C.A.R. Market Matters

Housing in 2015: Four Reasons for Optimism (And One for Worry)
Source: NPR

Will 2015 be the year that the housing market finally breaks out of its tepid recovery and takes off as economic indicators point to strong improvement? According to economists, there are several factors to encourage optimism. Firstly, employers are hiring again, job growth is relatively strong, and consumer confidence is growing. Also, slower price appreciation in 2014 may have set the stage for a buying surge in 2015. Millennial entry into the market and high rents may also working in housing’s favor.
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Buying a Home in California is Harder for Middle Class Families

Source: KPBS

 

The median income required to buy a home today in California is $30,000 higher than it was a few years ago, which means less than a third of California households can afford a home at the median price right now. According to Selma Hepp, senior economist with the CALIFORNIA ASSOCIATION OF REALTORS®, it’s much harder today than it was a year ago to buy a home in the state because there are very few affordable homes available in places most people want to live.
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Five Things to Watch in Housing In 2015
Source: Wall St. Journal

 
With lingering concerns about the recovery of the housing market, there are several key factors to watch in 2015, including affordability. It remains to be seen whether sales will pick up in 2015 if there’s more available for sale, and if those sellers realize prices aren’t rising the way they were one or two years ago. Slight loosening in access to credit may make the process of obtaining a mortgage less burdensome, but without an increase in incomes, there may not be sufficient buyers. Interest rates, inventory, and new construction are also important to monitor.
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Young Home Buyers Return in U.S. as Economy Accelerates

Source: Bloomberg

 

It is hoped that an increase in first-time buyers, whose market share dropped to a record low last year, will provide a boost to the sluggish mortgage industry. As the economy improves, economists expect weak demand to turn around as more renters are put in a better position to buy. It is believed that increasing confidence in the job market is the strongest indicator home sales will improve.
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Housing market on track for more improvement this year
Source: The Hill
Existing-home sales are expected to increase 7.4 percent this year, according to the National Association of REALTORS®. The forecast predicts that median home prices are expected to rise about 4 percent, while new homes sales are slated to jump 37 percent and rents are likely to increase 4 percent. Problem areas for the market include an expected rise in interest rates, stifled lending, and tough conditions for first-time home buyers.
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Stop charging borrowers for yesterday’s mistakes, FHA
Source: HousingWire

The Urban Institute is calling on the Federal Housing Administration to update its approach to insurance premiums because current rates are too high. According to its analysis, the FHA can significantly lower its premiums—charging current borrowers more appropriately for their risks—while continuing to build the necessary reserves against future losses.
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