Home is Never Far Away

Market Matters

Bank of America to pay record $16.65 billion to settle mortgage claims Source: LA Times In what amounts to the largest settlement by a single company in U.S. history, the Justice Department has announced that Bank of America Corp. will pay $16.65 billion to end federal and state investigations into the sale of toxic mortgage securities during the subprime housing boom. California will receive $300 million from the settlement to reimburse the CalPERS and CalSTRS pension funds. Read the full story

3 facts crippling California's housing recovery Source: HousingWire   While California’s job growth and economy continue to improve, major hurdles remain for housing’s recovery. Firstly, affordability is a huge concern as rapid home price increases, mixed with a lack of affordable inventory is leaving little room for first-time borrowers to jump into the market. Tight credit and stagnant incomes are another concern if prices remain high. Read the full story

Housing construction surges in July Source: The Hill During July, housing construction hit its highest level in eight months as the sector shows signs of picking up pace in the second half of the year. After two months of drops, construction jumped 15.7 percent last month to a seasonally adjusted annual rate of 1.09 million homes, the fastest pace since the 1.11 million posted in November, according to the Commerce Department. Read the full story

Young Adults Are Living With Their Parents, But Not As Much As (Or Why) You Think

Source: Wall St. Journal

Young Americans are living with their parents in greater numbers, but don’t blame the economy or housing costs. Blame student loans. The proportion of young adults aged 18 to 31 living with parents has hit 36% from 31% in 2005, and indebtedness—especially rising student debt—explains roughly 30% of this increase, according to a new study by Lisa Dettling and Joanne Hsu at the Federal Reserve Board.
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Market Matters

Many Renters Could Afford Mortgages, But Can't Afford Homes
Source: The Atlantic

In many metro areas across the U.S., more than 50 percent of renters could afford to own a home, so why aren’t more young renters becoming first-time home-buyers right now? According to data analysis, the Atlantic notes that “Young renters don't appear to be transitioning into homeownership at the rate they could be. Either renters are opting out of the American dream, or it remains out of reach for reasons beyond affordability.” Possible explanations include tight credit, low inventory, and investor cash. 
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Closing costs: States ranked

Source: Bankrate

 

States have been ranked by average closing costs, from most expensive to least expensive. To determine the rankings, Bankrate requested good faith estimates for a $200,000 mortgage loan from up to 10 lenders in each state. The hypothetical loan was for a purchase of a single-family house in the state's largest city, using a 20 percent down payment, with excellent credit. California ranked as the 22nd most expensive state for closing costs.
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Homeownership at near 20-year low, but some bright spots
Source: HousingWire

Homeownership in the U.S. continues to fall, down to a low of 64.7 percent, a level not seen since 1995. Despite low interest rates and expanding credit availability, affordability has remained an issue. Also, first-time home purchasers are declining as a share of total home sales. Experts have expressed concerns that loosening of mortgage credit and a reduction in home price growth won’t be enough to reduce the trend of declining mortgage origination.
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No project left undone

Market Matters

House hunting in the Southern California summer real-estate doldrums
Source: LA Daily News

Home shoppers in Southern California this summer are confronted with a market trying to shake the lingering effects of the Great Recession. From the South Bay through the valleys and into the Inland Empire, there are fewer homes on the market, and appreciation of home prices has moderated —thereby prompting sellers to hold onto their homes longer — and as a result, homes sales are weak.
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Realtor.com®’s First Economist: I’m Anything But Typical

Source: N.A.R.

 

Realtor.com® has hired Jonathan Smoke as its first economist in its 18-year history to compete with rivals Zillow and Trulia, both of which have long had their own economists to provide insights on the market. Smoke previously served as chief economist, senior vice president, and other executive roles at real estate marketing firm Hanley Wood. Smoke stated, “I’m just getting started surveying what we can produce, and I need to hear from consumers and REALTORS® first-hand about what is missing and needed that no company is producing today.”
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Black Homeowners Are Worse Off Today Than They Were 40 Years Ago
Source: The Atlantic

A new study shows that changes in the market that led to the foreclosure crisis have essentially wiped out the gains in racial–residential equality made by black homeowners since the 1970s, and they have been dramatically more likely to transition back to renter status than whites following the recession. Overall, black homeowners in high-income neighborhoods were twice as likely to have subprime mortgages as white homeowners in low-income neighborhoods.
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The future of affordable housing is Lego houses?
Source: HousingWire

 

Is a real-life Lego house the answer to creating more affordable housing? A Danish company is showcasing a prototype for a 3D printed Lego-style home idea. The company stated, “If our Lego-constructed houses are good enough to be the home of tiny Lego figures, then why shouldn't they be good enough on a much bigger scale, to house real people?”
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Julián Castro sworn in, spends first day as HUD Secretary
Source: HousingWire

Julián Castro is now officially the head of the Department of Housing and Urban Development after being sworn into office earlier this week in Washington, D.C. In taking the reins, the 39-year-old is now the highest ranking Hispanic in the federal bureaucracy and the youngest member of the Obama cabinet. President Obama stated, “Julián has lived the American Dream in his own life, and I’m confident he will help Americans across our country seize their own piece of that dream for themselves and their children."
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Some Home Builders Say First-Time Buyers Returning, Others Not Sure
Source: Wall Street Journal

Many major builders across the nation say they’re getting mixed signals about whether first-time buyers are truly returning to the housing market. PulteGroup Inc. stirred optimism after announcing that sales for its entry-level brand leapt by 26 percent in the second quarter, while D.R. Horton, the largest U.S. builder by closings, has seen a low percentage of mortgage originations going to first-timers. Conflicting signals were also seen when KB Homes stated it saw a revival in these buyers while Lennar Corp did not. Many analysts expect these buyers to return in full force in the second half of this year.
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Gen Y is ready to buy!