interesting angle from NYtimes.com
Home prices are out of reach relative to incomes and mortgage rates. The big question for the economy is how the imbalance adjusts.
These should be happy times for the housing sector. The economy is booming, with more people working at higher pay, and with the sizable millennial generation reaching prime home buying age.
Instead, the housing market has gone soft, acting as a drag on the overall economy rather than as a force propelling it forward.
Sales of new single-family homes were down 22 percent in September from their recent high in November 2017, and existing home sales in September were down 10 percent. This tepid residential investment subtracted from G.D.P. growth in each of the first three quarters of 2018.
Home prices have not declined nationally, at least according to the most widely followed indexes. But their rate of increase has declined, and more and more home sellers are finding they must reduce asking prices to find a buyer.
Given how central housing is to the broader economy — it is the biggest driver of both wealth and indebtedness for most families, and its fluctuations have frequently been major factors in past booms and busts — this slump isn’t something to be taken lightly for anyone hoping the good times will last.
So what’s going on?
When you look closely at the data, it appears this paradox of a strong economy and a weak housing market is, at its core, an illustration of a fundamental rule in economics: If something can’t go on forever, it won’t.
Home prices in a given location are ultimately tethered to the incomes of the people who either live there or want to. But for much of the last six years, that relationship has come undone.
Nationally, personal income per capita has risen 25 percent since the end of 2011, while the S&P/Case-Shiller national home price index is up 48 percent (neither figure is adjusted for inflation).
The gap is even larger in the big coastal cities with high wages and booming job markets, but where legal and other barriers make it hard for builders to add to the supply of homes. In the San Francisco metro area, per capita personal income rose 40 percent from 2011 to 2017, while home prices rose 96 percent. Similar patterns are evident in Los Angeles, Seattle, Boston, New York and Washington.
In less high-flying markets, there was still a disconnect. In the Minneapolis area, for example, incomes rose 22 percent while home prices rose 46 percent.
Those rising home prices got help from years of very low mortgage rates, which put more expensive homes within reach for people at a given income level. Activity was also probably boosted by some bounce-back effect after the housing market crash of 2007-09, a result of pent-up demand for homes that were not bought while the market was collapsing.
Rates bottomed out in late 2012 at 3.31 percent for a 30-year fixed-rate mortgage. They have been moving upward in fits and starts since, including a full percentage point in the last year alone to nearly 5 percent — still low by historical standards, but high compared with the ultralow levels that had enabled these huge price gains.
There’s no doubt that demographics are favorable for housing demand. The peak birth year for millennials was 1990; it’s a group that is turning 28 this year and thus entering prime years for home buying. As it happens, 28 is exactly the median response in a Bankrate survey that asked adults for the ideal age to buy a home.
But that doesn’t matter if prices are out of reach relative to incomes. Moreover, lending standards have remained more rigorous than they were during the last housing boom, so it has been harder for people to stretch to buy a home. The inability of people to buy homes they can’t really afford is great news in terms of avoiding another crisis, but not so great for the near-term outlook for housing.
“Buyers can only stomach so many price increases until it gets unsustainable,” said Daryl Fairweather, the chief economist at the online brokerage Redfin. “Prices reached a breaking point where buyers were fed up and started to consider other options,” she said, including renting and moving away from the expensive coastal
markets where prices are most out of whack with incomes.
As Economics 101 teaches, price movements are the way that supply and demand match up with each other. But in the housing sector especially, that adjustment can take a while.
In contrast with the stock market, where relatively unemotional traders are buying and selling shares every day and the market stays liquid, home purchase and sales decisions can take months and are deeply emotional for the participants.
What seems to be happening is that sellers are trying to cling to the spring 2018 prices that their neighbors received, while there aren’t enough buyers in late 2018 willing or able to pay those prices.
In a Fannie Mae survey of home purchase sentiment, the proportion of people who think it is a good time to buy a home has decreased significantly since the spring, to a net 21 percent from 29 percent. But so has the proportion who think it is a good time to sell, which has dropped to 35 percent from 45 percent.
You would expect, in a zero-sum transaction like a home sale, for those numbers to move in opposite directions. Instead, it seems that sellers are unhappily realizing that they aren’t going to get what they thought their house was worth six months ago, and buyers still think homes are too expensive.
That helps explain why transaction volume, especially for new houses, has fallen substantially while prices haven’t (at least yet). It’s a standoff. And the outcome of the standoff will, in the aggregate, play a role in shaping the future of the economy.
There is precedent for this, and it isn’t a happy one. In the last housing boom, new home sales peaked in July 2005, and home prices didn’t start declining until May 2006. It didn’t start to hurt the overall economy until December 2007, when the damage had spread through an overleveraged global financial system.
But that doesn’t mean this episode has to end in tears. Home prices are not nearly as out of line with incomes as they were then; speculative activity hasn’t been nearly as frothy; and consumer debt levels are considerably more measured.
“I think income growth will help us get out of this period,” said Robert Dietz, the chief economist at the National Association of Home Builders. “We’re probably looking at a period where existing home sales volume is flat to declining, and it now looks like 2017 was the peak year for transaction volume.”
A strong (nonhousing) economy makes it more likely that this housing slump will end without a steep 2008-style downturn. So does the basic reality that young adults are forming families and need a place to house them.
But in the meantime, it could be a soft few months or even years of standoffs between buyers and sellers, with the big question of which comes first: sellers who settle for less after recognizing that the price they thought they would get is beyond the reach of buyers, or incomes that catch up with a housing market that got a little ahead of itself.
