Category Archives: Westchester NY

Housing bubble, then and now | South Salem Real Estate

You can’t blame a homeowner in Fresno, California, for viewing the thriving metropolis to its northwest with both envy and dismay. While San Francisco home values have surged since the recession, Fresno’s housing market is stuck in a rut. Less than 3 percent of homes in the city and its environs have returned to their pre-recession peak, according to a new study from Trulia. Median home values are a teeth-clenching $78,000 below their pre-recession peak.

The difference between the two California markets helps explain a key dynamic of U.S. housing a decade after the foreclosure crisis. Popular measures of the landscape, like S&P CoreLogic Case-Shiller Index and the FHFA House Price Index, show the market has recovered to levels last seen before the housing market went bust. But according to Trulia, this isn’t the whole, significantly bleaker picture.

Nationally, just 1 in 3 homes are worth more now than they were at their peak. While tech hubs in the Bay Area and Denver and job centers like Dallas or Nashville have seen home values explode past earlier highs, there are more losers than winners when you look across the country, Trulia’s analysis shows. And it’s really bad news if you live in Las Vegas, Tucson—or Fresno.

Many of the losers aren’t just losing—they’re getting trounced. There were 28 metros where fewer than 10 percent of homes have recovered their value since the bubble burst. Las Vegas has seen less than 1 percent of its homes returning to or surpassing what they were worth before the recession. The median sales price there is down a full $91,000 from its peak.

“It’s a reflection of just how well a metro area has recovered, broadly speaking,” said Ralph McLaughlin, chief economist at Trulia, adding that his findings largely correlate with other measures of metro-level growth, such as gains in income and total population.

As a result, it’s tempting to view these results through the prism of the 2016 election. Many of the metropolitan areas where home values lag the most are Rust Belt towns with little prospect for an immediate comeback, or Sunbelt cities whose peak home values were a product of the bubble that preceded the collapse.

McLaughlin says a zip code-level analysis offers a more nuanced view of the haves and have-nots. In much of the middle of the country, cities have stagnated while less populated regions lead the recovery. While it’s true coastal markets have experienced the lion’s share of appreciation, the majority of homes in pricey markets like New York, Los Angeles, Silver Spring, Maryland, and Fairfield County, Connecticut, are still worth less than a decade ago.

To be sure, Trulia’s research is based on its own estimates of home values, while the big indices are based on actual sales. Other research suggests a hot economy gives rural workers more choice, causing an outflow of potential employees to better jobs, often in the cities or on the coasts, potentially speeding a decline in home value elsewhere.

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https://www.bloomberg.com/news/articles/2017-05-03/most-u-s-homes-are-worth-less-than-before-the-crash

Pending sales drop | Waccabuc Real Estate

The Pending Home Sales Index decreased 2.5% in November 2016 to its lowest level since January 2016, and is 0.4% below November 2015. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), decreased to 107.3 in November 2016 from 110.0 the previous month.

The PHSI increased 0.6% in the Northeast, but fell 1.2% in the South, 2.5% in the Midwest and 6.7% in the West. Year-over-year, the PHSI increased 5.7% in the Northeast, but decreased 1.0% in the West, 1.3% in the South and 2.4% in the Midwest.

NAR recently reported a decline in confidence among renters who are contemplating the best time to buy a home. The election boosted the U.S. 10-year Treasury note from 1.83% the day before the election to 2.54% on December 28, 2016, and mortgage rates followed quickly. The Freddie Mac Weekly Survey reported a 30-year commitment rate of 3.54% on November 3, which increased to 4.30% for the week ending December 22, 2016. However, November existing sales continued a solid year-end path, and total 2016 existing sales are expected to reach the highest level since 2006. As the economy adds jobs, increased demand among first-time buyers will help fuel existing sales into 2017.

