Walkable Areas Are Getting More Competition

Older Americans are placing a higher value on living in walkable urban centers, according to a new survey of 1,000 respondents nationwide about their living preferences

A majority of respondents surveyed by A Place for Mom, a national referral service, said it was “very important” or “somewhat important” to live in a walkable neighborhood. They also sought neighborhoods with low crime and those that are close to family.

“It’s time to abandon the idea that only millennials and Generation X care about walkability and the services available in dense urban neighborhoods,” says Charlie Severn, head of marketing at A Place for Mom. “These results show a growing set of senior housing consumers also find these neighborhoods desirable.

The survey authors say it’s important for developers to consider creating multigenerational communities in suburban centers that place an emphasis on walkability. Walkability ranked high regardless of income level in the survey. Walkability ranked highest for those under 70 years old who were seeking senior apartments.

Source: “Seniors Want Walkability Too, Survey Says,” Curbed.com (July 25, 2017)

After Brief Hike, Mortgage Rates Fall Below 4%

Following two weeks of rate increases, the 30-year fixed-rate mortgage settled back below a 4 percent average this week.

“Continued economic uncertainty and weak inflation data pushed rates lower this week,” says Sean Becketti, Freddie Mac’s chief economist.

Freddie Mac reported the following national averages for the week ending July 20:

  • 30-year fixed-rate mortgages: averaged 3.96 percent, with an average 0.6 point, dropping from last week’s 4.03 percent average. Last year at this time, 30-year rates averaged 3.45 percent.
  • 15-year fixed-rate mortgages: averaged 3.23 percent, with an average 0.5 point, falling from last week’s 3.29 percent average. A year ago, 15-year mortgage rates averaged 2.75 percent.

Source: Freddie Mac

Is Calif.’s Housing Crisis Spinning Out of Control?

California has a severe lack of affordable homes and apartments for middle-class families, The New York Times reports. Their median cost of a home has surged to $500,000—double the national cost.

“The extreme rise in housing costs has emerged as a threat to the state’s future economy and its quality of life,” The New York Times reports. “It has pushed the debate over housing to the center of state and local politics, fueling a resurgent rent control movement and the growth of neighborhood ‘Yes in My Back Yard’ organizations, battling long-established neighborhood groups and local elected officials as they demand an end to strict zoning and planning regulations.”

The state has introduced 130 housing measures this year. Among one of the most recent actions, the Senate approved a bill to crack down on communities that have delayed or derailed housing construction proposals. The bill would restrict the ability to use zoning, environmental, and procedural laws to kill projects that may be considered “out of character” with the neighborhood. The bill is expected to be voted on again later this summer.

Source: “The Cost of a Hot Economy: A Severe Housing Crisis,” The New York Times (July 17, 2017)

Labor Shortage Causes Headaches for Builders

Buyers eyeing newly constructed homes may need to brace for building delays and higher prices due to an ongoing labor shortage. About two-thirds of homebuilding contractors say they’re struggling to finish projects on time because of the labor shortage, according to a new survey sponsored by USG Corp. and the U.S. Chamber of Commerce. More than one-third say they sometimes have to turn projects down.

“There is reason for concern in the lack of qualified talent,” says Tom Donohue, CEO of the Chamber of Commerce. Further, more construction projects are being started with an insufficient number of workers. Construction spending zoomed to $359.5 billion in the first four months of this year, which is 5.8 percent higher than the same period in 2016, according to Census data.

During the housing downturn, many workers left the industry for other employment and have not returned. Also, the construction workforce is aging ,says Steve Jones, senior director of Dodge Data & Analytics. “You have an aging workforce in an industry that doesn’t lend itself to long careers because it’s hard, physical work, and then you lose a whole bunch of people.”

Source: “Labor Shortage Squeezes Real-Estate Developers,” The Wall Street Journal (June 27, 2017) [Log-in required.]

Survey: More Buyers Make Offers Sight Unseen

The number of buyers making offers sight unseen—meaning they haven’t physically visited the property is on the rise, according to a survey of recent home buyers conducted by real estate brokerage Redfin. Thirty-three percent of respondents in 11 major markets say they made an offer on at least one house sight unseen. These types of offers are more common when working with foreign buyers and in markets where homes are selling quickly, real estate professionals say.

