Everyone happy about housing again?

From HousingWire:

Experts: Spring home-buying season starts off with a bang

The spring home-buying season is in full swing and it started off with a bang.

Home prices increased in February to a new high for the fourth consecutive month, according to the S&P CoreLogic Case-Shiller Indices, released Tuesday by S&P Dow Jones and CoreLogic.

And another release Tuesday from the Federal Housing Finance Agency showed home prices rose 6.4% annually and 0.2% from the prior month.

But these rising home prices didn’t hold back new home sales, which increased a full 5.8% monthly and 15.6% annually, according to Tuesday’s release from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

“The 2017 spring home shopping season has started off with a bang, and at this point the strength of the market shouldn’t come as much of a surprise,” Zillow Chief Economist Svenja Gudell said. “February Case-Shiller numbers point to more fierce competition in the housing market.”

“The thing to watch for now is when market conditions will shift, and change does seem to loom on the horizon, with rising mortgage interest rates and flattening rents,” Gudell said. “Both could put a dent in home-buyer demand and overall price growth and affordability.”

Another expert confirmed that the market is strong for now, but explains high home prices and low inventory create significant headwinds for first-time homebuyers.

“Strong demand bolstered by income and job growth sets the stage for intense competition and continued price growth in the housing market,” Trulia Senior Economist Cheryl Young said.

“Consumers are likely to also take advantage of mortgage rates as they remain low,” Young said. “While the housing market looks to be recovering, these high prices impact the affordability of homes, directing the strongest headwinds towards starter-home buyers.”

“The good news is that new home sales jumped for the third month in a row, to about the same as last year’s peak in July,” realtor.com Senior Economist Joseph Kirchner said. “Already this spring market is challenging last year’s high-water mark.”

“The bad news is that sales are increasingly concentrated at the mid- to upper-end of the price range,” Kirchner said. “Sales of affordable new homes under $200,000 dropped to 12% from 17% of the market since last April.”

Posted in Demographics, Economics, National Real Estate | 74 Comments

You were hoping for a job?

From the Star Ledger:

More bad news for office leasing market in N.J., report says

Office leading deals in the first quarter in New Jersey has dropped to its lowest level in nearly a decade, the Wall Street Journal reported.

The first quarter showed the state’s office leasing market posted 1.75 million square feet of lease deals — both new and renewed, according to real estate services firm JLL, the Wall Street Journal reported.

Vacancy rates in New Jersey increased to 24.9 percent, growing 0.3 percentage points from the first quarter of 2016.

Newer buildings and those with high-end upgrades located in commuter-friendly areas have done better at securing new tenants, the report said. But older buildings continue to drag down the market, the report said.

Vacancy rates are likely to improve as more empty spaces are being redeveloped, turning aging B- and C-class buildings and business parks into modern properties with more amenities, the report said.

Posted in Demographics, Economics, Employment, New Jersey Real Estate | 125 Comments

Home price expectations highest since 2005.

From Gallup:

More in US Expect Local Home Values to Rise

Sixty-one percent of U.S. adults predict housing prices in their local area will increase in the next 12 months, up from 55% a year ago and the highest Gallup has measured since 2005.

Americans’ optimism about home values continues to recover from where it was after the housing bust and recession. Between 2008 and 2012, only as many as one-third of Americans, including a low of 22% in 2009, believed local housing prices would increase.

By 2013, a majority again held this view for the first time since 2007. This year, the percentage expecting housing-value gains pushed past 60%.

The high point in Gallup’s trend was 70% in 2005, the first year it asked the question and shortly before U.S. home values hit their peak.

These expectations largely mirror what has happened to U.S. home values over the past 10 years, with declines between 2007 and 2011, and increases beginning in 2012 and continuing since then.

In addition to the 61% currently expecting local housing prices to rise, 28% predict they will stay the same and 10% say they will decrease.

Americans — both those who own a home and those who do not — appear to be cognizant of trends in home prices. With U.S. home values showing consistent increases over the past five years after several years of decline, Americans expect local home prices to continue to rise. While Americans’ optimism is not yet back to where it was during the housing boom in the mid-2000s, it is now the closest it has been since the housing bubble burst in 2007.

The continued increase in housing prices leads to questions of whether another housing bubble could occur. While prices now are nearly where they were a decade ago, houses are more affordable because of lower interest rates, and banks are more reluctant to issue risky mortgages than they were before the mid-2000s housing market crash. Still, if housing prices continue to rise and interest rates increase, the potential for a new housing bubble will grow.

