The Most Motivating Video for Success!

This motivating video for success is great to watch every once in a while to get you in the right state of mind needed to run your business all the way to the top..!

Warning -- expletives are used infrequently to accentuate the motivational power of the message.

Pending Home Sales Dip Slightly in June

After reaching the highest level in over six years, pending home sales declined in June, with rising mortgage interest rates beginning to impact the market, according to the National Association of Realtors®.

The Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, edged down 0.4 percent to 110.9 in June from a downwardly revised 111.3 in May, but it’s 10.9 percent higher than June 2012 when it was 100.0.

The data reflect contracts but not closings. Pending sales have been above year-ago levels for the past 26 months, and the pace in May was the highest since December 2006 when it reached 112.8.

“Mortgage interest rates began to rise in May, taking some of the momentum out of contract activity in June,” says Lawrence Yun, NAR chief economist. “The persistent lack of inventory also is contributing to lower contract signings.”

Yun says a quick rise in mortgage interest rates during June may have had a bit of an impact too.

“There are some homebuyers who sign contracts with strong lender commitment letters, but have floating mortgage interest rates,” Yun says. “Those rates can be locked as late as 10 to 14 days before closing, so some homebuyers may change their minds if the rate rises too much, which apparently happened with some sales scheduled to close in June,” he said. “Closed sales may edge down a bit in the months ahead, but they’ll stay above year-ago levels.”

The PHSI in the Northeast was unchanged at 87.2 in June but is 12.2 percent higher than a year ago. In the Midwest the index slipped 1.0 percent to 114.3 in June but is 19.5 percent above June 2012.

Pending home sales in the South fell 2.1 percent to an index of 118.3 in June but are 9.5 percent higher than a year ago. The index in the West rose 3.3 percent in June to 114.2, and is 4.4 percent above June 2012.

Based on year-to-date sales activity, and stable contract signings expected for the balance of the year, NAR projects existing-home sales to rise more than 8 percent in 2013. Inventory shortages will lead the median price to rise by nearly 11 percent this year.

© 2013 Florida Realtors®

Existing Home Owners Join Market Recovery

Existing home owners are taking a bigger share of the housing market while investors—who have been the powerhouse until late—are slowly retreating.

“A sustainable housing market typically includes a more balanced share of first-timers, move-up buyers and investors, and that's how the housing recovery is beginning to shake out,” Realty Times reports.

Taking the lead: Current home owners—whether move-up, move-down, or move-over buyers—accounted for nearly 45 percent of the market share in home sales in June, up from 43.8 percent in May, reports the Campbell/Inside Mortgage Finance HousingPulse. Recent home price gains and the return of equity is prompting more to make the move, particularly as concerns rise that mortgage rates may soon cut into housing affordability.

Meanwhile, first-time home buyers are still being held back, with a slight drop in their market share from 36 percent in May to 35.7 percent in June, according to HousingPulse. Rising housing costs and mortgage rates as well as toughening up of lending standards have continued to shut out some first-timers.

The investor share in home purchases dropped to 19.7 percent in June from 23.1 percent share in February. It’s the lowest level recorded since September 2012, HousingPulse reports. Rising home prices and fewer distressed homes are prompting more investors to pull out of the market, which they had been dominating up until recently.

Source: “Shifting Share of Homebuyers Supports Sustainable Recovery,” Realty Times (July 26, 2013)

Prepare Your Buyers for Higher Home Prices

Home prices are rising across the country and the prices for new homes in particular may increase significantly in the near future. Economist Bradley Hunter with Metrostudy told The Chicago Tribune that he predicts newly-built homes could see a 9 percent increase in price by the end of the year.

“Here's what's happening: Land values are going up very fast right now in prime locations, what we call the ‘A’ locations,” Hunter explains. “In the best A (and B) markets, we expect prices to rise by 11 percent to 15 percent. Builders are desperate to buy lots, which in some cases are 30 percent to 50 percent higher than last year.”

The “A” and “B” locations, as Hunter refers to them, tend to be closer to the center city—near jobs, retail, and services.

Hunter does see some relief for those looking to buy in the coming year, however.

“I think the builders are going to have to come to grips with a new affordability mentality,” Hunter says. “They're going to have to reckon with these forces — rising mortgage interest rates, mainly — that are going to limit how much they can raise prices. That's why 10 percent to 15 percent price increases will become 3 to 6 percent pretty soon — in six to 12 months. It depends on when mortgage rates move higher. If they go up, say, by 2 percent or 3 percent, it will have a noticeable impact on what people can afford and therefore on what builders are offering.”

Source: “Builders navigating complex housing market,” The Chicago Tribune (July 26, 2013)

Florida has 4 out of Top 10 Cash Deals

Home buyers who require financing for their home purchase can struggle to compete against buyers who have offers of all-cash.

Where are all-cash deals are the most prevalent? Cash deals represented 80 percent of home sales in June in Vermont; 58 percent in Nevada; 57 percent in Florida, and 51 percent in New York, according to RealtyTrac. Cash deals represent a very small percentage in Texas, Utah, and New Mexico.

The markets with the most all-cash transactions tend to have a high number of foreclosures and depressed home prices, which attracts investors and private equity firms, according to RealtyTrac.

The following 10 metros had 40 percent or more all-cash deals out of the total home sales in June, according to RealtyTrac:
Miami/Ft. Lauderdale: 64%
Las Vegas: 62%
Tampa, Fla.: 58%
Detroit: 56%
Orlando: 53%
New York: 49%
New Orleans: 43%
Memphis: 43%
Jacksonville, Fla.: 42%
Atlanta: 42%

Source: “Housing markets where cash is king,” CNNMoney (July 25, 2013)

Coming Soon: 360-Degree View of all Florida Beaches

Tech giant Google is partnering with the state tourism marketing corporation to capture 360-degree panoramic images of the Sunshine State’s glam beaches, enabling potential visitors to check them out on the Internet before they ever leave home.

Trained by Google Maps experts, two teams started July 15, and will cover roughly 50 miles of beach per week, according Kevin McGeever, senior editor at Visit Florida, the state tourism marketing corporation.

One team is tentatively scheduled to work in an area from Palm Harbor to Sarasota, which includes Manatee County, during the week of Sept. 23, said McGeever Wednesday.

A Bradenton Beach resort owner was enthusiastic about the project.

“That’s awesome. That’s very cool technology,” said Gayle Luper, owner of the Bungalow Beach Resort, 2000 Gulf Drive. “A lot of people use Google to find us, but now, they can also use it to see the beach.”

One team member carries a 40-pound backpack with a camera system on top. It boasts 15 lenses angled in different directions to capture a complete picture.

The other team member scouts ahead, takes still pictures for a journal and tracks the weather.

Then, they switch.

Once the images are edited, integrated into Google Maps and uploaded to Internet websites, anyone with access to a computer can enjoy panoramic views of Florida’s world-class beaches beginning next year, said McGeever.

Although Google Maps has used cars equipped with similar technology to map street views across 5 million miles and 50 countries, the company wanted to expand to places cars can’t go, said Sierra Lovelace, a spokesperson for Google at its headquarters in Mountain View, Calif.

“There are places in the world that are important to document with Google maps, so we developed a fleet of street-view platforms or vehicles with the same technology that can go places cars can’t go,” she said, noting company transportation alternatives include snowmobiles, trolleys and trikes.

However, the Street View Trekker can eyeball places even trikes and trolleys can’t negotiate, she said.

Google’s partnership with Visit Florida involved the loan of two Trekkers under a financial arrangement Lovelace declined to discuss, she said.

“The beautiful thing is that, both on Google and on our site, visitors can look for their favorite beaches – by name, geography and region,” said McGeever. “It’ll be a great tool.”

Source: Bradenton Herald

Chinese Buyers Fastest Growing International Niche

Chinese buyers rank as the world’s fastest-growing population of property buyers, and they’re especially eager to invest in North American real estate. They’re expected to spend $114 billion on overseas property by 2015.

Reaching the Chinese buyer, however, is not as simple as listing a house online or taking out an advertisement in a Chinese magazine.

Pauline Ha, a Chinese-American real estate agent with Better Homes and Gardens Real Estate Mason-McDuffie in San Francisco, recommends a strategy that emphasizes customer service first and foremost. Her company is one of several ramping up its sales force and marketing initiatives to attract foreign buyers.

There is also a language barrier. An American Realtor who doesn’t speak Mandarin must use an interpreter, Mason-McDuffie’s Ed Krafchow recommends. At the same time, agents should be wary of using translating machines to create Chinese language content because they’re not always accurate. There is a good chance the technology could erroneously translate a Realtor’s actual meaning, prompting Chinese regulators to assume the agent is trying to mislead its citizens.