Tuesday, November 27, 2018
Here’s why buying a home during the holidays can save you big
interesting considerations from Bankrate.com
While holiday shoppers are obsessing over finding the ultimate gift deals, tenacious house hunters who buy a home in December compared with other times of the year will save the most money, according to a new study.
In fact, buying a home on Dec. 26 can save you as much as $2,500 on the sales price, according to an analysis from ATTOM Data Solutions. Nationwide, December held seven of the top 10 days where buyers snagged the best price discounts on a home purchase, making it the best month to buy a home, ATTOM revealed.
“Right around Thanksgiving, in particular, is a great time to [put in an offer] given that Dec. 26, 29 and 21 are all in the top 10 of best times to buy,” says Daren Blomquist, senior vice president of communications with ATTOM. He notes that it can take about 30 days from the time an offer is submitted to close a home sale. “It’s the housing market’s version of a Black Friday sale.”
The study looked at more than 18 million single-family home and condo sales from 2013 to 2017. To calculate the premium or discount paid on a given day, ATTOM compared the median sales price for home purchases closing on that day with the median automated valuation model, or AVM, price on the same homes at the time of sale. Here’s a look at the best days of the year to buy a home.
10 best days of the year to buy a home
1 Dec. 26
2 Dec. 7
3 Dec. 4
4 Dec. 29
5 Dec. 21
6 Dec. 1
7 Oct. 12
8 Nov. 9
9 Feb. 9
10 Dec. 8
The saying all real estate is local still applies when timing your home purchase. Buyers in warmer climates may not see as much of a price break during the holidays as those farther north where weather is more of a factor in keeping buyers on the sidelines, Blomquist says.
Negotiating a lower price isn’t the only good reason to buy a home during the holidays, real estate experts say. December is a month before the Federal Reserve’s interest rate hikes resume, says Leonard Steinberg, a real estate broker with Compass Real Estate in New York City. Mortgage rate spikes can add to your borrowing costs and put some homes out of reach.
“While everyone else is out celebrating and shopping — reducing buyer volume — those who shop [for a home] will be met by sellers willing to make a deal,” he says.
Danielle Hale, chief economist with Realtor.com, says that sellers may be more flexible about negotiating the closing date and paying for a home warranty to give buyers more piece of mind. You might also have more luck submitting a smaller earnest money deposit — something that’s less likely to fly when sellers are fielding multiple offers during busier times of year, Hale says.
If you find a house that meets your must-haves — especially when inventory in many markets is so limited — don’t let the holidays deter you from making an offer.
“With rate hikes and home-price increases on the horizon, there’s a lot to be gained by locking in your monthly payment now versus waiting until later.”
While holiday shoppers are obsessing over finding the ultimate gift deals, tenacious house hunters who buy a home in December compared with other times of the year will save the most money, according to a new study.
In fact, buying a home on Dec. 26 can save you as much as $2,500 on the sales price, according to an analysis from ATTOM Data Solutions. Nationwide, December held seven of the top 10 days where buyers snagged the best price discounts on a home purchase, making it the best month to buy a home, ATTOM revealed.
“Right around Thanksgiving, in particular, is a great time to [put in an offer] given that Dec. 26, 29 and 21 are all in the top 10 of best times to buy,” says Daren Blomquist, senior vice president of communications with ATTOM. He notes that it can take about 30 days from the time an offer is submitted to close a home sale. “It’s the housing market’s version of a Black Friday sale.”
The study looked at more than 18 million single-family home and condo sales from 2013 to 2017. To calculate the premium or discount paid on a given day, ATTOM compared the median sales price for home purchases closing on that day with the median automated valuation model, or AVM, price on the same homes at the time of sale. Here’s a look at the best days of the year to buy a home.
10 best days of the year to buy a home
1 Dec. 26
2 Dec. 7
3 Dec. 4
4 Dec. 29
5 Dec. 21
6 Dec. 1
7 Oct. 12
8 Nov. 9
9 Feb. 9
10 Dec. 8
The saying all real estate is local still applies when timing your home purchase. Buyers in warmer climates may not see as much of a price break during the holidays as those farther north where weather is more of a factor in keeping buyers on the sidelines, Blomquist says.
Negotiating a lower price isn’t the only good reason to buy a home during the holidays, real estate experts say. December is a month before the Federal Reserve’s interest rate hikes resume, says Leonard Steinberg, a real estate broker with Compass Real Estate in New York City. Mortgage rate spikes can add to your borrowing costs and put some homes out of reach.
“While everyone else is out celebrating and shopping — reducing buyer volume — those who shop [for a home] will be met by sellers willing to make a deal,” he says.
Danielle Hale, chief economist with Realtor.com, says that sellers may be more flexible about negotiating the closing date and paying for a home warranty to give buyers more piece of mind. You might also have more luck submitting a smaller earnest money deposit — something that’s less likely to fly when sellers are fielding multiple offers during busier times of year, Hale says.
If you find a house that meets your must-haves — especially when inventory in many markets is so limited — don’t let the holidays deter you from making an offer.
“With rate hikes and home-price increases on the horizon, there’s a lot to be gained by locking in your monthly payment now versus waiting until later.”
3-D Printed Houses Are Here and in High Demand
fun article on 3-D printed homes....from architecturaldigest.com
Cutting costs, saving time, and eliminating waste, the 3-D-printed house has officially arrived
For the past several years, talk of 3-D printing revolutionizing the way we build has been mostly just that—talk. But the promise of printing a habitable house, on demand, in virtually any location, is becoming a reality. Around the globe, teams of architects, engineers, and entrepreneurs have developed robotic arms capable of producing walls for a small home in as little as 24 hours, with essentially zero waste and for a fraction of traditional construction costs. Competing to develop the top technology, industry players are now engaged in a space race of sorts—literally so, in some cases, with NASA funding research for printing habitats beyond our planet.
