Wednesday, August 29, 2018
Wednesday, August 22, 2018
Don’t Wait To Sell Your House! Buyers Are Out Now
Recently released data from the National Association of Realtors (NAR) suggests that now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.
Let’s see how this applies to the current residential real estate market.
SUPPLY
It is no secret that the supply of homes for sale has been far below the number needed to sustain a normal market for over a year at this point. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.
Supply is currently very low!
DEMAND
A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”
Demand is currently very high!
Bottom Line
Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, contact a local real estate professional who can explain the conditions in your market.
Let’s see how this applies to the current residential real estate market.
SUPPLY
It is no secret that the supply of homes for sale has been far below the number needed to sustain a normal market for over a year at this point. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.
Supply is currently very low!
DEMAND
A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”
Demand is currently very high!
Bottom Line
Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, contact a local real estate professional who can explain the conditions in your market.
Wednesday, August 15, 2018
One-third of LA homes sell above asking price
Source: Curbed
In Los Angeles, where a very hot housing market shows no signs of slowing, nearly 40 percent of homes now sell above asking price, according to a report from Zillow.
How much above? Around $14,100—more than twice the national median, as measured by the real estate website.
Making sense of the story
Across the country, nearly one-quarter, or 24 percent, of homes sold above the price that the owners were asking in 2017; in the Los Angeles metro area, the figure was 38 percent. That’s the highest share since 2013, when home values were just beginning to recover from the mortgage crisis of 2008.
LA’s share of homes selling above sticker price has also risen in each of the last three years, suggesting that competition among homebuyers is heating up. “You’ve got to move quickly if you’re a homebuyer,” says Jordan Levine, senior economist for the California Association of REALTORS®.
A strong economy and low interest rates on home loans are bringing plenty of buyers to the market. By Zillow’s reckoning, the typical LA home now takes 66 days to sell (including an escrow period); that’s well under the 91 days that homes last on the market nationwide
High demand and low supply is driving up prices to the point that sellers may often undervalue their homes when putting them on the market, explains Zillow senior economist Aaron Terrazas. He says that sellers are often “pleasantly surprised” when homes fetch prices significantly higher than their asking price.
Levine says that rising home values may actually be causing some homeowners not to sell, out of fear they may not be able to afford something better. It’s a seller’s market, he says, “unless you want to turn around and buy again.”
This trend further limits the number of homes available for purchase—meaning that high costs and competition among buyers may be here to stay.
In Los Angeles, where a very hot housing market shows no signs of slowing, nearly 40 percent of homes now sell above asking price, according to a report from Zillow.
How much above? Around $14,100—more than twice the national median, as measured by the real estate website.
Making sense of the story
Across the country, nearly one-quarter, or 24 percent, of homes sold above the price that the owners were asking in 2017; in the Los Angeles metro area, the figure was 38 percent. That’s the highest share since 2013, when home values were just beginning to recover from the mortgage crisis of 2008.
LA’s share of homes selling above sticker price has also risen in each of the last three years, suggesting that competition among homebuyers is heating up. “You’ve got to move quickly if you’re a homebuyer,” says Jordan Levine, senior economist for the California Association of REALTORS®.
A strong economy and low interest rates on home loans are bringing plenty of buyers to the market. By Zillow’s reckoning, the typical LA home now takes 66 days to sell (including an escrow period); that’s well under the 91 days that homes last on the market nationwide
High demand and low supply is driving up prices to the point that sellers may often undervalue their homes when putting them on the market, explains Zillow senior economist Aaron Terrazas. He says that sellers are often “pleasantly surprised” when homes fetch prices significantly higher than their asking price.
Levine says that rising home values may actually be causing some homeowners not to sell, out of fear they may not be able to afford something better. It’s a seller’s market, he says, “unless you want to turn around and buy again.”
This trend further limits the number of homes available for purchase—meaning that high costs and competition among buyers may be here to stay.
Wednesday, August 8, 2018
To buy or not to buy? New tax law creates uncertainty for some homebuyers
Source: The Orange County Register
Throughout Southern California, potential homebuyers and their real estate agents are trying to assess how tax cuts President Donald Trump signed into law Dec. 20 will impact housing.
