Tag Archives: Real Estate

4 Keys to Real Estate Recovery

January 17, 2014 jd

Photo Courtesy of: http://onepicinspires.blogspot.com/

In order to have a fully recovered housing market and economic recovery, economists point to the need for four positive indicators:

1. A healthy job market with low stable unemployment;

2. Mortgage delinquencies that have returned to historical averages;

3. Home prices consistent with an affordable mortgage payment–to–income ratio; and

4. Home sales that are in the range of historical norms.

So, is the housing market inching closer?

Freddie Mac’s U.S. Economic and Housing Market Outlook for January takes a look at how the housing market is performing among these four indicators. Economists note that the unemployment rate — while inching down — still remains high at 6.7 percent. Meanwhile, mortgage delinquencies have fallen to 5.88 percent — nearly half of their peak rate but still higher than the national average of about 2 percent, Freddie notes.

Home prices still have some room to grow without outpacing income growth, economists say.

“From 1999–2006, mortgage payments on a hypothetical 30-year fixed-rate mortgage would have increased by 50 percent more than income growth,” Freddie Mac notes in the report. “Currently, payment-to-income ratios are only 60 percent of the level we had in 1999, suggesting room for continued housing growth.”

Finally, home sales have risen over the past two years but remain below levels from a nearly a decade ago. Home sales, historically, average a rate of about 6 percent of the housing stock every year. They dropped to 4 percent during the housing crisis. Economists are predicting a 5.7 percent pace in 2014.

“As we start 2014, the housing recovery continues its steady pace,” Frank Nothaft, Freddie Mac’s chief economist. “House-price gains will likely moderate from last year’s pace but rise about 5 percent in national indexes. Home sales, as well as other key indicators, continue to trend in the right direction, although in some markets we are seeing the sales recovery strengthen while many others remain weak.”

Source: Freddie Mac and “Are We There Yet? Freddie Mac Says Recovery Has a Ways to Go,” Mortgage News Daily (Jan. 16, 2014)

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Real Estate

How the Shutdown is Affecting Real Estate

October 15, 2013 jd

The government shutdown is starting to cripple the real estate business just as it was starting a comeback. You might ask how this is happening, well, here are just some of the reasons.

FHA and VA loans are being delayed because of lack of staff
USDA loans which are for low income borrowers, have ground to a complete halt.
IRS is down, so FHA and conventional loans cannot verify tax documents, delaying or killing loans.

All this means that real estate deals are being put on hold, or in some cases, just falling apart. There is a real good chance if this idiotic shutdown continues that interest rates will climb. A one percent increase in the interest rate and shutdown could mean a decline in 450,000 home sales. Welcome to another depression, thanks some die hard conservatives.

John J. O’Dell
Real Estate Broker
Civil Engineer
General Contractor

Real Estate

Nevada County Real Estate Trends

September 19, 2013 jd

Nevada County Stats : Reprinted with permission from Trendgraphix Inc.

September 19, 2013

Viewing the chart above, you can see that sales of homes from June 2012 to the end of August 2013 have increased. Inventory, however, has dropped from 626 homes to 495 homes

Without making your eyes bleary, here are the stats. For sale in the months of August 2013 495 homes, August 2012, 587 homes a decrease of -15.7% down. Homes sold in the month of August 2013, 124, in the month of August 2013, 107 for in increase in sales of 15.9%.

The median price in June 2012 was $260,000. In August the median price raised to $305,000 a significant increase percentage wise of 17.3%

Judging from the chart above, February was the lowest inventory with 305 and we seem to be steadily increasing our inventory This may be due to more home owners realizing that they may be above water with their mortgages and the market has come back for selling their homes.

Sales of Existing Homes at Six-Year High

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O’Dell Realty
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Real Estate

My House is Worth Money, Time for a Divorce

September 11, 2013 jd

“So many couples have been living together and biding their time,” says Leigh Sigman, an Orlando lawyer. “I know many people who have coasted for years and touched base with me periodically — until they got equity in their homes.”

During the housing market crash, home prices fell dramatically in some areas, causing the home in a marriage to become one asset that no one wanted in a divorce because of the large amount of mortgage debt it carried, says Sigman.

But some metros are seeing that as home values rise, divorce rates are too.

“I have seen many of the deals we’re doing have involved a divorce — selling a house because of it or buying because of it,” says Robert Tenaglia, a real estate professional in Orlando. “When people don’t have equity and don’t have money, it dissuades them from going through the final step.”

Many couples may need the equity from the house sale to cover the costs of starting a new life and for a down payment on a new home or an apartment deposit, Tenaglia says.

Source: “Divorce and Home Values: Till Equity Do Us Part,” RISMedia (Sept. 6, 2013)

Commercial Appraiser; FW: Another 8.3 Million Underwater Homeowners on Track to Resurface before 2015

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O’Dell Realty
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Real Estate

Pending Home Sales Highest Level Since Late 2006

July 3, 2013 jd

Pending home sales rose in May to the highest level since late 2006, implying a possible spark as mortgage interest rates began to rise, according to the National Association of Realtors ^®.

