Tag Archives: Waccabuc Homes

Schiller: Always reason to worry about housing prices | Waccabuc Real Estate

US home price gains slowed slighting in July, as many on Wall Street are speculating that the Federal Reserve will raise rates before the end of the year. The S&P/Case-Shiller 20-City Composite Index rose 5.0% year-over-year, missing analysts’ expectations of a 5.1% increase but still above the 4.8% pace of the prior two years.

The recent surge in real estate demand has pushed home prices near their pre-crisis peak in 2006, which is making it increasingly difficult for new home buyers to enter the market. Home sales fell 0.9% in August from the previous month, according to the National Association of Realtors. That’s the second straight month of declines.

Higher home prices have begged the question by many as to whether the current pace is sustainable, or if there’s reason to fear another massive collapse in real estate.

“There’s always reason to worry [about a coming collapse],” Robert Shiller, Nobel Prize–winning economist and co-creator of the S&P/Case Shiller Index, told Yahoo Finance’s Seana Smith in the video above. But he is quick to point out one stark difference between today’s housing market and that of 2006. “We’re in a holding pattern right now … People are less excited about buying because they themselves don’t believe [home prices] will be going up a lot. Back in 2006, when the homeownership rate was setting records, people had extravagant expectations.”

His comments on Americans’ hesitation to buy echo the findings of a recent study byPulsenomics, which found that just 38% of renters surveyed think now is a good time to buy. Today, home values have reached or surpassed peak levels in about a quarter of US markets.

How rising rates could impact the housing market

While prospective buyers continue to benefit from relatively low borrowing costs, the big question is whether a series of rate hikes will increase mortgage rates and prompt a fallout in the housing sector. Fed funds futures suggests a roughly 57% chance of higher US interest rates by December, according to data from CME Group.

Shiller says it’s very difficult to forecast how the housing market will react to rising rates but is quick to point out that even in an uncertain environment, rate hikes shouldn’t be a factor for potential buyers.

“The Fed raised [rates] in December just a quarter of one percent, and plausibly they’ll raise [rates] by another quarter or a half percent, and it may not be a big deal,” said Shiller. “On the other hand, it might be a big deal because we’re in this strange period of near zero interest rates, and if people see it as a major turning point, it could affect home prices … My opinion is if you want a house, go out and buy it. It’s not an extremely unusual time. There are always risks.

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Pending Sales Decline | Waccabuc Real Estate

The Pending Home Sales Index decreased 2.4% in August, declining for the third time in four months, and falling 0.2% below its level for the same month a year ago. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR),decreased to 108.5 in August from a downwardly revised 111.2 in July.


The PHSI increased 1.3% in the Northeast in August, consistent with the 6.1% increase in existing sales in the Northeast reported last week. But the PHSI decreased in the remaining regions, ranging from 0.9% in the Midwest to 3.2% in the South and 5.3% in the West. Year-over-year, the PHSI was up 5.9% in the Northeast, but fell 0.6% in the West. 1.5% in the South and 1.7% in the Midwest.

NAR attributed the PHSI decline to a lack of inventory. However, builder confidence surged in September along with consumer confidence. Also, August new home sales recorded their second strongest month since the Great Recession. These reports suggest good news for new construction as the housing recovery continues to address demand among first-time buyers and broaden across a wider range of markets during the balance of 2016.


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Home building group unveils tiny home designer series | Waccabuc Real Estate

Architect Jeffrey Dungan said it was important to keep the tiny home's dimensions between 12-feet-tall and 12 ½-feet-wide so that it could be transported by road and under bridges. The "Low Country" model pictured here at Cashiers Designer Showcase in Cashiers, North Carolina in August, is the first in a series of tiny homes that Dungan designed for Clayton Homes. (Submitted/Special to the Knoxville News Sentinel)

Architect Jeffrey Dungan said it was important to keep the tiny home’s dimensions between 12-feet-tall and 12 ½-feet-wide so that it could be transported by road and under bridges. The “Low Country” model pictured here at Cashiers Designer Showcase in Cashiers, North Carolina in August, is the first in a series of tiny homes that Dungan designed for Clayton Homes.

