by Peter L. Mosca
Giffels-Webster Engineers (GWE), a civil engineering firm with a 50-year industry reputation for its vision for today’s market and beyond, revealed its annual list of Top Five Real Estate and Development Trends. According to GWE, the hottest market-growth areas are:
1. Infrastructure Rehabilitation
2. Urban Redevelopment
3. Energy Generation
4. Life Sciences
5. Healthcare Expansion/Renovation
Intrinsic to each of the following trends is sustainable design and LEED-certified construction. Green elements will continue to be incorporated into projects as energy efficient, healthy spaces remain a top priority.
Infrastructure Rehabilitation
There has long been a need for public investment in the nation's aging infrastructure - roads, bridges and utilities. The new presidential administration has expressed a substantial commitment to this investment, which will generate significant work for public agencies, private design consultants and contractors.
Urban Redevelopment
Retail and residential re-development opportunities exist in urban areas, where the population and infrastructure foundation is already in place. This year, expect to see an increase in repurposing manufacturing plants and industrial buildings into new mixed-use developments. In addition, public investment to create connected, urban living spaces with walkable and bike-friendly communities are gaining popularity. Creating and improving light rail connections from cities to suburbs will also see investment.
Energy Generation
Government and private investment in energy generation, particularly of renewable sources, will provide opportunities for developers, construction managers and civil engineers as demand for clean energy grows. Many states, especially in the Midwest, are mandating that higher percentages of electricity come from renewable sources like wind energy, which will require site planning and manufacturing for thousands of new turbines.
Life Sciences
The life sciences industry is positioned for growth as a result of the aging baby-boomer population, increases in prescription drug spending and steady investment trends. Many companies are building or expanding research-and-development facilities, labs and office space for biotechnology, pharmaceuticals and diagnostics. It’s an opportunity to provide facilities that meet these companies’ needs now and can easily be scaled up for future expansion.
Healthcare Expansion/Renovation
Healthcare facilities must stay on top of technology developments and treatment needs to remain competitive; new advancements can quickly outdate existing facilities. An aging baby-boomer generation, coupled with a trend toward single-occupancy rooms, will drive many hospitals, nursing homes and hospice centers to undergo substantial renovations and expansions in 2009.
[Note: Giffels-Webster Engineers, Inc. is a civil engineering and land-development consulting firm serving public, private, and institutional clients throughout the United States with their infrastructure needs, www.giffelswebster.com.]
Published: February 11, 2009
Friday, February 13, 2009
Real Estate Outlook: Encouraging Signs
by Kenneth R. Harney
Could the tide be turning for real estate?
It's probably premature to make that call, but you can't ignore the encouraging signs -- especially when they come in multiples.
First we saw a surprising 6.5 percent jump in home sales for December. Now we've just gotten the latest Pending Home Sales Index, and it's up 6.3 percent, thanks to double digit gains of 13 percent in the Midwest and the South.
The index is based on signed contracts for home sales that haven't gone to closing, but that are scheduled to settle in the coming two or three months.
The National Association of Realtors collects the data from Multiple Listing Services around the country, and most economists accept the index as a reliable gauge of where we're headed in housing activity.
Dr. Lawrence Yun, chief economist for the National Association of Realtors, attributed the upward movement to "buyers responding to lower home prices and interest rates" that have improved the affordability equation to its most favorable level in 39 years.
Sales in the coming months might also be powered by something no index can measure: Congress is likely to improve last year's $7,500 home buyer tax credit by turning it into a nonrepayable incentive for new sales this year -- all as part of the stimulus package on Capitol Hill.
Though it's impossible to predict how many more home sales a true credit might stimulate -- one that doesn't have to be paid back to the government like the 2008 version -- industry estimates range anywhere from several hundred thousand upward, provided the expiration date runs through this coming December.
On other economic fronts last week, reports of tens of thousands of industry layoffs definitely won't help housing, but new numbers on inventories of unsold homes just might be a plus. Total homes for sale on the market nationwide dropped nearly 18 percent last month to the lowest level since May of 2007.
Mortgage rates inched up slightly last week, according to the Mortgage Bankers Association, with thirty year fixed rate loans averaging 5.3 percent compared to 5.2 percent the week before. That's up a notch, but it's still close to 40 year historic lows.
As we've said before on this program: Keep your eyes open for the little statistical improvements in the market that often get ignored by the media: Once they start mounting up, month after month, you'll know we're in turnaround mode.
We're not there yet, but we're headed in a promising direction.
Published: February 10, 2009
Could the tide be turning for real estate?
It's probably premature to make that call, but you can't ignore the encouraging signs -- especially when they come in multiples.
First we saw a surprising 6.5 percent jump in home sales for December. Now we've just gotten the latest Pending Home Sales Index, and it's up 6.3 percent, thanks to double digit gains of 13 percent in the Midwest and the South.
The index is based on signed contracts for home sales that haven't gone to closing, but that are scheduled to settle in the coming two or three months.
The National Association of Realtors collects the data from Multiple Listing Services around the country, and most economists accept the index as a reliable gauge of where we're headed in housing activity.
Dr. Lawrence Yun, chief economist for the National Association of Realtors, attributed the upward movement to "buyers responding to lower home prices and interest rates" that have improved the affordability equation to its most favorable level in 39 years.
Sales in the coming months might also be powered by something no index can measure: Congress is likely to improve last year's $7,500 home buyer tax credit by turning it into a nonrepayable incentive for new sales this year -- all as part of the stimulus package on Capitol Hill.
Though it's impossible to predict how many more home sales a true credit might stimulate -- one that doesn't have to be paid back to the government like the 2008 version -- industry estimates range anywhere from several hundred thousand upward, provided the expiration date runs through this coming December.