The Pending Home Sales Index,^* a forward-looking indicator based on contract signings, increased 6.7 percent to 112.3 in May from a downwardly revised 105.2 in April, and is 12.1 percent above May 2012 when it was 100.2; the data reflect contracts but not closings.

Contract activity is at the strongest pace since December 2006 when it reached 112.8; pending sales have been above year-ago levels for the past 25 months.

Lawrence Yun, NAR chief economist, said there may be a fence-jumping effect. “Even with limited choices, it appears some of the rise in contract signings could be from buyers wanting to take advantage of current affordability conditions before mortgage interest rates move higher,” he said. “This implies a continuation of double-digit price increases from a year earlier, with a strong push from pent-up demand.”

Yun upgraded the price forecast for 2013, with the national median existing-home price expected to rise more than 10 percent to nearly $195,000. This would be the strongest increase since 2005 when the median increased 12.4 percent.

Existing-home sales are projected to increase 8.5 to 9.0 percent, reaching about 5.07 million in 2013, the highest in seven years; it would be slightly above the 5.03 million total recorded in 2007.

The PHSI in the Northeast was unchanged at 92.3 in May but is 14.3 percent above a year ago. In the Midwest the index jumped 10.2 percent to 115.5 in May and is 22.2 percent higher than May 2012. Pending home sales in the South rose 2.8 percent to an index of 121.8 in May and are 12.3 percent above a year ago. The index in the West jumped 16.0 percent in May to 109.7, but with limited inventory is only 1.1 percent above May 2012.

The National Association of Realtors^®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries. For additional commentary and consumer information, visit www.houselogic.com and http://retradio.com.

# # #

^*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

Source: National Association of Realtors ^®.

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O’Dell Realty
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Real Estate

Where the Real Estate Market Is Really Hot

June 17, 2013 jd

Photo Credit: http://www.powersiteblog.com/

Median list prices in May edged up 2.10 percent month-over-month, as housing inventories also were on the rise, creating a greater balance between supply and demand, according to realtor.com’s latest Real Estate Health Report.

The nationwide median list price was $199,000 for May, and up 4.79 percent year-over-year.

“We are seeing large regional markets across the country leading the way to national recovery. These regions are acting as a microcosm for what’s slowly happening in the larger real estate market,” says Steve Berkowitz, chief executive officer of Move. “Overall, we’re seeing seller confidence beginning to respond to consumer demand. Nationally, there are more homes going on the market for a shorter amount of time. And this is happening in our hot markets on a much larger scale.”

California housing markets are seeing some of the highest median price gains. The following 10 markets have seen the highest year-over-year list price gains:

1. Sacramento, Calif.: up 42.45%

Median list price: $284,900

2. Oakland, Calif.: up 38.27%

Median list price: $495,000

3. Detroit, Mich.: up 31.73%

Median list price: $125,000

4. San Jose, Calif.: up 30.58%

Median list price: $679,000

5. Los Angeles-Long Beach, Calif.: up 27.80%

Median list price: $428,000

6. Fresno, Calif.: up 27.48%

Median list price: $219,900

7. Phoenix-Mesa, Ariz.: up 27.03%

Median list price: $235,000

8. Stockton-Lodi, Calif.: up 25.63%

Median list price: $199,750

9. Reno, Nev.: up 24.23%

Median list price: $235,900

10. Santa Barbara-Santa Maria-Lompoc, Calif.: up 24%

Median list price: $775,000

Source: realtor.com®

Read more

Inventories, Asking Prices Get a Boost
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John J. O’Dell Realtor® GRI
O’Dell Realty
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Real Estate

Foreclosure Activity Back on the Rise

June 15, 2013 jd

Foreclosure filings—which include default notices, scheduled auctions, and bank repossessions—increased 2 percent in May, rising from a 75-month low in April, according to the latest foreclosure report from RealtyTrac. Still, foreclosure filings are down 28 percent from a year ago.

The May increase was largely attributed to an 11 percent increase in bank repossessions. Foreclosure starts also ticked up 4 percent in May over last month, with 26 states posting increases, according to the report.

“Foreclosure activity continued to bounce back in some markets where it may have appeared the foreclosure problem had been knocked out by an aggressive combination of foreclosure prevention efforts over the past two years,” says Daren Blomquist, vice president at RealtyTrac. “Places like Nevada, where foreclosure starts increased to a 20-month high, and Maryland, where overall foreclosure activity increased to a 33-month high. Still, the emerging housing recovery has strengthened most local markets enough to quickly shake off a few more blows from these nagging foreclosures.”

The top foreclosure rates in the country were in Florida, Nevada, and Ohio. Florida saw a 20 percent increase in foreclosure activity in May, accelerating it to the highest foreclosure rate in the country for the month. One in every 302 Florida households received a foreclosure filing in May—nearly triple the national average.

