Higher rates could raise housing costs 15 percent
If mortgage rate forecasts pan out, homebuyers might see their mortgage payments grow by 15 percent this year, according to a new analysis by CoreLogic. CoreLogic economists predict that mortgage rates will increase by about 0.85 percentage points between November 2017 and November 2018. The median sales price of a home is projected to increase 2.6 percent in real terms over that same period.
Based on that, CoreLogic researchers predict that the inflation-adjusted typical mortgage payment will increase from $804 in November 2017 to $910 by November 2018, a 13.3 percent year-over-year gain. In nominal terms, CoreLogic researchers say the typical mortgage payment’s year-over-year increase would be 15.5 percent.
As such, homebuyers could see a larger portion of their incomes devoted to mortgage payments.
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Empire State housing market stays hot in January
Albany, NY – Feb. 21, 2018 –New York State home sales remained strong to start the new year with 8,698 closed sales, falling just shy of the 2017 record for January, according to the housing market report released today by the New York State Association of REALTORS. The January statewide median sales price of $266,000 represented an increase of 8.4 percent from a year ago.
“The 2017 trends of strong buyer demand and price growth carried over into January as the New York State housing market posted its second-highest sales total on record for the month,” said Duncan R. MacKenzie, CEO of the New York State Association of REALTORS. “The other prevailing trend – fewer homes listed for sale – also continued into the new year. We believe that strong competition in a low-inventory market will drive price growth, but it may also provide a braking action to sales growth. We will also be closely watching the data for the potential impact of federal tax reform.”
The January 2018 sales total of 8,698, represents a decrease of 2.7 percent from the January 2017 total of 8,940.
The January 2018 statewide median sales price was $266,000, an increase of 8.4 percent from the January 2017 median of $245,500.
January 2018 pending sales decreased by 1.4 percent from a year ago to 8,268.
The months supply of homes for sale dropped 12.5 percent at the end of January to 4.9 months supply. It was at 5.6 months at the end of January 2017. A 6 month to 6.5 month supply is considered to be a balanced market. Inventory stood at 56,374, a decrease of 9.7 percent compared to January 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
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National builder confidence unmoved in February, falls slightly for Northeast
Builder confidence in the market for newly-built single-family homes remained unchanged at a healthy level of 72 in February, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
The Northeast fell two points to 56 on the index.
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Buyers taking longer to find homes
Two-thirds of homebuyers said they searched for more than three months before going under contract on a home, according to a new survey by the National Association of Home Builders. Buyers also complain that homes are getting too pricey. Forty-two percent of respondents said that the homes they wanted were too expensive for their budgets, which further delayed their search. Twenty-seven percent said they were being outbid by others.
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Housing affordability remains flat in 2017; Syracuse tied for nation’s most affordable housing market
Data for all four quarters of 2017 show housing affordability remaining essentially flat throughout the year, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI).
Syracuse, NY tied with Youngstown-Warren-Boardman, Ohio-Pa. for the nation’s most affordable major housing market. In Syracuse, 88.3 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the area’s median income of $68,000.
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Renters are getting frustrated
The majority of renters say they want to own a home in the future and believe that homeownership is a critical piece of the American dream. But making the leap into homeownership is facing bigger hurdles as the market sees higher home prices and a shortage of homes for sale, according to the National Association of REALTORS’ newly released Aspiring Home Buyers Profile, which is based on findings from a survey of more than 10,000 households’ attitudes about the real estate market.
Non-homeowners surveyed say the main reason why they do not currently own is because they are unable to afford homeownership. Still, non-homeowners’ desire to eventually buy is not waning. They say the following goals most make them want to buy in the future: change in lifestyle, such as getting married, starting a family, or retiring; improvement in their financial situation; and a desire to settle down in one location. Until they do buy, non-homeowners expect to face increasing rents. Fifty-one percent of renters surveyed say they expect their rent to increase this year.