On other economic fronts last week, reports of tens of thousands of industry layoffs definitely won't help housing, but new numbers on inventories of unsold homes just might be a plus. Total homes for sale on the market nationwide dropped nearly 18 percent last month to the lowest level since May of 2007.
Mortgage rates inched up slightly last week, according to the Mortgage Bankers Association, with thirty year fixed rate loans averaging 5.3 percent compared to 5.2 percent the week before. That's up a notch, but it's still close to 40 year historic lows.
As we've said before on this program: Keep your eyes open for the little statistical improvements in the market that often get ignored by the media: Once they start mounting up, month after month, you'll know we're in turnaround mode.
We're not there yet, but we're headed in a promising direction.
Published: February 10, 2009
Homeowners Face Reality, Remain Optimistic
Release date: 02/09/09
Although more than half of those surveyed in Zillow.com's Q4 Homeowner Confidence Survey believe their own home lost value in 2008, more than two-thirds appear to believe that the worst may be over.
According to the fourth-quarter-2008 survey, some 70 percent of those surveyed believe their home's value will either increase or stay the same in the first six months of 2009, while only 30 percent expect a decrease in value.
Fifty-seven percent believe their home last value last year, up from 38 percent of those surveyed in the second quarter of 2008. In reality, 76 percent of all U.S. homes lost value in 2008, according to analysis of the Zillow Q4 Real Estate Market Reports.
With these new findings, Zillow's Home Value Misperception Index shrunk to 10 in the fourth quarter, from 16 in the third and 32 in the second quarter. An index of zero would mean homeowners' perceptions were in line with actual values.
"It's clear that the 'not my house' sentiment that was so prevalent in earlier surveys is waning, and homeowners are opening their eyes to the unfortunate reality of significant losses in home values across most of the country," said Dr. Stan Humphries, Zillow's vice president of data and analytics, in a statement. "That said, there's a curious optimism for homeowners when asked about the future -- most seem to believe we've hit a bottom and the worst has passed. Unfortunately, the data tells another story. With year-over-year home value losses continuing to accelerate, most areas of the country will see housing values get worse before they begin to stabilize."
With a Misperception Index of only 3 -- down from 20 in the third quarter -- the perception of homeowners in the Northeast was closest to reality. Well over half (57 percent) of Northeastern homeowners believe their own home's value declined during 2008, while 20 percent believed it stayed the same. According to Zillow's fourth-quarter data, 71 percent of homes in the Northeast declined in value during 2008.
Homeowners in the West, where values were hardest-hit, lost some of their optimism in the fourth quarter, but home values continued to edge downward, leaving Western homeowners' perceptions among the farthest from reality with a Misperception Index of 13 (the same as last quarter). Southerners' perceptions were farthest from reality, with a Misperception Index of 14.
Source: Inman News
Although more than half of those surveyed in Zillow.com's Q4 Homeowner Confidence Survey believe their own home lost value in 2008, more than two-thirds appear to believe that the worst may be over.
According to the fourth-quarter-2008 survey, some 70 percent of those surveyed believe their home's value will either increase or stay the same in the first six months of 2009, while only 30 percent expect a decrease in value.
Fifty-seven percent believe their home last value last year, up from 38 percent of those surveyed in the second quarter of 2008. In reality, 76 percent of all U.S. homes lost value in 2008, according to analysis of the Zillow Q4 Real Estate Market Reports.
With these new findings, Zillow's Home Value Misperception Index shrunk to 10 in the fourth quarter, from 16 in the third and 32 in the second quarter. An index of zero would mean homeowners' perceptions were in line with actual values.
"It's clear that the 'not my house' sentiment that was so prevalent in earlier surveys is waning, and homeowners are opening their eyes to the unfortunate reality of significant losses in home values across most of the country," said Dr. Stan Humphries, Zillow's vice president of data and analytics, in a statement. "That said, there's a curious optimism for homeowners when asked about the future -- most seem to believe we've hit a bottom and the worst has passed. Unfortunately, the data tells another story. With year-over-year home value losses continuing to accelerate, most areas of the country will see housing values get worse before they begin to stabilize."
With a Misperception Index of only 3 -- down from 20 in the third quarter -- the perception of homeowners in the Northeast was closest to reality. Well over half (57 percent) of Northeastern homeowners believe their own home's value declined during 2008, while 20 percent believed it stayed the same. According to Zillow's fourth-quarter data, 71 percent of homes in the Northeast declined in value during 2008.
Homeowners in the West, where values were hardest-hit, lost some of their optimism in the fourth quarter, but home values continued to edge downward, leaving Western homeowners' perceptions among the farthest from reality with a Misperception Index of 13 (the same as last quarter). Southerners' perceptions were farthest from reality, with a Misperception Index of 14.
Source: Inman News
Transfer Tax Defeated in Avery County After All
Release date: 02/10/09
Upon further review, North Carolina homeowners remained undefeated with regard to a real estate transfer tax.
On a snowy Tuesday last week in a special election in Avery County, voters failed to pass the measure by 35 votes. The final tally, as certified today by the county’s Board of Elections, was 1,449 opposed versus 1,414 who supported the measure.
Election night results initially indicated that the transfer tax had passed by 25 votes (1,434 for; 1,409 against). But Johnny A. Canupp, chair of the Avery County Board of Elections, said the canvas had caught errors from two precincts. “The canvas of the votes caught the errors,” he said. “We wanted to make sure the total vote is correct.”
The result in Avery County marks the 24th time in 24 attempts statewide that the transfer tax — also known as the Home Tax — has failed. A recent statewide poll shows that 83 percent of the public opposes the tax.
The transfer tax option for counties has been in place since the 2007 legislative session when lawmakers in Raleigh rolled it into the budget bill. Since then, homeowners across the state have fought vigilantly – and successfully – against the tax.