After 27 months of decreases, Nevada foreclosure activity rose in May, with one in every 305 households receiving a foreclosure filing. The increase was driven by an 81 percent year-over-year increase in foreclosure starts, which reached a 20-month high in May, RealtyTrac reports.

Ohio posted the third-highest foreclosure rate in the country, where one in every 584 households received a foreclosure filing during May. Still, that’s a 27 percent decrease from a 31-month high the state reached in April.

Source: RealtyTrac

Real Estate

Appraisals Catching Up to Rising Home Values

May 16, 2013 jd 1 Comment

Hard to find comparable sales on this home. Photo credit: http://hekk-m.com/post180818332/

In recent months, real estate professionals have had to hold their breath as they waited for an appraisal on a property to come back. Would it be lower than the agreed-upon selling price — and by how much?

Many real estate professionals have blamed a high number of derailed transactions on low-ball appraisals.

But now the industry is noticing a change in appraised values: Appraisals are getting more in line with the agreed upon selling price, CNNMoney reports.

Appraisers are valuing homes at or above their selling prices as home prices nationwide climb and inventories of homes decrease, says Lawrence Yun, chief economist for the National Association of REALTORS®.

For example, in Wallingford, Wash., real estate pro Michael Ackerman told CNNMoney that he was concerned a transaction would fall apart when a buyer agreed to pay $755,000 for a home since other comparable homes in the area had sold for $690,000.

“Everybody’s jaws dropped” when the appraised value came in at the full, agreed-upon selling price,” says Ackerman.

In some cases, appraisals are even coming in higher — which was practically unheard of just a few months ago. For example, real estate pro Cara Ameer in Jacksonville Beach, Fla., says with home prices in the area rising 15 percent over the past year, she was concerned the appraisal on a two-bedroom townhouse wouldn’t reflect the current rise. A buyer offered to pay $5,000 above the $189,000 asking price. The appraisal came in above the selling price, Ameer says.

Source: “Home appraisals no longer derailing sales,” CNNMoney (May 15, 2013)

For all your real estate needs
Email or call today:

John J. O’Dell Realtor® GRI
Civil Engineer
General Contractor
(530) 263-1091
Email jodell@nevadacounty.com

DRE#00669941

Real Estate

Is The Foreclosure Crisis Disappearing?

April 24, 2013 jd

Foreclosures are falling quickly as more borrowers keep up with their mortgage payments and banks complete more loan modifications or approve short sales to avoid foreclosures on their books.

For the first time since 2008, the number of borrowers who are behind on their payments or in foreclosure dropped below 5 million, according to a new report reflecting March data by Lender Processing Services.

The number of mortgages in foreclosure dropped to below 1.69 million in March, which marks the lowest level in nearly four years and a drop of nearly 20 percent compared to one year ago.

About 3.4 percent of all U.S. mortgages were in foreclosure by the end of March, which is a decrease from 4.2 percent a year ago, Lender Processing Services reports.

In March, about 6.6 percent of all borrowers were in some stage of delinquency, excluding those in foreclosure. That percentage is down by 3 percent from a year ago, but is still high by historical standards. Prior to the housing crisis, about 5 percent of all borrowers were delinquent on their mortgages and 1 percent of loans were in foreclosure, LPS reports.

Source: “Bad Mortgages Hit Lowest Level Since 2008,” The Wall Street Journal (April 23, 2013)

For all your real estate needs
Email or call today:

John J. O’Dell Realtor® GRI
Civil Engineer
General Contractor
(530) 263-1091
Email jodell@nevadacounty.com

DRE#00669941

Real Estate

Gold Drops, Real Estate Shines Again

April 18, 2013 jd

Chart credit: Blanchard http://www.blanchardonline.com/market_charts/

Now that gold prices have dropped like a brick, real estate is starting to shine again. Back in August 2011, when gold was at its peak, investors were asked where they’d want to keep their money long-term. According to a Gallup poll, 34% said gold was the best investment.

Now, only 24% of investors say gold is a good investment.. Real estate essentially ties gold for the best investment currently, at 25% to 24%, respectively. In August 2011, 19% of those surveyed listed real estate as their top choice.

Stocks also are more popular, with about 22% saying the market is the best long-term place for their investment dollars. In August 2011, 17% had that view.

“Stocks have been booming and real estate has been recovering in recent months, likely contributing to the decline in gold’s perceived investment status,” Gallup researchers noted in a prepared statement released late Tuesday.

Gold still has its standard bearers, of course. Though investors no longer are rushing to gold, solid support comes from men over 50 years old, while Americans who consider themselves politically independent favor gold over stocks almost two-to-one: 26% to 15%.

Source: Market Watch

For all your real estate needs
Email or call today:

John J. O’Dell Realtor® GRI
Civil Engineer
General Contractor
(530) 263-1091
Email jodell@nevadacounty.com

DRE#00669941

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