House passes NFIP extension, no Senate vote yet
On July 25, the U.S. House of Representatives passed an extension of the National Flood Insurance Program (NFIP) through Nov. 30 by a vote of 366 to 52. The bill next moves to the U.S. Senate for its consideration with little time to spare before the July 31 deadline. Congress has enacted six short-term extensions of the NFIP since September 2017. More than 3,500 New York REALTORS answered this critical Call for Action urging Congress to act. You can still take action here and urge the Senate to pass the extension without any lapse before it’s too late.
Homebuyer demand keeps NY housing market moving
Albany, NY – July 23, 2018 – The New York State housing market posted a solid first half of the year with 60,043 closed sales, falling only 3.8 percent behind the 2017 record sales pace, according to the housing market report released today by the New York State Association of REALTORS. The statewide median sales price continued to grow though the first six months of 2018, climbing 8.9 percent from the first half of 2017 to reach $262,500.
“The story line at the midpoint of this year is sellers doing well in a tight inventory market that also has eager buyers ready to close,” said Duncan R. MacKenzie, CEO of the New York State Association of REALTORS. “With the ongoing growth in selling prices it is a great time for wavering sellers to come off the sidelines. If we see an uptick in seller activity and any meaningful growth in new residential construction, the housing market could make a run at last year’s sales record.”
There were 60,043 closed sales from Jan. 1 to June 30, a decrease of 3.8 percent from the same period in 2017. Second quarter 2018 sales declined by 5.5 percent compared to the 2017 second quarter to finish at 31,952. The June 2018 closed sales total of 12,234 represents a 10-percent decline from June 2017.
Through the first six months of the year, the statewide median sales price increased 8.9 percent compared to the same period in 2017 to reach $262,500. The second quarter 2018 median sales price of $266,500 represents an 11-percent increase from the second quarter 2017 median of $240,100. The June 2018 median price of $280,000 was a 9.8-percent increase compared to June 2017.
Pending sales decreased 2.0 percent to 68,974 through the first six months of 2018 compared to the same period in 2017. Second quarter 2018 pending sales (39,894) were 1.5-percent below the 2017 second quarter. June 2018 pending sales (13,421) were down 3.5 percent compared to June 2017.
The months supply of inventory dropped 6.1 percent at the end of the second quarter to 6.2 months supply. It was at 6.6 months at the end of the 2017 second quarter. A 6 month to 6.5 month supply is considered to be a balanced market. Inventory stood at 70,038, a decrease of 5.3 percent compared to the 2017 second quarter.
Additional data is available at http://www.nysar.com/industry-resources/market-data
Editor’s Note: All data is compiled from multiple listing services in the state of New York and the data include townhomes, condominiums and existing single-family homes.
The New York State Association of REALTORS is a not-for-profit trade organization representing more than 55,000 of New York State’s real estate professionals. The term REALTOR is a registered trademark, which identifies real estate professionals who subscribe to a strict code of ethics as members of the National Association of REALTORS. These REALTORS® are also members of the New York State Association of REALTORS® as well as their local board or association of REALTORS.
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Mortgage demand surges in early July
Mortgage applications for both home purchases and refinancings increased 2.5 percent last week on a seasonally adjusted basis, according to the Mortgage Bankers Association’s latest report. The rise was fueled entirely by an uptick in home purchase applications.
Mortgage applications for home purchases surged 7 percent in the week and are now 8 percent higher than a year ago, the MBA reports. Abounding housing shortages have mostly kept a lid on any notable increases in home sales this summer, but that gradually may be changing.
“Even though inventories continue to decline, they are doing so at a slower pace,” says Danielle Hale, chief economist at realtor.com®. “In other words, while buyers continue to see fewer homes available for sale, the decline was smaller than what we’ve seen in previous months. Before we see inventories increase, we need to see them slow, and the data has shown four months of deceleration (smaller year-over-year declines).”
Buyer demand continues to be strong from a strengthening job market, says Mike Fratantoni, the MBA’s chief economist.
Despite last week’s uptick, mortgage applications remain 4.3 percent lower than a year ago. Most of that is due to a plunge in the number of borrowers who are refinancing. Mortgage rates are higher than a year ago, which is erasing the incentive for most homeowners to refinance. Mortgage applications to refinance a home loan last week dropped 4 percent and are now at their lowest level since December 2000.
