Discussing the positive effect of remodeling, home selling in the fall, home prices, increasing rents, economic confidence and much more!
The Positive Effects of Remodeling
NAR released a report that points out how remodeling not only helps the value of a home but also increases the owner’s satisfaction and enjoyment.
Highlights from NAR’s 2017 Remodeling Impact Report:
Best Interior Remodeling Projects
Best Exterior Remodeling Projects
If you are thinking about selling, I strongly suggest speaking with a local experienced Realtor before shelling out any money. And if you are thinking about selling….
Why You May Want to Sell This Fall
The most recent NAR Realtors Confidence Index reveals that home buyer demand is still very good throughout most of the U.S. Check out this map showing the strong demand:
As you can see, demand is RED HOT in South Carolina. Of course, it varies greatly on the area and price range.
If you combine the high demand with the tight inventory, you can REALLY see why now is a good time to sell a home. Once again, if we look at the latest data from NAR, there is less than a 6 month supply of homes for sale.
This means we are in a seller’s market!
Also, the high demand and limited inventory has forced buyers to properly prepare by getting pre-approved before making an offer or looking at homes for sale. This means buyers understand exactly what they are able to buy before they start looking at homes for sale.
Finally, the time to close a loan has dropped to 43 days according to Ellie Mae’s latest Origination Insights Report. This means that the time between when your home goes under contract and when you walk out of the closing attorney’s office is much shorter!
Plus, if you missed yesterday’s post, it looks like there will be a serious increase in the number of new homes hitting the market in the coming months. Combine all of these things and you can see why selling now could be better than waiting…
Rents Still Increasing But Stabilizing
While the trend of plateauing prices continued in the top 10 markets this month, the rest of the country began to experience this as well. The only change in position in the most expensive markets was Honolulu, moving up one spot. Mid and lower tiered cities also saw one of the flattest months ever with a record number of cities with no monthly growth. With that being said, those less expensive cities still had the most volatile changes. Overall, with summer winding down, rents across the nation seem to be stabilizing.
Nationwide, the Zumper National Rent Index showed one and two bedroom median rent settling at $1,183 and $1,402, respectively.
Obviously, this a national report and does NOT reflect what is realistic or possible in the Anderson SC area.
Economic Confidence Dips Slightly
Americans’ confidence in the economy declined slightly in September, with Gallup’s U.S. Economic Confidence Index slipping to +4 from August’s reading of +6.
While Gallup’s confidence index climbed past the +10 mark in the first month of the year, September’s score of +4 represents a continuation of economic attitudes that have held since May, apart from a brief increase in early August after the Dow Jones industrial average hit 22,000.
I am not too concerned about this decrease since we are at a much higher level than the same time last year. Just look at the chart above and you can see how economic confidence has increased compared to the past couple of years.
Will this translate into more homes being sold? Hard to say…
There is no doubt that someone buying a home has to feel pretty confident about the economy to make such a large purchase!
FHFA Director Watt Caught With Hand in the Cookie Jar
Mel Watt, the director of the Federal Housing Finance Agency, sometimes tasked FHFA employees with driving him and his wife to the airport for personal trips, and directed staff members to book flights unrelated to government business, the agency’s inspector general said in a December 2016 report. An unredacted version of the document was obtained by Bloomberg News.
Watt, an appointee of former President Barack Obama, had FHFA employees make personal travel arrangements for him and his family 28 times, the watchdog found, adding that the requests were “inconsistent with standards of ethical conduct.”
How is it someone deemed smart enough to run the FHFA could be this dumb? Watt said he was doing what other officials said was appropriate.
My Mom would ask Watt “If all the other kids jumped off the top of a building, would you do the same thing?”
U.S. Home Prices Increased 6.9% in August
CoreLogic just reported that home prices were up strongly both year over year and month over month during August 2017. Home prices nationally increased year over year by 6.9% YoY and 0.9% MoM in August 2017.
CoreLogic is predicting that U.S. home prices will increase by 4.7% YoY from August 2017 to August 2018. That sounds great but there is also some distressing news in the CoreLogic report.
They said that nearly 50% of the nation’s largest housing markets are overvalued. While this certainly does not apply to every market, if we start seeing a crapload of delinquent mortgages, it would NOT be good.
The Fastest Growing Segment of the Housing Market
From Urban Institute:
One of the most pronounced shifts in the housing market since the financial crisis has been the evolution of the single-family rental (SFR) market. Today, single-family rentals (one-unit, attached and detached) account for 35 percent of the country’s 44 million rental units, compared with 31 percent in 2006. More than half of renters live in structures with less than four units.
Growth in SFRs has outpaced growth of single-family owner and all multifamily housing in recent years. Data from NAREIT shows the SFR sector has seen growth every year since the crisis and has lingered around a 30 percent growth rate for the past three years, compared with less than a 15 percent growth rate for the multifamily market during that same period. The single-family owner market began to grow again in 2016, after declining for seven years.
They go on to point out that most single-family investors own fewer than 10 units. As much as we have heard about Wall Street investing in single family rentals, the majority are local investors.
They also say that the years of easy growth is behind us. Anyone that owns rentals will probably tell you it is never easy.
Senators Grill Wells Fargo CEO
The chief executive of Wells Fargo & Co. on Tuesday faced senators unimpressed with the bank’s claims of progress in rectifying a massive scandal that lasted years and ensnared millions of customers. Sloan outlined steps Wells had taken to address the management structure that incentivized opening accounts for customers fraudulently, and to make affected customers whole. The hearing marked one year since regulators settled with Wells over the opening of 2 million phony accounts and since then, additional wrongdoing has emerged.
While entertaining, the ugly but honest truth is this is just a show so the politicians can continue acting like they are working to protect the American people.
As I have said hundreds of times, this type of behavior will not change until CEO’s start going to prison. And not some minimum security country club prison…
Private Sector Employment Increases by 135,000 Jobs in September
Ahu Yildirmaz, vice president and co-head of the ADP Research Institute said:
In September, small businesses experienced a dip in hiring. This is in part due to Hurricane’s Harvey and Irma which significantly impacted smaller retailers. In addition, the continued slow down we have seen in small business hiring could be due to a lack of competitive compensation to attract skilled talent.
Mark Zandi, chief economist of Mood y’s Analytics said:
Hurricanes Harvey and Irma hurt the job market in September. Looking through the storms the job market remains sturdy and strong.
This is the slowest pace for growth in 11 months but this is only 1 month and probably due to the hurricanes. That being said, we need to keep an eye on this for the next several months as we head into the Holiday hiring season.
ISM Service Sector Increases
ISM just reported that economic activity in the non-manufacturing sector grew in September for the 93rd consecutive month.
Anthony Nieves, Chair of the IISM Non-Manufacturing Business Survey Committee said:
The NMI registered 59.8%, which is 4.5 percentage points higher than the August reading of 55.3%. This represents continued growth in the non-manufacturing sector at a faster rate. This is the highest reading since August 2005 when the index registered 61.3%.
Good news since this is a 12 year high! Hopefully this makes the ADP report more of a hurricane induced blip than the start of a trend.
Well that’s it for today! Please share or subscribe!