“Homeowners by and large are overwhelmingly against the transfer tax,” said Sandra O’Connor, 2009 president of the NC Association of REALTORS®. “We’ll continue to oppose the real estate transfer tax because it is fundamentally unfair, and has negative implications for homeowners. Basically, it’s a tax for the privilege of selling your own property. It doesn’t impact newcomers, as some proponents claim. It hurts the sellers – many who have lived on their property for years and have paid property taxes all that time.”
In each of the previous 23 elections, the transfer tax was defeated by overwhelming margins. But a snowstorm that gripped the county on Election Day led to a smaller-than-expected voter turnout of only 22 percent. The local grassroots organization that opposed the measure – Avery County Property Owners Against the Transfer Tax – felt the inclement weather contributed to the close vote.
“Some people have asked if there will be a recount,” Canupp said. “Under North Carolina law, a recount can be conducted if the election result is no more than 1 percent; that would mean the difference would have to be 29 votes. The measure failed by 35 votes, so there will be no recount.”
Upon further review, North Carolina homeowners remained undefeated with regard to a real estate transfer tax.
On a snowy Tuesday last week in a special election in Avery County, voters failed to pass the measure by 35 votes. The final tally, as certified today by the county’s Board of Elections, was 1,449 opposed versus 1,414 who supported the measure.
Election night results initially indicated that the transfer tax had passed by 25 votes (1,434 for; 1,409 against). But Johnny A. Canupp, chair of the Avery County Board of Elections, said the canvas had caught errors from two precincts. “The canvas of the votes caught the errors,” he said. “We wanted to make sure the total vote is correct.”
The result in Avery County marks the 24th time in 24 attempts statewide that the transfer tax — also known as the Home Tax — has failed. A recent statewide poll shows that 83 percent of the public opposes the tax.
The transfer tax option for counties has been in place since the 2007 legislative session when lawmakers in Raleigh rolled it into the budget bill. Since then, homeowners across the state have fought vigilantly – and successfully – against the tax.
“Homeowners by and large are overwhelmingly against the transfer tax,” said Sandra O’Connor, 2009 president of the NC Association of REALTORS®. “We’ll continue to oppose the real estate transfer tax because it is fundamentally unfair, and has negative implications for homeowners. Basically, it’s a tax for the privilege of selling your own property. It doesn’t impact newcomers, as some proponents claim. It hurts the sellers – many who have lived on their property for years and have paid property taxes all that time.”
In each of the previous 23 elections, the transfer tax was defeated by overwhelming margins. But a snowstorm that gripped the county on Election Day led to a smaller-than-expected voter turnout of only 22 percent. The local grassroots organization that opposed the measure – Avery County Property Owners Against the Transfer Tax – felt the inclement weather contributed to the close vote.
“Some people have asked if there will be a recount,” Canupp said. “Under North Carolina law, a recount can be conducted if the election result is no more than 1 percent; that would mean the difference would have to be 29 votes. The measure failed by 35 votes, so there will be no recount.”
Freddie Mac: rates on 30-year fixed mortgages fall
The Associated Press
Posted: Thursday, Feb. 12, 2009
McLEAN, Va. Rates on 30-year-fixed mortgages fell this week, offering homeowners a chance to refinance their loans, Freddie Mac said Thursday.
The average rate on a 30-year fixed mortgage dropped to 5.16 percent this week from 5.25 percent last week. A year ago, the 30-year, fixed-rate mortgage averaged 5.72 percent.
Frank Nothaft, Freddie Mac's chief economist, said interest rates for 30-year fixed-rate mortgages are almost 1.5 percentage points below last year's peak set in late July, 'offering many homeowners an incentive to refinance.'
The new rate translates into a monthly payment savings of about $188 on a $200,000 loan, Nothaft said.
Average rates for 30-year-fixed mortgages had been rising since hitting a record low of 4.96 percent a month ago, a decline attributed to the Federal Reserve's move to buy $500 billion in mortgage-backed securities to spur lending by banks.
In late January, Freddie Mac reported that U.S. homeowners took out $17.5 billion in home equity in the fourth quarter by refinancing their mortgages, the lowest amount since the first quarter of 2001.
The average rate this week on a 15-year fixed-rate mortgage was 4.81 percent, Freddie Mac sai"
Posted: Thursday, Feb. 12, 2009
McLEAN, Va. Rates on 30-year-fixed mortgages fell this week, offering homeowners a chance to refinance their loans, Freddie Mac said Thursday.
The average rate on a 30-year fixed mortgage dropped to 5.16 percent this week from 5.25 percent last week. A year ago, the 30-year, fixed-rate mortgage averaged 5.72 percent.
Frank Nothaft, Freddie Mac's chief economist, said interest rates for 30-year fixed-rate mortgages are almost 1.5 percentage points below last year's peak set in late July, 'offering many homeowners an incentive to refinance.'
The new rate translates into a monthly payment savings of about $188 on a $200,000 loan, Nothaft said.
Average rates for 30-year-fixed mortgages had been rising since hitting a record low of 4.96 percent a month ago, a decline attributed to the Federal Reserve's move to buy $500 billion in mortgage-backed securities to spur lending by banks.
In late January, Freddie Mac reported that U.S. homeowners took out $17.5 billion in home equity in the fourth quarter by refinancing their mortgages, the lowest amount since the first quarter of 2001.
The average rate this week on a 15-year fixed-rate mortgage was 4.81 percent, Freddie Mac sai"
Friday, February 6, 2009
Mortgage rates fell back under 5.5 percent this week
The benchmark 30-year fixed-rate mortgage fell 11 basis points, to 5.48 percent, according to the Bankrate.com national survey of large lenders. The mortgages in last week's survey had an average total of 0.29 discount and origination points. One year ago, the mortgage index was 5.88 percent; four weeks ago, it was 5.64 percent."
