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North Salem NY Realtor

Pending home sales down 10 months in a row as rates rise | North Salem Real Estate

Pending home sales declined slightly in October in all regions but the Northeast, according to the National Association of Realtors®.

The Pending Home Sales Index,* www.nar.realtor/pending-home-sales, a forward-looking indicator based on contract signings, decreased 2.6 percent to 102.1 in October, down from 104.8 in September. However, year-over-year contract signings dropped 6.7 percent, making this the tenth straight month of annual decreases.

Lawrence Yun, NAR chief economist, said that ten straight months of decline certainly isn’t favorable news for the housing sector. “The recent rise in mortgage rates have reduced the pool of eligible homebuyers,” he said.

Yun notes that a similar period of decline occurred during the 2013 Taper Tantrum when interest rates jumped from 3.5 percent to 4.5 percent. After 11 months – November 2013 to September 2014 – sales finally rebounded when rates decreased. “But this time, interests rates are not going down, in fact, they are probably going to increase even further,” Yun noted.

While the short-term outlook is uncertain, Yun stressed that he is very optimistic about the long-term outlook. The current home sales level matches sales in 2000. “However, mortgage rates are much lower today compared to earlier this century, when mortgage rates averaged 8 percent. Additionally, there are more jobs today than there were two decades ago,” said Yun. “So, while the long-term prospects look solid, we just have to get through this short-term period of uncertainty.”

All four major regions saw a decline when compared to a year ago, with the West seeing the most pronounced drop. Yun said that decline is not at all surprising. “The West region experienced the fastest run-up in home prices in a short time and therefore, has essentially priced out many consumers,” Yun said.

Yun suggests that the Federal Reserve should be less aggressive in raising rates. He cites the collapse in oil prices and the decrease in gasoline prices. “The inflationary pressure is all but disappearing. Given that condition, there is less of a need to aggressively raise interest rates. Looking at the broader economy and keeping in mind that the housing sector is a great contributor to the economy, it would be wise for the Federal Reserve to slow the raising of rates to see how inflation develops.”

Yun pointed to year-over-year increases in active listings from data at realtor.com® to illustrate a potential rise in inventory. Denver-Aurora-Lakewood, Colo., Seattle-Tacoma-Bellevue, Wash., Columbus, Ohio, San Francisco-Oakland-Hayward, Calif. and San Diego-Carlsbad, Calif. saw the largest increase in active listings in October compared to a year ago.

Yun expects existing-home sales this year to decrease 3.1 percent to 5.34 million, and the national median existing-home price to increase 4.7 percent. Looking ahead to next year, existing sales are forecast to decline 0.4 percent and home prices to drop roughly 2.5 percent.

October Pending Home Sales Regional Breakdown

The PHSI in the Northeast rose 0.7 percent to 92.9 in October, and is now 2.9 percent below a year ago. In the Midwest, the index fell 1.8 percent to 100.4 in October and is 4.9 percent lower than October 2017.

Pending home sales in the South fell 1.1 percent to an index of 118.9 in October, which is 4.6 percent lower than a year ago. The index in the West decreased 8.9 percent in October to 84.8 and fell 15.3 percent below a year ago.

The National Association of Realtors® is America’s largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries.

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*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

NOTE: NAR’s November Housing Minute video will be released on November 30, Existing-Home Sales for November will be reported December 19, and the next Pending Home Sales Index will be December 28; all release times are 10:00 a.m. ET.

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https://www.nar.realtor/newsroom/pending-home-sales-slip-2-6-percent-in-october

Baby Boomers won’t downsize homes anytime soon | North Salem Real Estate

Spring house

Baby Boomers are staying put and their kids are sticking with them.

A study released Thursday by Trulia examined the housing situations of homeowners 65 and older and compared it with a decade ago.

It uncovered a 3.4% jump in the number of seniors working in 2016 compared with 2005, and a 1.7% increase in the number living with younger generations.

It also showed that seniors appear to be holding off on downsizing just the same as they were 10 years prior.

Only 5.5% of seniors moved,according to Trulia, and of those who did, the split was pretty even between single-family and multifamily residences.

But Trulia analyst Alexandra Lee points out that while the percentage of downsizers hasn’t changed, the number of those moving actually has.