 

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http://eyeonhousing.org/2017/01/pending-sales-retreat-2/

Serious Delinquency Rates Improve Across Most Household Debts | Waccabuc Real Estate

A recent release by the Federal Reserve Bank of New York indicates that, in aggregate, 90 or more day delinquency rates are falling on most household debt products. However, serious delinquency on student loans remains elevated while a greater portion of auto debt held by households with low credit scores is entering serious delinquency. The results indicate that household balance sheets are likely improving on balance but some concerns persist.

As the figure below illustrates, the majority of consumer loan types have seen the share of balances 90 or more days delinquent fall from their cycle peaks. The proportion of credit card debt 90 or more days past due has dropped to 7.1 percent 6.6 percentage points below its peak in 2010, 13.7 percent. The percentage of mortgage debt has dived 7.3 percentage points to 1.6 percent while the portion of 90 or more days late home equity lines of credit has fallen from 4.9 percent to 2.0 percent.

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Although credit card debt, mortgages, and home equity lines of credit have trended downward since reaching their cycle peaks, the share of student loan debt 90 or more days delinquent jumped in 2012 to 11.7 percent and has remained near this level in subsequent years.

Interestingly, the 90 or more day delinquency rate on auto debt followed the same pattern as credit card and mortgage debt, declining in the years immediately after reaching its peak. However, since 2014, the proportion of auto loan debt 90 or more days delinquent has held steady. More precisely, the percent of auto loans 90 or more days delinquent has trended up slightly since the middle of 2014.

Additional analysis by the Federal Reserve Bank of New York indicates that, after declines from their cycle peaks, the flow of auto debt into 90 or more day delinquency has been generally flat for households with a 620 and above. However, as shown in the figure below which was reproduced from the blog post linked to above, the flow of auto loans into 90 or more day delinquency has increased noticeably for consumers with a credit score below a 620.

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More precisely, the flow of auto debt flowing into 90 or more day delinquency for those with a credit score between 620 and 659 rose a bit in 2014 before returning in 2015. In addition, there has been a very slight upward trend in the flow of auto debt into 90 or more day delinquency by borrowers with a credit score between 660 and 719 and a small uptick over 2016 in the flow for consumers with a score between 720 and 759.

 

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http://eyeonhousing.org/2016/12/serious-delinquency-rates-improve-across-most-household-debts/

Are Trophy Homes Losing their Lustre? | Waccabuc Real Estate

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Are Trophy Homes Losing their Lustre?

With pressure on the homebuilding industry to build fewer trophy homes and concentrate on filling the demand for affordable housing, the data does not bode well for builders.

Median prices of new homes have risen steadily during the recession. In September, the median sold price of a new home hit $313,500, 5.5 percent higher than last year’s median of $296,400 and 25.2 percent higher than the median price for existing homes in September.

Even so, over the past two years super expensive homes priced at one million or more are on the decline, according to data from the Census Bureau’s Survey of Construction.  In 2015, a total of 1,762 homes were started for sale with a price of $1 million or more and new homes started for sale with a price of $1 million or more decreased as a share in absolute number in 2015. That number was significantly lower than in 2013 (3,347 homes) and 2014 (3,019).

 

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In percentage terms, these expensive homes represented 1.06 percent of all new homes started for sale in 2015, from a peak of 1.26 percent in 2014 but about the same as in 2013 (0.99 percent). This represents a much higher percent share compared to other years. For instance, from 2008 to 2012 the percent share of $1 million or more homes started for sale was less than 0.50 percent, while it was at most 0.66 percent during the boom period, reported the National Association of Home Builders’ Eye on Housing blog.

To put things in perspective, Trulia reported in May that since 2012 the share of all million dollar homes in the United States has increased from 1.6 percent to 3 percent, but many metros and neighborhoods have seen a much larger increase.

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http://www.realestateeconomywatch.com/2016/11/are-trophy-homes-losing-their-lustre/

Garages in New Homes: 2015 Data | Waccabuc Real Estate

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A majority of new homes that completed construction in 2015 included two-car garages, according to NAHB analysis of Census Bureau Survey of Construction data gathered from garage door repair  and installation companies and homeowners.