Monday, February 2, 2009
Mortgage Rates Hold Steady
The 30-year fixed-rate mortgage averaged 5.10 percent with an average 0.7 point for the week ending January 29, 2009, down from last week when it averaged 5.12 percent according to Freddie Mac. Last year at this time, the 30-year FRM averaged 5.68 percent.
Make banks bid for your money
Problem: You're too nervous to invest in the stock market, but your bank is offering paltry yields on CDs.
Solution: Auction your cash to the highest bidder. At MoneyAisle.com, more than 100 small and midsize banks compete for consumer deposits through live auctions. When a customer comes to the site and asks for the terms of a CD or high-yield savings account, the banks bid against one another – through automated auction software that runs on the Web site – to win the deposit. The cost is free to consumers, and you don't have to commit to investing anything before you see the results of an auction. Participating banks, which are all FDIC-insured, are screened by an independent bank-rating agency to filter out the riskiest banks.
Savers can also find high-yield CDs with brokered CDs, which are offered by banks and brokerage firms around the country and typically sold through brokerage firms and financial intermediaries. As the big brokerage firms expand their deposit business, many are offering attractive yields to lure buyers. Keep in mind that brokered CDs have different rules. If you cash out before they mature, you may lose some"
Solution: Auction your cash to the highest bidder. At MoneyAisle.com, more than 100 small and midsize banks compete for consumer deposits through live auctions. When a customer comes to the site and asks for the terms of a CD or high-yield savings account, the banks bid against one another – through automated auction software that runs on the Web site – to win the deposit. The cost is free to consumers, and you don't have to commit to investing anything before you see the results of an auction. Participating banks, which are all FDIC-insured, are screened by an independent bank-rating agency to filter out the riskiest banks.
Savers can also find high-yield CDs with brokered CDs, which are offered by banks and brokerage firms around the country and typically sold through brokerage firms and financial intermediaries. As the big brokerage firms expand their deposit business, many are offering attractive yields to lure buyers. Keep in mind that brokered CDs have different rules. If you cash out before they mature, you may lose some"
Remodeling Projects That Add Value
According to Remodeling magazine's 2008-2009 Cost vs. Value Report, even despite the challenging economy, investing in your home still pays off at resale. Based on interviews with real estate professionals throughout the country, the Remodeling report found that homeowners could expect to recoup an average of 67.3 percent of their investment in 30 different home improvement projects.
Exterior projects that boost curb appeal and kitchen remodels generally get the biggest bang for the homeowner's buck. The right remodeling project, when done well, also has the potential to make for a quicker sale and reduce negotiations with buyers over perceived shortcomings.
Some of the projects that are paying off the most nationally this year at resale include the following. The number in parentheses represents the percentage of the project's cost that is recovered.
* Upscale fiber cement siding (86.7 percent)
* Midrange wood deck (81.8 percent)
* Midrange vinyl siding (80.7 percent)
* Midrange minor kitchen remodel (79.5 percent)
* Upscale vinyl window replacement (79.2 percent)
* Midrange major kitchen remodel (76 percent)
Exterior projects that boost curb appeal and kitchen remodels generally get the biggest bang for the homeowner's buck. The right remodeling project, when done well, also has the potential to make for a quicker sale and reduce negotiations with buyers over perceived shortcomings.
Some of the projects that are paying off the most nationally this year at resale include the following. The number in parentheses represents the percentage of the project's cost that is recovered.
* Upscale fiber cement siding (86.7 percent)
* Midrange wood deck (81.8 percent)
* Midrange vinyl siding (80.7 percent)
* Midrange minor kitchen remodel (79.5 percent)
* Upscale vinyl window replacement (79.2 percent)
* Midrange major kitchen remodel (76 percent)
Tuesday, January 27, 2009
Leading indicators post surprise gain in December
The index of U.S. leading indicators rose above expectations in December, posting a 0.3 percent month-over-month gain, according to the Conference Board. The consensus had forecast a 0.2 percent month-over-month decline. November's level was unrevised at -0.4 percent. Over the past six months, the leading index has fallen 5 percent, with five out of the 10 components showing contractions.
The leading index saw positive contributions from consumer goods orders, capital goods, M2 money supply, and the interest rate spread, while consumer expectations were flat. The average workweek fell 0.25 percent from the prior month.
The leading index saw positive contributions from consumer goods orders, capital goods, M2 money supply, and the interest rate spread, while consumer expectations were flat. The average workweek fell 0.25 percent from the prior month.
Existing home sales rise
Existing-home sales rose unexpectedly while inventory declined, led by a surge of sales in the West, according to the National Association of Realtors®. Existing-home sales jumped 6.5 percent to a seasonally adjusted annual rate of 4.74 million units in December from a downwardly revised pace of 4.45 million units in November, but are 3.5 percent below the 4.91 million-unit pace in December 2007.
For all of 2008 there were 4,912,000 existing-home sales, which was 13.1 percent below the 5,652,000 transactions recorded in 2007. This is the lowest volume since 1997 when there were 4,371,000 sales.
Total housing inventory at the end of December fell 11.7 percent to 3.68 million existing homes available for sale, which represents a 9.3-month supply at the current sales pace, down from a 11.2-month supply in November. The national median existing-home price for all housing types was $175,400 in December, which is 15.3 percent below December 2007 when the median was $207,000.
REAL Trends Comment: As we reported in the December REAL Trends Housing Market Report, sales in December were better than expected given the drum beat of negative economic and housing market news. Yes prices are down, nationally somewhere in the 11-14% range, but sales show signs of firming.
Have we reached bottom? With unemployment rising we expect continued downward pressure on sales and prices, but declining inventory and higher affordability may take the edge off substantial further declines in all but a few markets.