“Because the Boomer generation is so much larger than previous generations, that 5.5% moving rate translates into very different raw numbers across the years,” Lee wrote. “There were about 7 million more senior households in 2016 than 2005, meaning 386,000 more senior households moved in 2016.”

The age at which seniors decide to downsize has also shifted. The survey revealed that in 2005, seniors were moving into multifamily residences by age 75. By 2016, this had moved to 80.

The study sought to examine whether Baby Boomers holding onto their homes was driving up home prices. In looking at the nation’s top 100 metros, it determined that Boomers were not eroding affordability.

“Like the general population, seniors in expensive and unaffordable metros rent at much higher rates,” Lee wrote. “The higher the income required to purchase the median home, the lower the proportion of senior households that could downsize.”

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https://www.housingwire.com/articles/46757-baby-boomers-wont-downsize-homes-anytime-soon?utm_campaign=Newsletter%20-%20HousingWire%20Daily&utm_source=hs_email&utm_medium=email&utm_content=65785845&_hsenc=p2ANqtz-8DJkz26bVvBlKjbpqVtwDRlTZEW2huOUt-knTDcKEEdq4EO-a-n_9-htcpsaznU7v7J7YkAGQyY0DPwieutdTFa6lf3Q&_hsmi=65785845

Single-Family Construction Up | North Salem Real Estate

NAHB analysis of Census Construction Spending data shows that total private residential construction spending fell 0.7% in November to a seasonally adjusted annual rate of $462.9 billion.

Multifamily construction spending slowed for the first time since July to a seasonally-adjusted annual rate of $61.9 billion, down 2.9% from the revised October estimate. Despite the slowdown, multifamily spending was still 10.7% higher than the rate one year prior.  In contrast, single-family construction spending increased by 1.7% over the month, posting its second consecutive gain. However, single-family construction spending still slipped down by 0.9% over November 2015. Though not as pronounced as the drop-off in multifamily construction spending, home improvements still fell by a substantial 3.5%. On a year-over-year basis, spending on home improvements increased by 6.8%.

The NAHB construction spending index shown in the graph below illustrates the recent convergence, though small, of single-family spending with that of multifamily and home improvements.

The pace of private nonresidential construction spending increased by 2.5% over the month, more than offsetting the 2.1% October decline, reaching a pace 6.4% higher than one year ago. The primary drivers of this month-over-month increase were spending on structures to be used for lodging (+6.9%) and religious (+9.8%) purposes.

 

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http://eyeonhousing.org/2017/01/single-family-construction-up-in-november/

Mortgage rates average 4.13% | North Salem Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates moving higher for the sixth consecutive week.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 4.13 percent with an average 0.5 point for the week ending December 8, 2016, up from last week when it averaged 4.08 percent. A year ago at this time, the 30-year FRM averaged 3.95 percent.
  • 15-year FRM this week averaged 3.36 percent with an average 0.5 point, up from last week when it averaged 3.34 percent. A year ago at this time, the 15-year FRM averaged 3.19 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.17 percent this week with an average 0.5 point, up from last week when it averaged 3.15 percent. A year ago, the 5-year ARM averaged 3.03 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.

Quote
Attributed to Sean Becketti, chief economist, Freddie Mac.

“The 10-year Treasury yield dipped this week following the release of the Job Openings and Labor Turnover Survey. The 30-year mortgage rate rose another 5 basis points to 4.13 percent, starting the month 18 basis points higher than this time last year. As rates continue to climb and the year comes to a close, next week’s FOMC meeting will be the talk of the town with the markets 94 percent certain of a quarter-point-rate hike.”

Growing number of firms offering energy-efficient modular design | North Salem Real Estate

The Alfreds' net-zero residence, in Cumberland, Maine, is a modular design by BrightBuilt Home.
James R. SalomonThe Alfreds’ net-zero residence, in Cumberland, Maine, is a modular design by BrightBuilt Home.

When Shaun Alfreds and his wife decided to build a house for their family of five in Cumberland, Maine, they didn’t know if a high-performance project would be within their budget. “We aren’t wealthy by any stretch of the imagination, but we wanted an energy-efficient home,” says Alfreds, a chief operating officer at HealthInfoNet, a local health information technology company.

