% say that saving enough for a down payment is the number one obstacle to homeownership, while 36% cite rising home prices.”
Another issue, as stated before, are rising interest rates, which are projected to continue climbing in 2019. According to Trulia, rates will rise throughout the year, eventually reaching 10-year highs.
And that’s going to hurt renters who want to become homebuyers.
“Mortgage rates on 30-year, fixed rate loans have been less than 5% since the end of the recession, helping to buoy housing demand and keep monthly payments relatively cheap even as prices themselves rose,” Trulia said in its report. “But those record-low rates will come to an end in 2019. Rising mortgage rates will take a bite out of affordability on top of an already supply-constrained and high-priced housing market.”
According to Trulia, nearly 20% of renters who want to buy say that rising interest rates are their biggest obstacle to buying a home, which is up from 13% who made that claim back in April when interest rates were lower than they are now.
Also impacting potential buyers is “tight” nationwide housing inventory.
“Inventory has fallen almost non-stop for the past several years, and while several pricey coastal California markets saw an increase the number of for-sale starter and trade-up homes last quarter, they’re likely to be the exception and not the rule,” Trulia said.
“And even if inventory begins to pick up in more markets, it will be rising from multi-year lows and will take a long while to get back to a more balanced level between buyers and sellers,” Trulia continued. “With the construction industry facing significant headwinds from the higher cost of materials and labor as well as rising interest rates, we do not expect much if any growth in new construction starts in 2019 to help alleviate inventory woes.”
Despite all of that, Trulia expects more Millennials to become first-time homebuyers in 2019.
“Younger Americans will continue to drive homeownership. After dropping to multi-decade lows in the years following the recession, the national homeownership rate is steadily rising and is currently at the same level it was in 2014,” Trulia said.
“The largest gains in homeownership rates in recent years were among those under 35 years old,” Trulia concluded. “And more of these younger Americans say they intend to buy a home soon. Of Americans aged 18 to 34, 21% say they plan to buy within the next 12 months, up from 14% last year.”
Johanna Lasser had lived in a dozen apartments before she bought her first house two years ago, a rundown Victorian in Ditmas Park, Brooklyn. Ms. Lasser and her husband, Jimm, figured they would fix it up, stay a few years and then move on to a house in the suburbs, or one in a better school district, as many people do.
It didn’t take long for that plan to stop making sense.
“Once you’ve got all that work done, where would we go in the city except to another place that somebody had just fixed up?” said Ms. Lasser, 40, a stay-at-home mother who’s pregnant with her second child. “We’d just be switching apples for apples.”
Ms. and Mr. Lasser, 43, a filmmaker, are not the only homeowners with doubts about moving these days. Americans have been moving less over the years, with only 11 percent changing households in 2017, down from 13 percent in 2007, according to United States census data. Historically, we stayed in our homes for around six years; now we’re now staying for 10, according the National Association of Realtors.
The mood is affecting how we live in our homes and where we spend our money. More than three quarters of the respondents to an October Zillow survey, for example, reported that, given the option, they’d rather spend a lump sum of money renovating their current home than on a down payment for a new one.
What happens, though, when the home you think is your starter house becomes your forever house?
As first-time home buyers, we often cobble together what we have for a down payment with the expectation that in five years (because, face it, we like to believe that life operates on an endless loop of five-year plans) we’ll upgrade to something larger, or in better condition, or in a better neighborhood. Realizing that we may not actually be able to move runs counter to an American ideal that there’s always a better version of our lives a few pay raises away.
“We are restless people, we like to feel like we could move at any time. If you think of your house as your starter home, you know you can just leave,” said Melody Warnick, the author of “This Is Where You Belong: Finding Home Wherever You Are.” “That’s a belief that we cherish because it gives us a sense of freedom.”
But increasingly, the math doesn’t work and we find that we’re not so free to go.
A brew of short- and long-term trends has led us to this moment. Millennials, saddled with student debt, are buying their first homes later in life, and so are less likely to move again. Inventory is tight (largely because homeowners aren’t moving), home prices are high, and interest rates are rising.
Added to that, the 2017 federal tax overhaul capped the mortgage interest deduction at $750,000 and limited sales and local tax deductions to $10,000 a year, making it less desirable for owners in high-tax states like New York to buy a home with a jumbo mortgage or a giant property-tax bill.
In short, if you were lucky enough to lock in a historically low interest rate, whatever you buy today will cost you more than it did just a few months ago. The Lassers, for example, pay roughly $12,000 a year in property taxes for the six-bedroom house that they bought for $1.475 million in 2016. But if they decided to move to the suburbs, their property taxes would likely be higher, and if they bought a house priced at or more than what they paid for their current home, their monthly mortgage payments would be substantially higher at current interest rates.
“With our next purchase, we will have less buying power,” Ms. Lasser said. After the couple finishes bringing the house back to its original glory — a $350,000 project that will involve restoring the original exterior and interior details, gut renovating four of the six bathrooms and renovating the kitchen — she doubts they’ll actually want to leave.