Where sales and prices have tumbled the most, the market is more robust. The more brokerage firms insist on accurate pricing among their listings, the less overpriced homes there are on the market, the quicker markets will return to health.
For all of 2008 there were 4,912,000 existing-home sales, which was 13.1 percent below the 5,652,000 transactions recorded in 2007. This is the lowest volume since 1997 when there were 4,371,000 sales.
Total housing inventory at the end of December fell 11.7 percent to 3.68 million existing homes available for sale, which represents a 9.3-month supply at the current sales pace, down from a 11.2-month supply in November. The national median existing-home price for all housing types was $175,400 in December, which is 15.3 percent below December 2007 when the median was $207,000.
REAL Trends Comment: As we reported in the December REAL Trends Housing Market Report, sales in December were better than expected given the drum beat of negative economic and housing market news. Yes prices are down, nationally somewhere in the 11-14% range, but sales show signs of firming.
Have we reached bottom? With unemployment rising we expect continued downward pressure on sales and prices, but declining inventory and higher affordability may take the edge off substantial further declines in all but a few markets.
Where sales and prices have tumbled the most, the market is more robust. The more brokerage firms insist on accurate pricing among their listings, the less overpriced homes there are on the market, the quicker markets will return to health.
Tuesday, January 13, 2009
Banks offer mortgage rates below 5%
Mortgage rates continue to drop, and some of the nation's largest banks are offering loans below 5 percent. Chase Bank advertised a 4.75 percent 30-year, fixed-rate mortgage, Wells Fargo's rate was 4.875 percent, and Bank of America was at 5 percent on their Web sites recently. The rates are for borrowers who have a 20 percent downpayment and an excellent credit rating.
The new, lower rates are a result of the Federal Reserve's $500 billion purchase of mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. These new lower rates should increase demand for mortgage refinancing, but it is unclear whether they will be enough to spur a growth in new mortgages.
The average rate for a 30-year mortgage dropped for the tenth consecutive week, according to Freddie Mac's weekly Primary Mortgage Market Survey, which indicated the average 30-year fixed-rate mortgage rate dropped nearly 2 percent from 5.10 percent for the week ending January 1, to 5.01 percent for the week ending January 8. The rate is down nearly 15 percent from this time last year, and is at its lowest level since Freddie Mac began tracking the data in 1971. The Fed buy-up of mortgage-backed securities has boosted the price of securities, and in turn, dropped interest rates.
Source: DSNEWS.com
REAL Trends Comment: Perhaps the housing market is finally seeing the direct benefit from Federal intervention into the mortgage market. Rates are at record lows and the REAL Trends Housing Market Report to be released on Friday, January 16 will show significant improvement in housing sales throughout the country compared both to November data and year ago December closings.
The new, lower rates are a result of the Federal Reserve's $500 billion purchase of mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. These new lower rates should increase demand for mortgage refinancing, but it is unclear whether they will be enough to spur a growth in new mortgages.
The average rate for a 30-year mortgage dropped for the tenth consecutive week, according to Freddie Mac's weekly Primary Mortgage Market Survey, which indicated the average 30-year fixed-rate mortgage rate dropped nearly 2 percent from 5.10 percent for the week ending January 1, to 5.01 percent for the week ending January 8. The rate is down nearly 15 percent from this time last year, and is at its lowest level since Freddie Mac began tracking the data in 1971. The Fed buy-up of mortgage-backed securities has boosted the price of securities, and in turn, dropped interest rates.
Source: DSNEWS.com
REAL Trends Comment: Perhaps the housing market is finally seeing the direct benefit from Federal intervention into the mortgage market. Rates are at record lows and the REAL Trends Housing Market Report to be released on Friday, January 16 will show significant improvement in housing sales throughout the country compared both to November data and year ago December closings.
Thursday, January 1, 2009
Charlotte home prices fall; still among best markets
Charlotte home sales prices continued sliding in October, according to a popular price index released this morning.
Still, Charlotte remains among the best of 20 major urban markets in the monthly index and well below the groups record drop of more than 18 percent.
Still, Charlotte remains among the best of 20 major urban markets in the monthly index and well below the groups record drop of more than 18 percent.
Wednesday, December 24, 2008
Aid to homeowners may double under Bush-backed loan initiative
The mortgage-industry effort to stem foreclosures aims to double the number of borrowers getting help next year, as Democrats call for using taxpayer money to address the crisis. The Hope Now Alliance, a group created at the behest of Treasury Secretary Henry Paulson last year, expects to modify about 2 million mortgages next year, according to a report to be released today in Washington. The group, which includes JPMorgan Chase & Co., Citigroup Inc. and Bank of America Corp., also plans a new campaign to boost participation in the program.
Hope Now projects 950,000 loan modifications for 2008, including 208,000 for the month of November. Including repayment plans and other assistance, the group estimates that about 2.2 million foreclosures will have been prevented this year, bringing to 3 million the total averted since the program began in 2007.
Source: Bloomberg.com
REAL Trends Comment: While modification of troubled mortgages may be good social policy it is evident that loans being modified are becoming delinquent at much higher rates than predicted. (See article below). While it may be that policy makers and large mortgage lenders who are participating in the Hope Now Alliance are merely trying to engineer a 'soft"
Hope Now projects 950,000 loan modifications for 2008, including 208,000 for the month of November. Including repayment plans and other assistance, the group estimates that about 2.2 million foreclosures will have been prevented this year, bringing to 3 million the total averted since the program began in 2007.