After some research, however, the couple realized that they achieve their dream for a nominal additional investment over the cost of a conventional house if they opted for a modular high-performance house. They chose a two-story, Cape Cod–style design from Portland, Maine–based BrightBuilt Home, and moved in last December.

At more than 3,000 square feet, the house is spacious, but its full sun exposure and a 10-kilowatt solar array of 39 photovoltaic (PV) panels should cover its energy consumption year-round. Alfreds says the house cost “almost exactly what other [builders] were bidding” for a standard, code-compliant project that was custom designed. And their small additional investment goes to building equity in the house, rather than to paying utilities.

BrightBuilt, a sister company of local firm Kaplan Thomson Architects (KTA), joins an increasing number of design companies that are expanding the market for high-performance residential projects. While KTA has custom-designed many energy-efficient houses, principal Phil Kaplan, AIA, says the firm also wanted to offer an off-the-shelf product. In 2015, it launched BrightBuilt with nine design templates. Starting at $175 to $180 per square foot, the houses bring net-zero energy to a price more people can afford. “We’re definitely seeing a lot of demand,” Kaplan says.

But some architects and builders have found ways to lower the price of net-zero housing even more.

De Verneil residence, by Deltec Homes (Ridgeline model)
Marie de VerneilDe Verneil residence, by Deltec Homes (Ridgeline model)

Marie de Verneil dreamed of building a retirement home on land she owned in central Virginia. “To me, green was very important,” she says. However, her savings from teaching French and international relations at the University of Maryland, Baltimore County, didn’t seem like enough. “It’s kind of discouraging for someone like me,” she says.

Kitchen, de Verneil residence
Marie de VerneilKitchen, de Verneil residence

Then de Verneil heard about Deltec Homes, in Asheville, N.C. The company—known for its distinctly round, prefabricated, and hurricane-resistant houses—recently launched Renew, a collection of models that use about two-thirds the energy of a conventional house and can include a PV array. De Verneil estimates she spent $250,000 on her 1,600-square-foot house (less than $160 per square foot), which includes a roof-mounted solar array. Her monthly electric bill is $30, the base fee for taxes and distribution. And when she is retired and living on a fixed income, she knows she’ll never have to say, “I can’t put the heat on.”

For those wanting to build a passive or net-zero energy house, right-sizing expectations is a crucial step to meeting one’s budget. And, as Deltec president Steve Linton adds, every project—modular or not—must be tailored to the particular site and climate. The company’s design team also conducts an energy model to evaluate site variables, solar energy capacity, building-shell size, features, and cost trade-offs.

Much of the market for high-performance housing is around single-family units in the suburbs, but the past few years have seen an uptick for multifamily dwellings and affordable housing projects in cities, including Washington, D.C., New York, and Philadelphia.

For low- and middle-income residents, in particular, an energy-efficient house can provide substantial benefits, says Orlando Velez, director of Housing Programs and Community at Habitat for Humanity of Washington, D.C.The organization recently built six passive townhouses last year in the district’s Ivy City neighborhood, whichhas a lot of air pollution. By creating a tight building envelope and filtering outside air, “you’re improving the air quality significantly,” Velez says. “It’s a healthier living environment.”

With savings from the lower utility bills, he says, residents may be able to spend more within the community. The organization plans to study those benefits over time to know whether energy efficiency is the best investment for its limited funds.

Ridgeline model in Deltec Homes' Renew Collection
Spacialists.com courtesy Deltec HomesRidgeline model in Deltec Homes’ Renew Collection
Interior rendering, Ridgeline model
Courtesy Deltec HomesInterior rendering, Ridgeline model

Living in a high-performance house can take some adjustment. Residents are often unfamiliar with high-tech HVAC equipment, such as energy recovery ventilators and solar water heaters. A tight building envelope also means that the size of the HVAC system can be decreased (fresh air supply is increased for indoor air quality purposes). The word that many residents use is “comfort”—indoor temperatures stay remarkably consistent across different areas of a house throughout the year.

 

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http://www.architectmagazine.com/technology/living-the-dream-of-a-net-zero-house_o

Custom Home Building Steady | North Salem 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 second quarter of 2016. There were 47,000 total custom starts for the quarter, compared to 45,000 for the second quarter of 2015.

Over the course of the last four quarters, there were 167,000 total custom single-family home construction starts. Note that this definition of custom home building does not include homes intended for sale, so the 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%, down from a cycle high of 31.5% set during the second quarter of 2009.

custom 2q

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 single-family 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.