Of more immediate, earthly interest was the recent unveiling of two of the first-ever homes to be printed on-site. At Austin’s South by Southwest festival this past March, the San Francisco–based nonprofit New Story presented a 350-square-foot prototype of the low-cost homes it hopes to build across the developing world. Just a month later, during Milan’s Design Week, architect Massimiliano Locatelli debuted a 1,100-square-foot residence of a decidedly more luxurious sort, with elegantly plastered interior walls, brass details, and stylish furnishings. These two projects—using similar technologies in which robotic arms extrude layers of a concrete mixture that harden into solid walls—represent opposing ends of the spectrum for this industry’s potential.
“There are over a billion people without adequate shelter,” says New Story cofounder Brett Hagler. “It’s a massive deficit, and traditional construction methods are not enough to make a dent. But 3-D printing promises significant decreases in cost and build time.” To date, New Story has completed close to 1,000 conventional houses in Bolivia, El Salvador, Mexico, and Haiti—where it is currently building a community with support from AD—with each home requiring around $7,000 and two weeks to finish. Using a 3-D printer developed with the company Icon, Hagler expects to reduce those numbers to $4,000 and just a couple of days. The charity’s first large-scale printed project will be 100 homes in El Salvador, slated for completion next year.
“We will be able to put a lot of creativity into the design based on a family’s current situation and their future dreams,” Hagler notes of the homes’ flexible layouts, which are determined by customizable CAD files. “We’re trying to have better aesthetics—something that’s too often ignored when it comes to the world’s poorest families.”
It’s precisely the aesthetics and creative potential that inspired Locatelli, cofounder of the firm CLS Architetti, to erect his 3-D-printed house in Piazza Cesare Beccaria. As he explains, the project was all about embracing the textures of 3-D-printed forms and “exploring the beauty of the new language.”
Realized in collaboration with concrete specialists Italcementi, the engineering firm Arup, and the Dutch mobile 3-D-printer maker CyBe Construction, the house took about a week to create, with production lasting roughly 48 hours. Consisting of four rounded volumes (living area, bedroom, kitchen, bath), all topped by a roof garden, “the shape was completely free compared to traditional architecture,” says Locatelli. “Go ahead, try to make a curved house with bricks or stone—it’s so complicated. With this you really can create new shapes.”
Locatelli says he has received numerous inquiries, including commissions for 100 homes near Washington, D.C., and a 10,000-square-foot house on Sardinia. And the owner of a Lake Como villa who had hired him to build a guesthouse switched gears after seeing the project in Milan. “He said, ‘I’m not going to build in stone anymore. I want the 3-D-printed house,’ ” recounts the architect, who is working with Arup on how to print multilevel structures—something that has never been done. “The relationship between architect and client is going to change so much,” says Locatelli. “Probably the architect is going to become a shrink, more or less, helping give shape to the client’s dreams.”
Cutting costs, saving time, and eliminating waste, the 3-D-printed house has officially arrived
For the past several years, talk of 3-D printing revolutionizing the way we build has been mostly just that—talk. But the promise of printing a habitable house, on demand, in virtually any location, is becoming a reality. Around the globe, teams of architects, engineers, and entrepreneurs have developed robotic arms capable of producing walls for a small home in as little as 24 hours, with essentially zero waste and for a fraction of traditional construction costs. Competing to develop the top technology, industry players are now engaged in a space race of sorts—literally so, in some cases, with NASA funding research for printing habitats beyond our planet.
Of more immediate, earthly interest was the recent unveiling of two of the first-ever homes to be printed on-site. At Austin’s South by Southwest festival this past March, the San Francisco–based nonprofit New Story presented a 350-square-foot prototype of the low-cost homes it hopes to build across the developing world. Just a month later, during Milan’s Design Week, architect Massimiliano Locatelli debuted a 1,100-square-foot residence of a decidedly more luxurious sort, with elegantly plastered interior walls, brass details, and stylish furnishings. These two projects—using similar technologies in which robotic arms extrude layers of a concrete mixture that harden into solid walls—represent opposing ends of the spectrum for this industry’s potential.
“There are over a billion people without adequate shelter,” says New Story cofounder Brett Hagler. “It’s a massive deficit, and traditional construction methods are not enough to make a dent. But 3-D printing promises significant decreases in cost and build time.” To date, New Story has completed close to 1,000 conventional houses in Bolivia, El Salvador, Mexico, and Haiti—where it is currently building a community with support from AD—with each home requiring around $7,000 and two weeks to finish. Using a 3-D printer developed with the company Icon, Hagler expects to reduce those numbers to $4,000 and just a couple of days. The charity’s first large-scale printed project will be 100 homes in El Salvador, slated for completion next year.
“We will be able to put a lot of creativity into the design based on a family’s current situation and their future dreams,” Hagler notes of the homes’ flexible layouts, which are determined by customizable CAD files. “We’re trying to have better aesthetics—something that’s too often ignored when it comes to the world’s poorest families.”
It’s precisely the aesthetics and creative potential that inspired Locatelli, cofounder of the firm CLS Architetti, to erect his 3-D-printed house in Piazza Cesare Beccaria. As he explains, the project was all about embracing the textures of 3-D-printed forms and “exploring the beauty of the new language.”