“For a broker to put a listing through a machine translator, you’re putting your broker license in jeopardy,” warns Andrew Taylor, co-CEO of Juwai.com, a Chinese-based global property listings site. “Make sure you’re hosted in China for speed, and make sure you’re speaking the right language.”

Source: RISMedia (07/25/13) King, Andrew

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Average Rate on 30-Year Loan Falls to 4.31%

Average rates on U.S. fixed mortgages fell for the second straight week, a welcome sign for homebuyers hoping to lock in lower rates that had spiked earlier this month.

Mortgage buyer Freddie Mac said Thursday that the average on the 30-year loan fell to 4.31 percent. That’s down from 4.37 percent last week but nearly a full percentage point higher than in early May. The rate reached a two-year high of 4.51 percent two weeks ago.

The average on the 15-year fixed loan declined to 3.39 percent, down from 3.41 percent last week

While rates remain low by historical standards, they have risen in recent weeks after the Federal Reserve indicated it might slow its bond purchases later this year. The $85-million-a-month in bond purchases have kept long-term interest rates low, encouraging more borrowing and spending.

Mortgage rates tend to follow the yield on the 10-year Treasury note, which rose sharply after Chairman Ben Bernanke said the Fed might reduce its bond-buying program. But the yield has since stabilized after Bernanke and other members emphasized that any change in the bond purchases would be tied to the economy’s health – not a calendar date. And Bernanke said the Fed would likely continue other low-interest rate policies for the foreseeable future because unemployment remains high and inflation low.

Low mortgage rates have contributed to a housing recovery that has helped drive economic growth this year.

Greater demand, along with a tight supply of homes for sale, has pushed up home prices. It also has led to more home construction, which has created more jobs.

This week the government said U.S. sales of new homes rose 8.3 percent to a seasonally adjusted annual rate of 497,000, the highest since May 2008.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was 0.8 point this week, up from 0.7 point last week. The fee for a 15-year loan also rose to 0.8 point from 0.7 point.

The average rate on a one-year adjustable-rate mortgage dipped to 2.65 percent from 2.66 percent. The fee was unchanged at 0.4 point.

The average rate on a five-year adjustable mortgage eased to 3.16 percent from 3.17 percent. The fee rose to 0.7 point from 0.6.

Copyright 2013 The Associated Press, Marcy Gordon, AP Business Writer.

U.S. Cash Sales Down, Short Sales Up

RealtyTrac released its first-ever U.S. Residential Sales Report, finding that all-cash purchases made up 30 percent of all sales in June, down from 31 percent of all sales in the previous month and a year ago.

A number of Florida metro areas had a high percentage of cash sales, including Cape Coral-Fort Myers, Fla. (70 percent), Miami (64 percent), Sarasota, Fla. (59 percent) and Tampa (58 percent). Las Vegas (62 percent) and Detroit (56 percent) also recorded a high percentage of cash sales.

Institutional investor purchases (sales to non-lending entities that purchased at least 10 properties in the last 12 months) accounted for 9 percent of all U.S. residential sales in June. Florida ranked No. 6 nationally with 12 percent of sales going to institutional investors. Top states include Georgia (23 percent), Nevada (16 percent), Arizona (15 percent), Oklahoma (13 percent) and North Carolina (12 percent).

Sales of bank-owned properties (REO) accounted for 9 percent of all residential sales in June, down from 10 percent in May 2013 and on par with a year ago.

Short sales accounted for 14 percent of all residential U.S. sales in June, according to RealtyTrac, with Florida No. 2 nationally with 29 percent of all sales short sales. Other high short-sale states include Nevada (30 percent), Maryland (21 percent), Tennessee (19 percent) and Arizona (19 percent).

“The U.S. housing market is slowly but surely moving toward a more normalized and sustainable pattern after a flurry of institutional and cash buyers flocked to residential real estate last year, pushing up prices and picking clean the best inventory available in many areas,” says Daren Blomquist, vice president at RealtyTrac.

© 2013 Florida Realtors®

New-Home Sales Hit 5-Year High

Increasing mortgage rates do not seem to be slowing new-home sales. Single-family new-construction home sales increased 8.3 percent in June to the highest level since May 2008, according to the Commerce Department. That's up 38.1 percent compared to June of last year — the largest year-over-year increase since January 1992.

With mortgage rates on the rise in recent weeks, some analysts have been concerned that home sales would slow. But the recent increase in mortgage rates hasn't appeared to slow demand as long as home affordability remains high. There are signs, however, that an increased urgency from potential new home buyers is evident as they move to secure today's historically low rates.

The inventory of new homes for sale in June fell to a thin 3.9-month supply, the National Association of Home Builders reported. The low supply is pushing up home prices: median new-home prices rose 7.4 percent in June compared to a year ago.

The Northeast saw new-home sales in June rise 18.5 percent; the West gained 13.8 percent; and the South gained 10.9 percent. The Midwest was the only region that posted a decline in new-home sales in June, falling 11.8 percent.

Source: National Association of Home Builders and “New Home Sales Hit Five-Year High; Prices Soar,” Reuters (July 24, 2013)

The Mall at University Town Center

The Mall at University Town Center near Sarasota is starting to take shape, as construction ramps up and becomes visible to passers-by. Excitement is growing with locals at what is projected to be a huge direct and indirect investment in this area of the Gulf Coast of Florida.

The new mall is going to be the next big retail development in western Florida. Taubman, in conjunction with Benderson Development is developing the 880,000 square foot, two-level enclosed regional shopping center, opening in October, 2014.

With Saks Fifth Avenue, Macy’s and Dillard’s committed to the mall, it is located at I-75 and University Parkway near Lakewood Ranch, which is the most densely traveled interchange in the area.

Robert Taubman, chairman, president and CEO of Taubman Centers says it "will be one of the premier shopping destinations on the west coast of Florida, and it will be the preferred shopping destination in the Sarasota region for locals and visitors alike."

Randy Benderson, president of Benderson Development thinks that “...this extraordinary investment in Southwest Florida’s future will exceed anyone’s expectations.”

New Home Sales Hit Highest Level in 5 Years

Americans snapped up new homes in June at the fastest pace in five years, a sign the housing recovery is strengthening.

The Commerce Department said Wednesday that sales rose 8.3 percent last month to a seasonally adjusted annual pace of 497,000. That’s up from an annual pace of 459,000 in May, which was revised lower.

While sales are still below the 700,000 pace consistent with healthy markets, they have risen 38 percent in the past 12 months. That’s the biggest annual gain since January 1992.

Home sales and prices have climbed since early last year, buoyed by solid hiring and low mortgage rates. Housing has helped drive economic growth this year at a time when other parts of the economy have languished, such as manufacturing and business investment.

New-home sales make up only a small part of the market but have a large impact on the economy. Each home built creates an average of three new jobs and generates about $90,000 in tax revenue, according to data from the National Association of Home Builders.

One concern is that rising mortgage rates could slow sales in the coming months. The average rate on the 30-year fixed was 4.37 percent last week – a full percentage point higher than in early May. At the same time, mortgage applications to purchase homes have fallen in the past few weeks.

Rates surged after Chairman Ben Bernanke said the Federal Reserve could slow its bond-buying program later this year if the economy continues to improve. The Fed’s bond purchases have kept long-term interest rates low, encouraging more borrowing and spending.

Still, other indicators suggest housing should continue to support the economy this year.

Sales of previously occupied homes slipped in June to a seasonally adjusted annual rate of 5.08 million but stayed near the 3-1/2-year high reached in May.

Homebuilders are more confident about the housing recovery than at any time in seven years, according to a survey by the National Association of Home Builders/Wells Fargo. That suggests home construction should keep increasing. Customer traffic and builders’ outlook for single-family home sales over the next six months are at the highest levels since the housing bubble burst in 2006.

Copyright © 2013 The Associated Press, Christopher S. Rugaber

Upward Trend Continues for Florida Housing Market

Florida’s housing market continued to show increased strength in June, including more closed sales of single-family homes, more new listings, rising median prices and a reduced inventory of homes for sale, according to the latest housing data released by Florida Realtors®.

Statewide closed sales of existing single-family homes totaled 20,403 in June, up 8.6 percent compared to the year-ago figure, according to data from Florida Realtors Industry Data and Analysis department in partnership with local Realtor boards/associations. Closed sales typically occur 30 to 90 days after sales contracts are written.

The inventory for single-family homes stood at a 5-months’ supply in June; inventory for townhouse-condos was at a 5.2-months’ supply, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.07 percent in June 2013, up from the 3.68 percent average recorded during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Media Center under Latest Releases or download the June 2013 data report PDFs under Market Data.

