Discussing the latest on housing starts and building permits, how long buyers are searching today, the best type of home to build wealth faster and more!
Housing Starts and Building Permits Increase
From Census Bureau and HUD:
Privately-owned housing units authorized by building permits in January were 7.4% above the revised December rate and 7.4% above the January 2017 rate. Single-family authorizations in January were 1.7% below the revised December figure.
Privately-owned housing starts in January were 9.7% above the revised December estimate and 7.3% above the January 2017 rate. Single-family housing starts in January were 3.7% above the revised December figure and are up 7.6% YoY.
The improvements are mainly due to multifamily but overall, this report was above expectations. With the limited inventory problem it is good to see the YoY improvements for single family permits and starts.
While we did see improvements, look at the chart to see how we are still lower than we should be:
I must point out that this is talking about the entire country. You need to always work with a local Realtor to make sure you know what is happening in your local real estate market!
Most Home Buyers Have Been Searching for Over 3 Months
From Eye On Housing:
A recent poll revealed that most prospective home buyers actively involved in the search for a home have been looking for a significant amount of time. In fact, 61% have been trying to find a home to buy for three months or more, while the other 39% have been looking for less than three months.
42% say they ‘can’t find a home at a price I can afford,’ 36% ‘can’t find a home with the features I want,’ 34% ‘can’t find a home in the neighborhood I want,’ and 27% were able to overcome all these obstacles but ‘continue to get outbid whenever I make an offer.’
With 42% saying they cannot find a home they can afford, it makes the way that mortgage rates have been increasing pretty disturbing. Plus home prices are still increasing as well…
Waiting will cost home buyers more AND it could mean that some people will NOT be able to buy at all…
Homebuyers’ Typical Mortgage Payment Could Rise Over 15% This Year
The CoreLogic Home Price Index Forecast suggests U.S. home prices will rise less than 5 percent this year, but if some 2018 mortgage rate forecasts pan out the mortgage payments homebuyers face could increase closer to 15 percent.
Ouch! I just said that waiting could cost more and here is yet another indication of just how painful it could be…
Are Banks Shutting the Door to Homeownership To People of Color?
Fifty years after the federal Fair Housing Act banned racial discrimination in lending, African Americans and Latinos continue to be routinely denied conventional mortgage loans at rates far higher than their white counterparts.
This modern-day redlining persisted in 61 metro areas even when controlling for applicants’ income, loan amount and neighborhood, according to a mountain of Home Mortgage Disclosure Act records analyzed by Reveal from The Center for Investigative Reporting.
The yearlong analysis, based on 31 million records, relied on techniques used by leading academics, the Federal Reserve and Department of Justice to identify lending disparities.
Wow! If this is true, you would think that HUD would be busting some banks. Or maybe this is a statistical oddity and the banks are simply forced to turn down some because of their credit scores?
In this analysis, they could not compare credit scores because this info isn’t included. The banks say they should not need to report this information since it wouldn’t be helpful in identifying discrimination…
I think they should include credit scores but what do you think?
Some Homes Build Wealth Faster
Owners of starter homes across the country are gaining equity faster than other homeowners because demand for entry-level homes continues to grow faster than supply.
The phenomenon – which has become more pronounced over the past few years — underscores the power of homeownership to build wealth, particularly among the middle class.
The strong demand for starter homes is not going away anytime soon. You would think that more home builders would be finding a way to capitalize on this strong demand.
I have written many times about how owning a home is a great way to build wealth. But you have to do it correctly and not let your ego write a check your bank account cannot cover!
Well that is it for today! Please hit those share buttons and be sure to subscribe for email notifications about new posts!