Daily Archives: July 7, 2013

As real estate market rebounds, Alaska recovery is slow, steady | Bedford Corners Real Estate

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As with most aspects of life, everything is a matter of perspective. A rebounding national real estate market means sellers who were underwater may be able to sell now, which gives buyers more choices. However, prices are still well below market highs. How does Anchorage’s real estate market stack up to national statistics?

 

According to the National Association of Realtors’ (NAR) snapshot of 146 metro marketplaces in May, the national real estate market has definitely made a turn. The hardest-hit areas, like California, are seeing the most rebound. California took the honors with the top three locations for May:

 

Oakland, median list price of $484,900 — an increase of 47 percent year over year;

San Jose, median list price of $675,000 — an increase of 35 percent;

San Francisco, median list price of $819,900 — an increase of 20 percent.

This double-digit growth is the third consecutive month of increase, when comparing 2013 to 2012, according to CoreLogic Case-Shiller Home Price Index. However in the longer term, this was the 15th month-over-month increase. Home prices rose in all states except Delaware and Alabama.

 

When comparing states, the top five states with the highest percentage of price increases were Nevada (26 percent), California (20.2 percent), Arizona (16.9 percent), Hawaii (16.1 percent) and Oregon (15.5 percent). Overall prices are still 20 percent below the 2006 pre-financial crisis peak.

 

Trending in the opposite direction — which is a good thing — is the May average price discount for short sales and foreclosures. According to the NAR Confidence Index, foreclosures are 15 percent below market in 2013, compared to 18 percent last year. Short sales are 12 percent below market in 2013, compared to 14 percent last year. This is a good sign because distressed short sales and foreclosures create less of a drag on property values.

 

The NAR Pending Home Sale Index (agreements signed but not closed) shows that in May 2013, signed agreements to purchase were up more than 12 percent compared to May 2012. The increase is due to pent-up demand and fear that increased interest rates will affect affordability.

 

For Anchorage, the market recovery is slow and steady on a much smaller scale. Here are a couple of interesting year-to-date statistics from the Alaska Multiple Listing Service for June 2013 versus June 2012.

 

Supply remains tight with the number of homes for sale (1,311) down 11 percent.

Median list price ($315,000) increased more than 2 percent.

Average list price ($342,040) increased only slightly, 0.3 percent.

Average days on the market (52) decreased almost 27 percent.

Total real estate sales volume ($447,629,340) increased more than 17 percent.

Median sales price ($315,500) increased more than 3 percent.

Average sale price ($338,600) increased almost 1 percent.

Closed foreclosures (82) decreased almost 14 percent.

Overall, Anchorage sellers cannot expect big increases in values for two reasons:

 

We didn’t have the big falls in home values that markets in much of the Lower 48 experienced.

Our population increased only .93 percent, while nationally the population increased 1.7 percent.

While we aren’t growing significantly in size, many perceive the economy as doing better and those on the sidelines are joining the house hunt. It will be interesting to see how the year finishes for Anchorage and the rest of the nation.

 

Read more here: http://www.adn.com/2013/07/06/2966248/ramseys-as-real-estate-market.html#storylink=cpy

 

 

Ramseys: As real estate market rebounds, local recovery is slow, steady | Barbara and Clair Ramsey | ADN.com.

Real estate market looking up in county | Pound Ridge NY Real Estate

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San Luis Obispo County’s housing market is on the rebound.

 

The median price — the point at which half of residences sell for more and half for less — continues to rise, sales have picked up and foreclosures have fallen.

 

A strengthening economy has played a key role in the housing market’s comeback, and real estate will be a significant contributor toward economic growth this year, economists say.

 

“It’s on an upward trend,” said Jordan Levine, economist for Beacon Economics, a Los Angeles-based independent research and consulting firm.  “The economy is improving, tourism is doing well and more people are back to work, and there’s not a lot of inventory.”

 

California traditionally suffers from an undersupply of housing, Levine added. That lack of housing supply has kept prices higher in California relative to other states, and has resulted in pent-up demand.

 

“The supply issue is starting to express itself,” he said. “It wasn’t as big an issue when the housing market was in the doldrums. But now, it has become more obvious as demand rises.”

 

The unsold inventory index for San Luis Obispo County, which indicates the number of months needed to sell the supply of homes on the market at the current sales rate, was 3.5 in May, according to the California Association of Realtors. A six- to seven-month supply is considered normal.