Source: Florida Realtors

Florida Cities Popular for Home-Flipping

RealtyTrac released its Midyear 2013 Home Flipping Report. In the first half of 2013, the nation had 136,184 single family home flips – defined as a home resale in less than six months – up 19 percent from a year ago and 74 percent from the first half of 2011.

Florida had 17,707 single-family home flips over the same timeframe, or roughly 13 percent of all U.S. flips. RealtyTrac found the average sale price to be $121,243, the average purchase discount to be 16 percent, and gross profit to be 25 percent ($30,861).

Nationwide, real estate investors made an average gross profit of $18,391 on single family home flips in the first half of the year – a 9 percent gross return on the initial purchase price. That’s up 246 percent from an average of $5,321 in the first half of 2012 and an average loss of $13,206 in 2011.

U.S. investors purchased flipped homes at a discount of 5 percent below estimated market value and sold them at a premium of 1 percent above estimated market value.

“While flipping continues to be profitable in most markets, particularly those where the home price recovery is still nascent and a recent rebound in foreclosure activity allows investors to find distressed inventory at a discount, home flipping is tapering off in markets where fewer of those distressed bargains are available,” says Daren Blomquist, vice president at RealtyTrac. “Out of the 100 markets we analyzed for the report, 32 had declining flipping numbers, including perennial flipping hot spots like Las Vegas, Phoenix, Southern California and Atlanta. Still, flipping was on the rise in more than two-thirds of the markets, including New York, Washington, D.C., Chicago and several Florida metros.”

Metro areas

RealtyTrac listed the top 15 metro areas nationwide for single-family property flips in the first half of 2013, and Florida cities took over half the spots, with Deltona-Daytona Beach-Ormond Beach the No. 1 U.S. city for flips.

1. Deltona-Daytona Beach-Ormond Beach. Average purchase price: $62,826. Gross profit: 82%
3. Palm Coast. Average purchase price: $127,896. Gross profit: 34%
5. Tampa-St. Petersburg-Clearwater. Average purchase price: $102,193. Gross profit: 23%
6. Port St. Lucie. Average purchase price: $105,824. Gross profit: 17%
7. Cape Coral-Fort Myers. Average purchase price: $134,644. Gross profit: 17%
8. Jacksonville. Average purchase price: $133,968. Gross profit: 16%
15. Orlando-Kissimmee. Average purchase price: $141,192. Gross profit: 10%

The complete report is posted on RealtyTrac’s website.

© 2013 Florida Realtors®

Will Rising Mortgage Rates Impact Home Prices?

History shows us that we don’t need to fear the recent spikes in mortgage rates because they won’t have an impact on home prices, according to Fannie Mae researchers in a new report.

Fannie Mae evaluated the trajectory of mortgage rates since 1990. Over the years, researchers have found that rising rates don’t hamper home sales and have no impact on home prices.

"History suggests that interest rate increases at the level recently witnessed will not stop the current housing recovery," the report notes.

For example, the study found that from October 1993 to December 1994, mortgage rates rose from 6.8 percent to 9.2 percent. However, home prices leveled off and then only dropped slightly during that time.

From October 1998 to May 2000, mortgage rates soared from 6.7 percent to 8.5 percent and there was no impact found on home prices during that period, according to Fannie Mae.

"What we see through the ups and downs of rate changes is that sellers are reluctant to lower prices," Mark Palim, who led the Fannie Mae study, told CNNMoney.

Source: “Higher mortgage rates won't hurt recovery, Fannie finds,” CNNMoney (July 18, 2013)

Inventory Drops to New Decade Low; Sales Remain High

The inventory of available homes in the Sarasota market fell to 3,114 in June, which is the lowest level in longer than a decade, and an 18 percent drop from this time last year. Declining inventory results in greater competition for homes and price escalation.

The latest results from the Sarasota Association of Realtors® shows that SAR members sold 883 properties in June, a drop from the May figure of 1,020 which represented an eight-year high, but up 2 percent over June of last year.

For the first half of 2013, sales are up 13.8 percent over last year at this time. If the current trend continues, 2013 will go down as the second highest sales year in the 90-year history of SAR, surpassed only by 2004's record figure of 11,267 closed transactions.

Pending sales stood at 1,024 in June, which is the sixth consecutive month that pendings have topped 1,000, an historic first for SAR. Pending sales have now topped 1,000 every month this year. This important statistic represents properties that went under contract during the month, and indicates sales in July and beyond could also be at near record high levels.

Median sales prices moderated in June 2013. The figure for single family homes was $200,000, down from the May figure of $220,000 but still 12 percent higher than last June's figure of $178,500. For condos, the median was $192,500, slightly below May's figure of $194,250 and below last June's figure of $195,000.

The available inventory hit yet another new decade low in June, dropping to 3,114 from May's figure of 3,297. The inventory is down almost 18 percent since June 2012, when it stood at 3,816.

The June inventory stood at 3.2 months for single family and 4.3 months for condos, with both property categories very near the lowest level in the past decade (achieved last month - 3.0 and 3.9, respectively). Months of inventory represents the time it would take to deplete the current inventory at the current sales rate. Last June there were 4.1 months of inventory for single family homes and 5.2 months of inventory for condos. At the worst point of our market in November 2008, there were 24 months of inventory for single family homes and 41.7 months for condos.

Click HERE for the complete press release in PDF format, plus several pages of statistical charts.

New Home Starts Take a Dive

Builders started construction on fewer new homes than expected in June, and permits for future construction also fell, the Commerce Department reported Wednesday.

Housing starts fell nearly 10 percent last month to the lowest level since August 2012. Housing permits—a gauge for future home construction—dropped 7.5 percent, posting a second consecutive month of declines. The report follows an industry index that showed builders’ confidence about the new-home sector was at its highest level since 2006.

Some economists weren't alarmed by the June decline in housing starts, attributing it to wet weather that pushed off construction projects in many parts of the country. The drop was also moslty present in the volatile multifamily housing sector, where starts fell 26.2 percent. Single-family home construction—the largest segment of the index—had a much more mild decline of 0.8 percent.

With builder confidence so high, several housing analysts say they expect housing starts to pick up in July.

"Since builders are under-supplying the market, inventories are likely to get leaner in the months ahead, and prices are likely to accelerate," Patrick Newport, an economist at IHS Global Insight in Lexington, Mass., told Reuters. "This will bring more builders into the market."

Source: “Housing Starts Fall to 10-Month Low,” Reuters (July 17, 2013)

Real Estate Appraisers Optimistic About Future

Eighty percent of residential appraisers and 78 percent of commercial appraisers said they’re upbeat about their future, according to a survey conducted in May-June by the Appraisal Institute, the nation’s largest professional association of real estate appraisers.

• 95 percent of residential appraisers and 49 percent of commercial appraisers said there is more demand for their services than there was one year ago
• 84 percent of residential appraisers said their local residential real estate market is strong
• 46 percent of commercial appraisers said their local commercial market is strong
• 86 percent of residential appraisers and 55 percent of commercial appraisers said demand for their services is strong
• 32 percent of residential appraisers and 45 percent of commercial appraisers anticipate more demand for their services during the next one to two years.

© 2013 Florida Realtors®

Did Cash Buyers Save the Housing Market?

Cash real estate sales have risen the last few years to some of the highest levels on record, and a new report by CoreLogic suggests that these sales heavily helped to contribute to stabilizing the residential housing market and leading it into recovery.

In the early 2000s, cash sales averaged 25 percent of home sales. But in 2007 and 2008, cash sales began to rise as foreclosures started to increase. By 2012, cash sales were making up 40 percent of sales and have since inched down to 39 percent as of May 2013.

“Without cash sales overall, sales today would be much lower and the price declines would have been worse,” Mortgage News Daily reports about CoreLogic’s findings. “More recently, cash sales have helped fuel price increases dramatically in several boom and bust markets. Median prices for cash sales are up 24 percent from a year ago while prices of sales generally have increased 15 percent.”

The rise in home prices will lead to a lower presence of cash sales as investor activity returns to more traditional levels, CoreLogic notes. With cash sales receding in recent months, first-time and trade-up home buyers will need to step in to keep the recovery expanding, CoreLogic notes.

Source: “Cash Sales Saved Housing Market -CoreLogic,” Mortgage News Daily (July 16, 2013)

Homebuilders' Confidence at 7-Year High

Builders continue to feel more optimistic about the direction of the recovery for newly built single-family homes. Builder confidence rose six points in July to 57, according to the National Association of Home Builders/Wells Fargo Housing Market Index. Any number above 50 indicates more builders view conditions as good than poor.