The 30-year fixed-rate mortgage averaged 4.76 percent last week, down from 4.79 percent the week prior, the MBA reports. Mortgage rates remain elevated compared to last year but the increases have been minimal this summer, so far.
Realtor.com: Buffalo, Rochester top performing markets
Two New York State housing markets landed in the top 20 “hottest housing markets” in the most recent Realtor.com survey. The rankings are determined by the number of online visitors to Realtor.com listings and where homes are selling the fastest. Buffalo was ranked the eighth hottest housing market, while Rochester reached the 14th spot on the June survey. Learn more here.
Why 5 percent mortgage rates aren’t a threat
Mortgage rates are on the rise. Could that derail sales? According to First American’s Potential Home Sales model, even if the 30-year fixed-rate mortgage rose to 5 percent, the impact on the housing market would be modest.
Many economists are predicting that the 30-year fixed-rate mortgage will average 5 percent by the end of 2018 or early 2019.
First American’s Potential Home Sales model estimates the potential for existing-home sales based on market fundamentals. The market potential for existing-home sales based on current fundamentals is 6.11 million at a seasonally adjusted annualized rate. If the 30-year fixed-rate mortgage rose to 5 percent, the impact would be a slight decline to 6.1 million existing-home sales, according to the model.
Learn more.
Homeownership rate depends heavily on seniors
The majority of homeownership conversations focus on the impact from millennials, but senior citizens may actually have more influence in shaping the future market, according to the Joint Center for Housing Studies of Harvard University’s 2018 State of the Nation’s Housing report.
The median age of homeowners is on the rise, increasing from 50 in 1990 to 56 in 2016. Americans over the age of 65 were the only age group who had a higher homeownership rate in 2017 (78.7 percent) than in 1987 (75.4 percent), according to the report. Further, the report states that “the only reason the national [homeownership] rate is near the 1994 level is because older adults now make up such a large share of households.”
Many seniors say they want to stay put in their homes. Eighty-eight percent of seniors said they intend to stay in their current home as they age, according to a 2014 survey. This could create growth in home improvements and renovations that are focused on accessibility and aging while staying in one place. But that also could place more pressure on younger adults to find a home to buy.
Learn more.
NYS home sales post second-highest May total
Albany, NY – June 20, 2018 – Homebuyer activity remained strong in May, driving the New York State housing market to the second-highest sales total for the month with 10,348 closings, according to the housing market report released today by the New York State Association of REALTORS. May 2018 closed sales were 8.6 percent lower than the record of 11,322 set in May 2017. The median sales price growth trend continued, increasing by 11.5 percent compared to last May, ending the month at $262,000.
“Robust buyer demand continues to keep homes across the Empire State selling at a brisk pace, despite the lower number of homes listed for sale,” said Duncan R. MacKenzie, CEO of the New York State Association of REALTORS. “Newly listed homes are selling more quickly than a year ago as buyers faced with fewer options are eager to get to the closing table. We believe that without the headwind of lower inventory sales would be near the record-setting levels of a year ago.”
“While growing sales prices may entice current owners to bring greatly needed inventory to the market, the combination of higher prices and growing mortgage rates will begin to erode affordability, potentially dampening buyer enthusiasm,” said MacKenzie.
The May 2018 sales total of 10,348 represents a decrease of 8.6 percent from the May 2017 total of 11,322. Year-to-date (Jan. 1 – May 31) sales were 45,005, a decrease of 3 percent from the same period in 2017.
The May 2018 statewide median sales price was $262,000, an increase of 11.5 percent from the May 2017 median of $235,000. The year-to-date (Jan. 1 – May 31) median sales price was $259,000, an increase of 8.6 percent from the same period in 2017.
Pending sales decreased 4.3 percent in May compared to a year ago to reach 13,633.
The average days on market for home sales closed during May 2018 was 80, a decrease from 87 in May 2017. Year-to-date (Jan. 1 – May 31) days on market for closed sales was 85, down from 93 during the same period in 2017.
The months supply of homes for sale dropped 7.8 percent at the end of May to 5.9 months supply. It was at 6.4 months at the end of May 2017. A 6 month to 6.5 month supply is considered to be a balanced market. Inventory stood at 66,682, a decrease of 6.7 percent compared to May 2017.
Additional data is available at http://www.nysar.com/industry-resources/market-data
Editor’s Note: All data is compiled from multiple listing services in the state of New York and the data include townhomes, condominiums and existing single-family homes.