 

But some inventory relief should come in the second half of this year, as homeowners who had been holding back decide it’s time to sell, said Leslie Appleton-Young, chief economist for the association.

 

“There are people that are still underwater; over 20 percent of the mortgages in California are underwater,” she said. “But that’s changing rapidly as prices go up. More will be above water and will either stay or list their home.”

 

The all-home median price for the county, which includes new and resale single-family detached homes and condos, was $421,500 in May, 12.4 percent higher than the same month in 2012, according to DataQuick, a Southern California-based real estate tracking firm. May marked the 13th consecutive month in which the county’s median home sales price saw a year-over-year increase.

 

However, the May median sale price was still 23.4 percent lower than the peak May median of $550,000 in 2006.

 

A total of 394 homes were sold in May 2013, up from 361 sold in May 2012, a 9 percent year-over-year increase.  Most of the homes sold in the county are existing, single-family homes.

 

The median price for resale homes was $435,500 in May, a 13.1 percent year-over-year increase. Sales for existing, single-family homes grew to 325, a nearly 5 percent year-over-year increase.

 

Read more here: http://www.sanluisobispo.com/2013/07/06/2574290/real-estate-market-looking-up.html#storylink=cpy

 

 

Real estate market looking up in county | Local News | SanLuisObispo.com.

Area vacation rental market fueled by renovations | Bedford NY Real Estate

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As anyone travelling the roads or eating in the restaurants of Beaufort County knows, the summer tourism season in the Lowcountry is off to a great start. According to the Hilton Head Island/Bluffton Chamber of Commerce, occupancy for vacation rental homes and villas is up strongly year to date on the island, outperforming national averages. The some 7,000 properties that rent short-term on Hilton Head are seeing the benefits of an improving national economy, rising consumer confidence and manageable gasoline and travel prices. You can learn about houses for sale in beaufort sc on this site.

Homeowners are getting on board and choosing to ride the wave of renovation momentum sweeping Hilton Head. They are improving their rental properties to keep pace with area hotels and resorts that are investing tens of millions of dollars of capital on upgrades. By doing so, these hotels, resorts and property owners are showing their bullishness about the future of Hilton Head travel and tourism (source: https://www.junglevistainn.com/).

Now is the perfect time to get in the game and purchase a vacation rental property and renovate it. Buyers that have recently purchased outdated properties are seeing almost immediate appreciation with renovations to the kitchens, bedrooms and bathrooms. This also helps owners gain a competitive advantage on rental revenues as today’s visitors are looking to rent these upgraded properties.

Your personal goals and objectives for purchasing a vacation rental property are the first things to consider. Make a list of your priorities, including your desired location, the ideal size, budget for purchase and for renovations, rental income expectations, how often you intend to use the property and whether you will retire there or eventually sell it. Be sure to choose a local Realtor who is experienced with vacation rental properties.

Next, be sure to consult your accountant and lawyer so that you fully understand the tax and insurance requirements, tax benefits, how to structure your mortgage loan, whether or not to set up an LLC and even if it might make sense for you to purchase a property out of your IRA. Getting these details worked out at the beginning of the vacation rental purchase process will make things much easier as you look for the perfect property.

Consult with a vacation rental expert early in the process. The expert can help with rental projections and great ideas for upgrades and renovations that will pay for themselves over time. Choose a professional rental management company that offers 24 hour reservation service and that can market your property effectively on the internet using social, local and mobile platforms. Your rental manager should employ housekeepers and maintenance technicians that are consistently assigned to your property for the best quality service.

Your management company should be partnered with local merchants and activities in order to give special discounts and deals exclusive to its’ owners and guests. Working with a local Realtor experienced with vacation rentals and employing a good rental manager can make vacation home ownership easy, allowing you and your family to enjoy the benefits for years to come.

Read more here: http://www.islandpacket.com/2013/07/07/2311903/reset-rental-marketing-strategy.html#storylink=cpy

Area vacation rental market fueled by renovations | Real Estate | The Island Packet.

Rising Mortgage Rates Could Chill Housing Market | Bedford Hills NY Real Estate

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A recent, sharp rise in mortgage-interest rates has raised concerns about whether the housing recovery will soften as home loans become more expensive.