The index gauges builders’ perceptions on single-family home sales, sales expectations for the next six months, and buyer traffic. The gauge for current sales condition rose to its highest level since early 2006, and the index’s measurements for prospective buyers and sales expectations for the next six months rose to the highest levels since late 2005. The latest report also showed improvements in builder confidence has expanded across every region of the United States.

"Builders are seeing more motivated buyers coming through their doors as the inventory of existing homes for sale continues to tighten," says NAHB Chief Economist David Crowe. "Meanwhile, as the infrastructure that supplies home building returns, some previously skyrocketing building material costs have begun to soften."

Source: National Association of Home Builders

Jumbo Loans are Back

It’s a good time to buy an expensive home.

Jumbo mortgage loans, which sizzled during the housing market’s run-up and then fizzled spectacularly, are back with more flexible products from more lenders and interest rates that are inching ever closer to the terms offered to buyers of much less luxurious homes.

As a result, more consumers are able to consider the purchase of luxury homes, a market that has been long stalled. Nationally, the annual dollar volume of jumbo loans is on pace to be the best since 2007, and a growing field of lenders is seeking to build a customer base or cement established relationships by offering those mortgages.

“For a long time, it was, ‘Oh, God, wait and see what happens with the mortgage,’” said Matt Farrell, managing partner of Urban Real Estate in Chicago. “The banks have a renewed confidence in the collateral.”

During the housing industry’s darkest days when private investor interest in mortgages was nil, the overwhelming majority of mortgages written were either Federal Housing Administration-backed loans or mortgages that met Fannie Mae or Freddie Mac standards and were then sold to either agency. The loan limit for those loans in most parts of the country is $417,000.

Even during the downturn, lenders continued to make some jumbo loans to their very best clients – those with stellar financial pedigrees that included high credit scores, high cash reserves and sizable downpayments, sometimes of more than 30 percent of the purchase price. The loans were held on the lender’s own books.

What’s different today is that demand for big loans is on the rise, and lenders are eagerly stepping in at a time of recovering home prices and improved economic reports. Jumbo loan volume still pales in comparison with the market’s headier days, but there are also successful efforts to bundle and sell jumbo mortgage securities to private investors.

Jumbo loan originations totaled $203 billion last year. If the first-quarter pace of $54 billion continues, $216 billion of jumbo loans could be written this year, according to Inside Mortgage Finance, a trade publication. About 7 percent of that first-quarter volume was bundled and sold to private investors on the secondary market.

“The jumbo market we have now was created in 2009 after the crash and is very conservatively underwritten,” said Guy Cecala, CEO and publisher of Inside Mortgage Finance. “The good news for jumbo borrowers is in terms of underwriting or choice, the market is the best it’s been in the past five years.”

Higher fees charged by Fannie Mae and Freddie Mac are shrinking the interest rate spread between conforming and jumbo loans, as is competition by lenders to woo high-net-worth customers. At the end of June, for example, the average interest rate for a 30-year, fixed-rate jumbo mortgage was only 0.17 percentage point higher than a conventional loan, compared with a 0.5 percentage point difference a year earlier, according to financial publisher HSH.com.

That spread had climbed as high as 1.8 percentage points in December 2008, when the average interest rates were 5.2 percent for a 30-year, fixed-rate conforming loan and 7 percent for a jumbo mortgage.

“The spread is crazy right now. It’s so close right now,” said Randy Ernst, a vice president of mortgage lending at Guaranteed Rate. “Underwriting is still tough, but (lenders) want to do the business right now.

“It’s a risk-reward thing. You look at the client in the jumbo sector. They’re very good clients. A lot of my jumbo clients have a lot of money in the bank.”

“It’s easier than it was a year to two years ago,” agreed Eric Schuppenhauer, Chase’s head of mortgage originations.

Dr. Matthew Flak and his wife, Sarah Payne, recently decided it was time to move out of the 1,000-square-foot Chicago condo they shared with a dog and two cats, but they were unsure what kind of mortgage they could get, since Flak had a business loan tied to his dental practice.

To their delight, the couple was able to secure a jumbo loan to purchase a $657,000, 4,000-square-foot home in Orland Park, Ill., two weeks ago that required a 10 percent downpayment on a 3.75 percent adjustable-rate mortgage. They plan to refinance the loan into a fixed-rate jumbo loan before the end of the year.

“I wanted to buy a home that we were going to be in for a long time,” Flak said. “It’s a little more than I wanted to spend right now, but it’s only going to get more expensive. I didn’t want to have to buy a house and then go buy another house in five to seven years. If (the rates) go up maybe 2 percentage points, maybe it’s prohibitive for us.”

That kind of flexibility has been key to getting deals done, and it can vary from lender to lender.

For instance, Chase is offering a jumbo mortgage with an 80 percent loan-to-value to customers who have a 770 FICO score. With a downpayment of 25 percent, a borrower may qualify with a FICO score of 735 or 750.

Wintrust is offering a 30-year fixed jumbo mortgage of up to $1 million to customers with a 740 FICO score and a 10 percent downpayment. One existing bank customer, a local executive of an international company, had a FICO score of 650 and wanted to buy a $1.5 million home in Chicago’s North Shore area. Wintrust approved the loan, with a 25 percent downpayment, and will hold it on its own books.

“You’re not seeing a secondary market for that,” said Ryan Mecum, a Wintrust assistant vice president who will close 16 jumbo purchase loans this month, twice what he did a year ago, in what he calls an “intensively competitive environment” for jumbo customers.

“In ‘08 they were in a $450,000 property and would have bought a $700,000 property,” said Urban Real Estate’s Farrell. “They’ve been putting money in their savings account for five years. They’re going out and skipping that and looking at $1 million, $1.2 million homes.”

Copyright © 2013 Chicago Tribune. Distributed by MCT Information Services.

$100 Million Listings Re-Emerge

More than a dozen homes in the U.S. are now listed—some quietly—on the market for $100 million or more. That's more than the number that were listed during the peak of the housing boom in 2007, CNBC reports.

With $100 million listings, the location of the property—often an oceanfront plot—is more the lure to buyers than amenities, brokers say. For example, a 314-acre Martha's Vineyard estate currently for sale for $118 million has more than 1,200 feet of ocean frontage, as well as a 35-acre freshwater pond.

The priciest property currently on the market in the U.S. is also an oceanfront oasis: a 50-acre property listed for $190 million in Greenwich, Conn., that features 4,000 feet of ocean views, as well as a 12-bedroom Victorian home.

But the sky-high price tags don’t always fly, and these homes don't always sell for that much. The former Spelling mansion in Los Angeles was originally listed for $150 million, but it reportedly ended up selling for $85 million. Also, a 95-acre Aspen, Colo., estate that was once owned by Saudi Prince Bandar bin Sultan originally was listed for $135 million in 2006—but eventually sold for $49 million.

There is a perception that pricing over the $100m threshold draws attention to the property and gets it sold even though the price may have little to do with its value.

Source: “$100 Million House Listings Are Back: Are They Worth the Price?” CNBC (July 17, 2013)

Sarasota and Manatee Commercial Real Estate Market Showing Gains

After commercial vacancy rates across Southwest Florida dipped to post-recession lows in June, landlords gained the confidence to raise rents and invest new capital in their properties. 

The strengthening economy has resulted in companies starting to expand their workspaces and merchants to fill storefronts across the Gulf Coast of Florida. 

Recent progress in the region's commercial real estate sector comes as a thriving housing market and improved confidence among consumers have combined to help bolster businesses throughout Southwest Florida.

There is now signs that a steady absorption of distressed commercial space vacated during the economic downturn is happening. While the sector's rise has failed to match the buoyant housing recovery, many industry observers believe it could reach the same pace in 2014.

The vacancy rate in combined Sarasota and Manatee counties was 19.4 percent in June, representing a slight dip from the 19.6 percent rate at the start of the year.
The June occupancy rate was also higher than that of the same time in 2012 (by 1.8 percent), though the available space is still higher than what is considered a healthy market.

That influx of tenants has translated into increased profits for landlords for the first time in years, while also making investments in commercial deals more attractive and prompting new development.

Source: Sarasota Herald-Tribune

Discover if Your Neighborhood is Walkable

Mapping data company Maponics LLC is now offering a tool that rates the walkability of neighborhoods, school attendance boundary zones, subdivisions, and other geographical areas. The new feature adds to the Vermont-based company's Maponics Context suite of data around the geographic units it defines using "intelligent polygons."

