Home Values: On the Rise

DSNews.com, February 21st, 2018

The housing market has been growing at a consistent pace, but it will take another five years for it to emerge from the shadow of the Great Recession, according to experts surveyed by Zillowin its Home Price Expectations Survey.

The quarterly survey of more than 100 economists and real estate experts across the U.S. asked them to offer their expectations for growth in the U.S. Zillow Home Value Index over the next five years, as well as offer their opinion on a series of supplemental questions related to the housing market.

The survey found that according to the S&P/Case-Shiller U.S. National Home Price Index home values grew at an average annual pace of 3.6 percent between 1987 and 1999. If home values had continued to grow at the same pace year-after-year, the median U.S. home would have been worth $214,500 at the end of 2017. However, as of December 2017, the median U.S. home was valued at $206,300 despite six years of an average annual home value growth of 5.3 percent during the recovery period after the Great Recession.

According to the survey panelists home values were expected to climb 4.8 percent in 2018, with annual appreciation slowing to 3.7 percent in 2019, and 2.7 percent by 2021, before accelerating to 2.8 percent annual growth by 2022.

Though the most pessimistic of them said they expected only 1.6 percent annual growth in the market, most respondents surveyed said that they expected the average annual growth rate at 3.4 percent over the next five years.

When asked how the recent passage of the new tax law impacted their overall outlook for U.S. home values over the next five years, 41 percent of panelists said their outlook was more pessimistic, compared to 31 percent who said their outlook was more optimistic.

The panelists said they expected bottom-third, entry-level home values to grow 6 percent in 2018, down from 8.5 percent annual growth currently but still double the expected pace of top-third annual home value growth, which is expected to be 3 percent in 2018, the survey found.#HomeValue #HomePrice #HousingMarket #LenandLeslieMarma

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80% of Renters Believe Homeownershipis a Part of Their American Dream

KCM Crew, February 21st, 2018

According to the latest Aspiring Home Buyers Profile by the National Association of Realtors (NAR), 82% of surveyed renters desire to own a home in the future, with 80% believing homeownership is a big part of achieving their American Dream.

The profile went on to state that 50% of millennials believe that their rent will increase, with 20% believing that an increase in rent will be the catalyst that pushes them to consider buying a home vs. renewing their lease.

So, what is holding renters back?

80% of Renters Believe Homeownership is a Part of Their American Dream | MyKCM

What would make renters take the plunge?

80% of Renters Believe Homeownership is a Part of Their American Dream | MyKCM

NAR’s Chief Economist, Lawrence Yun believes that,

“Housing demand in 2018 will be fueled by more millennials finally deciding to marry and have kids and the expectations that solid job growth and the strengthening economy will push incomes higher.”

Yun goes on to warn that,

“However, with prices and mortgage rates also expected to increase, affordability pressures will persist. That is why it is critical for much of the country to start seeing a significant hike in new and existing housing supply. Otherwise, many would-be first-time buyers will be forced to continue renting and not reach their dream of being a homeowner.”

Bottom Line

If you are one of the many homeowners whose houses no longer fit their needs and are looking to move up to your dream home, now is a great time to list your starter home! First-time buyers are out in force looking to achieve their American Dream.

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8 Tips for a Soothing and Organized Bath

8 Tips for a Soothing and Organized Bath https://www.houselogic.com/by-room/bathroom-laundry/bathroom-organization-ideas/#bath #bathroom #LenandLeslieMarma’

http://www.houselogic.com, February 19th, 2018

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50 Box-Office Bombs that are Actually Great

50 Box-Office Bombs That Are Actually Great @Thrillist https://www.thrillist.com/entertainment/nation/biggest-box-office-flops-bombs-good-movies?utm_content=50+Box-

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Should I Wait Until Next Year to Buy? Or Buy Now?

KCM Crew, February 17th, 2018

Should I Wait until next Year to Buy? Or Buy Now? [INFOGRAPHIC] | MyKCM

Some Highlights:

  • The Cost of Waiting to Buy is defined as the additional funds it would take to buy a home if prices & interest rates were to increase over a period of time.
  • Freddie Mac predicts interest rates to rise to 5.1% by 2019.
  • CoreLogic predicts home prices to appreciate by 4.3% over the next 12 months.
  • If you are ready and willing to buy your dream home, find out if you are able to!
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Calm Down! The Real Estate Market is NOT Falling Apart

KCM Crew, February 16th, 2018

Calm Down! The Real Estate Market is NOT Falling Apart | MyKCMThere has been tremendous volatility in certain markets over the last few weeks (for example, the stock and currency markets). When this happens, some tend to lump all of their investments together and create an almost ‘Armageddon’ scenario where everything loses value quickly and dramatically. Real estate is an investment that can get caught up in this hysteria. Does the concern about the current housing market have merit?

Financial advisors have been warning us for months that the stock market was ripe for a “correction.”

Experts have been questioning the value of alternative currencies for over a year.

In contrast, here are the opinions of three major players in the residential housing market:

Ralph DeFranco, Chief Economist, Arch Capital Services Inc.

“It’s premature to worry about a housing bubble. The typical warning signs – excessive debt levels, poor quality loans, exponentially increasing home prices, rising vacancy rates and/or poor affordability compared to the past, and a high number of internet searches on house flipping – are not present.”

Liu-Down, Genworth Chief Economist

“My thoughts on many recent discussions of ‘housing bubble’ – the bar for a housing bubble is higher than just prices being above some fundamental value. There must be widespread behavior change as well such as higher levels of fraud and speculation.”

Fitch Report

“US home prices are on track for a 5% nominal gain for the 4th consecutive year, returning national prices to their highest level since 2007. The growth has been driven by historically low mortgage rates and unemployment plus solid population and personal income growth rates…a meaningful correction should only be triggered by an unexpected economic shock.”

Bottom Line

Speculation has driven certain markets over the last year. However, it has not been speculation, but instead people’s desire for homeownership, that has driven the real estate market.

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High Prices Collide with Dwindling Inventory

DSNews.com, February 16th, 2108

Last year ended with a jump in home prices, according to the Q4 2017 report from the National Association of REALTORS (NAR). In Q4 2016, the national median single-family home price was $235,400, and in Q4 2017 it jumped to $247,800, a 5.3 percent year-over-year increase.

As home prices increased, so have sales, according to NAR. Existing home sales went up 4.3 percent to a seasonally adjusted annual rate of 5.62 million in Q4 2017 from Q3, and 1.3 percent higher than the 5.55 million pace during Q4 2016. NAR notes that this increase in home sales forced housing inventory to an all-time low.

“A majority of the country saw an upswing in buyer interest at the end of last year, which ultimately ended up putting even more strain on inventory levels and prices,” said NAR Chief Economist Lawrence Yun. “Remarkably, home prices have risen a cumulative 48 percent since 2011, yet during this same timeframe, incomes are up only 15 percent. In the West region, where very healthy labor markets are driving demand, the gap is even wider.”

NAR also notes that the national family median income rose in Q4 2017, but the combination of rising prices and mortgage rates have still kept many buyers out of the market.

“While tight supply is expected to keep home prices on an upward trajectory in most metro areas in 2018, both the uptick in mortgage rates and the impact of the new tax law on some high-cost markets could cause price growth to moderate nationally,” said Yun. “In areas where homebuilding has severely lagged job creation in recent years, it’s going to be a slow slog before there’s enough new construction to cool price appreciation to a pace that aligns more closely with incomes.”

NAR will release its Existing-Home Sales report for January on February 21.

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