For new single-family completions in 2015, 61% of homes offered a two-car garage that had Commercial Overhead Door Installation on them. Another 24% of homes possessed a garage large enough to hold three or more cars. Just 6% of newly-built homes had a one-car garage, and only 1% possessed a carport. Another 9% of new homes had no garage or carport. The ADSAutomaticDoorSpecialists, provide best garage door services to homeowners. The term garage door repair also includes replacements of major parts and even renovation. It can be performed through the use of simple hand tools, through the help of professionals and through the services of people expert on the job of repairs for garage. Simple repairs on a garage can be done through the use of household tools. Screws that have already loosened, for example, can be quickly repaired by simply tightening them up using screw drivers. Loose screws in the doors are commonly seen on the hinges and if they are not repaired right away, they may even cause accidents. Another simple repair on the garage that the resident handy man can do is changing the batteries for the remote controls of the garage opener. Very often, people get stressed out by door malfunctions or unresponsiveness to the controller without even realizing that the problem is very simple. In fact, they can be considered as not a problem at all. All that one has to do is to check the remote controller first. He can see if the thing is really not working or the batteries have just worn out and are already calling for replacements. A basic thing like this should not be worried about and is actually just a minor repair.

There are times, however, that simple remedies and the use of household tools are not enough to make the necessary repair. On such occasions, seeking the help of professionals is not a bad idea. One example of this is getting help from the locksmith. The lock of the garage door is one of those parts that worn out first due to frequent, and sometimes, wrongful use. It is very impractical to change the whole thing just because of a problematic part. Still, it is also impractical to raid the supermarkets for locks that one is not even sure of, particularly in terms appropriateness, installation and the security that the device provides. As such, the help of an expert locksmith will come in very handy. He can identify the device appropriate for the door, install it for the owner and guarantee as to the security that the device will provide.

Always check out the reputation of any company you are considering. Do they have the most up-to-date tools and equipment? Are their technicians highly-trained and knowledgeable? These are the people who you will be entrusting with the inspection your door, the diagnosis of the problems, and making the actual repairs. You need to feel confident that they know what they’re doing. Meet with the technician who will be working on your door personally, and assess for yourself how professionally this person behaves, how important your job is to him, and how quickly and efficiently he can assure you the repairs will be made. Once you are satisfied that the repairman meets these criteria, you can go ahead and hire him.

The company you hire should be willing to spend the time it takes to inspect your door and its hardware, give you a detailed explanation of the repairs and the costs, and answer any questions you may have. Anyone who tries to give you a rush job or who only gives you a runaround isn’t worth considering. Most likely, this person will also perform slipshod work and cosmetic fixes without dealing with the underlying causes of the problem. Instead, you want someone who is willing to give your job the individualized time and attention it needs.

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Over the last two decades, there has been a shift in parking options. As home size has grown, the share of homes with a three or more car garage has grown as well. In 1992, 11% of homes had a garage for three or more cars. That share rose to a peak of 20% in 2005, before falling to 16% in 2010.

In contrast, the market share of homes with no garage or carport has been on the decline. In 1992, 15% of new single-family homes had no parking facility. That share fell to 8% in 2005, before rising slightly to 13% in 2010.

There are also clear regional differences for parking options in new homes. In the Northeast, no garage or carport is available in 18% of homes, the highest such share. In the West, that is true in only 3% of homes, the lowest Census region. The Midwest had the highest share of three or more car garages, at 42% of new homes. The Northeast had the lowest market share of three-plus car garages, with just 12% homes completed. The Northeast in contrast leads the share in one-car garages, with 16% of completed single-family homes.

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http://eyeonhousing.org/2016/10/garages-in-new-homes-2015-data/

NAR says home sales to continue to increase next year | Chappaqua Real Estate

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Predictions from the National Association of Realtors, the Mortgage Bankers Association,Fannie Mae and Freddie Mac show that home sales are going to heat up in 2017, according to a blog by NAR.