The market share for custom home building will likely experience ups and downs in the quarters ahead as the overall single-family construction market expands. Recent declines in market share are due to an acceleration in overall single-family construction.

 

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http://eyeonhousing.org/2016/08/custom-home-building-steady/

Build a Zero-Waste Homestead | North Salem Real Estate

In your permaculture design, you want to shoot for a near-zero-waste system. That doesn’t have to happen overnight, but it is definitely a primary goal. If the systems you design are wasteful, they will forever be reliant on large quantities of external inputs to keep them running. Most lawns are like this. Without chemical fertilizers, city water, and gasoline to run the mower, they would very quickly cease to look the way they do.

Many of the external resources we rely on every day are nonrenewable (at least in a human timescale). Once we use them, they’re gone. Relying heavily on these resources for day-to-day operations means we are more susceptible to market fluctuations and supply chains, and thus less resilient. In an emergency the lawn can just grow and become weedy, but what happens when we rely heavily on external inputs for our food, water, and heat?

This chapter focuses on where leaks often appear in systems and how we can minimize them, thus eliminating waste. The idea is to integrate those surpluses (another name for waste considered from a different perspective) back into our systems in some way. For instance, if we produce compost, apples that go bad can’t really go to waste. If we apply the principle of efficient energy planning and the concept of next highest use, we don’t really waste energy. Overall, the goal is to manage the inflows and outflows of our systems. We aren’t going to create completely closed-loop systems (where nothing enters or leaves), but we want to get a lot closer to that than where we are right now. Ultimately, we want to be very conscious of how the outflows of our systems can be used as inflows. Any outflows we do end up with should not harm the environment nor our neighbors.

Types of waste to address in your design include human waste, greywater, food and yard waste, and heat. We have already explored some ways to turn food and yard waste into compost in the earlier chapter on soil fertility. We’ll look more closely at the other topics here.

Human Waste

The topic of managing human waste, also known as humanure, is pretty much considered taboo in Western culture. You don’t talk about it in polite company. However, it is imperative that we begin to take responsibility for the humanure we produce. Unfortunately, the centralized systems upon which many of us rely and conventional home septic systems do not score that well on their ecological report card. In many parts of the world, waste collected by municipal sewer systems is dumped into the ocean or injected into the groundwater. Even the municipal systems that are ecologically kinder often have enormous energy inputs. The amount of fresh, clean water wasted by these systems is staggering. Consider, for example, that the Colorado River no longer reaches the Gulf of Mexico, thanks partly to all the flush toilets in huge desert metropolises like Las Vegas and Phoenix.

 

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http://www.motherearthnews.com/homesteading-and-livestock/self-reliance/zero-waste-homestead-ze0z1509zbay.aspx?newsletter=1&utm_source=Sailthru&utm_medium=email&utm_campaign=10.28.15%20MEN%20DIY%20eNews&utm_term=DIY%20eNews

Under Jeb Bush, housing prices fueled Florida’s boom | North Salem Real Estate

On the campaign trail, Jeb Bush has repeatedly emphasized his record overseeing Florida’s boom economy as the state’s governor. He says it’s an example of an economy that created a huge number of jobs and benefited the middle class — an example of what he could do as president. “I know how to do this,” he said in Maitland, Fla., on Monday.

But according to interviews with economists and a review of data, Florida owed a substantial portion of its growth under Bush not to any state policies but to a massive and unsustainable housing bubble — one that ultimately benefited rich investors at the expense of middle-class families.

The bubble, one of the biggest in the nation, drove up home prices and had many short-term benefits for the state, spurring construction, spending and jobs. But the collapse of the housing bubble as Bush left office in 2007, after eight years of service, sent Florida into a recession deeper than that in the rest of the country, and hundreds of thousands lost their homes.

“Who got hammered? Lower- and middle-class America,” said Marshall Sklar, a real estate investor who, like other well-off financiers operating in the state, has benefited from the wreckage.

Sklar recently won an online auction for a small stucco condominium in Boca Raton that a married couple had bought in 2004 for no money down. They borrowed against it as the state’s housing bubble inflated and then, like so many others, had to walk away heavily in debt when it burst.