Vaulted ceilings give the impression of spaciousness and offer additional wall space for mounting storage and lofted sleeping areas, according to architect Jeffrey Dungan. Pictured here is the interior of the "Low Country" model designed as part of Jeffrey Dungan Collection for Clayton Homes. (Submitted/Special to the Knoxville News Sentinel)

Vaulted ceilings give the impression of spaciousness and offer additional wall space for mounting storage and lofted sleeping areas, according to architect Jeffrey Dungan. Pictured here is the interior of the “Low Country” model designed as part of Jeffrey Dungan Collection for Clayton Homes. (Submitted/Special to the Knoxville News Sentinel)

"It's more about designing much more meticulously, design by the cubic inch instead of by the square foot," said Jeffrey Dungan of his thoughtful use of the limited space in a tiny home. (Submitted/Special to the Knoxville News Sentinel)

“It’s more about designing much more meticulously, design by the cubic inch instead of by the square foot,” said Jeffrey Dungan of his thoughtful use of the limited space in a tiny home. (Submitted/Special to the Knoxville News Sentinel)

Lofty 12-foot ceilings leave plenty of space for bunk beds in the "Low Country" tiny home model, built by Clayton Homes. (Submitted/Special to the Knoxville News Sentinel)

Lofty 12-foot ceilings leave plenty of space for bunk beds in the “Low Country” tiny home model, built by Clayton Homes. (Submitted/Special to the Knoxville News Sentinel)

Every square inch of Clayton Homes Designer Series Tiny Homes has been carefully considered to accommodate high-end amenities, such as this full bathroom in the "Low Country" model home. (Supplied/Special to the Knoxville News Sentinel)

Every square inch of Clayton Homes Designer Series Tiny Homes has been carefully considered to accommodate high-end amenities, such as this full bathroom in the “Low Country” model home. (Supplied/Special to the Knoxville News Sentinel)

Last week, the Clayton home building group took their “Low Country” tiny home prototype to the Cashiers Designer Showcase in North Carolina. The event attracted interior designers and builders from around the region to explore new trends.

“People were very excited,” said Jeffrey Dungan, whose company designed the prototype. “It was almost like a childlike response, even with people who are 70 years old. I don’t know quite what it is, there’s this youthful exuberance when you talk about tiny homes and when they get to actually stand in one.”

Most people were surprised it did not feel like a “playhouse” and that it was actually really comfortable, said Dungan

“I could have sold it 15 times. People pulled out their checkbooks and offered money on the spot,” said Dungan of the response to the low country-inspired tiny house.

Dungan, a renowned Birmingham, Ala.-based architect, has partnered with Clayton building group, a division of Clayton Homes and one of America’s largest homebuilders, to bring luxury tiny homes to the housing market that the architect would not ordinarily reach.

The “Low Country” model tiny home, which was showcased in Cashiers, is 396 square feet and retails for $96,000.

“Clayton approached us to design a series of five homes and this is the first one that they’ve actually constructed,” he said. “Instead of me designing all of them, I have a talented crew that works with me, so everybody took a day to sit around and sketch, look at inspiration and share ideas. We took the best of the bunch and pursued those.”

In addition to the “Low Country” there are four different models in the series: Adirondak, Saltbox, Marseille and Cloudbreak. They range in size from 386-399 square feet.

The designers looked at different styles of architecture across the country and in Europe. “We looked at the low country in South Carolina, the Saltbox in New England, the Adirondacks in upstate New York, the French countryside, and beach huts in the Bahamas, Cape Cod or Malibu.”

“We really loved the whole attitude of being at the beach and escaping and that’s what little houses are about,” said Dungan. “Cloudbreak was inspired by beach style, surf shacks and places that sell beer and Jerk chicken in the Bahamas.”

“It’s more about designing much more meticulously, designing by the cubic inch rather than by the square foot,” said Dungan, who is more accustomed to designing high-end residences with a minimum of 7,000-8,000 square feet.