NAR predicted existing home sales will reach 6 million in 2017, an increase from this year’s forecast of 5.8 million, according to the blog. MBA predicted home sales will reach 5.75 million and Fannie and Freddie forecast home sales will come in at 6.2 million.

From the blog:

A huge wave of Generation Yers, who have delayed home buying, are emerging into their key buying years. They are predicted to keep home sales and condo sales strong well into 2020, according to economists.

Meanwhile, new-home construction starts likely will tick up to about 1.5 million per year to 2024, predicts Forisk Research.

Home builders likely will continue to be more subdued, despite calls for more inventory.

As for the rest of this year, the summer housing market saw high demand next to rising home prices, but don’t expect Fall to bring any relief. In fact, it could bring the hottest fallin a decade, new data from realtor.com shows.

 

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NAR forecasts heated housing market in 2017

Number of baths in new homes increases | Bedford Corners Real Estate

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In its Survey of Construction (SOC), the US Census Bureau publishes data on the number of bathrooms in new homes started. In the last several years, the share of new single-family homes with 3 or more full bathrooms has increased, which may reflect the move by builders to focus on higher-end, larger homes in the post-recession period. However, recent data indicate that this trend started to reverse: the median square feet of new homes declined in the second quarter of 2016. Growth in the number of smaller homes, such as townhomes, may emerge going forward in response to first-time buyers returning to the market.

Of new single-family homes started in 2015, 4 percent have 1 or less full bathrooms, 59 percent have 2 full bathrooms, 27 percent have 3 full bathrooms, and 10 percent have four or more full bathrooms.

Figure 1 displays the shares of new single-family homes started by the number of full bathrooms from 2005 to 2015. Over this time frame, the shares of new homes with 2 bathrooms and with 1 or less bathrooms edged downward. Meanwhile, the shares of new homes with 3 bathrooms and with 4 or more bathrooms increased.
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Differences in the share of new single-family homes started in 2015 with 3 or more full bathrooms can be observed by Census Division (Figure 2). Figure 2 shows that the South Atlantic division has the largest share of new homes with 3 or more full bathrooms (42 percent). Other divisions with large shares include the Mountain (39 percent), the Pacific (38 percent), and the West South Central divisions (38 percent). Regions with smaller shares of new homes with 3 or more bathrooms include the New England (30 percent), the West North Central (30 percent), and the East North Central divisions (24 percent).

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http://eyeonhousing.org/2016/10/bathrooms-in-2015-new-homes/

Is now really the time to invest in Real Estate? | Armonk Real Estate

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According to a recent survey conducted by Better Homes and Gardens® Real Estate, as many as 89 percent of U.S. investors would strongly consider pursuing real estate as part of a broader investment strategy.

The same study, which was also cited by the National Mortgage Professional’s Magazine, goes on to reveal an even higher percentage of millennial investors — 96% — expressed interest in purchasing real estate for investment purposes. So I thought it would be nice to investigate these claims to find out why this does or does not represent sound strategy.

There are a myriad of reasons to invest in real estate. Likewise, there must be plenty of reasons not to invest. Let’s take a look.

Real Estate Investing: The Pros

  • The timing may be ripe. Given the uncertainty surrounding the upcoming elections, many investment managers are predicting a volatile stock market; this is regardless of who sits in the Oval Office, this January.
  • Hefty Earnings potential. When you reach the level of competence necessary to complete a deal on your own without making mistakes your earnings potential will soar.
  • You call the shots. As a real estate investor, you’re ultimately accountable to you and your checkbook. Of course, you will need to stay on top of your local coding regulations and ordinances. But once you get the hang of it, you really shouldn’t have any problems with ordinances.
  • Nurture your inner builder. Getting into the residential investment business entails lots of renovation work. As such, you can certainly expect to play with your fair share of power tools. Of course, if your favorite pastime is catching re-runs of ‘This Old House’, you probably already love using these tools. Perhaps this explains why so many contractors wind up investing in real estate.
  • A ‘hands on’ investment. Real estate investing is unique in that it’s almost as much a career or a way of life as it is a form of investing. Indeed, the fact that real estate is involves so much sweat equity makes it unique among other investments.