Realized in collaboration with concrete specialists Italcementi, the engineering firm Arup, and the Dutch mobile 3-D-printer maker CyBe Construction, the house took about a week to create, with production lasting roughly 48 hours. Consisting of four rounded volumes (living area, bedroom, kitchen, bath), all topped by a roof garden, “the shape was completely free compared to traditional architecture,” says Locatelli. “Go ahead, try to make a curved house with bricks or stone—it’s so complicated. With this you really can create new shapes.”
Locatelli says he has received numerous inquiries, including commissions for 100 homes near Washington, D.C., and a 10,000-square-foot house on Sardinia. And the owner of a Lake Como villa who had hired him to build a guesthouse switched gears after seeing the project in Milan. “He said, ‘I’m not going to build in stone anymore. I want the 3-D-printed house,’ ” recounts the architect, who is working with Arup on how to print multilevel structures—something that has never been done. “The relationship between architect and client is going to change so much,” says Locatelli. “Probably the architect is going to become a shrink, more or less, helping give shape to the client’s dreams.”
Monday, October 29, 2018
Inside seven haunted homes that are seriously creepy and for sale
interesting article from Washington Post on haunted houses for sale...
Inside seven haunted homes that are seriously creepy and for sale
There’s a house that was involved in an exorcism to rid its spaces of ghosts. There’s a house that, according to local lore, has a piano that repeatedly plays one note by itself. Several other residences have infamous histories associated with them.
If you have a taste for the offbeat and creepy, here’s a way to keep the Halloween mood going year-round: You can buy a purportedly haunted house — or one that looks like it is.
A haunted house, obviously, is not for everyone. But they do appeal to a select segment of the market, realty experts say.
“We have had some people ask to spend the night in the house,” says agent Matt Barnhart of Pagoda Real Estate in West Lawn, Pa., who is representing a home built in 1749 where there have been reports of a lovelorn female ghost endlessly awaiting the return of her beloved. “Some of them consider it a feature.”
The creepy residences range from $495,000 to $4.5 million.
The appearance of a female ghost and a piano playing by itself are said to be some of the spooky occurrences at the four-bedroom, four-bathroom Priestly House in Canton, Miss. (By Keller Williams/By Keller Williams)
Confederate soldier deserters, wearing Union uniforms, were said to have died at Adams Griffin House in New Orleans, and continued to hang around. Sightings of their ghostly bodies — sometimes holding whiskey bottles and singing drinking songs — have been reported.
Wyckoff Villa on Carleton Island in Cape Vincent, N.Y., was built by the Remington typewriter magnate, William O. Wyckoff, in 1894. He died of a heart attack the first night he stayed in the home. His son sold it to General Electric in the early 1930s, but their plans to build a new plant were scuttled by World War II.
Many of the fireplaces and stained-glass windows were imported from castles in Europe. The 300-year-old staircase was imported from London. Some have said spirits from the old European castles haunt this new location. The house is listed on local, state and national registers of historical places and has an asking price of $3.5 million.
Pillars Estate, built in the early 1800s, is part of a haunted house tour in Albion, N.Y. Children’s voices have been heard roaming through the house, and the sound of one piano key being played repeatedly, even though there is no one at the piano, is another ghostly feature. The six-bedroom, six-bathroom home is listed for $499,000.
Villa Paula in Miami was built for the Cuban consul in 1925 and named after his wife, who had died after complications from a leg amputation. A recent resident reported repeatedly noticing the strong smell of coffee coming from the kitchen and seeing a ghostlike woman who only had one leg disappearing down a hallway.
Savannah’s Hampton Lillibridge, built in 1796, has had multiple spooky occurrences including sightings of “tall man dressed in black” looking out the window. Jim Williams, the subject of the book “Midnight In The Garden of Good and Evil,” bought the house and had an exorcism performed in 1963. (
Inside seven haunted homes that are seriously creepy and for sale
There’s a house that was involved in an exorcism to rid its spaces of ghosts. There’s a house that, according to local lore, has a piano that repeatedly plays one note by itself. Several other residences have infamous histories associated with them.
If you have a taste for the offbeat and creepy, here’s a way to keep the Halloween mood going year-round: You can buy a purportedly haunted house — or one that looks like it is.
A haunted house, obviously, is not for everyone. But they do appeal to a select segment of the market, realty experts say.
“We have had some people ask to spend the night in the house,” says agent Matt Barnhart of Pagoda Real Estate in West Lawn, Pa., who is representing a home built in 1749 where there have been reports of a lovelorn female ghost endlessly awaiting the return of her beloved. “Some of them consider it a feature.”
The creepy residences range from $495,000 to $4.5 million.
The appearance of a female ghost and a piano playing by itself are said to be some of the spooky occurrences at the four-bedroom, four-bathroom Priestly House in Canton, Miss. (By Keller Williams/By Keller Williams)
Confederate soldier deserters, wearing Union uniforms, were said to have died at Adams Griffin House in New Orleans, and continued to hang around. Sightings of their ghostly bodies — sometimes holding whiskey bottles and singing drinking songs — have been reported.
Wyckoff Villa on Carleton Island in Cape Vincent, N.Y., was built by the Remington typewriter magnate, William O. Wyckoff, in 1894. He died of a heart attack the first night he stayed in the home. His son sold it to General Electric in the early 1930s, but their plans to build a new plant were scuttled by World War II.
Many of the fireplaces and stained-glass windows were imported from castles in Europe. The 300-year-old staircase was imported from London. Some have said spirits from the old European castles haunt this new location. The house is listed on local, state and national registers of historical places and has an asking price of $3.5 million.