Posted in Demographics, Economics, Housing Bubble, National Real Estate | 43 Comments

Pay Up Jersey City – Just like the rest of us

From the Jersey Journal:

Jersey City homeowners uneasy as long-delayed revaluation begins

A five-letter word is causing heartburn in every neighborhood in Jersey City.

Reval.

The citywide property revaluation, Jersey City’s first since 1988, is finally underway, with inspectors knocking on doors, homeowners nervous about what their tax bills will be next year and Mayor Steve Fulop urging calm.

Fulop faced a roomful of grim-faced Downtown residents on March 28 to tell them what to expect.

“I know there’s a lot of fear because people assume the worst,” he told them before adding, “It’s going to be disruptive. I don’t want to mince words.”

Downtown property owners are expected to take a big hit since home values there have soared since the city last conducted a reval. But residents everywhere, from Merritt Street down in Greenville to Secaucus Road up in the Heights, say they fear higher property taxes, overassessed homes and a Jersey City that will be unaffordable for many longtime residents.

“This is going to kill me,” said Rosalie Narciso, a 71-year-old retired woman who lives in a Third Street brownstone. “It’s going to absolutely kill me.”

The 1988 reval, which came 17 years after the previous one, produced dramatic shifts in property values — the tax base soared from $800 million to $5.6 billion — followed by steep tax increases Downtown and in the Heights. A citizen group alleged wide disparities in assessments.

The revolt was bad news for then-Mayor Anthony Cucci. He was trounced when he sought re-election in 1989, receiving fewer than half the number of votes of the eventual winner, Gerry McCann. Cucci came in fourth place.

“The reval killed him,” City Clerk Robert Byrne said.

Fulop critics have said his fear of a repeat voter revolt led him to postpone this reval, with new assessments now not scheduled to be public until after the Nov. 7 mayoral race. Fulop has denied this, saying he stopped the reval in 2011 to make sure it is done fairly (last year New Jersey ordered this one to proceed and wrap up by Nov. 1).

“The last time the city did a reval, when I was 11 years old … many people throughout Jersey City lost their homes,” he said during an April 2015 meeting with local activist group Jersey City Together. “If it’s not done fairly the same thing from 1988 will happen.”

Since the last reval was nearly 30 years ago, the average property in Jersey City is assessed at just 23.66 percent of its market value.

The state says revals should be conducted when that figure dips below 80 percent, arguing that local taxes are not distributed fairly if the assessed-to-market-value ratio is so low (taxes are tied to assessment). One resident’s home could be assessed at its 1988 value, their neighbor’s home at its 2017 value.

Critics of the mayor point to his house as an example of unfair taxation.

In 2015 Fulop and his wife bought a four-bedroom house on Ogden Avenue, a leafy street in the Heights overlooking the Manhattan skyline. The sale price was $845,000. Its assessed value is $104,000, just 12 percent of its market value. The Fulops’ annual tax bill is $8,009.

Posted in Gold Coast, New Jersey Real Estate, Politics, Property Taxes | 19 Comments

17,500 jobs … poof

From the Star Ledger:

N.J. lost 17,500 jobs in March

New Jersey employers cut 19,100 private-sector jobs in March, while at the same time the unemployment rate fell to 4.2 percent, according to the latest U.S. Bureau of Labor Statistics data released Thursday.

Those private-sector job losses were offset by 1,600 new public-sector jobs the state Department of Labor and Workforce Development said are housed in local government.

In total, the state shed 17,500 jobs.

The Bureau of Labor Statistics also adjusted its February estimates down by 1,700 jobs, resulting in a revised total of 10,900 jobs added. The jobless rate for that month was changed from 4.4 percent to 4.5 percent.

The bureau set the March rate at 4.2 percent, three notches below the national unemployment rate of 4.5 percent.

In March, New Jersey lost 6,300 jobs in leisure and hospitality; 5,000 in professional and business services; 4,300 in trade, transportation and utilities; 2,800 in constructions; 1,200 in other services; and 300 in financial activities. Manufacturing and information employers each added 300 jobs, while education and health services added 200.

Public-sector employers created 1,600 jobs.

Posted in Demographics, Economics, New Jersey Real Estate | 64 Comments

Just part of doing business in NJ

From HousingWire:

Ex-NJ mayor sent to prison for kickbacks involving HUD funds

The former mayor of Passaic, New Jersey will spend the next two years in prison after being convicted of soliciting and accepting bribes from developers who wanted to build low-income housing in the city.

According to the U.S. Attorney’s Office for the District of New Jersey, a federal judge sentenced Alex Blanco to spend 27 months in prison for taking $110,000 in corrupt payments, much of which was money from the Department of Housing and Urban Development.

