Wall Street Journal: Housing Recovery Picks Up Steam

Yesterday, we ran a post quoting major housing experts on the increasing strength of the U.S. housing market. We were pleasantly surprised that, on the same day, the Wall Street Journal decided to run a front page story titled, “Housing Recovery Picks Up Steam”(article available to WSJ subscribers).

The first paragraph of the article says it best:

“Home prices are back to near-record highs across the U.S. amid rising demand and supply constraints, a sign that the lopsided housing-market recovery of the past five years is gaining some strength.” (emphasis added).

What about the struggles in the economy?

Some openly question how the real estate market can be gaining ground if the overall economy is still struggling. According to the WSJ, it is:

“Despite the unbalanced recovery, Federal Reserve officials have seen housing as a bright spot for the U.S. economy in recent years. Residential construction has contributed to overall economic output for eight straight quarters, expanding at a 17% annual rate in a first quarter marked by slow growth in other sectors.”

Bottom Line

The housing market is gaining strength and all indicators point to an even stronger real estate market moving forward.

For more information on the housing market and personalized help buying/selling your home, visit teamwickham.com!

Sell NOW Before Competition Hits the Market

In their current edition of the Home Price Expectation Survey released last week,Pulsenomics asked this question of the 100+ economists, real estate experts and investment & market strategists they surveyed:

“In your opinion, what is the primary driver of recent home value growth in the U.S.?”

Here are the top four reasons given by those surveyed:

As we have stated before, the current lack of inventory in most housing markets has caused home appreciation to increase at greater percentages than historical averages. This means that this is a great time to sell your home as supply is low and demand is high.

However, things may be about to change…

The fortuitous situation sellers see themselves in may soon change for three reasons:

1. As more homeowners realize their equity situation has dramatically improved over the last four years, they will be more likely to put their homes on the market.
2. With the residential real estate sector outperforming a sluggish economy, more home builders will be looking to add new construction inventory to a depleted supply of housing stock.
3. Many banks are just now foreclosing on loans that have been delinquent since the housing bust. These houses will also be coming to market.

According to Daren Blomquist, senior vice president of RealtyTrac, in the Q2 2016 U.S. Residential Property Vacancy and Zombie Foreclosure Report:

“Lenders have been taking advantage of the strong seller’s market to dispose of lingering foreclosure inventory.” 

Bottom Line

In most housing markets, don’t wait for this additional competition to hit the market. If you are considering selling your house, now may be the time.

For more information on the housing market and personalized help buying/selling your home, visit teamwickham.com!

A Possible Housing Meltdown? These Experts Respectfully Disagree

We want to let you know that “rumors of a new market meltdown” are not based on any reputable data. As proof, we offer you the comments of the following experts who have a totally different view on the current housing market.

Lawrence Yun, Chief Economist at NAR:

“In spite of deficient supply levels, stock market volatility and the paltry economic growth seen so far this year, the housing market did show resilience and had its best first quarter of existing-sales since 2007.”

Jonathan Smoke, Chief Economist at realtor.com:

“We had a triple crown of April home sales reports, so 2016 is in the pole position to earn best year of home sales in a decade.”

Andrea Riquier, MarketWatch housing reporter:

“I'm calling the end of the housing “recovery.” On to ‘expansion.’”

Freddie Mac:

“Despite the disappointing economic reports, we still forecast housing to maintain its momentum in 2016.”

Steven Russolillo, Wall Street Journal housing reporter:

“A recent gauge of home builder sentiment held firmly in positive territory, according to the National Association of Home Builders. Perhaps more important, expectations for sales in the next six months jumped to the highest level of the year.”

Fannie Mae:

“Our latest housing tracker shows that the first quarter of 2016 was the second fastest first quarter pace of home sales in the past decade... Home sales typically rise in the spring and summer months, and we anticipate an acceleration in home sales that will surpass 2007's pace by late summer.”

For more information on the housing market and personalized help buying/selling your home, visit teamwickham.com!

How Does Housing Help Build Family Wealth?