"Walkability gives a geospatial meaning to the concept of 'street smarts.' We have over 150,000 neighborhoods that we generate the walkability rating for," said Maponics founder and CEO Darren Clement.

Maponics researchers derive walkability ratings based on a five-point scale using a complex algorithm the company developed. This algorithm takes into account such information as the concentration of homes in an area, number of local amenities, and the numbers and types of streets and intersections.

Source: "Maponics Now Providing 'Walkability' Ratings," Inman News (July 12, 2013)

Snakes Venture Out in Lakewood Ranch

There are so many snakes about in Lakewood Ranch this month; this is the fourth one we have spotted in July (after about a year without seeing any!).

We snapped this one crossing the street in front of our home. Can anyone identify it for us?

Homebuilding Hit by Labor and Supplies Shortages

Despite a big rise in orders for new homes in the past year, a shortage of building supplies and skilled labor is causing construction to lag demand.

“A wider housing market recovery has yet to filter down to regional building products makers—the companies that supply the roofing, walls and interior fittings needed to build these new homes,” Reuters reports.

Tight credit is also limiting suppliers' ability to raise their production to meet demand. Since the financial crisis, big banks are more reluctant to lend to small suppliers.

"Until you know unequivocally that the housing market has returned, you are going to be more reticent if you are a bank," Scott Simpson, BlueTarp chief executive, told Reuters. "Big banks are not going to lead the field in lending."

Homebuilders also are still operating at low workforces, following cutbacks during the housing crash in 2007.

"Construction is not proceeding as fast as it might have, had there been an ample supply of labor," says Chad Crow, chief financial officer at Builders FirstSource Inc. "I think that will probably be the trend over the next year or two."

Source: “Starved of credit, construction suppliers lag housing rebound,” Reuters (July 15, 2013)

Boomerang Buyers On Way Back to Florida Real Estate Market?

“Boomerang buyers”—former home owners who have gone through a short sale, foreclosure, or bankruptcy in the past few years and are saving up for a down payment to purchase a home again—are coming back. They're expected to flood markets in some of the hardest hit areas for short sales and foreclosures in the coming years. For example, boomerang buyers are predicted to account for nearly one in every five home sales in the metro Phoenix area this year—double the projected U.S. rate.

Rising rents and the desire to own again now that the economy is more stable are driving many boomerang buyers to re-enter the market. They also want to jump in before interest rates and home prices climb too much higher.

But how soon they can jump back in will depend on the type of loan they had as a previous home owner. For example, boomerang buyers who had FHA loans may need to wait only three years if they can prove that a hardship, such as job loss or death of a wage earner, led to their foreclosure or short sale.

Borrowers have typically been required to wait five to seven years to qualify for another loan, but mortgage giants have begun to change their rules to allow home owners who underwent a foreclosure or short sale to qualify sooner. Those who underwent a short sale will likely qualify the soonest. However, not all lenders are participating, so borrowers will need to shop around.

Freddie Mac’s wait time is usually four years following a short sale or deed-in-lieu, and seven years after a foreclosure. Fannie Mae may require a seven-year wait for a foreclosure, but only a two-year wait following a short sale as long as the borrower can provide a 20 percent down payment.

Source: “New Wave of Buyers Ready to Hit the Real Estate Market,” The Examiner (July 15, 2013)

The Sight-Unseen Real Estate Buyer Returns

Spurred by tight inventory, developers in cities like New York and Miami are demanding, and getting, millions for homes that have yet to be built

One real estate developer hired a drone; another displayed life-size sculptures of polar bears. A third charged potential buyers $100,000 just to take a peek at the floor plans. The common goal: selling something that doesn’t exist.

Spurred by tight inventory and plenty of interest from foreign buyers, real estate developers in cities such as New York and Miami are reviving the boom-era practice of pitching new buildings months – and even years – ahead of completion.

Miami’s Faena House, a planned 18-story tower, is still pouring concrete at the condo’s basement level. Yet the project, part of a newly developed strip that will include a five-star hotel and an arts center by Rem Koolhaas’s OMA design firm, already has 50 percent of its 47 units under contract, according to Alicia Goldstein of Faena Group. Buyers are required to put down a 50 percent cash deposit on the apartments, which range from $2.5 million for a one-bedroom to $50 million for the full-floor duplex penthouse.

At 56 Leonard in downtown Manhattan, which is being designed by Pritzker Prize-winning firm Herzog & de Meuron, 80 percent of the 145 units were under contract since presales launched in March. According to co-developer Izak Senbahar, a penthouse has gone to contract for $47 million, a record for downtown Manhattan if the deal closes. One57, one of the most expensive projects in Manhattan, won’t be completed until 2014, but 70 percent of its 92 units are already taken, and total sales are expected to exceed $2 billion.

“Today we see presales as early as two to three years away from completion,” says Kelly Kennedy Mack, president of New York-based Corcoran Sunshine Marketing Group, which runs marketing and sales for projects similar to 56 Leonard.

It is a contrast to the first years after the housing bust, when would-be buyers grew leery of presale offerings after some high-profile developments stalled during construction, leaving early buyers in the lurch. In Manhattan, the practice of selling out buildings on plans alone had all but disappeared three years ago, says Jonathan Miller, president of appraisal firm Miller Samuel.

But now that buyers are returning to the market, they are confronting historically low inventory levels, making presale offerings an increasingly attractive option. In the second quarter of this year, there were 4,795 units for sale in Manhattan, the lowest second quarter on record in at least 13 years, Mr. Miller says. Sales volume, on the other hand, has risen almost 19 percent compared with the same period last year. In a rising market, buyers are less fearful of a building going bust – and can look to presales as a way to “lock in” a lower price point.

At the same time, New York developers are contending with stricter criteria for securing loans. Lenders typically now require that a building sell at least 50 percent of its units or some comparable benchmark before a construction loan is completed, according to Frances Katzen, a managing director at Douglas Elliman.

In South Florida, where few of the proposed towers have traditional lender financing because banks and big investors are still spooked from the bust, presales are even more critical. The large cash downpayments demanded of buyers are used to fund most of the development’s construction.

That is where the marketing comes in. Michael Namer, the CEO of New York-based Alfa Development and the developer of Village Green West, takes a showman’s approach. In March, his pop-up art gallery in Chelsea hosted artist Oscar Dotter’s “Nordic Pop” exhibition, which included paintings and two life-size sculptures of polar bears. Mr. Namer says the goal was twofold: to raise awareness for the plight of the polar bear, and to showcase Chelsea Green, a 14-story, 51-unit green-energy building that he is developing. It is slated to open later this year, but was nearly sold out by the time of the exhibit. (Mr. Dotter, the artist, says he bought a two-bedroom unit in Chelsea Green for $2.1 million and says it would now list for $800,000 more than he paid for it.)

At 35XV, a condo to be built in New York’s Flatiron district, the pitch includes a view from the top. While the 24-floor project is only built about halfway up, so a “little baby helicopter” was commissioned to snap photos of the city skyline from different levels of the planned tower, says Kenneth Horn of Alchemy Properties. The images are compiled into a video package played on loop at the off-site sales office, he says, where a model kitchen and bathroom also await prospective buyers.

The building is about 50 percent under contract, and Mr. Horn says it has already raised prices twice, with prices for one-bedrooms now starting at over $2.2 million, up from around $1.5 million. He says his firm expects the building to sell out before it opens in August 2014.

Marketers of the Porsche Design Tower in Miami, which is scheduled to open in early 2016, created an aura of secrecy. There was so much interest in the building’s planned car elevator, which lifts tenants’ cars directly to their units, that Dezer Development charged interested parties a $100,000 refundable deposit just to see the floor plans. (The ploy got them about 33 buyer commitments before the presale office even opened, says owner Gil Dezer.)

Once the off-site sales office opened, though, the company felt it needed a better way to help buyers visualize their apartments, which range from $4.8 million for a 4,800-square-foot unit to $32.5 million for a 17,000-square-foot penthouse. “When you start showing duplexes on floor plans, people get confused,” Mr. Dezer says. So they made four replicas of different apartments and the lobby encased in four-by-six-foot glass boxes at a cost of $250,000. The décor and furniture was designed by Michael Wolk Design Associates and was crafted in miniature by MYP Maquetas, a Mexico-based model-making company. Currently 89 of the building’s 132 units have been sold for a total of $535 million, Mr. Dezer says.

The Porsche Design Tower required a 30 percent downpayment, which is lower than usual for Miami. This is because the developer plans to secure lender financing, taking some of the onus off buyers. While buyers can usually finance the balance of their purchase once their unit is completed, veterans say the vast majority of luxury presale buyers pay for their units in cash. The stiff cash requirements means buyers are betting, heavily, that their units will be completed to their liking – and that the development will be a success.