Some are pulling out of the market, local agents say. Others are in a holding pattern and some home shoppers said they plan to buy out of state where the tax consequences won’t be as great.
There also are forecasts showing California house price increases won’t be as big as they would have been before the tax changes.
But interviews with economists, mortgage brokers, accountants and agents show there are just as many who think this is no big deal. The brouhaha will die out, they say, once the industry adjusts to the new reality.
“Every time these new laws are passed, there’s panic. Then it ends up being nothing,” said Blake Roberts, CEO at Pier to Pier Brokers in Hermosa Beach. “Death, divorce and desire keep happening, and people still have a need to buy real estate.”
Throughout Southern California, potential homebuyers and their real estate agents are trying to assess how tax cuts President Donald Trump signed into law Dec. 20 will impact housing.
Some are pulling out of the market, local agents say. Others are in a holding pattern and some home shoppers said they plan to buy out of state where the tax consequences won’t be as great.
There also are forecasts showing California house price increases won’t be as big as they would have been before the tax changes.
But interviews with economists, mortgage brokers, accountants and agents show there are just as many who think this is no big deal. The brouhaha will die out, they say, once the industry adjusts to the new reality.
“Every time these new laws are passed, there’s panic. Then it ends up being nothing,” said Blake Roberts, CEO at Pier to Pier Brokers in Hermosa Beach. “Death, divorce and desire keep happening, and people still have a need to buy real estate.”
Friday, August 3, 2018
Why Have Interest Rates Jumped To A 7-Year High?
Interest rates for a 30-year fixed rate mortgage have climbed from 3.95% in the first week of January up to 4.61% last week, which marks a 7-year high according to Freddie Mac. The current pace of acceleration has been fueled by many factors.
Sam Khater, Freddie Mac’s Chief Economist, had this to say:
“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.
Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”
But what do gas prices have to do with interest rates?
Investopedia explains the relationship like this:
“The price of oil and inflation are often seen as being connected in a cause-and-effect relationship. As oil prices move up or down, inflation follows in the same direction.”
You may have noticed that filling your gas tank has become substantially more expensive in recent months. The average national gas price has climbed nearly $0.50 from the beginning of the year, leading to the highest price for Memorial Day weekend since 2014.
As rates go up, your purchasing power goes down, but don’t worry; rates are still well below the averages we’ve seen over the last four decades.
“Freddie Mac said this year’s higher rates have not yet caused much of a ripple in the strong demand levels for buying a home seen in most markets, but inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”
Buying sooner rather than later will help lock in a lower rate than waiting, as the experts believe rates will continue to climb. Even a small increase in interest rates can have a big impact on your monthly housing cost.
Bottom Line
If you are planning on buying a home this year, keep an eye on gas prices the next time you’re at the pump. If you start to feel a big jump in price, know that rates are probably on their way up, too.
Sam Khater, Freddie Mac’s Chief Economist, had this to say:
“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.
Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”
But what do gas prices have to do with interest rates?
Investopedia explains the relationship like this:
“The price of oil and inflation are often seen as being connected in a cause-and-effect relationship. As oil prices move up or down, inflation follows in the same direction.”
You may have noticed that filling your gas tank has become substantially more expensive in recent months. The average national gas price has climbed nearly $0.50 from the beginning of the year, leading to the highest price for Memorial Day weekend since 2014.
As rates go up, your purchasing power goes down, but don’t worry; rates are still well below the averages we’ve seen over the last four decades.
“Freddie Mac said this year’s higher rates have not yet caused much of a ripple in the strong demand levels for buying a home seen in most markets, but inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”
Buying sooner rather than later will help lock in a lower rate than waiting, as the experts believe rates will continue to climb. Even a small increase in interest rates can have a big impact on your monthly housing cost.
Bottom Line
If you are planning on buying a home this year, keep an eye on gas prices the next time you’re at the pump. If you start to feel a big jump in price, know that rates are probably on their way up, too.
Wednesday, August 1, 2018
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