The New York State Association of REALTORS is a not-for-profit trade organization representing more than 55,000 of New York State’s real estate professionals. The term REALTOR is a registered trademark, which identifies real estate professionals who subscribe to a strict code of ethics as members of the National Association of REALTORS. These REALTORS are also members of the New York State Association of REALTORS as well as their local board or association of REALTORS.
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Salvatore I. Prividera Jr.
Director of Communications
518-463-0300×208 office
[email protected]
Gen Z expected to make big splash in housing
Generation Z is still mostly comprised of kids, but analysts in the housing market are already expecting big things about this generation’s future appetite for real estate.
Generation Z, born in 1997 and beyond, is a cohort of about 65 million to 75 million who are expected to start buying homes on a large scale within five to 10 years. The oldest members of Gen Z are in their early 20s. Millennials are currently the largest group of homebuyers. But Gen Z is already showing some characteristics for being real estate savvy, bargain hunters, and tech lovers, likely competing for smaller and more affordable homes, real estate experts told realtor.com.
Gen Z is also showing signs of being more risk-averse and more financially savvy than millennials and Generation X. More than a tenth of them are already saving for retirement. Also, they’re reportedly choosing less pricey colleges so they don’t face a ton of student debt.
Real estate experts predict that this generation will mostly shy away from large, expensive homes and show a preference for lower-priced, smaller homes to accommodate their likely smaller families.
Learn more.
Rates inch up, mortgage applications recede
The recent drop in interest rates appears to be short-lived. Mortgage rates inched higher last week, prompting loan demand to soften.
Total mortgage application volume, which includes home purchases and refinancings, dropped 1.5 percent last week compared to the previous week on a seasonally adjusted basis, the Mortgage Bankers Association reported Wednesday. Applications are now 15.4 percent lower than a year ago.
Learn more.
Millennials are the ‘renovation generation’
Millennials aren’t turned off by home improvement projects. They are more likely than any other generation to remodel any part of their home, according to HomeAdvisor’s 2018 True Cost Survey. Millennials are twice as likely as baby boomers to complete bathroom and kitchen remodeling projects. They are also more likely to build a deck or porch and paint a home’s exterior than other generations too.
Millennials, those born between 1980 and 1994, have completed the most home projects in the past 12 months—more than baby boomers, Generation X, or the silent generation, according to the study. However, baby boomers tend to outspend all generations in home improvement projects.
More than half of the millennials surveyed said they want to move to a home with more space or to upgrade to a nicer home, but a lack of homes for sale is keeping them stuck in place.
As such, they’ve got big plans for their current home: 82 percent of millennials surveyed—the highest compared to other generations surveyed—say they plan to spend as much as they did in the last 12 months on home improvement projects next year. More than half of millennials say they expect to spend more than they did last year.
Learn more.
Take action and respond to this important Call for Action!
Please answer this important Call for Action to OPPOSE a requirement to provide prevailing wage standards on any private construction project that receives any form of public funding or support.
The New York State Senate is considering a vote soon on S.2975-A/A.5498-A by Sen. Murphy (R-Hudson Valley) and Assemblymember Bronson (D-Rochester), which would redefine the term “public works,” thereby requiring prevailing wage standards on all private construction projects that receive any financial support from state or local entities, including loans, bonds, grants, tax abatements from local IDAs and other forms of value.
If enacted, this bill would result in significant increases in labor and construction costs for private construction projects across the state by imposing a prevailing wage and benefit structure that exceeds market compensation rates. This will ultimately drive businesses out of the state or force them to lose workers, lose business opportunities, or close altogether.
We need you to answer the Call for Action today and make your voice heard on this important issue!
Half of buyers fret about down payments
According to a new study, more than half of Americans who have or plan to purchase a home admit they’re concerned about the ability to afford a home in the current market. The study is based on a survey of 1,000 consumers and was released by national online lender Laurel Road. One of the biggest barriers to affordability, respondents said, is the down payment.
Nearly half – or 46 percent – of Americans say they are unfamiliar with alternative down payment options, according to the survey. Nearly three in five respondents – or 58 percent – plan to put down a traditional 20 percent down payment.
One-third of respondents expressed concern that they could not confidently afford a 20-percent down payment. Among those with student loan debt, even more consumers said they do not feel confident.
Learn more.