 

Two weeks ago, the average rate nationwide for a 30-year mortgage jumped to 4.46 percent from 3.93 percent — the biggest one-week increase since 1987 and the highest rate since July 2011, according to the Federal Home Loan Mortgage Corp.

 

“We do think that, as rates go higher, there will be additional affordability issues,” said Brad Hunter, a Florida-based economist for the real-estate research firm MetroStudy Inc.

 

“Everyone is getting nervous now as the Fed is taking away the Kool-Aid bowl soon,” he said. Rates started moving up after the Federal Reserve said on June 19 that it might end its economic-stimulation program by the end of this year or in 2014.

 

An increase in interest rates could temper the housing recovery in several ways.

 

For one thing, higher rates would mean prospective buyers could afford less house, possibly easing demand for new and existing homes. For another, the equity funds that have been buying up foreclosures would likely go looking elsewhere for better ways to invest their money, which would likely limit competition for new listings. Home builders may be pressured by higher carrying costs, even as fewer prospects show up to tour their model units. And homeowners not interested in selling would be less likely to refinance their existing loans.

 

Here’s a closer look at how rising rates could affect those four groups:

 

Buyers : For home buyers, many of whom have struggled since the Great Recession and global credit crisis to qualify for mortgages, an uptick in rates would also cut into their buying power once they were approved for a loan.

 

For example, buyers who obtained a $200,000 mortgage when interest rates were about 3.5 percent in April landed a monthly payment of about $900. But if rates head north to 5 percent, buyers hoping to get that same monthly payment would have to limit their mortgage to $170,000 — or $30,000 less than they could have afforded with the lower loan rate.

 

In a talk to Congress last month, Fed Chairman Ben Bernanke noted that housing’s vital role in the nation’s economic recovery is due partly to the real estate-related jobs it creates “but also because higher house prices increase consumer wealth and promote consumer spending.”

 

Over the 30-year life of a $200,000 mortgage, however, a home buyer would pay an additional $63,000 in interest with a 5 percent rate than with a 3.5 percent rate — money not available for spending on consumer goods or services.

 

And even though mortgage lenders stand to earn more money with higher rates of return on their loans, borrowers would not find it easier to qualify for home loans should interest rates keep rising, said Rob Nunziata, president of Orlando, Fla.-based FBC Mortgage LLC.

 

Rising Mortgage Rates Could Chill Housing Market | Valley News.

Surging interest rates could slow housing’s recovery | Katonah Real Estate

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A sharp rise in mortgage rates is threatening to slow the momentum that has driven the housing market sharply higher in the past year.

 

Rates on a 30-year fixed mortgage have spiked in the past two months as the Federal Reserve signaled the coming end of a massive bond-buying program designed to stimulate the economy by keeping rates low.

 

Someone who today takes out a $220,000 loan — the median sale price for a traditional home in the Twin Cities — will pay at least $100 per month more on the mortgage than someone who locked in an interest rate on May 1.

 

“It’s been a pretty impressive increase in rates,” said Keith Gum­binger, vice president of HSH.com, a mortgage information firm. “If that increases monthly payments by, give or take, 10 to 15 percent, it wouldn’t be unreasonable to see sales back off by perhaps that much.”

 

U.S. home prices were up 12 percent in May from a year earlier, and Twin Cities prices were up 14.8 percent, in part thanks to demand fueled by rock-bottom ­interest rates. Since home purchases often translate into sales of garden hoses, lawn mowers and washing machines, as well as construction jobs, the likelihood that rates will continue to rise should temper economic growth.

 

The irony is that what’s driving up rates is, ultimately, an improving economy. Rates are as low as they are because the Federal Reserve has been buying $85 billion in mortgage-backed securities per month, a program known as quantitative easing that’s meant to stimulate borrowing.

 

The Fed’s purchases create demand for mortgage-backed securities and so drive down interest rates for borrowers. The strategy has been effective. Rates for 30-year mortgages were as low as 3.3 percent in November, a number that inspires awe in anyone who took out a mortgage in decades past.

 

But rates started to rise in mid-May when Fed Chairman Ben Bernanke first hinted in a Congressional hearing that the economy might be strong enough for the central bank to contemplate slowing its asset purchases. After a Bernanke news conference on June 19, rates on a 30-year fixed mortgage rose from 4 percent to 4.6 percent in five days, while the stock market faltered.

 

Surging interest rates could slow housing’s recovery | StarTribune.com.