Planning and then manufacturing a small home off-site comes with its unique set of challenges according to Dungan. “Everything was a little different,” he said. “There were the restraints of working within 400 square feet — it couldn’t be more than 12 ½ feet wide to get them down the road or more than 12 feet tall to go under bridges.” This led to the modification of roof pitch in some cases.

Dungan admits to never watching shows like “Tiny House Nation”.

“When I started this study, what I reacted to was how DIY they looked,” he said. “There was a lack of overall elegance and sophistication in a lot of what I saw.”

Dungan hoped to bring the elegance and sophistication of his firm’s work into a tiny place. “I wanted the quality of the Faberge egg with details and wonderful materials,” he said. “Because you are doing something small you can afford to work with better materials. I was very impressed with Clayton’s joinery, the craftsmanship and just the materials themselves I didn’t feel like I was in a less nice space than I was accustomed to.”

Inside the prototype they opted for reclaimed materials such as the ceiling beams and the hardwood floors, and used for wood for the ceilings and vertical ship lap for the walls so there is no Sheetrock at all.

The exterior is clad in poplar bark siding with cedar shake on the roof.

Dungan said it is economical to heat and cool and the windows have the highest insulation value.

“In all of the designs we were very mindful of the 3-D space,” said Dungan. “The vaulted ceiling created wall space for additional storage and sleeping space. It can sleep up to six or eight people and that totally blows my mind.”

They may be small in stature, but do not lack for amenities. The “Low Country” accommodates eight — two in the bedroom, two in the loft area, two on a fold-out couch and two bunks. There are large French doors that open out onto a covered front porch, a full-height pantry, as well as a dishwasher and stack washer and dryer.

The architect likened the production of the “Low Country” prototype to making pancakes.

“When you are cooking your pancakes if you don’t get the heat and batter right for the first one, you adjust it,” he said. “For our first pancake, it was a heck of a good one and I’m hoping that our second and third ones will be even better.”

And Dungan said a website is in the works, where buyers can customize their home. Choosing from a myriad colors, materials and exterior options. “It will give people the flexibility to personalize their tiny home,” he added.


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Mortgage rates average 3.73% | Waccabuc Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing mortgage rates moving higher for the third week in a row.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 3.73 percent with an average 0.5 point for the week ending March 17, 2016, up from last week when it averaged 3.68 percent. A year ago at this time, the 30-year FRM averaged 3.78 percent.
  • 15-year FRM this week averaged 2.99 percent with an average 0.4 point, up from last week when it averaged 2.96 percent. A year ago at this time, the 15-year FRM averaged 3.06 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.93 percent this week with an average 0.5 point, up from last week when it averaged 2.92 percent. A year ago, the 5-year ARM averaged 2.97 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 theDefinitions. Borrowers may still pay closing costs which are not included in the survey.

Attributed to Sean Becketti, chief economist, Freddie Mac.

“Treasury yields increased heading into this week’s FOMC meeting, partially in response to modestly higher inflation readings. 30-year mortgage rates kept pace, rising 5 basis points to 3.73 percent. Nonetheless, at the meeting the Fed confirmed what the market had already concluded and made no change to the Federal funds target. The Fed went further and acknowledged that economic signals have been mixed and that the pace of monetary tightening may be slower than had been assumed at the end of 2015.”

#Hamptons real estate prices up, sales slow | #Waccabuc Real Estate

Real estate prices continued to climb in the third quarter of 2015, but sales pace slowed and inventory is more difficult to come by, when compared with the third quarter of 2014, which was a banner season for real estate on the East End.

According to The Corcoran Group’s quarterly Corcoran Report, “the volatility of financial markets world-wide resulted in fewer closed transactions this quarter.”

On the South Fork, according to Corcoran, sales activity and sales volume declined by 16 percent and 13 percent, respectively, compared to the third quarter of 2014. Only East Hampton Village, Southampton and Shelter Island reported more sales than last year.

The Corcoran Group reported that the average sale price on the South Fork increased 3 percent, while the median price rose 6 percent, versus the same quarter a year ago.

Nine sales over $5 million in East Hampton Village skewed the median price there up 70 percent over the third quarter of 2014.