Pillars Estate, built in the early 1800s, is part of a haunted house tour in Albion, N.Y. Children’s voices have been heard roaming through the house, and the sound of one piano key being played repeatedly, even though there is no one at the piano, is another ghostly feature. The six-bedroom, six-bathroom home is listed for $499,000.
Villa Paula in Miami was built for the Cuban consul in 1925 and named after his wife, who had died after complications from a leg amputation. A recent resident reported repeatedly noticing the strong smell of coffee coming from the kitchen and seeing a ghostlike woman who only had one leg disappearing down a hallway.
Savannah’s Hampton Lillibridge, built in 1796, has had multiple spooky occurrences including sightings of “tall man dressed in black” looking out the window. Jim Williams, the subject of the book “Midnight In The Garden of Good and Evil,” bought the house and had an exorcism performed in 1963. (
Tuesday, October 23, 2018
Home sales slid across Colorado in September
more news to consider when it comes to current timing with buying/selling in this market...
from Denver Post.com
Home sales aren’t just slumping big in metro Denver, they are dropping across much of Colorado and in what were some of the hottest markets in the country.
Existing home sales in the United States fell 3.4 percent in August from September to a seasonally adjusted annual rate of 5.15 million. Year-over-year, they are down 4.1 percent, according to an update Friday from the National Association of Realtors.
“A decade’s high mortgage rates are preventing consumers from making quick decisions on home purchases,” Lawrence Yun, chief economist, said in the report.
Those national declines look tame compared to what is going on in states like Colorado, Washington and California. Real estate brokerage Redfin, in a different report, estimates that sales in 50 of the 71 largest metros it tracks are now falling.
“Last year and earlier this year, Seattle, San Jose and Denver were the hottest markets with homes selling in days, not weeks. These metros have now been replaced by Grand Rapids (Mich.), Omaha, Neb., and Indianapolis as the fastest markets in the country,” noted Daryl Fairweather, Redfin’s chief economist.
Last week, the Colorado Association of Realtors reported that the number of single-family home listings sold in Colorado dropped 14.6 percent in September compared to the same month a year earlier. Sales of townhouses and condos dropped 15.2 percent.
Metro Denver definitely skews the numbers. Year-over-year single-family home sales in September were down 15.8 percent in Adams County, 17.8 percent in Arapahoe County, 10.3 percent in Boulder County, 11.9 percent in Denver, 16.4 percent in Douglas County and 25.6 percent in Jefferson County, according to the CAR report.
But the state’s other metro areas weren’t immune. Single-family home sales fell 26.7 percent in Pueblo County, 17.2 percent in El Paso County and 18.8 percent in Mesa County. Fort Collins and Greeley held up better, with a smaller 4.4-percent drop in Larimer County and 7-percent drop in Weld County.
“Sold listings –- down. New listings –- down. Affordability –- down. Inventory supply –- down. Days on market -– down. Interest rates –- up. Median price –- up and down,” said Chris Hardy, a Fort Collins area Realtor, in comments accompanying last week’s report of his home turf.
Even the mountain counties are getting caught in the down draft. Home sales fell in Summit, Grand, Routt, Gunnison and San Miguel counties. The picture was more mixed picture in Eagle, Pitkin and La Plata counties. Garfield County, home to Glenwood Springs, represented a rare pocket of strength, with home and condo sales both up more than 5 percent last month.
from Denver Post.com
Home sales aren’t just slumping big in metro Denver, they are dropping across much of Colorado and in what were some of the hottest markets in the country.
Existing home sales in the United States fell 3.4 percent in August from September to a seasonally adjusted annual rate of 5.15 million. Year-over-year, they are down 4.1 percent, according to an update Friday from the National Association of Realtors.
“A decade’s high mortgage rates are preventing consumers from making quick decisions on home purchases,” Lawrence Yun, chief economist, said in the report.
Those national declines look tame compared to what is going on in states like Colorado, Washington and California. Real estate brokerage Redfin, in a different report, estimates that sales in 50 of the 71 largest metros it tracks are now falling.
“Last year and earlier this year, Seattle, San Jose and Denver were the hottest markets with homes selling in days, not weeks. These metros have now been replaced by Grand Rapids (Mich.), Omaha, Neb., and Indianapolis as the fastest markets in the country,” noted Daryl Fairweather, Redfin’s chief economist.
Last week, the Colorado Association of Realtors reported that the number of single-family home listings sold in Colorado dropped 14.6 percent in September compared to the same month a year earlier. Sales of townhouses and condos dropped 15.2 percent.
Metro Denver definitely skews the numbers. Year-over-year single-family home sales in September were down 15.8 percent in Adams County, 17.8 percent in Arapahoe County, 10.3 percent in Boulder County, 11.9 percent in Denver, 16.4 percent in Douglas County and 25.6 percent in Jefferson County, according to the CAR report.
But the state’s other metro areas weren’t immune. Single-family home sales fell 26.7 percent in Pueblo County, 17.2 percent in El Paso County and 18.8 percent in Mesa County. Fort Collins and Greeley held up better, with a smaller 4.4-percent drop in Larimer County and 7-percent drop in Weld County.
“Sold listings –- down. New listings –- down. Affordability –- down. Inventory supply –- down. Days on market -– down. Interest rates –- up. Median price –- up and down,” said Chris Hardy, a Fort Collins area Realtor, in comments accompanying last week’s report of his home turf.
Even the mountain counties are getting caught in the down draft. Home sales fell in Summit, Grand, Routt, Gunnison and San Miguel counties. The picture was more mixed picture in Eagle, Pitkin and La Plata counties. Garfield County, home to Glenwood Springs, represented a rare pocket of strength, with home and condo sales both up more than 5 percent last month.
