Housing Market Still Not Meeting Potential

DSNews.com, November 25th, 2017

The housing market still wasn’t living up to its potential in October 2017, with new data from First American highlighting a market performance gap that is the largest since November 2016. According to First American’s Potential Home Sales model for the month of October, potential existing-home sales got a 0.4 percent month-over-month bump, reaching a 5.89 million seasonally adjusted, annualized rate (SAAR). However, First American says the market for existing-home sales is underperforming its potential by 455,000 (SAAR) sales (7.7 percent).

Market potential was on the upswing, increasing by an estimated 26,000 (SAAR) sales between September 2017 and October 2017. The October 2017 potential existing-home sales were down by 4.3 percent compared to the same month last year, however, although the October numbers were still 95.7 percent higher than the market potential low point from December 2008. As of October 2017, potential existing-home sales are 8.2 percent below the pre-recession peak of July 2005.

First American Chief Economist Mark Fleming’s monthly analysis explained that continuing supply problems are going head-to-head with strong demand to shape the current state of the market. The number of homes for sale has declined on a year-over-year basis for the past 38 months in a row. Moreover, according to Realtor.com, active inventory is down by 7.6 percent and homes are selling 7.6 percent faster than a year ago. Per the First American Real House Price Index, affordability was down 9.6 percent in August 2017, as compared to August 2016.

In Fleming’s October market analysis, he said:

Tight supply and strong first-time home buyer demand continue to be the dominant factors driving the current state of the housing market. Existing homeowners remain reluctant to list their homes for sale for fear of not being able to find a home to buy, keeping supply levels low. At the same time, a healthy number of potential home buyers continue to enter the market, so house prices are increasing and affordability is declining. Historically low rates offer some relief in the form of strong borrowing power, however rates are expected to rise in the months to come, so if you are renting and thinking of buying, now is the time.

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Existing Home Sales Slowed by a Lack of Listings

KCM Crew, November 24th, 2017

Existing Home Sales Slowed by a Lack of Listings [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • The inventory of existing homes for sale has dropped year-over-year for the last 29 consecutive months and is now at a 3.9-month supply.
  • Existing home sales are currently at an annual pace of 5.48 million, the highest pace since June of this year, but down 0.9% from October 2016.
  • NAR’s Chief Economist, Lawrence Yun, had this to say: “While the housing market gained a little more momentum last month, sales are still below year ago levels because low inventory is limiting choices for prospective buyers and keeping price growth elevated.”
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4 Funky Odors in your Home only your Guests can Smell

4 Funky Odors In Your House Only Your Guests Can Smell https://www.houselogic.com/organize-maintain/cleaning-decluttering/noseblind/#odorremoval

http://www.houselogic.com, November 23rd, 2017

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Existing Home Sales Hit Highest Pace Since Summer Months

But drop annually for second consecutive month

fall houses neighborhood

Existing home sales increased in October, hitting their highest pace since earlier this summer, however, sales are still down year-over-year, according to the latest report from the National Association of Realtors.

This increase marks the strongest pace of sales since June’s 5.51 million, however, it is still down 0.9% from last year, marking the second consecutive month of annual declines.

“Job growth in most of the country continues to carry on at a robust level and is starting to slowly push up wages, which is in turn giving households added assurance that now is a good time to buy a home,” NAR Chief Economist Lawrence Yun said. “While the housing market gained a little more momentum last month, sales are still below year ago levels because low inventory is limiting choices for prospective buyers and keeping price growth elevated.”

Yun explained that while Hurricanes Harvey and Irma are still creating a pull on home sales in Texas and Florida, sales should completely bounce back to their normal levels by next year.

“It has been an eventful past couple months as the housing market has absorbed and bounced back from a string of deadly and destructive storms,” Zillow Chief Economist Svenja Gudell said. “But late-summer action aside, the housing market largely remains stuck in the same, predictable rut it has been in for the past two years or so: Demand is high, inventory is low and nothing short of a dramatic shock – which nobody expects – seems likely to knock it off that track.”

The median existing home price for all housing types in October increased 5.5% from last year’s $234,100 to $247,000 in October this year. This marks the 68th straight month of year-over-year gains.

“More than two years of inventory declines have taken a toll on sales,” Redfin Chief Economist Nela Richardson said. “Buyer demand continues to surpass last year’s levels, and we don’t expect that to change anytime soon. What will change is the cost of buying a home, which is likely to increase heading into 2018.”

Another expert explained this growing level of demand continues to worsen the already low levels of housing inventory.

“Existing home sales rose for the second month in a row in October, with a larger than expected gain of 2% m/m,” Capital Economics Property Economist Matthew Pointon said. “But that rise has only worsened what was an already very low level of inventory. With home buyer sentiment dropping to a six-year low in September, there seems little chance that this marks the start of a sustained rise in sales.”