Though recent quarters have shown a good deal of activity in the under-$500,000 range, where such properties can even be found on the South Fork, that share of the market shrank in the third quarter both east and west of the Shinnecock Canal.

East of the canal, under-$500,000 sales shrunk to just 8 percent of the market, from 14 percent in the third quarter of 2014, while the market share of houses under $500,000 west of the canal shrank from 41 percent in the third quarter of 2014 to 38 percent in the third quarter of this year.

On the North Fork, the Corcoran Group reported the number of sales and sales volume decreased 11 percent and 17 percent, respectively, over the third quarter of 2014. They reported the median sales price increased 1 percent, but the average sales price decreased 8 percent.

On the North Fork, they reported the $500,000 to $750,000 market range grew from 23 percent to 31 percent of sales, while market shares above and below those ranges declined by 4 percent.

The Corcoran Group also reported that the total inventory of residential properties for sale on both forks declined by 383 housing units from the third quarter of 2014.

With a limited amount of vacant land available for sale on the East End, the number of vacant land sales decreased quarter-over-quarter by 32 percent on the South Fork and 29 percent on the North Fork.

In commercial markets however, The Corcoran Group saw quite a bit of activity on the North Fork, with the number of sales increasing 67 percent. The number of South Fork commercial sales declined 37 percent over the same period.

Douglas Elliman Real Estate’s Elliman Report also showed a market slow-down on the South Fork when compared with the same quarter in 2014, though they did report greater gains in prices.

Douglas Elliman reported 507 sales on the South Fork in the third quarter, 20 percent below the same quarter in 2014 but 11 percent above the decade quarterly average of 457 sales.

The market share of sales below $12 million fell to 49.5 percent, its lowest point in the past four years, with 44 percent of sales between $1 million and $5 million.

According to Douglas Elliman, listing inventory on the South Fork was unchanged over the third quarter of 2015, with 1,710 houses on the market this quarter. The listing discount, or the difference between the last listing price and the sales price, declined to 10.2 percent from 12 percent in the same quarter last year.

Median sales price rose to $950,000, up 9.8 percent over the same quarter last year, the fourth highest level reported in the past decade.  The average number of days on the market fell 6.4 percent to 161.

Douglas Elliman reported that North Fork housing prices also skewed higher, with the median sales price jumping 16.1 percent to $516,250, the second highest median price in the past seven years. Only the second quarter of 2015 saw higher prices on the North Fork, and the year-over-year increase was the sixth consecutive quarterly increase.


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Building Labor Shortage Intensifies | Waccabuc Real Estate

A survey of single-family builders conducted by NAHB in June 2015 shows that shortages of labor and subcontractors—already quite widespread in mid-2014—have become even more widespread during the past year.

The shortages are most acute for basic skills like carpentry, which are needed during the construction of any home.  For example, in the 2015 survey 69 percent of builders reported a shortage (either serious or some) of construction workers willing and able to do rough carpentry.

2015 labor shortages

Builders, however, may be even more concerned about the availability of subcontractors than of workers to employ directly.  In building a single-family home, three-quarters of the construction work is typically done by subcontractors (documented in a 2012 NAHB survey available here).  The rankings of labor and subcontractor shortages in the 2015 survey were similar, but—with the exception of building maintenance managers—the shortages of subcontractors were more widespread.  In the rough carpentry category at the top of  both charts, 74 percent of builders reported a shortage of subcontractors, compared to 69 percent for labor directly employed.

2015 sub shortages

Historically, for every trade covered in the survey, shortages were more widespread in 2015 than in 2014.  One way to see this is to look at the labor shortage percentage averaged across all 9 trades that NAHB surveys have covered in a consistent way since 1996.  This average skyrocketed from a low of 21 percent in 2012 to 46 percent in 2014, before increasing even further to 52 percent in 2015.

Nine trade history

The 9 consistently covered trades are carpenters-rough, carpenters-finished, electricians, excavators, framing crews, roofers, plumbers, bricklayers/masons and painters.  The history for each is available in the full report.  The survey’s current list of 12 trades was recommended by Home Builders Institute, NAHB’s workforce development arm.