Monday, October 8, 2018
Major cold front slams Denver housing market in September
allot of what I'm seeing as well from Denver Post....
Major cold front slams Denver housing market in September
Home sales drop big as buyers go missing, especially in luxury market
Home sales in the metro Denver area fell precipitously in September, forcing sellers to cut their asking prices and pushing up the inventory of properties available for sale at an unprecedented rate, according to a monthly update from the Denver Metro Association of Realtors.
“The housing inventory and home price adjustments are normal and expected,” said Steve Danyliw, chairman of the DMAR Market Trends Committee, in the report. “What’s not normal? Sales of single-family homes priced over $500,000 dropping 33 percent from August to September. For those sellers, that’s real turbulence.”
Metro Denver’s housing market has shown signs of cooling since early summer. But it practically froze over in September, and that meant sellers faced a bumpy ride, especially owners of more expensive properties.
The number of single-family homes sold in September, across all price ranges, dropped 30.5 percent from August and is down 21.4 percent compared to September 2017. Condo sales fell a dramatic 42.9 percent on the month and are down 17.3 percent year-over-year.
Normally, the inventory of homes available for sale dips slightly in September as sellers focus on other things. But buyers, after years of coping with a lack of affordability, are now pulling back in a big way.
The inventory of homes and condos available for sale at the end of September shot up to 8,807, an increase of 7.04 percent from August and 16.1 percent compared to a year ago.
The median price of single-family homes sold in September dropped 3.8 percent from August to $428,000, but remains up 6.1 percent from the same month a year earlier. Condos, which are generally more affordable, continued to show gains. The median condo price rose 1.73 percent to $301,625 last month and is up 12.8 percent on the year.
The luxury end of the market, which was running hot this summer, was especially hard hit. Sales of homes worth $1 million or more fell 44.4 percent between August and September.
Major cold front slams Denver housing market in September
Home sales drop big as buyers go missing, especially in luxury market
Home sales in the metro Denver area fell precipitously in September, forcing sellers to cut their asking prices and pushing up the inventory of properties available for sale at an unprecedented rate, according to a monthly update from the Denver Metro Association of Realtors.
“The housing inventory and home price adjustments are normal and expected,” said Steve Danyliw, chairman of the DMAR Market Trends Committee, in the report. “What’s not normal? Sales of single-family homes priced over $500,000 dropping 33 percent from August to September. For those sellers, that’s real turbulence.”
Metro Denver’s housing market has shown signs of cooling since early summer. But it practically froze over in September, and that meant sellers faced a bumpy ride, especially owners of more expensive properties.
The number of single-family homes sold in September, across all price ranges, dropped 30.5 percent from August and is down 21.4 percent compared to September 2017. Condo sales fell a dramatic 42.9 percent on the month and are down 17.3 percent year-over-year.
Normally, the inventory of homes available for sale dips slightly in September as sellers focus on other things. But buyers, after years of coping with a lack of affordability, are now pulling back in a big way.
The inventory of homes and condos available for sale at the end of September shot up to 8,807, an increase of 7.04 percent from August and 16.1 percent compared to a year ago.
The median price of single-family homes sold in September dropped 3.8 percent from August to $428,000, but remains up 6.1 percent from the same month a year earlier. Condos, which are generally more affordable, continued to show gains. The median condo price rose 1.73 percent to $301,625 last month and is up 12.8 percent on the year.
The luxury end of the market, which was running hot this summer, was especially hard hit. Sales of homes worth $1 million or more fell 44.4 percent between August and September.
Balance of power shifting in metro Denver’s housing market
the tides are turning in the metro Denver area...interesting article from Denver Post...
Hot real estate market starting to cool allowing buyers to take back some power
Sellers have remained in firm control of metro Denver’s housing market
for four years, with inventory shortages, quick sales and escalating home prices par for the course.
The imbalance has lasted for so long, it is hard to remember what a more balanced market looks like. But agents warn that things are finally moving in that direction.
“In comparison to the last four years it feels foreign,” said Kerron Stokes, a broker and Realtor with Resource Group at REMAX Leaders in Centennial. “But the normalization that we are going through is still better than the conditions in most of the country.”
In June, metro Denver’s housing market began to show signs of cooling after a hot run at the start of the year. More sellers had to drop their asking prices, fewer buyers attended showings and made offers, and homes took longer to sell. From record highs reached in May and June, prices have come down 4.9 percent.
Some wrote that off as the usual seasonal slump coming early. Things would rev up again in January. repeating the pattern of recent years. But in September, home sales fell hard despite a lot more properties on the market.
That disproved a common explanation that a lack of inventory was what was holding back home sales in metro Denver.
“The amount of showings per listing is dropping. The days on market are increasing. It is telling us that there are fewer buyers and less activity,” said Steve Danyliw, chairman of the market trends committee at the Denver Metro Association of Realtors and a Denver real estate agent.
Last month, there were 3,989 single-family homes and condos sold in metro Denver, a drop of 28.9 percent from August and 20.2 percent from a year earlier. The last time so few homes sold in a September was back in 2012, according to a report Wednesday from DMAR.
The inventory of homes available for sale shot up 7 percent from August to 8,807, the highest number available since the fall of 2013, when the Denver market was starting to take off. Normally, the number of homes available for sale drops slightly in September.
One of the hardest tasks agents say they face now is convincing sellers, long accustomed to calling the shots, to lower their expectations, especially when it comes to how much money they can get.