As the economy continues to improve, more and more Americans are seeing their personal financial situations also improving. Instead of just getting by, many are now beginning to save and find other ways to build their net worth. One way to dramatically increase their family wealth is through the acquisition of real estate.

For example, let’s assume a young couple purchased and closed on a $250,000 home in January. What will that home be worth five years down the road? 

Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists every quarter. They ask them to project how residential prices will appreciate over the next five years. According to their latest survey, here is how much value that $250,000 house will gain in the coming years.

Over a five-year period, that homeowner can build their home equity to over $40,000. And, in many cases, home equity is large portion of a family’s overall net worth.

Bottom Line

If you are looking to better your family’s long-term financial situation, buying your dream home might be a great option.

For more information on the housing market and personalized help buying/selling your home, visit teamwickham.com!

Renting vs. Buying: What Does it Really Cost? [INFOGRAPHIC]

Some Highlights:

• The percentage of income needed to afford a median priced home is almost half the percentage of income needed to afford median rent.
• Buying costs are significantly less than renting costs.
• The percentage of income needed to afford a median priced home is less than the historic norm.

Sales Up In Nearly Every Price Range

The National Association of Realtors’ most recent Existing Home Sales Report revealed that home sales were up rather dramatically over last year in five of the six price ranges they measure.

Only those homes priced under $100,000 showed a decline (-4.6%). The decline in this price range points to the lower inventory of distressed properties available for sale and speaks to the strength of the market.

Every other category showed a minimum increase of at least 4.6%, with sales in the $250,000- $500,000 range up 15.2%!

Here is the breakdown:

What does that mean to you if you are selling?

Houses are definitely selling. If your house has been on the market for any length of time and has not yet sold, let's meet up to see if it is priced appropriately to compete in today’s market.

Where is Housing Headed for the Rest of 2016?

With the overall economy just inching along, some experts are questioning whether the housing market can continue its momentum throughout the rest of the year. People are beginning to ask questions such as:

• Will disappointing economic news adversely impact housing?
• Is affordability a major concern in today’s real estate market?
• Are we approaching a new housing bubble?
• Are mortgage standards too tight? Or have they loosened too much?

Freddie Mac, in their April Economic Outlook, addresses the disappointing economic news and what impact they think it will have on housing:

“Recent data darkened the growth outlook for the first quarter of 2016. However, despite the disappointing economic reports, we still forecast housing to maintain its momentum in 2016.

We’ve revised down our forecast for economic growth to reflect the recent data for the first quarter, but our outlook for the balance of the year remains modestly optimistic for the economy.”

What about real estate?

Freddie Mac was much more optimistic about housing…

“We maintain our positive view on housing. In fact, the declines in long-term interest rates that accompanied much of the recent news should increase mortgage market activity.”

They went on to conclude:

"We expect housing to be an engine of growth. Construction activity will pick up as we enter the spring and summer months, and rising home values will bolster consumers and help support renewed confidence in the remaining months of this year." With the overall economy just inching along, some experts are questioning whether the housing market can continue its momentum throughout the rest of the year. People are beginning to ask questions such as:

• Will disappointing economic news adversely impact housing?
• Is affordability a major concern in today’s real estate market?
• Are we approaching a new housing bubble?
• Are mortgage standards too tight? Or have they loosened too much?

Freddie Mac, in their April Economic Outlook, addresses the disappointing economic news and what impact they think it will have on housing:

“Recent data darkened the growth outlook for the first quarter of 2016. However, despite the disappointing economic reports, we still forecast housing to maintain its momentum in 2016.

We’ve revised down our forecast for economic growth to reflect the recent data for the first quarter, but our outlook for the balance of the year remains modestly optimistic for the economy.”

What about real estate?

Freddie Mac was much more optimistic about housing…

“We maintain our positive view on housing. In fact, the declines in long-term interest rates that accompanied much of the recent news should increase mortgage market activity.”

They went on to conclude:

"We expect housing to be an engine of growth. Construction activity will pick up as we enter the spring and summer months, and rising home values will bolster consumers and help support renewed confidence in the remaining months of this year."