Daily Archives: November 5, 2015

Here’s what the typical #homebuyer and #seller look like | Cross River Real Estate

This is the third year in a row that the share of first-time buyers declined, staying at the lowest point in nearly three decades, according to an annual survey released by the National Association of Realtors.

Instead of first-time buyers, the overall strengthening pace of home sales over the past year was driven more by repeat buyers with dual incomes.

In this year’s survey, the share of first-time buyers declined to 32%å (33% a year ago), which is the second-lowest share since the survey’s inception (1981) and the lowest since 1987 (30%). Historically, the long-term average shows that nearly 40% of primary purchases are from first-time homebuyers.

Lawrence Yun, NAR chief economist, said the housing recovery’s missing link continues to be the absence of first-time buyers.

“There are several reasons why there should be more first-time buyers reaching the market, including persistently low mortgage rates, healthy job prospects for those college-educated, and the fact that renting is becoming more unaffordable in many areas,” said Yun.

He attributed the drop in first-time buyers to several reasons.

“Unfortunately, there are just as many high hurdles slowing first-time buyers down. Increasing rents and home prices are impeding their ability to save for a down payment, there’s scarce inventory for new and existing-homes in their price range, and it’s still too difficult for some to get a mortgage,” Yun said.

This infographic shows what the typical homebuyer and home seller look like.

Click to enlarge

(Source: National Association of Realtors)

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

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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.

#Mortgage rates rise | #Katonah Real Estate

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Freddie today released the results of its Primary Mortgage Market Survey® (PMMS^®), showing average fixed mortgage rates rising amid market expectations of possible rate increase by the Federal Reserve.

News Facts

30-year fixed-rate mortgage (FRM) averaged 3.87 percent with an average 0.6 point for the week ending November 5, 2015, up from last week when it averaged 3.76 percent. A year ago at this time, the 30-year FRM averaged 4.02 percent.

15-year FRM this week averaged 3.09 percent with an average 0.6 point, up from last week when it averaged 2.98 percent. A year ago at this time, the 15-year FRM averaged 3.21 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.96 percent this week with an average 0.4 point, up from last week when it averaged 2.89 percent. A year ago, the 5-year ARM averaged 2.97 percent.

1-year Treasury-indexed ARM averaged 2.62 percent this week with an average 0.2 point, up from 2.54 percent last week. At this time last year, the 1-year ARM averaged 2.45 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.

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

“Treasury yields climbed nearly 20 basis points over the past week, capturing the market movement following last week’s FOMC meeting. In response, the 30-year mortgage rate experienced its largest increase since June, up 11 basis points to 3.87 percent. Recent commentary suggests interest rates may rise in the near future. Janet Yellen referred to a December rate hike as a ‘live possibility’ if incoming information supports it. The October jobs report to be released this Friday will be one crucial factor influencing the FOMC’s decision.”

Home #builders’ strategies for 2016 | #Bedford Hills Real Estate

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As price looms up as a bigger factor in the success or failure of home builders’ strategies for 2016, time becomes one of the few real opportunity areas to stand out from among peers.

A plot line shows the difference between Census Bureau data on home sizes vs. NAHB survey respondents.

The most magical words in residential new development and construction? The right price in the right location.

“Right,” meaning, priced both to move into a satisfied home buyer’s possession and to profit the builder and his many partners. What’s less apparent–and for most home builders as critically important–is that the meaning of the term “right” includes both a cost and value of time. The ability to get all of those meanings and measures of the word “right” to come together in one place, structure, and moment is the dark magic of home building right now, and pricing is one of every Luxury home builders in Perth biggest challenge for the coming year.

Let’s explore this, first by looking at the latest batch of data from a bi-annual well of research from the National Association of Home Builders.

It cost $103 per square foot–all-in in expenses and gross profit–to build the average home in 2015, a jump of 8.4% since 2013, and almost a 30% increase from four years ago. This is according to the just-released NAHB Cost of Construction Survey, which shows that the average home was built on 20,129 square feet (about a half an acre) of land, had 2,802 square feet of finished space, and sold for an average of $468,318.

A partial view of the NAHB Cost of Constructing a Home chart.

First of all, what more glaring evidence of a “mix” tilt toward higher-priced, first move-up and second-time move up homes do we need, where all-in the cost, including profit, to complete and deliver an average home this year is 17% more than the $399K all-in cost in 2013, and a stunning 50% increase since 2011? This data, directionally, matches that of another source on new home price trends:

According to the Census Bureau’s data on new residential construction, the sales price of new single-family homes has been steadily rising from $267,900 in 2011, to $345,800 in 2014.

NAHB Construction Cost Surveys 1998-2015

This bias, and imbalance, won’t hold. If the recovery proceeds as it needs to going into the next 12 to 18 months, the 2017 Cost of Construction Survey should reflect an actual decrease in the cost (including builder’s profit) of delivering a new home, as the sale of homes to entry-level buyers at a lower price-tag tier kicks up to account for a greater share of the volume. But it’s going to be a struggle.

That’s partly because of the cost pressure on both materials and labor.

According to the NAHB’s HMI survey from June and July of this year, builders report that on average, over the previous year, labor costs increased by 3.3%, material costs by 4.5%, and subcontractor costs by 5.0%.

Buying Bedford Real Estate

Robert Paul Realtor buying Bedford real estate

Daily Archives: November 5, 2015

Here’s what the typical #homebuyer and #seller look like | Cross River Real Estate

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

#Mortgage rates rise | #Katonah Real Estate

Home #builders’ strategies for 2016 | #Bedford Hills Real Estate

As price looms up as a bigger factor in the success or failure of home builders’ strategies for 2016, time becomes one of the few real opportunity areas to stand out from among peers.