Fannie Mae: Housing Market Faring Better Than Economy
According to a new report published by Fannie Mae late last week, the housing market in the United States is currently faring better than the economy as a whole.
Although the GDP grew by just 0.2 percent in the first quarter of 2015, the housing market did a bit better, with March existing home sales at their highest level in two years.
Still, the numbers call for cautious optimism. As Mortgage News Daily points out, “Even though March sales were up, the first quarter fell short of fourth quarter 2014 numbers. New home sales retreated in March but the first quarter overall was the best for that sector since 2008 and pending home sales and purchase mortgage applications both portend a strong spring buying season.”
Image via flickr/Simon Cunningham
Denver Housing Market Getting Hot, Sparking Bidding Wars
Potential homebuyers in the Denver, Colorado, area should be ready for a bidding war, as the real estate market continues to boom in the Mile High City.
According to CNBC, demand for homes is currently outpacing supply, and prices are skyrocketing.
“Apple and Google are bringing jobs here, home construction is very weak, and real estate experts tell me millennials love this market,” Diana Olick reported. “So what’s the result? Homes are flying off the shelves, and bidding wars are the new normal.”
Image via flickr/Larry Johnson
First-Time Homebuyers Returning to New Home Market
Builders are starting to see more first-time homebuyers entering the new home market, J.P. Morgan Chase & Co. revealed in a conference in New York City on Wednesday.
According to The Wall Street Journal, just over 15 percent of new homes were sold to first-time homebuyers in 2014, but so far this year, that number is up closer to 20 percent.
“We do see this as an expanding market,” said Meritage chief executive Steven Hilton. “We saw strong demand in that segment in the last quarter and even more so over the last two months.”
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McMansions Making Their Way Back Into the Market
From each quarter to the next in 2014, the median size of newly built homes in the U.S. dropped steadily.
But now, in the first quarter of 2015, that number is up significantly.
According to The Wall Street Journal, the median home size in 2015 Q1 shot up to 2,521 square feet, up 3 percent from 2014 Q4.
Steven Hilton, Meritage CEO, these numbers could suggest the return of the McMansion to the new homes market.
“We do see this as an expanding market,” he said. “We saw very strong demand in that segment in the last quarter and even more so over the last two months.”
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Ocwen Financial Corp. in Negotiations to Refinance Debt
In an attempt to avoid a cash crisis, Ocwen Financial Corp. disclosed on Monday that it is currently negotiating with lenders to extend and refinance some of its debt.
If the company is unable to change some of its debt arrangements – particularly ones that are set to amortize this year – it could face a liquidity crunch.
"Due to the significant level of cash requirements related to servicing advances, we may not have sufficient levels of liquidity to fund the operations without our advance financing facilities," Ocwen said in the filing.
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Portland Housing Market Driven by Water, Millennials
Portland, Oregon, has recently become one of the hottest spots for millennials on the West Coast. But according to real estate experts, it has nothing to do with jobs and everything to do with water.
“We’re on the West Coast, and we have water,” said Brian Ramsay, a real estate agent with Hasson Company Realtors. “They’re moving here in preparation for lack of water.”
And, unlike California and Seattle, home prices still remain relatively low – which means the market in Portland is currently red hot.
“You’re lucky if you can be one of the first 15 offers in 24 hours,” Ramsay added. “That’s how hard it is for buyers to get a house now.”
Image via flickr/Michael Silberstein
Existing Home Sales Expected to Hit Highest Level Since 2006
The National Association of Realtors announced on Thursday that the total number of existing home sales in 2015 is expected to reach the highest level we’ve seen since 2006.
“There is a sizeable pent up demand,” said Lawrence Yun, the NAR’s chief economist.
According to Yun, we should expect to see approximately 5.3 million existing homes sold by the end of this year, which would be a significant jump from 4.9 million in 2014. Additionally, it would be the first time in nearly a decade that the number has surpassed 5.0 million.
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Experts Suggest Using Your Home to Fund Retirement Plans
For many retirees, the idea of giving up their family home is a tough proposition to accept. But according to Steven Sass, a research economist at the Center for Retirement Research at Boston College, that’s exactly what’s needed for many individuals to afford retirement.
"People have a serious behavioral resistance to touching their savings or home equity in retirement," Sass told CNBC. “We think a lot more retirees need to think about using their house for income.”
According to the latest University of Michigan Health and Retirement study – conducted in 2010 – the average household entering retirement has a net worth of just over $300,000, including their home.
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Foreclosure Numbers Dropping Drastically
Although foreclosure numbers continue to rise and fall each month, when looking at the data year-over-year, the numbers have made a significant downward shift.
According to the data released by CoreLogic on Tuesday, the number of properties in some state of foreclosure in March was down 25 percent from a year ago, while completed foreclosures were down 15.5 percent.
Additionally, completed foreclosures are now down a whopping 65.2 percent from the peak in September 2010.
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Home Prices Seeing Double-Digit Gains in Many Metro Areas
Home prices are on the rise nationwide, an in many metropolitan areas, the median price jumped by 10 percent or more in the first quarter of 2015.
According to the National Association of Realtors (NAR), 51 of the 174 metropolitan statistical areas tracked by NAR saw price gains in the double digits.
"Sales activity to start the year was notably higher than a year ago, as steady hiring and low interest rates encouraged more buyers to enter the market," Lawrence Yun, NAR chief economist, told Mortgage News Daily. "However, stronger demand without increasing supply led to faster price growth in many markets. Sales could soften slightly in some of these markets seeing sharp price appreciation unless housing supply markedly improves and tempers its unhealthy level of growth."
Image via flickr/James Willamor