“If you’ve gone through one remodel, I don’t think you ever want to do it again,” she said. “And where would we go?”
Companies such as Fusion Exteriors provide various services all the way from free estimation on all the work to professionals who ensure perfection in every task they perform.
Now, rather than scrolling Zillow listings, the couple is paying closer attention to their neighborhood schools, a detail they had overlooked when they bought the place because they figured they’d be gone by the time their daughter, now 4, was old enough for elementary school. “We were not at all prepared for her being in elementary or middle school in the city,” she said.
There are upsides to abandoning the idea of the next house. People who have lived in one place for a long time report feeling better, healthier and more content, according to Ms. Warnick. “Imagine if you channeled some of that restless energy into building strong relationships with people in your neighborhood or planning the block party?” she said.
But if you bought your home during one life stage, it may not necessarily fit so well with the next one.
Mary Botel, 38, bought a 750-square foot bungalow in Portland, Ore., in 2011 for $100,000, when she was single. At the time, she thought it was a good deal and a great place to live for a few years. Seven years later, she is married and now shares the tiny space with her husband, Blaine Botel, 35, and his teenage son. The quarters are tight, requiring the family to pare down on their possessions and stay organized. “Everything now has to have a place,” she said.
Initially the neighborhood was rough — her car was stolen once and so were her boots, snatched off the front porch in the middle of winter. But as the economy improved, so too did the neighborhood. Now apartments in the rental building next door rent for about $1,400 a month, substantially more than Mrs. Botel’s mortgage payments. “If we were to move today, even if we sold, our money wouldn’t go very far,” said Mrs. Botel, who works for Multnomah County, Ore.
Prospective home buyers often want to get pricing information for various properties without having to always rely on a real estate agent. This is where real estate sites like Zillow.com come in very handy. However, can you really rely on the site’s value estimates? Many have wondered whether Zillow provides accurate data with its Zestimate home price estimates.
Zillow is a business website, established to get eyeballs on a bunch of homes for sale and, in turn, to sell advertising to real estate professionals. It isn’t a real estate company with a group of agents.
Zillow bases many of its value conclusions on opinions formed by using algorithms that process data collected from various sources. No matter how great the algorithm is, opinions are not facts. If Zillow and similar sites truly had their finger on the pulse of the real estate market, any of these sites could’ve predicted the collapse of the housing market, which they did not.
Understanding Zillow’s Zestimate
Zillow acquires data by amalgamating all the information on housing it can gain access to. It mixes and merges data from various sources into one source. Many computerized programs exist that can forecast the value of a home. Even real estate agents use computerized programs, but the difference is real estate agents don’t rely on those programs alone like Zillow relies on the artificial intelligence used to assemble its Zillow Zestimates.
At least for now, Zillow can’t predict how a buyer will feel when she enters a home. Zillow can’t tell you whether the interior has been updated, if the workmanship is superior, whether the materials used are inferior, or whether a school around the corner has decreased the value of homes backing up to the football field or any other number of factors real estate agents and appraisers use when they know the neighborhood and have inspected the home in person.
How Agents Arrive at an Estimate of Value
When agents begin to assess a property, the first thing they typically do is study the home from an overhead, satellite view on Google. They note whether it backs up to a busy street, the proximity to commercial property or freeways, the size of other homes nearby, the vegetation and landscaping, its orientation to the sun and, if available, will view any photos of the exterior plus a street scene.
An agent might then run an automated valuation using specialized real estate software. One is Realist, a company owned by CoreLogic, that is data-centric for all sales, including non-MLS, and will take into consideration surrounding home sales varying 25 percent or less in configuration and type, including other parameters an agent can manually establish.
Another type of automated valuation is based on sales pulled directly from the MLS, and computed based on square footage, including high, low, median and average values of all sold, pending, and active listings. Those two types of automated valuations and the resulting values alone are often very different from each other but, used together, can provide a range of value, generally not more than a 5-percent difference. That process provides a lot of information but still is not nearly enough to establish a strong value conclusion.
Armed with that information, an agent would then inspect the home and look at it through the eyes of a buyer, how an appraiser will view it, and where it would be positioned against the competition to drive traffic to the home. It’s not unusual to enter a home with a prepared listing agreement in hand and end up manually changing the listing price after viewing the home. Automation, such as that used by Zillow, can never take the place of personal assessment.
The Zillow Zestimate of Value Accuracy
Zillow never claims to be 100 percent accurate all the time or even 80 percent accurate most of the time in all areas. If all the homes within a six-block radius are very similar to each other, in a suburban subdivision, filled with homes built around the same year, and about the same size and with identical amenities, a Zillow estimate will be much more accurate, perhaps within 10 percent, because there are not enough specific variances to throw it off. In other cases, such as for older neighborhoods with many homes that have been improved in different ways, it won’t be that close at all.