According to Jack McCabe, CEO of McCabe Research & Consulting, an independent real estate analysis company in South Florida, buyers are only entitled to a fraction of their downpayment if the project sours. Litigation can be onerous; many lawsuits from the last housing bust are still pending. The vast majority of new condo buildings after the bust saw individual or class action lawsuits from contract holders trying to recoup their losses, Mr. McCabe says.

Peter Zalewski, founder of the real-estate consultancy Condo Vultures, notes that foreign investors are more used to large cash deposits than U.S. buyers, so the large downpayment requirements are better tolerated. “Right now, it feels like 2003 in South Florida,” he says, recalling the boom years.

Not all developers are on board with such an early presales strategy. “A lot of developers leave money on the table if they sell too soon,” said Shaun Osher, CEO of CORE, a brokerage in New York. Mr. Osher says his company will only market a building a year out from completion, otherwise it risks underpricing the units. And should the still-fragile market take another drop, he warns that overly optimistic developers could end up with another bust-era dilemma. “Buyers would sooner lose their deposit than close on a devalued unit,” he says.

Copyright © 2013 The Wall Street Journal, Stefanos Chen, July 11, 2013

Florida Housing Bargains Still Available

Foreclosures have fallen by 35 percent nationwide in the last year, according to data from RealtyTrac. However, where such proceedings must first get approved by the courts—which are known for having a lengthy process—foreclosures have climbed 34 percent overall. In New Jersey foreclosures have soared 103 percent, followed by Florida (up 100 percent), Maryland (up 94 percent), New York (up 66 percent), and Illinois (up 65 percent), according to RealtyTrac.

In some states, a glut of foreclosures remain, and foreclosures tend to sell at discounts. Many of these properties will likely enter the market in the next six to 12 months, says Daren Blomquist, vice president of RealtyTrac.

“If you missed the bottom of the housing market, this might be the last chance to get a bargain on one of these foreclosure homes,” he says.

However, finding big housing bargains these days has become trickier “because there’s been such a recovery,” says Bradley Hunter, chief economist of Metro Study, a Houston-based housing market research firm. But he says those willing to choose developments that were built in the late part of the housing boom that are furthest from urban hubs and schools may find the biggest deals. “If you’re willing to make a bit of a commute, you may be able to save more money. In 2005, the motto for those looking for a new home was ‘drive 'til you qualify.’”

Source: “Where home prices haven’t hit bottom,” The Wall Street Journal (July 14, 2013)

Crazy Ants Invade Florida, Altering Ecosystem

If you’re in Texas, Florida or other Southern states this summer, watch out for “crazy ants,” warns Edward LeBrun, a University of Texas researcher who studies the species.

Also known as Nylanderia fulva, they’re called “crazy” because of their unpredictable movements and swarming populations. The bugs are reddish-brown, measure about one-eighth of an inch long and have a hankering for honeydew. They nest anywhere and are easily transported but, so far, have mostly infested Texas and several Southern states after being inadvertently transported from South America by humans.

They’ve spread to 24 counties in Texas, 20 in Florida and a few in Mississippi and Louisiana, says LeBrun’s study, which is published in the journal Biological Invasions. They cause almost $150 million in electrical damage a year because millions of ants are electrocuted in small circuits or wires, where they seek warmth, said a Texas A&M study published in April.

There’s no permanent solution yet, and fending off the ants is costly. Repeated treatments are needed to keep them from returning.

Susan and Paul Dans of Baytown, Texas, noticed the ants in 2010, when millions invaded their 3-acre lot. Struggling to keep the ants at bay using chemical sprays every two weeks, Susan Dans says she “felt overwhelmed.” It became difficult to walk or stand outside – she couldn’t even let her dogs in the yard.

“It’s just a frenzy,” she says. “They’re everywhere.”

Then the couple saw a TV interview with Tom Rasberry, the Texas pest exterminator credited with identifying the vexatious insects in 2002. Rasberry says he has been able to ward them off and, on two occasions, eliminate an entire colony with the insecticide Termidor (fipronil). Initially used for termites, it was approved by the Environmental Protection Agency for emergency use in Texas. If used incorrectly, it can kill bees, birds and aquatic animals, including fish.

“We can kill them,” he says of the ants. “But unless you can control the entire area, the best we can do is keep them at bay.”

The Danses still get treatments every three months at a cost of about $2,300 a year. To avoid paying even more, they treat only a 1-acre area around their house. They say the other 2 acres is wasting away, decreasing its property value. “It’s sad because you have no control,” Susan Dans says. “You just don’t see daylight.”

LeBrun’s study says the ants aren’t just a costly nuisance: They’re displacing other aggressive species, such as fire ants, and throwing the whole Southern ecosystem out of whack.

“It’s not a good trade,” says Robert Puckett, an associate research scientist at Texas A&M University who also studies the species. “Some people think they’d prefer to deal with crazy ants. But once they invade, people want their fire ants back.”

Though crazy ants don’t have a nasty stinger like fire ants, they do bite. Mounds are decentralized and can create larger supercolonies. And, as Rasberry knows, the insect’s kryptonite has yet to be discovered – typical insecticides have no effect.

In Colombia, they have replaced all other ant species, killing small animals by asphyxiation. They have attacked the eyes, noses and hooves of larger animals, such as cattle, and dried out entire grasslands.

LeBrun says scientists from both South and North America know little about the ant. The best thing to do, he says, is avoid transporting them by closely monitoring belongings when traveling and take advantage of available treatments until researchers can find better answers.

“We can really make a difference,” he says. “But we need to be careful, and we need to know more.”

Rasberry isn’t as optimistic: “It’s gone too far. There’s no turning back.”

Copyright © USA TODAY 2013, David J. Phillip, Associated Press.

Housing Inventories Rising Faster Than Usual

The number of homes for sale rose 4.3 percent in June to 1.9 million—the highest level in the past year. These gains are also higher than usual for this time of year, according to newly-released housing data from realtor.com®.

Following two years of declines, housing inventory is finally reversing course. More home owners are seeing rising prices and may be more apt to try to sell their homes.

The number of homes for sale has risen the most in the past year in areas that had seen the largest declines, such as Sacramento, Calif. (up 11 percent), Atlanta (up 10.9 percent), Phoenix (up 6.2 percent), and Miami (up 2.2 percent). From May to June, inventories soared by the highest month-over-month amounts in Southern California, with inventories up 51.5 percent in Orange County, 45.7 percent in Los Angeles, and 18.1 percent in San Diego, according to realtor.com®.

However, inventories of homes for sale remain far below last year’s level in markets such as Boston (down 35.1 percent), Denver (down 30.1 percent), Detroit (down 25.7 percent), Seattle (down 23.2 percent), and San Francisco (down 21.7 percent).

Realtor.com® also reports that median asking prices climbed 0.5 percent in June from May, reaching $199,900. Median asking prices are up by 5 percent over last year.

Source: “Housing Listings Multiply in June,” The Wall Street Journal (July 15, 2013)

Are Builders Intentionally Underbuilding?

With housing inventories so low, why aren’t homebuilders jumping in by ramping up production to meet demand?

A new housing report by Arizona State University suggests that homebuilders are methodically holding back their inventories and keeping the rate of new-home building low, despite population growth projections.

“New-home builders don’t appear too anxious to help meet the demand,” says Michael Orr, a real estate expert at ASU’s W.P. Carey School of Business.

A few years ago, during the housing bubble, homebuilding outpaced population growth. But builders are taking the opposite approach this time around. In an environment with tight underwriting for loans, builders are exercising some caution and restraint.

“They are trying to make sure they don’t overbuild like they did before the housing crisis, and they want to keep prices moving up,” Orr says. For example, Orr notes that in the Phoenix area, new-home sales rates are less than one-third of what is needed to keep pace with the projected population growth. He added that, with limited supply, builders are able to increase prices for new homes.

Those in the building industry have cited labor shortages, tight underwriting standards, and the rise in lot prices as a reason building hasn’t kept pace.

Source: “Why home builders aren't rushing to meet demand,” Phoenix Business Journal (July 9, 2013)

Foreclosures Down 29% From Year Ago

Foreclosures are continuing a steady fall, as home prices rise and the housing market picks up nationwide.

About 1 million homes were in some stage of foreclosure in May, down from 1.4 million in May 2012, a 29 percent decline, according to CoreLogic’s latest foreclosure report. As of May, the foreclosure inventory represented 2.6 percent of all homes with a mortgage -- down from 3.5 percent a year prior.