That notwithstanding, the hands-on aspect of buying and rehabbing homes is also why you’ll face less competition from investors than you might expect in stocks or bonds.

Real Estate Investing: The Cons

  • Substantial risk involved. The business side of real estate investing is fraught with risk. Unlike purchasing mutual funds or savings bonds, with real estate you can lose money; this is one of the reasons that seasoned real estate investors caution neophytes never to get too emotional about a property and always be willing to walk away.
  • You could pay dearly for your mistakes. Another thing that’s so different about real estate is that you pay dearly for your errors in this field. For example, if you sign a deal only to realize afterward that the numbers don’t add up – walking away is not always an option.
  • Requires a significant investment. Don’t let the late night infomercials fool you. It takes serious resources to pull off a successful real estate deal from start to finish. Hence, it’s important that you have a plan and stick to it, going into every investment.
  • Demands a well-defined skill set. For anyone used to going into the office every day and ‘punching the clock’, real estate can be a daunting field. Namely, because it requires the investor to become proficient in activities that you may not be accustomed to doing on a daily basis.

So these are the pluses and minuses. As prohibitive as the potential drawbacks might be, real estate still has the potential to offer substantial dividends – both in the form of financial rewards and in the satisfaction that comes from building something with your hands.

Hence, if you’re willing to learn the ropes and put in the effort, you should find your goals very attainable.

Should You Decide to Take the Plunge Know This

  • If you do choose to invest in real estate, don’t go in blind. Prepare a road map first. Determine what it will take to accomplish your goals for each property beforehand; this includes finances, materials, personnel planning, etc. Upon completing your plan be sure to meet with the concerned parties.
  • Always expect the unexpected. When meeting with sellers, buyers or investors be sure to expect the best but plan for the worse. There’s always the potential that the deal may fall through. Doing so will help put all other parties at ease while preventing you from getting too emotionally invested.
  • Find a good CPA and attorney. While you may already be familiar with accounting and various legalities, it helps to have a professional on speed dial in case a problem that you aren’t familiar with crops up.

It’s important to point out that I’m not here to advise you one way or another, as it relates to whether to invest in real estate or not. My job is to bring you the facts and let you decide what to do with them. That said, now that we’ve covered the advantages and disadvantages of real estate investing, what do you think?

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http://www.huffingtonpost.com/entry/is-now-really-the-time-to-invest-in-real-estate_us_57f6477de4b0568704999ef7

New Home Sales in September – Continuing Gains, Continuing Headwinds | Cross River Real Estate

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The US Census Bureau and Department of Housing and Urban Development in a joint release reported that newly constructed single family homes sold at a seasonally adjusted annual pace of 593 thousand in September, up 3.1% from a downwardly revised August figure, and up 29.8% from September 2015. However, note the monthly data is volatile and September was the lowest point in 2015 and the second highest point in 2016. Year over year growth in the trend in sales was 9.4%. Downward revisions to the July and August figures in no way diminish the upward trend that continues with the September figures.

The inventory of new single family homes for sale was 235 thousand, essentially flat in recent months after modest gains earlier in the year. Prices for new homes rose 3.5% from August and 1.9% from last September. A flat inventory in an environment of rising sales has put upward pressure on prices but expanding inventory has been a challenge given shortages of developed lots and skilled labor (NAHB). Both sales and inventories remain depressed by historical standards but the level of inventory given the pace of sales is in line with historical norms as builders balance caution and available resources in their efforts to meet expanding demand.