Real World: Zillow vs. Actual Sale Prices
The following four typical homes were actual home sales, and the price outcome is compared with their Zillow Zestimates at the point of sale, to highlight some of the variations in the two values.
One property is two houses on a lot in Midtown Sacramento, located on a busy street near the railroad tracks and close to freeway noise, across from a commercial property. Zillow estimated the value of that home at $380,733, but it sold at $349,000, after almost 6 months on the market, with plenty of exposure. In this case, the Zillow estimate was about 9 percent too high.
The second home was a custom waterfront property in the Pocket area of Sacramento. Zillow valued that home at $983,097, yet it sold at $1,085,000, which was 10 percent more than the Zillow estimate. If the sellers had relied on the Zillow estimate, they would have lost more than $100,000, which is no small change.
The third home was a reconstructed home in an exclusive area of Davis, California, near the University of California, Davis. Zillow valued that home at $1,230,563, but it sold for $1,495,000, and for cash, with no financing involved. That Zestimate was more than 20 percent too low.
Finally, the fourth home was a lakefront home in Elk Grove, California. Again, the Zillow estimate was too low, at $488,711, and it sold for 16 percent more, which included the buyer’s lender’s appraisal, at $565,500.
The Zestimate is formulated to give website visitors a range of value. It’s not meant to replace an appraisal nor a real estate professional’s opinion of value. Many agents might take a gander at Zillow values before visiting a seller because they know the seller is looking at those values, but not because there is value to the agent as a professional in the estimate. Real estate agents do not use Zillow to price a home.
Zillow as a Backup Value
In some cases, agents will tell their clients to look at a home’s price on Zillow to justify how good of a good deal they are getting when buying a home, providing the Zestimate is much higher than the actual sales price, of course. It’s a selective usage with agents. When the price is to their advantage, they might use it as evidence for their client. Even banks don’t know any better, so in a short sale situation for example, when the offer is more than a Zestimate, a short sale agent might point to the Zestimate when in negotiations with the short-sale bank.
Interest rates and low inventory caused home sales to fall in September, but Realtors expect housing conditions to improve over the next six months.
The Buyer Traffic Index decreased to 51 in September, down from 61 in September 2017, according to the National Association of Realtors Confidence Index.
The index gathers monthly information from Realtors about local real estate market conditions, characteristics of buyers and sellers and issues affecting homeownership and real estate transactions. An index of more than 50 indicates an expectation of improvement.
The Seller Traffic Index also decreased, falling to 41 in September, down from 45 in September 2017, according to NAR.
However, despite these decreases, Realtors expect that, over the next six months, conditions will improve for the single-family housing market. The Confidence Index – Six-Month Outlook Current Conditions came in at 53 in September.
The same can’t be said for other housing markets. For example, the index for townhomes came in at 44, and 43 for condominium properties.
When asked about major issues affecting housing transactions in September, Realtors answered that low inventory and interest rates were the most common issues.
But while Realtors may be optimistic about the future, some economists disagree.
“Our expectations for housing have become more pessimistic: Rising interest rates and declining housing sentiment from both consumers and lenders led us to lower our home sales forecast over the duration of 2018 and through 2019,” Fannie Mae Chief Economist Doug Duncan said.
Most experts expect one final rate hike in December 2018 and another two or three rate hikes in 2019. These rising rates will only continue to push potential homebuyers out of the market.
In fact, recent data from NAR showed that existing home sales hit their lowest level in three years, and Freddie Mac data shows interest rates are currently at a 10-year high. Now, these factors could be pushing more families to rent instead of buying a home.
Despite the difficult conditions, some home buyers managed to increase their share. First-time buyers accounted for 32% of sales in September, up from 29% in September last year.
U.S. home sales fell in September by the most in over two years as the housing market continued to struggle despite strength across the broader economy.
The National Association of Realtors said on Friday that existing home sales dropped 3.4 percent to a seasonally adjusted annual rate of 5.15 million units last month.
Home sales have now fallen for six straight months. A dearth of properties for sale has pushed up prices, sidelining many would-be homeowners. Sales dropped the most in the South and the decline in the West left sales there down 12.2 percent from a year earlier.
NAR Chief Economist Lawrence Yun said the overall decline appeared related to a rise in interest rates.
Supply has also been constrained by rising building material costs as well as land and labor shortages, while rising mortgage rates are expected to slow demand.
The Federal Reserve raised borrowing costs in September for the third time this year and is widely expected to hike rates again in December.
Economists polled by Reuters had forecast existing home sales falling to 5.30 million from a previously reported 5.34 million. Existing home sales make up about 90 percent of U.S. home sales.
There were 1.88 million homes on the market in September, an increase of 1.1 percent from a year ago.
At September’s sales pace, it would take 4.4 months to clear the current inventory. A supply of six to seven months is viewed as a healthy balance between supply and demand.
The median house price increased 4.2 percent from one year ago to $258,100 in September.