Source: Bloomberg.com
REAL Trends Comment: While modification of troubled mortgages may be good social policy it is evident that loans being modified are becoming delinquent at much higher rates than predicted. (See article below). While it may be that policy makers and large mortgage lenders who are participating in the Hope Now Alliance are merely trying to engineer a 'soft"
Brokers see declining inventory, more pending sales
In comparison to six months ago, over half of member brokers responding to a recent Leading Real Estate Companies of the World® 'Housing Beat' survey are reporting one bit of good news with declining housing inventory in their markets. And while only 9 percent are seeing an increase in closings, 26 percent are experiencing more pending sales (homes under contract but not yet closed), although many of those contracts are for foreclosure properties.
Meanwhile, nearly a third of brokers are seeing more open house and Web site activity, and 54 percent are seeing much more flexibility from banks in responding to short-sale inquiries. With more affordable prices, it's no surprise that nearly 90 percent of brokers are experiencing more activity with first-time buyers, with only 22 percent reporting the same for move-up buyers and 14 percent for high-end buyers. In many markets, there are rising sales to investors who are taking advantage of opportunities by buying at bargain-basement prices.
Some 72 percent of LeadingRE respondents believe that the original allocation of government funds to provide credit relief to banks was necessary, although most qualified their responses with a strong tone of frustration by noting that the disposition of the funds has bee"
Meanwhile, nearly a third of brokers are seeing more open house and Web site activity, and 54 percent are seeing much more flexibility from banks in responding to short-sale inquiries. With more affordable prices, it's no surprise that nearly 90 percent of brokers are experiencing more activity with first-time buyers, with only 22 percent reporting the same for move-up buyers and 14 percent for high-end buyers. In many markets, there are rising sales to investors who are taking advantage of opportunities by buying at bargain-basement prices.
Some 72 percent of LeadingRE respondents believe that the original allocation of government funds to provide credit relief to banks was necessary, although most qualified their responses with a strong tone of frustration by noting that the disposition of the funds has bee"
30-year fixed rate falls to 37-year low
The 30-year fixed-rate mortgage averaged 5.19 percent with an average 0.7 point for the week ending December 18, 2008-a 37-year low- according to Freddie Mac's Primary Mortgage Market Survey. It was down from last week when it averaged 5.47 percent. Last year at this time, the 30-year FRM averaged 6.14 percent. The 30-year FRM has not been lower since Freddie Mac started the Primary Mortgage Market Survey in 1971.
The 15-year FRM this week averaged 4.92 percent with an average 0.7 point, down from last week when it averaged 5.20 percent. A year ago at this time, the 15-year FRM averaged 5.79 percent. The 15-year FRM has not been lower since April 1, 2004, when it averaged 4.84 percent.
REAL Trends Comment: As we first noted in September, lower rates combined with higher affordability would significantly stimulate sales. And despite direct Federal intervention in lowering mortgage rates these two factors are having a positive affect on housing.
While housing markets overall will remain sluggish through next year, recovery depends on low mortgage rates, strong affordability and job/income growth. Unfortunately for optimists, the general economic slowdown will mute any increase in sales in the short term."
The 15-year FRM this week averaged 4.92 percent with an average 0.7 point, down from last week when it averaged 5.20 percent. A year ago at this time, the 15-year FRM averaged 5.79 percent. The 15-year FRM has not been lower since April 1, 2004, when it averaged 4.84 percent.
REAL Trends Comment: As we first noted in September, lower rates combined with higher affordability would significantly stimulate sales. And despite direct Federal intervention in lowering mortgage rates these two factors are having a positive affect on housing.
While housing markets overall will remain sluggish through next year, recovery depends on low mortgage rates, strong affordability and job/income growth. Unfortunately for optimists, the general economic slowdown will mute any increase in sales in the short term."
Surprise! Some areas have had price increases
U.S. Home values declined an average of 8.4 percent in the first three periods of 2008, down $2 trillion in total value, according to a recent Zillow.com Real Estate Market Report. Thirty of the 163 metropolitan statistical areas covered by Zillow, either showed gains in the median value of homes in the area or values stabilized.
Here are the 10 areas where values increased:
* Ithaca, N.Y., 5.6%
* State College, Pa., 4%
* Jacksonville, N.C., 3.9%
* Winston-Salem, N.C., 3.4%
* Bay City, Mi., 3.2%
* Rochester, N.Y. 3.1%
* Greenville, S. C., 2.8%
* Anderson, S.C. 2.7%
* Burlington, N.C., 2.6%
* Spartanburg, S.C., 2.0%"
Here are the 10 areas where values increased:
* Ithaca, N.Y., 5.6%
* State College, Pa., 4%
* Jacksonville, N.C., 3.9%
* Winston-Salem, N.C., 3.4%
* Bay City, Mi., 3.2%
* Rochester, N.Y. 3.1%
* Greenville, S. C., 2.8%
* Anderson, S.C. 2.7%
* Burlington, N.C., 2.6%
* Spartanburg, S.C., 2.0%"
Monday, December 22, 2008
Green Homes! Villas at Winecoff
Villas at Winecoff
The Villas at Wincoff is located just over 1 mile east of I-85 off Hwy 73 in Cabarrus County, North Carolina just minutes north of the Charlotte Metropolitan Area. The Villas at Winecoff is an ideal location for the active adult surrounded by Concord, Kannapolis and Charlotte shopping, dining, entertainment venues, the Charlotte Douglas International airport, and award winning medical facilities.
The Villas at Winecoff is a picturesque blend of exquisite European-style villas and rustic farmhouses like those that have been a retreat for aristocrats for generations. European style is simple yet elegant. Relax in a private courtyard or entertain friends in your state-of-the-art custom kitchen. Rich, earth tones and textures, natural stone, wood and stucco blends with lush landscape… all found in the Villas at Winecoff.
The first community of homes in North Carolina to strive for LEED (green) certification, the Villas at Winecoff features all custom built homes designed for those who enjoy the luxury of a majestic estate but on a smaller scale.