According to the U.S. Attorney’s Office, from 2010 to 2012, two developers sought to build eight low-income residential units on property they owned in Passaic.

After the Passaic City Council and the Passaic Zoning Board of Adjustment approved the projects, Blanco dispatched an intermediary to approach the developers in July 2011.

According to court documents, Blanco’s intermediary told the developers that they were expected to provide a “sizable payment” to the mayor to ensure that the project would move forward.

Some time after that meeting took place, the Passaic City Council approved the release of $216,400 in HUD funds to the developers, money that was designated for use on the project.

Then, in early September 2011, Blanco arranged for a meeting with the developers where solicited and agreed to accept $75,000, the U.S. Attorney’s Office said.

The following day, Blanco met one of the developers in Clifton, New Jersey, and asked for the kickback in cash. Court document showed that the developer told Blanco that the developer brought signed, blank checks, which could be made out to whoever Blanco chose.

Blanco took those checks, which totaled $65,000, and had them filled in, arranged for them to be cashed, and pocketed the cash.

Posted in New Development, New Jersey Real Estate, Politics | 65 Comments

Not the best in a decade?

From HousingWire:

Here’s why the housing market continues to struggle with low inventory

Tight housing inventory supply could put a strain on this year’s spring home-buying season, according to the monthly Outlook released Tuesday by Freddie Mac.

The low supply of inventory continues to push home prices up as they outpace rising incomes. Rising home prices combined with higher interest rates caused affordability to decrease in March.

Freddie Mac outlines four reasons why housing inventory remains low. They are:

1. Fear of low inventory

2. Mortgage rates

3. Home prices

4. Housing starts

And this tight inventory will pull down home sales for the year. Freddie Mac predicts home sales will come in at 5.9 million in 2017, falling from 5.97 million in 2016, which was housing’s best year in a decade.

Posted in Housing Recovery, National Real Estate, Where's the Beef? | 71 Comments

JC overtakes Hoboken?

Really interesting piece over at Jersey Digs:

In 2016, Downtown Jersey City Real Estate Proved The Better Bet Over Hoboken

When Pure Properties released their last quarterly market report in January, it was the first time that Downtown Jersey City median rental prices eclipsed those of Hoboken. Now, with the release of Pure’s Q1 2017 report, it appears the dynamic between the two areas continues to shift. This time, however, the shift comes on the sales side.

According to Pure’s Q1 2017 report, over the last quarter, the rental prices in the two areas have balanced back out, tying at $2,600. However, this most recent quarter saw Downtown median sale prices for 1-4 family homes outrank Hoboken for the first time since 1996 when MLS data launched.

Similarly, on the condo side, Jersey City continues to outpace Hoboken. Around the middle of 2016, Downtown condo prices surpassed Hoboken and have since only continued to break away. This strengthening is also the result of strong gains in Downtown while Hoboken’s were more modest. Year-over-year Downtown condo prices rose 12% to a median price of $735,000. In Hoboken, prices rose just 3% to $685,000.

Posted in Gold Coast, New Jersey Real Estate | 103 Comments

Best spring market in (almost) a decade?

From CNBC:

Homes this spring are selling faster than ever

Homes are flying off the shelves this spring, as demand rises and supply continues to drop.

Record high prices in some local markets are not thwarting hungry buyers, as they rush to take advantage of the lowest mortgage rates of the year.

Home sales jumped nearly 9 percent in March compared with March 2016, even as the number of homes for sale plunged 13 percent, according to a new report from Redfin, a national real estate firm.

That demand dynamic further increased competition in the market, resulting in the fastest average sales pace since Redfin began tracking in 2010. The typical home went under contract in just 49 days, down from 60 days a year ago.

Steep competition also pushed the median price of a home sold in March to $273,000, up 7.5 percent year over year.

Posted in Housing Recovery, National Real Estate | 39 Comments

…except here

From MarketWatch:

Foreclosure activity drops to pre-recession levels nationwide

Chances are slim that a new foreclosure sign was posted on your block.

The number of foreclosure filings, which include default notices, auctions and bank repossessions, dropped 19% nationwide from a year ago during the first quarter, affecting only roughly 235,000 properties, according to a report released Thursday by real-estate data firm Attom Data Solutions. That figure represents the lowest level of foreclosure activity reported since the third quarter of 2006.

The trend extends to the local level: More than 100 markets fell below pre-recession foreclosure levels, up from 78 markets last year. Among those markets are Los Angeles, Houston and Miami. Cities where foreclosure activity remains elevated compared to before the financial crisis include Philadelphia (97% above the level before the recession), New York (80% above) and Boston (26% above.)