There were 52,000 foreclosures completed nationwide in May, down 27 percent year over year. However, the numbers are still elevated compared to what’s considered normal for the market. Prior to the decline in the housing market in 2007, completed foreclosures averaged 21,000 per month between 2000 and 2006, according to CoreLogic.

Since September 2008 -- the start of the financial crisis -- about 4.4 million foreclosures have been completed, CoreLogic’s data shows.

Meanwhile, shadow inventory is down 34 percent from reaching its 2010 peak. It was under 2 million units in April, representing a 5.3 month supply.

“We continue to see a sharp drop in foreclosures around the country and, with it, a decrease in the size of the shadow inventory,” says Anand Nallathambi, president and CEO of CoreLogic. “Affordability, despite the rise in home prices over the past year, and consumer confidence are big contributors to these positive trends. We are particularly encouraged by the broad-based nature of the housing market recovery so far in 2013.”

The stock of seriously delinquent homes, which is the main driver of shadow inventory, is at the lowest level since December 2008, adds Mark Fleming, chief economist for CoreLogic. “Over the last year, it has decreased in 42 states by double-digit figures, resulting in rapid declines in shadow inventory for the first quarter of 2013,” Fleming says.

The following five states account for nearly half of all completed foreclosures nationally and had the highest number of completed foreclosures in the last 12 months ending in May:

• Florida
• California
• Michigan 
• Texas
• Georgia

Source: CoreLogic

Some Buyers Still Not Sure About Timing the Market

Home prices and mortgage rates are rising, but there is still a crop of home buyers out there who are pondering whether now is the right time to buy a home or whether they should continue to wait a few more months.

Have they missed the boat completely, or could waiting pay off?

Mortgage rates have jumped more than half a percentage point in the last few weeks, with more jumps expected in the coming months. While rates are still low from a historical perspective, any rate increase impacts housing affordability.

However, rising interest rates will also likely mean the pace at which home prices are rising will slow down, according to economists.

Home prices may fall slightly – up to 1 to 3 percent – as buyer demand dips seasonally, says Amy Crew Cutts, senior vice president and chief economist for Equifax.

“But if interest rates jump another half percentage point, you may lose that price advantage to higher interest rates and monthly payments,” says Ilyce R. Glink, author of several real estate books.

While existing and new home sales have risen in recent months, they remain below their pre-recession peaks, says Cutts. Single-family housing starts are still about 60 percent below their pre-recession peak and existing-home sales are about 38 percent off their peak.

“Even with large percentage gains in housing measures, all major indices of housing market vitality point to a long recovery yet to come,” she says.

Source: “Real Estate Matters | Betting on the right time to buy as interest rates jump,” The Washington Post (July 2, 2013)

Foreclosure Inventory Down 27%

CoreLogic released its May National Foreclosure Report with a supplement featuring quarterly shadow inventory data as of April 2013.

According to CoreLogic, the U.S. had 52,000 completed foreclosures in May 2013, down from 71,000 one year earlier – a year-over-year decrease of 27 percent. On a month-over-month basis, however, completed foreclosures increased 3.5 percent – from 50,000 in April 2013 to 52, in May.

Florida, however, continued to lead the nation in both completed foreclosures and number of homes in its foreclosure inventory. In the year ending in May, the state recorded 103,000 completed foreclosures compared to second-place California with 76,000. Michigan (64,000), Texas (51,000) and Georgia (47,000) rounded out the top five. The five states, added together made up almost half of all U.S. foreclosures.

The Sunshine State, at 8.8 percent, also ranked No. 1 in foreclosure inventory as a percentage of all mortgaged homes. The remaining states in the top five for foreclosure inventory include, New Jersey (6 percent), New York (4.8 percent), Maine (4.1 percent) and Connecticut (4.1 percent).

Nationally, CoreLogic says that the total residential shadow inventory as of April was fewer than 2 million units – a supply of 5.3 months and down 34 percent from its peak in 2010. The shadow inventory is also down 18 percent for the year.

As of May 2013, about 1 million U.S. homes were in some stage of foreclosure (the foreclosure inventory) compared to 1.4 million in May 2012 – a year-over-year decrease of 29 percent. Month over month, the foreclosure inventory was down 3.3 percent.

At the end of May the number of seriously delinquent mortgages – those at least 90 days or more past due – hit its lowest level in four-and-a-half years.

“The stock of seriously delinquent homes, which is the main driver of shadow inventory, is at the lowest level since December 2008,” says Dr. Mark Fleming, chief economist for CoreLogic. “Over the last year it has decreased in 42 states by double-digit figures, resulting in rapid declines in shadow inventory for the first quarter of 2013.”

The value of shadow inventory was $314 billion as of April 2013, down from $386 billion in April 2012 and down from $320 billion six months earlier.

© 2013 Florida Realtors®

Americans Upbeat About Home Prices According to Survey

Fifty-seven percent of Americans believe home prices will increase within the next year, an all-time high for Fannie Mae’s National Housing Survey, which was created in 2010. Meanwhile, 7 percent of those surveyed say they believe home prices will drop.

The majority of Americans — also 57 percent — believe that mortgage rates will increase as well, reaching the highest level since the survey was created.

"The spike in mortgage rate expectations this month seems to have had an impact on a number of the survey’s indicators and may increase housing activity in the near term by driving urgency to buy," says Doug Duncan, senior vice president and chief economist at Fannie Mae. "Consumers may recognize that today’s still favorable mortgage rates and home ownership affordability levels will recede over time. Given rising home and rental price expectations and improving personal financial attitudes, more prospective homebuyers may be deciding that now is the time to get off the fence."

Seventy-two percent of Americans say now is a good time to purchase a home, according to the survey. The survey also found that 37 percent of Americans say now is a good time to sell, a slight fall from 40 percent in May.

Source: “Majority of Americans expect housing fundamentals to rise,” HousingWire (July 8, 2013)

Latest Real Estate Market Analysis in Zip Code 34202

We are at the halfway stage of 2013 and the latest market analysis in zip code 34202 is showing an overall increase in inventory levels (finally!), however we are getting a varied story across the different price points -- this is why the real estate market is so interesting this year. Although we are clearly in a seller's market, there are good deals for buyers depending on the price you want to pay, and most analysts expect this 'noise' to smooth sometime in 2014 when the market should return to 'normal'.

Click the following links according to what sector of the market you are in.

All 34202

$0 - 250k

$250-500k

$500-800k

$800-1250k

$1250k +

If you need to talk to me about your upcoming real estate opportunities, please contact me on (941) 725-1468 for a personal and free no-obligation consultation.

Sellers Gaining in Soaring Markets

Robert and Emerald Oravec were itching to sell their condominium late last year to move closer to a favorite surfing spot, but they were stuck. They owed the bank $194,000 and figured the most they could get was $180,000.

When they put their San Diego home up for sale a few months later, they fielded five offers within two weeks. It sold for $260,000 in May, allowing them to invest profits in a new home that’s more than twice the size on a large lot and 40 minutes closer to the surfing beach.

“We’re stoked,” said Robert, 50, a facilities engineer at Solar Turbines Inc., a maker of gas turbines that has employed him for the last 22 years. “It was better to be patient and wait it out.”

Soaring prices are leaving fewer homeowners owing more money than their properties are worth, bringing them off the sidelines of the nation’s surging housing market and offering relief to buyers who are frustrated by bidding wars. As more homes are put up for sale, price increases are expected to moderate.

Mark Fleming, chief economist at real estate data provider CoreLogic Inc., calls it “a virtuous circle.”

“The fact that house prices have increased so dramatically … has unlocked a lot of that pent-up supply,” said Fleming, whose firm found that markets with the largest percentage of “underwater” or “upside down” mortgages often have the lowest supply of homes for sale.

At the end of March, 19.8 percent of the nation’s mortgaged homes were underwater, down from 23.7 percent a year earlier and 25 percent during the same period of 2011, according to CoreLogic. Gains spread across the country, though regions that rose high and crashed hard remained saddled with homeowners who bought near the peak.

Nevada had a nation-high 45.4 percent of mortgages underwater, followed by Florida at 38.1 percent, Michigan at 32 percent and Arizona at 31.4 percent. Montana had a nation-low 5.6 percent.

Among major metropolitan areas, Tampa Bay had a nation-high 41.1 percent of mortgaged homes underwater, followed by Miami at 40.7 percent. Dallas had a nation-low 8.3 percent.

San Diego, at 19.5 percent, was slightly better than the national rate and California’s 21.3 percent. The region’s median home sale price hit $406,500 in May, up 21.3 percent from a year earlier amid brisk sales, according to DataQuick.