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http://eyeonhousing.org/2016/10/new-home-sales-in-september-continuing-gains-continuing-headwinds/

U.S. Housing Market Continues Steady Improvement | Bedford Corners Real Estate

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Freddie Mac (OTCQB: FMCC) today released its Multi-Indicator Market Index® (MiMi®), showing three additional states — Indiana, Alabama and New Jersey — and one additional metro area — Dayton, Ohio — entering their historic benchmark levels of housing activity.

The national MiMi value stands at 85.7, indicating a housing market that’s on the outer edge of its historic benchmark range of housing activity with a +1.05 percent improvement from July to August and a three-month improvement of +1.22 percent. On a year-over-year basis, the national MiMi value improved +5.44 percent. Since its all-time low in October 2010, the national MiMi has rebounded 43 percent, but remains significantly off its high of 121.7.

News Facts:

  • Forty-one of the 50 states plus the District of Columbia have MiMi values within range of their benchmark averages, with Utah (99.2), Colorado (96.6), Hawaii (96.3), Idaho (96) and North Dakota (95.4) ranking in the top five with scores closest to their historical benchmark index levels of 100.
  • Eighty of the 100 metro areas have MiMi values within range, with Los Angeles, CA (101.1), Honolulu, HI (99.5), Provo, UT (100.8), Dallas, TX (98.9) and Ogden, UT (98.6) ranking in the top five with scores closest to their historical benchmark index levels of 100.
  • The most improving states month over month were Nevada (+2.95%), Florida (+2.14%), Illinois (+1.95%), Washington (+1.91%) and Alabama (+1.90%). On a year-over-year basis, the most improving states were Florida (+12.13%), Massachusetts (+9.94%), Nevada (+9.94%), Oregon (+9.43%) and Tennessee (+9.39%).
  • The most improving metro areas month over month were Las Vegas, NV (+3.00%), Palm Bay, FL (+2.63%), Tampa, FL (+2.59%), Orlando, FL (+2.40%) and Sarasota, FL (+2.40%). On a year-over-year basis, the most improving metro areas were Orlando, FL (+18.21%), Tampa, FL (+14.78%), Chattanooga, TN (+14.51%), Palm Bay, FL (+14.25%) and Lakeland, FL (+13.66%).
  • In August, 33 of the 50 states and 73 of the top 100 metros were showing an improving three-month trend. The same time last year, all 50 states and 96 of the top 100 metro areas were showing an improving three-month trend.

Quote attributable to Freddie Mac Deputy Chief Economist Len Kiefer:

“Housing markets are on track for their best year in a decade, and that’s reflected in MiMi. The National MiMi stands at 85.7, a 5.4 percent year-over-year increase. The MiMi purchase applications indicator is up over 18 percent from last year and is at its highest level since December 2007.

“The housing market is showing strength across the country. The South continues to show some the biggest improvements, especially in Florida. MiMi’s purchase applications indicator is up more than 30 percent in Florida compared to last year. Meanwhile, in the West, the battle between low mortgage rates and rising house prices continues. So far, low mortgage rates have helped on the affordability front, but in hot markets like Denver, Fresno, Provo and Los Angeles it’s becoming increasingly difficult for the typical family to afford a median price home.”

The 2016 MiMi release calendar is available online.

MiMi monitors and measures the stability of the nation’s housing market, as well as the housing markets of all 50 states, the District of Columbia, and the top 100 metro markets. MiMi combines proprietary Freddie Mac data with current local market data to assess where each single-family housing market is relative to its own long-term stable range by looking at home purchase applications, payment-to-income ratios (changes in home purchasing power based on house prices, mortgage rates and household income), proportion of on-time mortgage payments in each market, and the local employment picture. The four indicators are combined to create a composite MiMi value for each market. Monthly, MiMi uses this data to show, at a glance, where each market stands relative to its own stable range of housing activity. MiMi also indicates how each market is trending, whether it is moving closer to, or further away from, its stable range. A market can fall outside its stable range by being too weak to generate enough demand for a well-balanced housing market or by overheating to an unsustainable level of activity.