Consider Adding a ‘Granny Flat’

Home improvement professionals say they’re fielding more inquiries from homeowners about adding accessory dwelling units—often nicknamed “granny flats.” A fifth of remodeling contractors say they undertook projects over the last year to create an ADU by converting an existing space, and a similar number say they created an ADU by building a new addition to a property, according to a new survey released by the National Association of Home Builders.

ADUs are smaller units added to a property, and they can be pricey to build. Only 6 percent of remodeling contractors report completing an ADU project for less than $25,000. Three-fourths say ADU projects cost at least $50,000, and 28 percent report projects costing at least $150,000.

Source: “Many Remodelers Are Now Creating ADUs,” National Association of Home Builders’ Eye on Housing blog (May 22, 2019)

Who Needs to Downsize?

A growing number of baby boomers are choosing not to downsize in retirement. Instead, they’re opting to remain in the homes where they raised their children, USA Today reports. But their reluctance to move is contributing to low inventory across the country, says realtor.com® Chief Economist Danielle Hale.

Baby boomers “have refused to follow what the traditional expectations were,” Barbara Risman, a sociology professor at the University of Illinois at Chicago, told USA Today. Baby boomers, mostly between the ages of 54 to 73, are working longer and, therefore, putting retirement off longer than previous generations. Their millennial children increasingly are living at home with them and staying well into adulthood.

For baby boomers who do plan to move, 43% say they want their next home to be the same size as their current one. Twenty-two percent say they want their next home to be even larger, according to a January surveyof 50- and 60-year-olds by Del Webb.

Homeowners’ Top Neighborhood Gripes

The wrong neighborhood can make for an unhappy homeowner.

A new survey from Porch.com, a home remodeling website, surveyed about 1,000 consumers to find the biggest neighborhood turnoffs. Noise, traffic, and crime were the chief concerns of buyers. Noise topped the list of neighborhood turnoffs, with 41% of respondents citing it as their top gripe, according to the survey. In fact, noise proved to be an even bigger deterrent than a high crime rate.

More details on illustrations at source: “Moving Matters,” Porch.com (May 2019)

Home Loan Interest Rates Update

Home buyers saw mortgage rates edge lower again this week, with rates remaining well below year ago levels.

“While signals from the financial markets are flashing caution signs, the real economy remains on solid ground with steady job growth and five-decade low unemployment rates, which will drive up home sales this summer,” said Sam Khater, Freddie Mac’s chief economist.

Freddie Mac reported the following national averages for the week ending May 16:

  • 30-year fixed-rate mortgages averaged 4.07 percent, with an average 0.5 point, dropping from last week’s 4.10 percent average. A year ago, 30-year rates averaged 4.61 percent.
  • 15-year fixed-rate mortgages averaged 3.53 percent, with an average 0.4 point, falling from last week’s 3.57 percent average. A year ago, was 4.08 percent.
Source: Freddie Mac

Mortgage Rates ‘Drop This Week’

Mortgage rates are showing signs of moderating this month, following increases in April. Borrowers are discovering much lower rates compared to a year ago.

“A combination of low mortgage rates, a strong job market, and modest wage growth should spur home buyer interest and also serve as an incentive for homeowners looking to refinance this spring,” says Sam Khater, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages with mortgage rates for the week ending May 9:

  • 30-year fixed-rate mortgages: averaged 4.10%, with an average 0.5 point, falling from last week’s 4.14% average. Last year at this time, rates averaged 4.55%.
  • 15-year fixed-rate mortgages: averaged 3.57%, with an average 0.4 point, falling from last week’s 3.60% average. A year ago, 15-year rates averaged 4.01%.
Source: Freddie Mac

2019 Employee Relocation Report

Corporate relocation volumes and budgets are increasing, helping employees to more easily make a move for a job. In particular, 60% of mid-size firms with 500 to 4,999 salaried employees reported relocation budget increases, according to national moving company Atlas Van Lines’ Corporate Relocation Survey. About 40% of small firms (fewer than 500 salaried employees) and 40% of large firms (5,000-plus) saw employee relocation increase over the past year.

Companies are optimistic that 2019 will be a good year for relocations.  About 50% of firms say they plan to restructure their relocation policy, withhold taxable relocation benefits, and streamline relocation processes to reduce costs, the survey showed.

Source: “Corporate Relocation Survey,” Atlas Van Lines (May 2019)

 

Mortgage Rates ‘Drop This Week’

Following four weeks of rate increases, fixed-rate mortgages posted a drop this week. Rates remain well below their averages from a year ago, and Freddie Mac predicts that will be a boon to home sales over the next couple of months. This comes after the Federal Reserve voted Wednesday not to increase its benchmark rate.

“Moving into summer, we expect rates to be about a quarter to half a percentage point lower than where they were last year, which is good news for the housing market,” says Sam Khater, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages for the week ending May 2:

  • 30-year fixed-rate mortgages: averaged 4.14%, with an average 0.5 point, falling from last week’s 4.20% percent average. Last year at this time, 30-year rates averaged 4.55%.
  • 15-year fixed-rate mortgages: averaged 3.60%, with an average 0.4 point, dropping from last week’s 3.64% average. A year ago, 15-year rates averaged 4.03%.
Source: Freddie Mac

Slight ‘Mortgage Rates Rise’

For the third week in a row, mortgage rates inched upward, but economists were quick to reassure home buyers and potential refinancers that rates remain still are below year-ago averages.

“After dropping dramatically in late March, mortgage rates have modestly increased since then,” says Sam Khater, Freddie Mac’s chief economist. “While this week marks the third consecutive week of rises, purchase activity reached a nine-year high—indicative of a strong spring homebuying season.”

Freddie Mac reports the following national averages for the week ending April 18:

  • 30-year fixed-rate mortgages: averaged 4.17 percent, with an average 0.5 point, rising from last week’s 4.12 percent. Last year at this time, 30-year rates averaged 4.47 percent.
  • 15-year fixed-rate mortgages: averaged 3.62 percent, with an average 0.5 point, rising from last week’s 3.60 percent average. A year ago, 15-year rates averaged 3.94 percent.
Source: Freddie Mac

Saving Enough for Remodeling?

Eighty-two percent of consumers believe the home they own is a financial asset, the study says. As such, they want to tackle home improvement project to increase the value of their home even more. More than half—52 percent—of consumers say they plan to take on a home improvement project in the next year. Kitchen and bathroom remodels lead in projects. (Read more: Design TV Shows Are Inspiring Optimistic Home Renovators)

But many consumers have failed to save enough. Sixty-four percent of consumers say their home improvement project will cost under $15,000. Bathroom remodels can cost anywhere from $19,000 upwards to $61,000; significant kitchen remodels can cost upwards to $125,000, according to the study from Discover Home Equity Loans.

Biggest Rate Drop in a Decade

“The Federal Reserve’s concern about the prospects for slowing economic growth caused investor jitters to drive down mortgage rates by the largest amount in over ten years,” says Sam Khater, with Freddie Mac. “Despite negative outlooks by some, the economy continues to churn out jobs, which is great for housing demand. We have recently seen home sales start to recover and with this week’s rate drop, we expect a continued rise in purchase demand.”

Freddie Mac reports the following mortgage rates for the week ending March 28:

  • 30-year fixed-rate mortgages: averaged 4.06 percent, with an average 0.5 point, falling from last week’s 4.28 percent average. Last year at this time, 30-year rates averaged 4.40 percent.
  • 15-year fixed-rate mortgages: averaged 3.57 percent, with an average 0.4 point, dropping from last week’s 3.71 percent average. A year ago, 15-year rates averaged 3.90 percent.