Month: September 2016

Millennials: Are We Boxing Them Out of the Housing Market? by Erin Schekler, President NexTAs the upper millennial population enters its 30’s, the heavy concentration of downtown dwellers that has been growing steadily for over a decade is finally beginning to peak. More and more we’re seeing the age group, which recently surpassed Baby Boomers as the nation’s largest living generation, seep outwards into the suburbs, as single-family rentals become more abundant than ever before. While they are notorious for taking their time to settle down, marry and establish a career, it appears millennials’ time for studio apartment living is dwindling. In fact, the majority of millennials say they do eventually want to buy a home. All that time spent convincing, as parents, that a home is a valuable investment is finally sinking in. So if the American Dream of homeownership is still alive and well—why are we not seeing the jump being made from rental to purchase? In fact, the U.S. homeownership rate is falling—down to 63.5 percent, which is dangerously close to its 50-year low. One key contributing factor hovering over the entire housing market as it currently stands is the limited number of inventory. The number of homes for sale continues to drop, and nationwide we’re seeing potential sellers choose to bow out of the rat race in fear that they won’t be able to find a new home of their own. Traditionally, the market will experience ebb and flow as the older generation moves out of their bigger houses and downsize to accommodate the empty nest, passing their homes on to the younger generation. However due to the scars left over from 2008’s recession, coupled with the narrow availability of homes, this isn’t the case for the current real estate market. Credit rates are also a factor to point the finger towards when it comes to restricting the millennial homebuyer. Current government policies are keeping credit conditions unnecessarily tight. And that’s not the only thing boxing them out from buying their first home. While mortgage rates hit historic lows, home prices are continuing to skyrocket across the country—much faster than the average income. This leaves millennials, still at the beginning of their careers, with very few options. Interestingly enough, when it comes to where we are seeing the market turn slightly in millennial homebuyers’ favor, it’s in the area of the country in least demand. The highest percentage of closed home loans for the age group as of now, are overwhelmingly located in the Midwest, think Iowa and Oklahoma, while the majority of millennials tend to live in western states such as California, Utah and Washington state.  It’s a correlation that offers little assurance for those looking to settle down. With millennials currently making up approximately 28 percent of the population, and homeownership amongst 25 to 34 year olds today coming in at nearly 10 percentage points lower than is traditional, the math just doesn’t add up. One startling fact pointed out by Pew Research Center on social and demographic trends, is that now, for the first time in 130 years, living at home (home as in, your childhood home with your parents), has become the most common living arrangement for young men and women aged 18 to 34. With such a tight marketplace combined with overinflated real estate prices (it would take approximately 10 years for millennials to earn the necessary 20 percent down payment to buy a house in the in-demand urban locales they typically flock to), what’s the solution? It’s hard to predict, at this point in the game. But for those parents still housing their own millennials under their roof, they get to hold on to a few more golden years.itle

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Ask the Economist: The Great Housing Divergence

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Ralph McLaughlin is Trulia's Chief Economist. He leads Trulia's housing economics research team and provides house hunters with key insights about the economy, housing trends, and public policy. His educational background includes a B.S. in Geography and Regional Development from the University of Arizona and a Ph.D. in Planning, Policy, and Design from the University … Continue reading Ask the Economist: The Great Housing Divergence

MBA: It’s another quiet week for mortgage applications – Mortgage rates fall across the board September 28, 2016 Brena Swanson

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Mortgage applications reported a very quiet week, echoing other industry reports, the Mortgage Bankers Association’s latest Weekly Mortgage Applications Survey for the week ending Sept. 23 stated. According to the survey, mortgage applications slipped 0.7% from one week earlier. While the last report posted a 7.3% decline in mortgage applications, it was one of one of the … Continue reading MBA: It’s another quiet week for mortgage applications – Mortgage rates fall across the board September 28, 2016 Brena Swanson

Will Airbnb disrupt the housing market? Single-family rentals in New Orleans offer compelling evidence September1, 2016 Kelsey Ramierez

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Crowds press together in the streets of New Orleans as people gather to see the city’s festivities, but this year, there’s something different about the tourists. This year, instead of staying in the city’s hotels, more tourists are pouring into residential areas after using an app to quickly book a home for the week. Airbnb, … Continue reading Will Airbnb disrupt the housing market? Single-family rentals in New Orleans offer compelling evidence September1, 2016 Kelsey Ramierez

The Week Ahead: Is Home Price Appreciation Slowing? New single-family home sales took a notable upturn in July, with the month becoming the best month for new sales since 2007, according to HUD and the U.S. Census Bureau.

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New single-family home sales took a notable upturn in July, with the month becoming the best month for new sales since 2007, according to HUD and the U.S. Census Bureau. The HUD/Census report showed that July sales leapt 12.4 percent over June, which recorded 582,000 sales, and 31.3 percent above last July. The median sales price of … Continue reading The Week Ahead: Is Home Price Appreciation Slowing? New single-family home sales took a notable upturn in July, with the month becoming the best month for new sales since 2007, according to HUD and the U.S. Census Bureau.

San Francisco’s real estate market has reached ‘peak unaffordability’: housing expert JP Mangalindan September 21, 2016

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For San Francisco Bay Area residents long accustomed to skyrocketing rents and real estate prices, there’s some relief on the horizon. According to Trulia Chief Economist Ralph McLaughlin, San Francisco Bay Area rents and real estate prices are cooling off, down from 15%-17% growth year-over-year to 5%-6% — a trend McLaughlin expects to continue for … Continue reading San Francisco’s real estate market has reached ‘peak unaffordability’: housing expert JP Mangalindan September 21, 2016

MBA: Mortgage applications erase previous week’s gains Fall 7.3% September 21, 2016 Brena Swanson

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Mortgage applications erased all of the previous week's gains, falling 7.3% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending Sept. 16, 2016. The prior week’s results included an adjustment for the Labor Day holiday and the 7.3% rise was one of the biggest increases in … Continue reading MBA: Mortgage applications erase previous week’s gains Fall 7.3% September 21, 2016 Brena Swanson

CFPB consumer complaint database about to hit 1 million complaints September 20, 2016 Ben Lane

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The Consumer Financial Protection Bureau’s much-maligned consumer complaint database is about to reach 1 million total complaints, CFPB Director Richard Cordray said Tuesday. Cordray revealed the approaching milestone during his testimony before the Senate Banking Committee over the CFPB’s role in the $185 million fine levied against Wells Fargo for opening up 2 million fake accounts. Cordray discussed … Continue reading CFPB consumer complaint database about to hit 1 million complaints September 20, 2016 Ben Lane

OCC Says Banking System is in a Position of Strength by Kendall Baer

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The U.S. banking system in 2016 is as well capitalized as any in the world as key industry participants continue to apply the basis lessons they learned from the financial crisis of 2008, according to Comptroller of the Currency Thomas Curry in a public address this week. In a speech this week at Harvard Kennedy School, … Continue reading OCC Says Banking System is in a Position of Strength by Kendall Baer

Even the CEO of Zillow thinks you should ask a real-estate agent what your home is worth Published: Sept 18, 2016 by Amy Hoak

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A decade ago, when the real-estate bubble was reaching its peak and homeowners were giddy about the rise in home values, plugging in addresses at the new website Zillow became a national pastime. “People ‘Zillowed’ their Christmas list. They would go and look up the home value of their boss and ex-girlfriend and ex-wife and … Continue reading Even the CEO of Zillow thinks you should ask a real-estate agent what your home is worth Published: Sept 18, 2016 by Amy Hoak