New uses of 3-D photos, video tours, and virtual reality are giving some buyers enough confidence to purchase a home without an in-person showing. The Wall Street Journal reports that some real estate pros are conducting property walkthroughs with long-distance buyers remotely via FaceTime, Skype, or WhatsApp. Some agents are working with technology companies to create 3-D photo and video tours within the virtual reality space to make long-distance buyers feel like they’re at the property in person.

Source: “Buying a Home Sight Unseen Is Easier Than Ever – and More Common,” The Wall Street Journal (June 22, 2017) [Log-in required.]

Retirees Look to Build Smaller, Custom Homes

Many people seek to downsize their home in retirement—but not their home buying wish list. Retirees reportedly are flocking to smaller newly built homes customized to their personal needs and tastes.

One advantage older home buyers find with these custom homes is that they can be built to accommodate medical conditions or physical restrictions, such as wider hallways to accommodate mobility devices. The home also can be outfitted with age-in-place features such as outdoor ramps and lower kitchen cabinets.

Retirees are looking to cut back on home maintenance and repairs, which is why their preferences are straying away from larger, older homes. However, building a custom home can be stressful because of the wide availability of options. Real estate experts recommend researching building plans and contractors carefully to make sure buyers get the type of craftsmanship they seek.

Source: “Retirees Turning to Custom Homes to Get the Right Space,” RISMedia (June 22, 2017)

Home Loan Interest Rates Hold at Low Levels

Home shoppers are getting another week to lock in some of the lowest mortgage rates of the year.  “The 30-year mortgage rate remained relatively flat, falling 1 basis point to 3.90 percent. Mortgage rates are continuing to hold at year-to-date lows amidst ongoing economic uncertainty,” says Sean Becketti, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages for the week ending June 22:

  • 30-year fixed-rate mortgages: averaged 3.90 percent, with an average 0.5 point, dropping from last week’s 3.91 percent average. Last year at this time, 30-year rates averaged 3.56 percent.
  • 15-year fixed-rate mortgages: averaged 3.17 percent, with an average 0.5 point, dropping slightly from last week’s 3.18 percent average. A year ago, 15-year rates averaged 2.83 percent.

Source: Freddie Mac

After Steady Decline, ‘Mortgage Rates Rise’

Mortgage rates increased this week for the first time in more than a month, but they still remain near their yearly lows.

Freddie Mac reports the following national averages for the week ending June 15:

  • 30-year fixed-rate mortgages: averaged 3.91 percent, with an average 0.5 point, rising from last week’s 3.89 percent average. Last year at this time, 30-year rates averaged 3.54 percent.
  • 15-year fixed-rate mortgages: averaged 3.18 percent, with an average 0.5 point, increasing from last week’s 3.16 percent average. A year ago, 15-year rates averaged 2.81 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.15 percent, with an average 0.5 point, rising from last week’s 3.11 percent average. A year ago, 5-year ARMs averaged 2.74 percent.

Source: Freddie Mac

Investors Back Away From Home Flipping

Investors are retreating from flipping houses, showing skepticism that the practice will continue to pay off. About 43,615 single-family homes and condos were flipped in the first quarter of 2017, down 8 percent from the previous quarter and 6 percent from a year ago, according to ATTOM Data Solutions’ Q1 2017 U.S. Home Flipping Report. It represents the lowest number of flips in two years. ATTOM Data Solutions defines a flip as a home that has been sold twice within a 12-month period.

Home flips accounted for 6.7 percent of all single-family and condo sales for the quarter, one-third of which were purchased with financing. That’s up from 31.9 percent that were financed in the fourth quarter of 2016, setting the highest level since the third quarter of 2008.

More interesting ‘Home Flipping’ information at: ATTOM Data Solutions/RealtyTrac

There is ‘High Priority on Home Ownership’

More than two-thirds of Americans believe that owning a home is an essential part of the American dream, according to a new survey released by the National Association of Home Builders of more than 11,300 registered voters.

Other recent surveys also have shown a high desire for home ownership, despite the home ownership rate remaining stalled near a historical low of 64 percent. About 80 percent of millennials recently surveyed by rental website Apartment List say they hope to one day buy a home.

However, being able to afford one is the main obstacle, millennials say, that is holding them back. Thirty-six percent of the 24,000 millennial renters born between 1982 and 2004 surveyed said they’ll likely need to wait more than five years.

Source: National Association of Home Builders and “Wannabe Buyers Aren’t Saving Enough,” REALTOR® Magazine (5/30/2017)