Total housing industry continues to decline, falling 3.2% to 1.8 million homes available for sale in October. This is down a full 10.4% from last year’s 2.01 million homes, and marks the 29th consecutive month of annual declines. Unsold inventory now rests at a 3.9-month supply at the current sales pace.

“We expect existing home sales to continue to edge higher over at least the next year, powered by solid job gains, faster wage increases, and improving demographics as Millennials form households at a faster pace,” Nationwide Chief Economist David Berson said. “The combination of rising housing demand and continued low inventories of homes for sale suggest that house price gains will continue to be outsized.”

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Putting Holiday Decorations Up Early Could Make You Happier, According to Experts

Putting Holiday Decorations Up Early Could Make You Happier, According to Experts http://www.goodhousekeeping.com/health/news/a46938/christmas-decorations-make-you-happy/ via @goodhousemag#ChristmasDecorations

http://www.goodhousekeeping.com, November 20th, 2017

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Homeowners: Your House Must be Sold TWICE

KCM Crew, November 20th, 2017

Homeowners: Your House Must Be Sold TWICE | MyKCMIn today’s housing market, where supply is very low and demand is very high, home values are increasing rapidly. Many experts are projecting that home values could appreciate by another 5%+ over the next twelve months. One major challenge in such a market is the bank appraisal.

If prices are surging, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that recently closed) to defend the selling price when performing the appraisal for the bank.

Every month in their Home Price Perception Index (HPPI), Quicken Loans measures the disparity between what a homeowner who is seeking to refinance their home believes their house is worth, and an appraiser’s evaluation of that same home.

Bill Banfield, Executive VP of Capital Markets at Quicken Loans urges anyone looking to buy or sell in today’s market to remember the impact of this challenge:

“Based on the HPPI, it appears homeowners in the markets where prices are rising faster than the national average – like Denver, Seattle and San Francisco – are continuing to underestimate just how quickly home values are rising, so the average appraisal is higher than homeowner estimate.

On the inverse of that, homeowners in areas where the values aren’t rising as fast may think they are rising faster than they are, leading to the appraisal lagging the estimate.”

The chart below illustrates the changes in home price estimates over the last 12 months.

Homeowners: Your House Must Be Sold TWICE | MyKCM

Bottom Line

Every house on the market must be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. If you are planning on entering the housing market this year, let’s get together to discuss this and any other obstacles that may arise.

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9 Ways to Stop Thanksgiving From Sending Your Energy Bill Soaring

National Association of REaltors, By: Courtney Craig, Published: August 18, 2016

Like turning down the heat when you crank up the oven.

Your home gets a serious workout on Thanksgiving. While you may be packing on the pounds, your home is sweating from increased usage — more people coming in and out, and more ditigal devices to charge so everyone can keep up with their favorite football team and friends. Your home’s energy consumption can skyrocket, especially when the oven’s working non-stop and you’re pulling out kitchen gadgets to chop and puree.

Give your home a break, and don’t make it work so hard, which will also save you cash on energy bills. Try these tips:

A Few Days Before Thanksgiving

1. Install a dimmer switch for the dining room chandelier. Every time you dim a bulb’s brightness by 10%, you’ll double the bulb’s lifespan. Most CFLs don’t work with dimmers, but you can create mood lighting with incandescents and LEDs. The dimmer switch will cost you about $10.

2. Plan side dishes that can cook simultaneously with the turkey. If you cook dishes at the same temperature at the same time, you’ll reduce the amount of time the oven has to be running — it’s easier for the cook and saves energy, too.

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When You Start Cooking

3. Lower your house thermostat a few degrees. The oven will keep the house warm. You also can turn on your ceiling fan so it sucks air up, distributing heat throughout the room.

4. Use ceramic or glass pans — you can turn down the oven’s temp by up to 25 degrees and get the same results. That’s because these materials retain heat so well, they’ll continue cooking food even after being removed from the oven.

5. Use your oven’s convection feature. When heated air is circulated around the food, it reduces the required temperature and cooking time. You’ll cut your energy use by about 20%.

6. Cook in the microwave whenever possible. Ditto slow cookers. Microwaves get the job done quickly, and although slow cookers take much longer, they still use less energy than the oven. Resist the urge to peek inside your slow cooker: Each time you remove the lid, it releases heat and can add about 25 minutes of cooking time to your dish.

7. Use lids on pots to retain heat. The food you’re cooking on the stovetop will heat up faster when you use lids.

When It’s Cleanup Time

8. Scrape plates instead of rinsing with hot water. Unless food is really caked on there, your dishwasher should get the dishes clean without a pre-rinse. Compost your non-meat food waste.

9. Use your dishwasher. It saves energy and water, so only hand-wash things that aren’t dishwasher-safe. Wait until you’ve got a full load before starting the dishwasher. Be sure to stop the appliance before the heated dry cycle; just open the door and let your dishes air-dry.


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