The Villas at Winecoff is the third development of successful developers – Minter Properties. Minter Properties is a family of developers, architects, builders, suppliers and craftsmen who share one vision, not of building houses, but building communities.
The Villas at Wincoff is located just over 1 mile east of I-85 off Hwy 73 in Cabarrus County, North Carolina just minutes north of the Charlotte Metropolitan Area. The Villas at Winecoff is an ideal location for the active adult surrounded by Concord, Kannapolis and Charlotte shopping, dining, entertainment venues, the Charlotte Douglas International airport, and award winning medical facilities.
The Villas at Winecoff is a picturesque blend of exquisite European-style villas and rustic farmhouses like those that have been a retreat for aristocrats for generations. European style is simple yet elegant. Relax in a private courtyard or entertain friends in your state-of-the-art custom kitchen. Rich, earth tones and textures, natural stone, wood and stucco blends with lush landscape… all found in the Villas at Winecoff.
The first community of homes in North Carolina to strive for LEED (green) certification, the Villas at Winecoff features all custom built homes designed for those who enjoy the luxury of a majestic estate but on a smaller scale.
The Villas at Winecoff is the third development of successful developers – Minter Properties. Minter Properties is a family of developers, architects, builders, suppliers and craftsmen who share one vision, not of building houses, but building communities.
2 years later: Water fight continues on
CONCORD — Nearly two years after the cities of Concord and Kannapolis received a state license to draw water from neighboring water basins, the fight over the matter goes on.
Two lawsuits were filed over the matter.
Neither was against the Cabarrus cities.
In January 2007, the state awarded Concord and Kannapolis a certificate to draw up to 10 million gallons a day from both the Catawba and Yadkin river basins.
The Catawba portion of the certificate found great opposition from jurisdictions and groups along the Catawba River — including South Carolina.
South Carolina sued North Carolina for what it claims are insufficient Catawba water levels reaching the state boarder. While the City of Charlotte joined North Carolina in that litigation, Concord and Kannapolis did not.
And a group called the Protect the Catawba Coalition — made of several Catawba river basin jurisdictions — appealed the decision of the N.C. Environmental Management Commission to grant the certificate to Concord and Kannapolis. And Concord has joined the litigation, which is in the 'discovery phase,' said Concord city attorney Al Benshoff.
'It's quite lengthy reviewing a six-year process with lots and lots of documents,' Benshoff said.
The discovery phase, in which both parties produce relevant documents for the case, has gone o"
Two lawsuits were filed over the matter.
Neither was against the Cabarrus cities.
In January 2007, the state awarded Concord and Kannapolis a certificate to draw up to 10 million gallons a day from both the Catawba and Yadkin river basins.
The Catawba portion of the certificate found great opposition from jurisdictions and groups along the Catawba River — including South Carolina.
South Carolina sued North Carolina for what it claims are insufficient Catawba water levels reaching the state boarder. While the City of Charlotte joined North Carolina in that litigation, Concord and Kannapolis did not.
And a group called the Protect the Catawba Coalition — made of several Catawba river basin jurisdictions — appealed the decision of the N.C. Environmental Management Commission to grant the certificate to Concord and Kannapolis. And Concord has joined the litigation, which is in the 'discovery phase,' said Concord city attorney Al Benshoff.
'It's quite lengthy reviewing a six-year process with lots and lots of documents,' Benshoff said.
The discovery phase, in which both parties produce relevant documents for the case, has gone o"
Final decision on land-use plan for East Cabarrus falls to commissioners
CONCORD — The final component of a massive land-use plan for Concord's eastern growth area will fall to a decision from the Cabarrus County Board of Commissioners in January.
The down-zoning decision for 24,500 acres was tabled by the Cabarrus Planning and Zoning Commissioner in September and failed to garner the super majority vote in November, putting the zoning decision in the hands of commissioners.
The down-zoning decision for 24,500 acres was tabled by the Cabarrus Planning and Zoning Commissioner in September and failed to garner the super majority vote in November, putting the zoning decision in the hands of commissioners.
N.C. looks at taxing drivers by the mile | CharlotteObserver.com
Idea for road-use tax is expected to hinge on odometer readings, then GPS tracking, to replace revenue lost to fuel efficiency.
With gas-tax revenues plummeting, the state of North Carolina is looking seriously at taxing motorists for how far they drive.
With gas-tax revenues plummeting, the state of North Carolina is looking seriously at taxing motorists for how far they drive.
Friday, December 19, 2008
Buyers Want Steep Discount on Foreclosed Properties
A new study conducted for Trulia.com and RealtyTrac by Harris Interactive shows that three-quarters of respondents expected a discount of at least 25 percent on a foreclosure purchase. In the previous survey conducted seven months ago, 54 percent of all U.S. adults surveyed said they would consider buying a foreclosed home, whereas now 47 percent of U.S. adults would consider buying a foreclosure."
Thursday, December 18, 2008
Pennsylvania, Carolinas have year's healthiest regions
Good news for at least 30 of the 163 metropolitan statistical areas (MSAs) covered in the Zillow Real Estate Market Reports as the areas showed gains in median value of all homes in the area. The best performing metropolitan area was Jacksonville, N.C., where home values rose 4.9% year-over-year to $139,261 in the first three quarters of the year. Winston-Salem, N.C., also registered a gain, of 4.1% to $136,854. Anderson, S.C., prices climbed 3.5% to $101,816 and State College, Pa., went up by 3.4% to $206,995.
In addition, some markets-particularly those hit hardest in the downturn-showed smaller year-over-year declines than in the prior quarter. 'Our optimism here, though, must be tempered by the knowledge that the larger economic problems that emerged in the fourth quarter will likely further challenge the real estate market,' says Dr. Stan Humphries, Zillow's vice president of data and analytics.