The incidence of shortages is surprisingly high given the rate of new home construction, which has only partially recovered from its 2008 downturn.  In fact, the 9-trade shortage is now substantially higher than it was at the peak of the 2004-2005 boom, when annual starts were averaging around 2 million, compared to current rates of about 1 million.  The last time builder-reported labor shortages were as widespread as now was just before 2001—during a prolonged period of strong GDP growth with overall unemployment as low as 4.0 percent.



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In the Horse Race for Millennials, is Renting Gaining on Buying? | Waccabuc Real Estate

Apartment rents are rising rapidly, up 3.5 percent in 2015, then they are expected to moderate to 3.0 percent in 2016 and 2.7 percent in 2017, according to the Urban Land Institute.  But home sales prices are rising even faster, tipping the scales of the rent vs buy equation towards rentals in the dollar for dollar comparisons Millennials face, according to the latest national housing market index produced by Florida Atlantic University and Florida International University faculty.

As of the end of the first quarter of 2015, the housing market in the U.S. and all 13 cities in the index are trending either closer to renting being the superior option or strictly favoring renting over purchasing a home.

Three of the hottest real estate markets in the nation, Dallas, Denver and Houston, are clearly in rent territory, with property pricing out-pacing rents, meaning buyers should proceed with strong caution.

Seven more cities (Miami, Honolulu, Los Angeles, Pittsburgh, Portland, San Francisco and Seattle) are at or near the indifference point between ownership and renting. Here the spread between monthly rent payments and ownership payments appears to be at a point where neither ownership nor renting is statistically favored.

Four cities (Chicago, Cincinnati, Cleveland and Detroit) remain in strong buy territory with scores that have historically favored wealth accumulation through home ownership.


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Lady Violet’s ‘Downton Abbey’ home for sale | #Waccabuc Real Estate

The dowager countess’s witticisms not included.

If you missed out last year on the listing of the “Godfather House” on Staten Island in New York, maybe this home is more up your abbey — er, alley.

Byfleet Manor, in Surrey, just southwest of London, and dower home to Maggie Smith’s character Lady Violet Crawley in the PBS series “Downton Abbey,” is on the market, according to real estate broker Savills. The price? £3.95 million,or $6.1 million. The Georgian-style brick home, built in 1686 and set on 19 acres, has a walled courtyard, eight bedrooms and four reception rooms — and it’s just 20 miles from central London.

“You get a lot of house for your money,” said Simon Ashwell, the Savills agent who is listing the home for Julie Hutton, the current owner, who bought Byfleet Manor about 10 years ago for £1 million.

Byfleet Manor isn’t one to avoid the cameras. The house also starred in the series “Poirot” and “Cranford” and was the stand-in for Cinderella’s home in the 2014 movie “Into the Woods” with Meryl Streep and Johnny Depp. When it comes to “Downton Abbey,” the home has served as Lady Violet’s house since 2010 after the location agent from the PBS series “Cranford” suggested it to the show’s producers. “We wanted to deliberately pull Violet back into that Georgian world,” Donal Woods, the production designer for “Downton Abbey,” told Savills.


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Strong First Quarter for Consumer Confidence | Waccabuc Real Estate

The University of Michigan Index of Consumer Sentiment reached a ten-year peak of 95.5 in the first quarter of 2015. Although the Index of Consumer Sentiment Index decreased to 93.0 in March from 95.4 in February, it was up from 80.0 from March 2014. The harsh winter dampened the giddiness of falling gasoline prices from the start of the year. Lower income households reported a loss in confidence because they are more sensitive to higher utility costs and disrupted work hours.

The Conference Board Confidence Index increased in March to 101.3 from 98.8 in February. The March increase was driven by the improved short-term prospects for employment and income. However, consumer assessment of current conditions declined for a second consecutive month, suggesting a softening in first quarter growth. The share of consumers expecting more jobs increased in March, and the share anticipating higher incomes increased from 16.4% to 18.4% in March.

Rising consumer confidence and improved job creation numbers are positive indicators for both improved GDP growth and housing demand once the economy clears the first quarter.

UM & CB three month moving average 3 31 2015


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