After buying their busted dream, Sklar flipped it to a wealthy investor, banking a commission. His investor will probably earn a 12 percent return by renting out the condo. The value of the condo was redistributed upward, like so much of Florida’s housing wealth in recent years. “You took it out of the sheep and gave it to the wolves,” Sklar said after touring several houses he recently bought at bargain prices.

The story of this house and its owners is in many ways emblematic of much of the experience of Florida’s economy in the 2000s — a story that contrasts sharply with the record Bush recounts.

 

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http://www.washingtonpost.com/business/economy/under-jeb-bush-housing-prices-fueled-floridas-boom-then-it-all-went-bust/2015/07/27/3cb40da2-2409-11e5-b72c-2b7d516e1e0e_story.html

Housing Construction Trends Heat Up in June | North Salem Real Estate

Total housing starts expanded 9.8% month over month in June, reaching a 1.174 million annual starts pace, which was led by a surge in multifamily development.

Single-family starts were effectively flat, recording a 0.9% monthly decline to a 685,000 seasonally adjusted annual rate but were up 14.7% year over year. As measured on a three-month moving average, the pace of single-family starts hit a post-recession high in June. Looking forward, single-family permits were up 0.9% for June and 6% year-over-year, reaching a 687,000 annual rate. Regionally, single-family starts were up 6.8% for the month in the South, but down 27.3% in the Northeast, 7.1% in the West, and 4% in the Midwest.

Pointing to future growth, the July NAHB/Wells Fargo Housing Market Index reached 60 in July, which is the highest level since November 2005. Two of its three components also rose to levels last seen in late 2005. The index of current sales rose one point from the June level to 66, the highest in 10 years. The index for expected sales rose two points from June’s 69 to 71, also the highest in almost 10 years. The index for traffic fell one point to 43 from the six-month high in June of 44.

And more good news from June: The National Association of Realtors measure of existing home salesexisting home sales increased 3.2%, reaching the highest level since February 2007. Given that most new home sales are to move-up buyers, a rise in the volume of existing sales bodes well for additional single-family construction. Inventory of resale homes continues to be limited, falling to a five-month supply in June as the current sales rate.

However, the standout of the June housing starts report was multifamily construction, which for units in buildings with five or more units climbed to a 476,000 annual rate with a 28.6% monthly growth rate. Permits also expanded greatly, jumping 16.1% to a 621,000 annual rate. NAHB expects this level of apartment development to cool in the coming months.

On the supply side of the market, the most recent Producer Price Index data from the BLS revealed a small increase for wood products in June after trending down for the start of 2015. Softwood lumber prices rose 1% for the month but are down 9.1% from a recent high in September 2014. Prices for OSB rose 2.4% in June after a 20.4% slide that followed the collapse in prices that ended in July 2013. Gypsum prices slipped 1.5% in June after being flat in May, increasing to 5.3% the retreat from a February peak.

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http://eyeonhousing.org/2015/07/eye-on-the-economy-housing-construction-trends-heat-up-in-june/

Mortgage Rates Up Again | North Salem Real Estate

Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates moving higher amid a strong employment report. Regardless, fixed-rate mortgages rates still remain near their May 23, 2013 lows.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.76 percent with an average 0.6 point for the week ending February 19, 2015, up from last week when it averaged 3.69 percent. A year ago at this time, the 30-year FRM averaged 4.33 percent.
  • 15-year FRM this week averaged 3.05 percent with an average 0.6 point, up from last week when it averaged 2.99 percent. A year ago at this time, the 15-year FRM averaged 3.35 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.97 percent this week with an average 0.5 point, unchanged from last week. A year ago, the 5-year ARM averaged 3.08 percent.
  • 1-year Treasury-indexed ARM averaged 2.45 percent this week with an average 0.4 point, up from last week when it averaged 2.42 percent. At this time last year, the 1-year ARM averaged 2.57 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.

Quotes
Attributed to Len Kiefer, deputy chief economist, Freddie Mac.

“Mortgage rates rose for the second consecutive week as 10-year Treasury yields surged. Housing starts declined 2 percent to a seasonally adjusted pace of 1.065 million units and housing permits dipped 0.7 percent in January. However, homebuilders remain confident about new home sales although slightly tempered from last month as the NAHB Housing Market Index slipped 2 points to 55 in February.”