In March, the foreclosure process began for 36,370 properties, a 6% increase from the previous month but a 24% decline from 2016. New Jersey had the highest foreclosure rate in the country, with one in 497 homes having a foreclosure filing, followed by Maryland and Nevada.

Posted in Economics, Foreclosures, National Real Estate | 29 Comments

2.5 month supply of homes in Brooklyn

From Bloomberg:

Brooklyn Home Sales Jump Most Since ’10 With Listings Near a Low

Home sales in Brooklyn jumped the most in seven years while the supply of listings hovered near a record low, pushing buyers toward bidding wars in the New York borough.

Purchases of condos, co-ops and one- to three-family homes jumped 46 percent in the first quarter from a year earlier to 2,800 deals, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. The number of homes on the market at the end of March fell 20 percent to 2,290, the second-fewest since the firms started tracking the data in 2008. The lowest period for listings was the previous quarter.

“What it boils down to is this: I’m starving for inventory,” said Frank Percesepe, who oversees Brooklyn sales for brokerage Corcoran Group, which also released a report on Thursday showing a drop in listings. “We are hurting for inventory and people are buying up what’s there.”

Brooklyn, the city’s most populous borough, and neighboring Queens are setting themselves apart from the sales market in Manhattan, where a growing supply of listings is giving buyers more leverage to negotiate and walk away. Shoppers searching for homes at relative discounts to Manhattan have less to choose from in the outer boroughs, where the post-recession construction boom focused largely on rentals, with a few select luxury-condo developments.

Buyers eager to strike a deal in Brooklyn were willing to overpay — and the lower the price, the more likely people were to bid it up. While 22 percent of all sales in the quarter were above the asking price, half of studio purchases were for more than the seller sought, Miller Samuel and Douglas Elliman said. For co-op apartments, which tend to be less costly than condos and houses, the share was 37 percent.

It would take just 2.5 months to sell all of Brooklyn’s existing inventory at the current pace of deals, the fastest rate in nine years, according to the firms.

“People realize there’s not going to be a glut of inventory and say, ‘Maybe let’s get in before prices go up more,” said Sarah Burke, a Douglas Elliman managing director who oversees sales in Brooklyn. “It does make people pull the trigger.”

A separate report by brokerage Brown Harris Stevens showed the median price of a one- to four-family home in Brooklyn rose 6.7 percent to a record $870,000. The median for co-ops and condos climbed 18 percent to $670,000, also an all-time high, spurred in part by closings in new developments.

Posted in Demographics, Economics, Employment, NYC | 48 Comments

Mortgage delinquencies at 10 year low

From HousingWire:

More Americans are now paying their mortgage often, and on time

Mortgage delinquency rates, including loans in serious delinquency and even foreclosure inventory, fell at the start of 2017, according to the latest monthly Loan Performance Insights Report from CoreLogic, a global property information, analytics and data-enabled solutions provider.

In January, 5.3% of mortgages were delinquent by 30 days or more, a drop of 1.1 percentage points from January last year.

“The 30-plus delinquency rate, the most comprehensive measure of mortgage performance, is at a 10-year low and rapidly declining,” CoreLogic President and CEO Frank Martell said.

“While late-stage delinquencies remain in the pipeline in selected markets, early-stage delinquency performance is stellar and the lowest it’s been in two decades,” Martell said. “The continued improvement in mortgage performance bodes well for the health of the market in 2017.”

Foreclosure inventory rates, which measures the share of mortgages in some stage of the foreclosure process, decreased to 0.8%, down from 1.1% last year. The serious delinquency rate, loans 90 days or more past due, including those in foreclosure, dropped to 2.5%. This is down from 3.2% the year before.

Posted in Demographics, Economics, Employment, Mortgages, National Real Estate | 22 Comments

Local realtors: It’s a great time to sell … and buy!

From NJ1015:

Demand for housing in New Jersey on the rise — It’s a seller’s market

The New Jersey housing market, which has been depressed since the Great Recession, is showing signs of firing up.

According to Rob Dekanski, a Realtor with RE/MAX 1st Advantage, inventory levels in the Garden State are now lower than they’ve been in the past 18 years, which is very good news for people selling their homes.

“There’s less to choose from and buyers are fighting over less inventory, enabling the sellers to ask for a little bit more money,” he said.

He estimated that depending on the specific town and the quality of the school district, homes are selling for 2 to 10 percent more than they were a year ago at this time.

“For sellers, they have a great, great, great market. We’ve seen a lot of bidding wars, not a lot to choose from, a lot of buyers fighting over the same properties, so if it’s a good house they’re flying off the shelves,” he said.

Amber Noble Garland, a Realtor with Keller Williams Realty said sellers, for whatever reason, are sitting on the fence.