Don’t expect 30 potential buyers to make the showing, don’t expect a solid offer within 72 hours and don’t refuse reasonable requests like inspections, repairs and contingency clauses.
Those were lessons Robin Olsen learned first-hand when she and her husband tried to sell their Sunnyside home this summer. Going in, Olsen said her reference point was a friend who listed an old, small and unrenovated home near the University of Denver. Within hours, a buyer made a cash offer, sight unseen, at $90,000 above the asking price.
“I am hearing the story and thinking this will happen to me. It won’t be on the market for more than a few hours,” she said.
Although the home, listed initially at $669,000, received lookers, no offer emerged after 72 hours. Olsen, president and founder of Honey Communications, couldn’t understand why a home in Denver’s popular northwest corner wouldn’t fly off the shelf.
Two price drops brought the listing down to $629,000, a price that drummed up more interest and helped land a buyer nearly three weeks later. Through it all, Olsen said she repeatedly had to remind herself to breathe deep, stay calm and realize it was only a business transaction.
“It was almost three weeks and to me that felt like three years relative to the stories we heard,” she said. “It was definitely emotional. There were some days I needed to go for a walk.”
Lisa Huntington-Kinn, the agent who handled the listing, credits the Olsens for listening to her and moving quickly to drop the price when the offers weren’t showing up. Some sellers are more stubborn.
“Buyers always determine what your house is worth. It doesn’t matter what I think it is worth and what you think it is worth,” she said.
Even last year, buyers were becoming more discriminate in what they were willing to take from sellers. After years of getting pushed around, they started to push back.
“I am paying top dollar, I want a top property,” Danyliw said, describing the attitude.
Van Lewis, a broker associate with REMAX Alliance 3000 in Aurora, said he was having a record year until June, when showings and sales dropped significantly. He doesn’t see the slow down resolving itself until prices correct.
Some buyers, realizing the market is shifting in their favor, may hold back. Lewis notes some sellers have the same attitude. They have a specific price they need to hit and are willing to bet that a rebound will bring it to them. They won’t let go of the scepter easily.
The problem is that both sides can’t be right.
Jim Brown, an Englewood Realtor who specializes in working with first-time homebuyers, said he isn’t seeing a “let’s wait” attitude as much as a “I can’t afford this market” resignation.
Contributing to that sentiment are higher interest rates on 30-year mortgages, which Freddie Mac reports at 3.8 percent a year ago and closer to 4.7 percent now. Home prices adjusted higher when rates dropped. But so far, they haven’t moved the other way to adjust for the rise in mortgages rates.
“I think buyers on the lower-end are feeling like they have been priced out of the market and have given up on the idea of buying in Colorado. Astute buyers are looking at interest rates, but most buyers aren’t getting to the lending phase because they aren’t looking. They’ve already decided they can’t afford a home,” said Brown.
A study from Attom Data Solutions lists the median price of a home sold in Denver County in the third quarter at $430,000. With a 3 percent down payment and conventional financing ratios, a buyer would need an income of $117,148 to qualify, the study found. The average yearly wage in Denver – $68,419
Even in Adams County, where the median home price is a more affordable $340,000, a buyer would need $94,047 in income to purchase that kind of home. The average income is $53,443 a year, according to Attom.
The affordability gap is a national problem, with the median priced home not affordable to someone earning the average wage in 84 percent of markets, according to Attom. The affordability gap is the worst Attom has measured since the third quarter of 2008, which was when the financial crisis hit.
And three of the most extreme divergences from historical levels of affordability in the nation’s 182 large counties, population 500,000 or more, are in Colorado – Denver, Arapahoe and Jefferson counties.
“Buyers see prices going up and have no expectations otherwise,” said Brown.
Year-to-date, the median price of a single-family home sold in metro Denver is still up 8.54 percent in 2018 versus 2017, even after the dip this summer. Median condo prices are up 12.3 percent on the year, according to DMAR. Danyliw attributes that bigger price gain in condos to a desire by buyers to find anything affordable.
Brown expects that once buyers realize the balance of power is shifting their way, they may reclaim a “we can” attitude. And Danyliw notes the Denver economy remains strong and jobs plentiful.
Unlike last decade, there isn’t a glut of homes on the market that could turn a rebalancing into a crash. For that reason, Danyliw, Stokes and other agents argue the market isn’t slumping as much as it is “normalizing.”
If the inventory of available homes for sale can get back into the 10,000 to 12,000 range, not that big jump from current levels of 8,807, then the balance between buyers and sellers should be restored, Danyliw predicts.
“We have gone from that insane crazy marketplace to not so insane or crazy,” Danyliw said. But that has left sellers befuddled, asking what happened to our hot market.
Hot real estate market starting to cool allowing buyers to take back some power
Sellers have remained in firm control of metro Denver’s housing market
for four years, with inventory shortages, quick sales and escalating home prices par for the course.
The imbalance has lasted for so long, it is hard to remember what a more balanced market looks like. But agents warn that things are finally moving in that direction.
“In comparison to the last four years it feels foreign,” said Kerron Stokes, a broker and Realtor with Resource Group at REMAX Leaders in Centennial. “But the normalization that we are going through is still better than the conditions in most of the country.”
In June, metro Denver’s housing market began to show signs of cooling after a hot run at the start of the year. More sellers had to drop their asking prices, fewer buyers attended showings and made offers, and homes took longer to sell. From record highs reached in May and June, prices have come down 4.9 percent.
Some wrote that off as the usual seasonal slump coming early. Things would rev up again in January. repeating the pattern of recent years. But in September, home sales fell hard despite a lot more properties on the market.