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Owners upbeat that equity will continue to rise
Homeowners are optimistic that their home’s value will continue to increase, and they’re increasingly turning to home equity loans to try to make their homes even more valuable. But a new survey shows they’re unclear on how new tax reform laws could impact home equity loans.
More than 80 percent of about 1,000 homeowners recently surveyed said that they believe the value of their home will increase over the next three years as well as over the next five years, according to a new study by LendEDU, a marketplace for student loans, credit cards, and other financial products. Fifty-two percent of homeowners say that they used a home equity loan for home improvement projects, and 89 percent believe that the home equity loan will increase the value of their home by even more.
But LendEDU’s study does sound some caution on the home equity loan market in the coming months. Only 4 percent of homeowners knew about the removal of home equity loan interest deductions from the new tax reform plan, the survey showed. Previously, consumers could deduct interest paid on up to $100,000 of home equity debt.
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HGAR and LIBOR prepare groundwork for new regional MLS for New York Metro area
The Hudson Gateway Association of REALTORS (HGAR) and the Long Island Board of REALTORS (LIBOR) have recently agreed on the framework for forming a new multiple listing service (MLS) to serve the New York metro area including: Westchester, Putnam, Rockland and Orange Counties, as well as the Bronx, Manhattan, Brooklyn, Queens, Nassau and Suffolk Counties. The newly formed regional MLS would consist of approximately 36,000 REALTOR subscribers.
HGAR CEO Richard Haggerty said a primary objective of the new MLS is to create a seamless flow of data for brokers and agents within the New York Metro area. LIBOR CEO Joseph Mottola said it will improve services in operational efficiencies, increased economies of scale, and enhanced technology, that will enable members to better serve the buying and selling public.
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Fed leaves rates alone, but hikes coming
The Federal Reserve voted on Wednesday to leave its benchmark interest rate unchanged, but it continues to leave the door open to future increases this year. The Fed’s benchmark rate will remain in the range of 1.25 to 1.5 percent, which is low by historical standards. Fed committee members said that by leaving the rate unchanged, they hope the low rates will help support broader job growth and stronger inflation.
Lawrence Yun, chief economist of the National Association of REALTORS, predicts the Fed will still do three short-term rate hikes later this year—and that will have an impact on mortgage rates for home shoppers. Yun predicts that mortgage rates will reach 4.5 percent by the second half of the year.
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New home sales for Northeast fell slightly in December
Sales of newly-built, single-family homes in December fell 2.4 percent to a seasonally adjusted annual rate of 41,000 for the Northeast, according to data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. Nationally, sales fell 9.3 percent to a rate of 625,000.
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Residential and commercial sales bolstered land market in 2017
Higher prices are behind the land boom. The U.S. dollar volume of land sales increased at a stronger pace of 4 percent from October 2016 to September 2017 compared to the prior 12-month period, according to the 2017 Land Market Survey produced by the REALTORS Land Institute and the National Association of REALTORS. Sales on all types of land posted an uptick; residential and commercial land sales grew by the highest amounts.
Higher prices drove most of the increased dollar volume in land prices rather than due to higher transactions volume, the report shows.
Residential land sales increased 5 percent while commercial land sales rose 4 percent in 2017, according to the report. Sales of agricultural irrigated and non-irrigated land each increased by 2 percent, a reversal from a sales decrease in the October 2016 survey. Agricultural land sales rebounded as commodity prices for livestock, cattle, and grains stabilized after a downfall between 2012 and 2016.
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Millennials are saving more than you think
Millennials have been stereotyped as a generation that lacks savings or money management skills. But the data isn’t backing that up. Sixteen percent of millennials ages 23 to 37 have $100,000 or more in savings, which is double the number of young people who had that much stowed away in 2015, a newly-released survey from Bank of America shows. Nearly half – or 47 percent – have $15,000 saved, up from 33 percent in 2015.
Sixty-three percent of millennials surveyed say they are saving, compared to 64 percent of Generation X and 75 percent of baby boomers. Fifty-four percent of millennials say they have a budget; 60 percent say they “feel financially secure.”
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