“We are literally just kind of at a rubberneck, and there are just not enough homes on the market,” she said.

“I couldn’t think of a better time than to sell than now, and this is not like a pickup line, she said. “This is the real deal.”

She said for a number of years in New Jersey there was a backlog of foreclosures, and buyers have been able to get very good deals — but now things are leveling out.

“Sellers are really getting what their home is really worth, and buyers are having to pay retail versus wholesale or discount,” she said.

Noble Garland said she’s doing a lot of group texts and chats, asking other real estate agents about new properties coming on the market because demand is so high.

“That’s something that we haven’t seen for quite some time, so there’s a real frenzy going on and particularly in Central New Jersey,” she said.

Dekanski said while this is an excellent sellers market, it’s also a good time to buy.

“The sooner you get in the better a price you’re getting compared to what it’s going to be down the road, so we are in an appreciating market,” he said. “Plus mortgage rates are still very good so it’s a good time to lock in a favorable rate.”

Posted in Economics, New Jersey Real Estate | 47 Comments

Better than renting out?

From the NYT:

Making a Living With Airbnb

New Yorkers who welcome strangers into their homes by becoming Airbnb hosts have found that the experience can be at turns nerve-racking, humorous and sometimes embarrassing. But for some determined hosts, it has proved profitable enough to replace more traditional revenue streams.

The first paying guest Evelyn Badia invited into her home was Ted, a professor from Amsterdam. Ted was a coffee drinker, but Evelyn didn’t own a coffee maker. “My first mistake as a host,” Ms. Badia said. “I don’t drink coffee. Why would I get a coffee maker?” She promptly went out and bought one.

Ted, it turned out, didn’t mind the oversight. When he traveled again to New York a few months later, this time with his wife, the couple stayed with Ms. Badia, whose guests have given her a five-star rating. “As an Airbnb host you have to remember, it’s not about you, it’s about them.”

Airbnb, the short-term home rental service that began operations eight years ago and is now valued at $31 billion, estimates that there are 46,000 hosts statewide, with more than 45,000 active listings in New York City alone, generating hundreds of millions of dollars in rental income every year. (Inside Airbnb, an independent data-tracking website, estimates the number of hosts in the city to be about 36,888.)

The annual median earnings for a host are $5,468 — money, the New York State attorney general has said, that may escape local sales, hotel and unincorporated business tax. State officials have instituted fines against illegal listings, arguing that Airbnb helps turn permanent housing into de facto hotel rooms. (Other cities around the world have also moved to crack down on illegal short-term rentals.)

While the debate continues over how Airbnb might affect housing availability and rental prices in the city, the incentive to host is clear. Why rent out the average New York one-bedroom for $2,700 a month when there is potential to make $200 every night, or $6,000 a month, during peak tourist seasons? Some housing advocates believe that if transient rentals like those on Airbnb were no longer available, the available long-term rental housing stock could be as much as 10 percent higher citywide.

Posted in Demographics, Economics, NYC | 37 Comments

When will home price growth start to slow?

From HousingWire:

CoreLogic: Home prices rose 7% in February

Home prices increased in February and will only continue that upward trend, according to the Home Price Index and HPI Forecast from CoreLogic, a global property information, analytics and data-enabled solutions provider.

Home prices increased 7% from February 2016 and increased 1% from January to February, according to the index.

“Home prices and rents have risen the most in local markets with high demand and limited supply, such as Seattle, Portland and Denver,” CoreLogic Chief Economist Frank Nothaft said. “The rise in housing costs has been largest for lower-tier-priced homes.”

“For example, from December to February in Seattle, the CoreLogic Home Price Index rose 12% and our single-family rent index rose 6% for all price tiers compared with the same period a year earlier,” Nothaft said. “However, when looking at only lower-cost homes in Seattle, the price increase was 13% and the rent increase was 7%.”

And home prices will continue going up a forecasted 4.7% on a year-over-year basis and 0.4% month-over-month, according to the HPI.

“Home prices continue to grow at a torrid pace so far in 2017 and these gains are likely to continue well into the future,” CoreLogic President and CEO Frank Martell said. “Home prices are at peak levels in many major markets and the appreciation is being driven by a number of dynamics—high demand, stronger employment, lean supplies and affordability—that will continue to play out in the coming years.”

“The CoreLogic Home Price Index is projecting an additional 5% rise in home prices nationally over the next 12 months,” Martell said.

And these rising home prices are increasing homeowner equity, causing a new rise in home equity lines of credit lead by the Millennial generation.

Posted in Demographics, Economics, National Real Estate | 105 Comments