Housing inventories remain unusually low. There was a 5.2-month supply of existing, single-family homes for sale in May, compared to 6.4 months a year earlier, according to the National Association of Realtors. California had only a 2.6-month supply, compared to 3.6 months a year earlier and well below the six months that is considered a balanced market.

San Diego broker Colleen Cotter began knocking on doors this year after scouring property records to find homeowners who didn’t owe money. If someone answers, she makes an all-cash bid on behalf of investors who don’t even visit.

Nearly one of three homes sold in Southern California is paid for in cash, putting borrowers at a disadvantage. Some buyers write sellers about how they would cherish a home, hoping to spark a personal connection.

Josh Martin, 26, discovered homes he and wife considered buying had changed hands less than a year earlier at much lower prices. The first-time homebuyers lost nine bids since August – many to cash buyers – until finally landing a home in May for $250,000 in the San Diego suburb of Chula Vista.

“It was very stressful because the prices just kept going up,” said Martin, who recently left the Marine Corps. “Our lease was about to end and we didn’t want to sign another year.”

Economists expect many homeowners will continue to resist selling because they think they can profit more by waiting.

Nancy Randazzo, a 38-year-old public school teacher who owes about $240,000 on an Anaheim condominium that she bought for $335,000 in 2005, figures she might be able to sell for what she owes but wants to rent to Disneyland tourists. One potential snag is that she and her fiancée would need to find a place to buy.

“Prices are going up so fast that I don’t know if I can,” she said.

The huge price increases produced an unexpected retirement gift for Larry and Diane Plaster, who were resigned in January to selling their San Diego home for less than they owed the bank, known as a short sale. They owed $352,000 but accepted an offer for $290,000.

Their bank rejected the deal four months later, leading the couple to put the home up for sale again. On the second attempt, they took an all-cash offer of $380,000, yielding a windfall of $6,500 after broker fees and closing costs. The Plasters, who live on Social Security income, fulfilled a dream of moving to a geodesic dome they built in Janesville, 130 miles north of Lake Tahoe.

The former Catholic social service workers were so angry when Chase rejected the short sale that they closed their account after more than 40 years.

“Now I guess I should send them a thank-you note,” said Diane, 66.

Copyright © 2013 The Associated Press, Elliot Spagat.

Developer Awarded $3.2 million for Legacy Trail Land

Sarasota County developer Hugh Culverhouse has been awarded $3.2 million in an unusual eminent domain case nearly a decade after a public agency called the Surface Transportation Board seized a sliver of his Palmer Ranch property to build the Legacy Trail on an abandoned rail line. The judgment could swell to $5.1 million after interest.

The decision comes just months after a similar eminent domain case involving claims by 48 land owners along the Legacy Trail fetched a $6.5 million settlement. Another 13 Legacy Trail claims are still pending.

Source: Sarasota Herald-Tribune, July 2, 1013

Are Buyers Right to Play the Waiting Game?

Home prices and mortgage rates are rising, but there is still a crop of home buyers out there who are pondering whether now is the right time to buy a home or whether they should continue to wait a few more months.

Have they missed the boat completely, or could waiting pay off?

Mortgage rates have jumped more than half a percentage point in the last few weeks, with more jumps expected in the coming months. While rates are still low from a historical perspective, any rate increases can impact housing affordability.

However, rising interest rates will likely mean the pace at which home prices are rising will slow down, according to economists.

Home prices may fall slightly -- up to 1 to 3 percent -- as buyer demand dips seasonally, says Amy Crew Cutts, senior vice president and chief economist for Equifax.

“But if interest rates jump another half percentage point, you may lose that price advantage to higher interest rates and monthly payments,” says Ilyce R. Glink, author of several real estate books.

While existing and new home sales have risen in recent months, they remain below their pre-recession peaks, says Cutts. She says single-family housing starts are still about 60 percent below their pre-recession peak and existing-home sales are about 38 percent off their peak.

“Even with large percentage gains in housing measures, all major indices of housing market vitality point to a long recovery yet to come,” she says.

Source: “Real Estate Matters | Betting on the right time to buy as interest rates jump,” The Washington Post (July 2, 2013)

Hundreds of Gators Gather at Deep Hole in Myakka River State Park

Deep Hole is one of the best places to see alligators at Myakka River State Park. Hundreds of the reptiles gather at the 200-foot-wide sinkhole, which is in the wilderness preserve section of the park. Only 30 people are allowed to hike the 4-mile round trip each day.

Click here for more information

Myakka River State Park is at 13208 State Road 72, Sarasota, FL 34241. Admission is $6 per vehicle. To visit Deep Hole, you need a free wilderness permit from the ranger station. First come, first served. The gates open at 8 a.m. http://www.myakkariver.org/; (941) 361-6511.

All-Cash Offers Indicate Improving Housing Market

All-cash offers accounted for 33 percent of home sales, according to the National Association of REALTORS®' May 2013 REALTORS® Confidence Index. The majority of those all-cash offers are coming from investors and international home buyers.

All-cash offers can represent stiff competition for traditional buyers. For example, first-time home buyers, who are already facing low inventories and rising home prices, view all-cash offers as one of their biggest competitions in the market today.

But for a seller, an all-cash deal is attractive, cutting out potential obstacles in making it to closing. "If you own a home and are selling yourself, it's probably easier if someone pays you cash -- it cuts out the messiness and having the home buyer get approved for a loan,” says Patrick Newport, U.S. economist at IHS Global Insights.

A high number of all-cash offers in the housing market can “signal a housing market that people are more willing to invest in,” says William Delwiche, investment strategist at Baird Research & Insights.

"A lot of those cash investors are looking for a return," says Karen Dynan, vice president and co-director of economic studies at the Brookings Institute. "If a lot of people think home prices will rise, they will put money into the market, and that increases demand and pushes up prices."

Cash-buying can be good for the economy, providing it with a short-term boost. It “helps to bid up asset values for houses, and is good for home owners who already own houses," Delwiche says. "There is also a benefit to state and local government finances because of the taxes associated with these purchases."

Source: “All-Cash Offers: Healthy for Real Estate Market, or a Hindrance?” FOX Business (June 28, 2013)

Rising Home Prices Tempting More Home Owners to Sell

With rising home prices, more home owners are finding they can sell without fear that their mortgage is worth more than their house. The number of sellers coming onto the market is serving as a relief to home buyers who were becoming increasingly frustrated at the lack of inventory and increased bidding wars, the Associated Press reports.

It’s a “virtuous circle,” says Mark Fleming, chief economist of CoreLogic, a real estate data provider. “The fact that house prices have increased so dramatically ... has unlocked a lot of that pent-up supply.”

From January to March, about 19.8 percent of homes nationwide with a mortgage are considered “underwater” -- that’s a drop from 23.7 percent a year earlier.

The largest percentage of underwater homes in the nation are often found in the markets with the lowest supply of homes for sale, according to CoreLogic. Tampa Bay, Fla., and Miami have the highest number of underwater mortgages of metro areas at 41.1 percent and 40.7 percent, respectively.

Housing inventories remain constrained in many markets. As of May, there’s a 5.2-month supply of existing homes for sale nationwide, according to the National Association of REALTORS®. One year earlier, the supply of homes stood at 6.4 months.

Some home owners may continue to resist selling despite regaining equity, believing that home prices may rise even more if they wait, economists say. However, economists predict that as inventories increase, home price increases will moderate.

Source: “Home price gains bring ‘underwater’ sellers off sidelines, relieving frustrated buyers,” The Associated Press (June 30, 2013)

Reduction in First-Time Homebuyers Still a Concern

First-time home buyers accounted for 28 percent of existing-home purchases in May—down from 34 percent a year prior, according to the National Association of REALTORS®. Traditionally, first-time home buyers account for four of 10 home buyers, so their dwindling numbers are alarming some housing analysts and economists.

As home prices rise, first-time home buyers may increasingly get left on the sidelines. Home prices have posted double-digit gains in the last year in many markets, and average mortgage rates are ticking up above 4 percent. Some first-time home buyers may have already missed the prime conditions to jump into home ownership.

First-time home buyers are “critical to a housing recovery because they help existing-home owners sell and move up to larger or more expensive homes,” USA Today reports.

First-time home buyers are being limited by a range of factors. They face competition from investors and tight credit conditions that are making it more difficult to qualify for a home loan.

The still looming aftereffects of the recession also represent a problem for some. The recession hit the 25- to 34-year-old age group hardest with high unemployment, coupled with the fact that this age group is also facing high levels of student loan debt—factors that have delayed home ownership for the younger generation.

Source: “First-time buyers losing out as home sales rise,” USA Today (June 29, 2013)