Overall, news wasn't so good. According to Zillow market reports, U.S. homes are set to lose well over $2 trillion in value during 2008. Home values declined 8.4 percent year-over-year during the first three quarters of this year, compared to the same period in 2007. 'This year marked the acceleration of the market correction, and is likely to end with the eight"
In addition, some markets-particularly those hit hardest in the downturn-showed smaller year-over-year declines than in the prior quarter. 'Our optimism here, though, must be tempered by the knowledge that the larger economic problems that emerged in the fourth quarter will likely further challenge the real estate market,' says Dr. Stan Humphries, Zillow's vice president of data and analytics.
Overall, news wasn't so good. According to Zillow market reports, U.S. homes are set to lose well over $2 trillion in value during 2008. Home values declined 8.4 percent year-over-year during the first three quarters of this year, compared to the same period in 2007. 'This year marked the acceleration of the market correction, and is likely to end with the eight"
NAR Pushes for Mortgage Interest Buy-Down
"NAR Pushes for Mortgage Interest Buy-Down
A federal mortgage interest buy-down program would help spark the housing market, the NATIONAL ASSOCIATION OF REALTORS® said in a letter sent today to James B. Lockhart, chairman of the Oversight Board of the Federal Housing Finance Agency.
NAR seeks a 4.5 percent mortgage interest rate buy-down program financed through the U.S. Treasury Department’s Troubled Asset Relief Program."
A federal mortgage interest buy-down program would help spark the housing market, the NATIONAL ASSOCIATION OF REALTORS® said in a letter sent today to James B. Lockhart, chairman of the Oversight Board of the Federal Housing Finance Agency.
NAR seeks a 4.5 percent mortgage interest rate buy-down program financed through the U.S. Treasury Department’s Troubled Asset Relief Program."
Business Picks Up Where Prices Have Tumbled
Sales are picking up in markets where prices are deflated, but the business is different than it was before the bubble burst, observers say.
The housing market in deflated markets--like Arizona, California, Florida, and Nebraska--are beginning to show signs of a rebound. Analysts say that prices have fallen to the point that those with average salaries can afford to buy once again.
'The buyers are returning,' says Lawrence Yun, National Association of Realtors chief economist. 'And in such a strong way that, now, we are hearing in some cases there is multiple bidding, which hints that maybe pricing is reaching a bottom point. But inventory remains high.
The housing market in deflated markets--like Arizona, California, Florida, and Nebraska--are beginning to show signs of a rebound. Analysts say that prices have fallen to the point that those with average salaries can afford to buy once again.
'The buyers are returning,' says Lawrence Yun, National Association of Realtors chief economist. 'And in such a strong way that, now, we are hearing in some cases there is multiple bidding, which hints that maybe pricing is reaching a bottom point. But inventory remains high.
Wednesday, December 17, 2008
Fed rate falls to historic depth
"By cutting its benchmark lending rate to historic lows and promising to combat the recession head on, the Federal Reserve served notice Tuesday that more unconventional actions probably are ahead."
Tuesday, December 16, 2008
Federal Reserve slashes key interest rate to record low
"The Federal Reserve has cut its target for a key interest rate to the lowest level on record and pledged to use 'all available tools' to combat a severe financial crisis and prolonged recession."
Friday, December 12, 2008
Home sales price, closings plunge in region
"Home sale prices and the number of closings continued to tumble in the Charlotte region, data released this morning show.
The average listing price of homes that sold last month fell by nearly 13 percent over the same time last year. Those prices were $213,548 in November and $245,237 in November 2007."
The average listing price of homes that sold last month fell by nearly 13 percent over the same time last year. Those prices were $213,548 in November and $245,237 in November 2007."
Saturday, December 6, 2008
Countrywide to refund 4,800 N.C. homeowners
"Mortgage lender Countrywide Financial Corp. will refund $11.5 million to 4,800 N.C. homeowners under a settlement with the state banking commissioner, the commissioner's office announced today."
Friday, December 5, 2008
Treasury's new plan - 4.5% mortgage rates
Homeowners may soon enjoy mortgage rates as low as 4.5 percent if the Treasury Department has its way. According to The Wall Street Journal's on-line addition, the department is discussing a plan that would use Freddie Mac and Fannie Mae to push banks to make mortgages available at more than a full percentage point below the current levels for a 30 year fixed rate mortgage.
The plan under review might lower rates to the 4.5 percent range and would be in addition to a program announced last week wherein the Federal Reserve will purchase up to $600 billion of debt either issued or backed by Freddie Mac, Fannie Mae, Ginnie Mae, and the Federal Home Loan Banks. That program is already having an effect on mortgage rates, which have dropped and caused investors to pay more attention to the stocks of banks and homebuilders.
Probably in response to the earlier new program and the lower rates, mortgage applications jumped a record 112.1 percent as seasonally adjusted over the previous week, according to the Mortgage Bankers Association. The Journal reported that the government would encourage banks to issue new mortgage loans at lower rates by offering to purchase securities backed by the loans at a price equivalent to the 4.5 percent
The plan under review might lower rates to the 4.5 percent range and would be in addition to a program announced last week wherein the Federal Reserve will purchase up to $600 billion of debt either issued or backed by Freddie Mac, Fannie Mae, Ginnie Mae, and the Federal Home Loan Banks. That program is already having an effect on mortgage rates, which have dropped and caused investors to pay more attention to the stocks of banks and homebuilders.
Probably in response to the earlier new program and the lower rates, mortgage applications jumped a record 112.1 percent as seasonally adjusted over the previous week, according to the Mortgage Bankers Association. The Journal reported that the government would encourage banks to issue new mortgage loans at lower rates by offering to purchase securities backed by the loans at a price equivalent to the 4.5 percent
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