That disproved a common explanation that a lack of inventory was what was holding back home sales in metro Denver.
“The amount of showings per listing is dropping. The days on market are increasing. It is telling us that there are fewer buyers and less activity,” said Steve Danyliw, chairman of the market trends committee at the Denver Metro Association of Realtors and a Denver real estate agent.
Last month, there were 3,989 single-family homes and condos sold in metro Denver, a drop of 28.9 percent from August and 20.2 percent from a year earlier. The last time so few homes sold in a September was back in 2012, according to a report Wednesday from DMAR.
The inventory of homes available for sale shot up 7 percent from August to 8,807, the highest number available since the fall of 2013, when the Denver market was starting to take off. Normally, the number of homes available for sale drops slightly in September.
One of the hardest tasks agents say they face now is convincing sellers, long accustomed to calling the shots, to lower their expectations, especially when it comes to how much money they can get.
Don’t expect 30 potential buyers to make the showing, don’t expect a solid offer within 72 hours and don’t refuse reasonable requests like inspections, repairs and contingency clauses.
Those were lessons Robin Olsen learned first-hand when she and her husband tried to sell their Sunnyside home this summer. Going in, Olsen said her reference point was a friend who listed an old, small and unrenovated home near the University of Denver. Within hours, a buyer made a cash offer, sight unseen, at $90,000 above the asking price.
“I am hearing the story and thinking this will happen to me. It won’t be on the market for more than a few hours,” she said.
Although the home, listed initially at $669,000, received lookers, no offer emerged after 72 hours. Olsen, president and founder of Honey Communications, couldn’t understand why a home in Denver’s popular northwest corner wouldn’t fly off the shelf.
Two price drops brought the listing down to $629,000, a price that drummed up more interest and helped land a buyer nearly three weeks later. Through it all, Olsen said she repeatedly had to remind herself to breathe deep, stay calm and realize it was only a business transaction.
“It was almost three weeks and to me that felt like three years relative to the stories we heard,” she said. “It was definitely emotional. There were some days I needed to go for a walk.”
Lisa Huntington-Kinn, the agent who handled the listing, credits the Olsens for listening to her and moving quickly to drop the price when the offers weren’t showing up. Some sellers are more stubborn.
“Buyers always determine what your house is worth. It doesn’t matter what I think it is worth and what you think it is worth,” she said.
Even last year, buyers were becoming more discriminate in what they were willing to take from sellers. After years of getting pushed around, they started to push back.
“I am paying top dollar, I want a top property,” Danyliw said, describing the attitude.
Van Lewis, a broker associate with REMAX Alliance 3000 in Aurora, said he was having a record year until June, when showings and sales dropped significantly. He doesn’t see the slow down resolving itself until prices correct.
Some buyers, realizing the market is shifting in their favor, may hold back. Lewis notes some sellers have the same attitude. They have a specific price they need to hit and are willing to bet that a rebound will bring it to them. They won’t let go of the scepter easily.
The problem is that both sides can’t be right.
Jim Brown, an Englewood Realtor who specializes in working with first-time homebuyers, said he isn’t seeing a “let’s wait” attitude as much as a “I can’t afford this market” resignation.
Contributing to that sentiment are higher interest rates on 30-year mortgages, which Freddie Mac reports at 3.8 percent a year ago and closer to 4.7 percent now. Home prices adjusted higher when rates dropped. But so far, they haven’t moved the other way to adjust for the rise in mortgages rates.
“I think buyers on the lower-end are feeling like they have been priced out of the market and have given up on the idea of buying in Colorado. Astute buyers are looking at interest rates, but most buyers aren’t getting to the lending phase because they aren’t looking. They’ve already decided they can’t afford a home,” said Brown.
A study from Attom Data Solutions lists the median price of a home sold in Denver County in the third quarter at $430,000. With a 3 percent down payment and conventional financing ratios, a buyer would need an income of $117,148 to qualify, the study found. The average yearly wage in Denver – $68,419
Even in Adams County, where the median home price is a more affordable $340,000, a buyer would need $94,047 in income to purchase that kind of home. The average income is $53,443 a year, according to Attom.
The affordability gap is a national problem, with the median priced home not affordable to someone earning the average wage in 84 percent of markets, according to Attom. The affordability gap is the worst Attom has measured since the third quarter of 2008, which was when the financial crisis hit.
And three of the most extreme divergences from historical levels of affordability in the nation’s 182 large counties, population 500,000 or more, are in Colorado – Denver, Arapahoe and Jefferson counties.
“Buyers see prices going up and have no expectations otherwise,” said Brown.
Year-to-date, the median price of a single-family home sold in metro Denver is still up 8.54 percent in 2018 versus 2017, even after the dip this summer. Median condo prices are up 12.3 percent on the year, according to DMAR. Danyliw attributes that bigger price gain in condos to a desire by buyers to find anything affordable.
Brown expects that once buyers realize the balance of power is shifting their way, they may reclaim a “we can” attitude. And Danyliw notes the Denver economy remains strong and jobs plentiful.
Unlike last decade, there isn’t a glut of homes on the market that could turn a rebalancing into a crash. For that reason, Danyliw, Stokes and other agents argue the market isn’t slumping as much as it is “normalizing.”
If the inventory of available homes for sale can get back into the 10,000 to 12,000 range, not that big jump from current levels of 8,807, then the balance between buyers and sellers should be restored, Danyliw predicts.
“We have gone from that insane crazy marketplace to not so insane or crazy,” Danyliw said. But that has left sellers befuddled, asking what happened to our hot market.
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