Discussing home prices, sugarcoating the housing market, easing mortgage credit standards, home ownership is still part of the American Dream plus more!
Wow! It has been way too long since I wrote a real post because of changing to the new website. Lots of stuff to talk about so let’s dive right in!
Case-Shiller Home Price Index Rises at Fastest Pace in 3 Years
From S&P Dow Jones Indices:
Data released today for July 2017 shows that home prices continued their rise across the country over the last 12 months.
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.9% annual gain in July, up from 5.8% the previous month. The 10-City Composite annual increase came in at 5.2%, up from 4.9% the previous month. The 20-City Composite posted a 5.8% year-over-year gain, up from 5.6% the previous month.
David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices said:
Home prices over the past year rose at a 5.9% annual rate. Consumers, through home buying and other spending, are the driving force in the current economic expansion.
While home prices continue to rise, other housing indicators may be leveling off. Sales of both new and existing homes have slipped since last March. The Builders Sentiment Index published by the National Association of Home Builders also leveled off after March.
The housing market will face two contradicting challenges during the rest of 2017 and into 2018. First, rebuilding following hurricanes across Texas, Florida and other parts of the south will lead to further supply pressures. Second, the Fed’s recent move to shrink its balance sheet could push mortgage rates upward.
Remember this is a national report but the tight inventory issue IS being felt in some areas and price ranges of Upstate SC. And if we see mortgage rates increase, the combination of rising home prices and higher rates could hurt some home buyers…
U.S. Economic Confidence Index Holds Steady
Americans’ confidence in the U.S. economy remained slightly positive and stable last week. Gallup’s U.S. Economic Confidence Index held at +5 for the week ending Sept. 24 — the same score as the prior week.
The latest reading of Americans’ confidence in the economy is slightly higher than most of the weekly figures Gallup has recorded since March. More broadly, except for two higher weekly scores in August and a lower score in late June, the index has remained within a +2 to +7 range since late March.
While not great, this is a good sign for the economy. Especially considering all the negative stuff that could hurt confidence.
Remember, most people need to feel pretty confident about their personal situation, finances and the economy to consider buying a home.
How Many More ‘500-Year Storms’ Will People Endure Before They Start Abandoning Coastal Cities?
For homeowners in flood zones, one big question looms: Rebuild or retreat? People love living near the coast. Only two of the world’s top 10 biggest cities—Mexico City and Sáo Paulo—are not coastal. The rest— Tokyo, Mumbai, New York, Shanghai, Lagos, Los Angeles, Calcutta and Buenos Aires—are. Around half of the world’s 7.5 billion people live within 60 miles of a coastline, with about 10 percent of the population living in coastal areas that are less than 10 meters (32 feet) above sea level.
Something to think about considering the terrible damage that we have seen recently. Is the possibility of losing your home because of a hurricane worth living on the coast?
Then again, there are tornadoes, earthquakes and many other natural disasters in some areas of the country. I guess you just have to weigh the pros and cons of living anywhere!
Right Direction or Wrong Track?
From Rasmussen Reports™:
Thirty-three percent (33%) of Likely U.S. Voters now think the country is heading in the right direction, according to a new Rasmussen Reports national telephone and online survey for the week ending September 21.
Only 33%? Sounds like there are plenty of people besides me that want serious change in how our country is being run.
Maybe we should be careful what we ask for?
The Large Parts of America Left Behind by Today’s Economy
Economic prosperity is concentrated in America’s elite zip codes, but economic stability outside of those communities is rapidly deteriorating.
What that means: U.S. geographical economic inequality is growing, meaning your economic opportunity is more tied to your location than ever before. A large portion of the country is being left behind by today’s economy, according to a county-by-county report released this morning by the Economic Innovation Group, a non-profit research and advocacy organization. This was a major election theme that helped thrust Donald Trump to the White House.
Be smart: This isn’t a Republican or Democratic problem. At every level of government, both parties represent distressed areas. But the economic fortunes of the haves and have-nots have only helped to widen the political chasm between them, and it has yet to be addressed by substantial policy proposals on either side of the aisle.
There is no doubt that this isn’t a Republican or Democratic problem. Sadly, getting anything meaningful or helpful accomplished in today’s political environment seems doubtful…
Stop Sugarcoating the Housing Market
From a broad view, the U.S. housing market looks very healthy. Demand is high, employment and wages are growing, and mortgage rates are low.
But the nation’s housing market is assuredly unhealthy; in fact, it is increasingly mismatched with today’s buyers. While the big numbers don’t lie, they don’t tell the real truth about the affordability and availability of U.S. housing for the bulk of would-be buyers.
“It sets up a situation in which the housing market looks largely healthy from a 50,000-foot view, but on the ground, the situation is much different, especially for younger, first-time buyers and/or buyers of more modest means,” wrote Svenja Gudell, chief economist at Zillow in a response to the latest home-price data. “Supply is low in general, but half of what is available to buy is priced in the top one-third of the market.”
Remember that real estate is local. Buyers and sellers should be informed about what is actually happening in their local market. They should understand what is realistic or possible…
And the best way to do this by working with an experienced local Realtor…
A Realtor that will tell them the ugly but honest truth!
As Market Pressures Mount, Lenders Continue to Ease Mortgage Credit Standards
From Fannie Mae:
Facing constrained mortgage demand and a negative profit margin outlook, more lenders say they have eased rather than tightened home mortgage credit standards, according to Fannie Mae’s third quarter 2017 Mortgage Lender Sentiment Survey®. Across all loan types – GSE Eligible, Non-GSE Eligible, and Government – the net share of lenders who reported easing credit standards over the prior three months reached a new high since the survey’s inception in March 2014, after climbing each quarter since Q4 2016.
Lenders further eased home mortgage credit standards during the third quarter, continuing a trend that started in late 2016. In particular, both the net share of lenders reporting easing on GSE-eligible loans for the prior three months and the share expecting to ease standards on those loans over the next three months increased to survey highs.
Good to see lenders easing credit standards. After the economy hit the crapper, many lenders overreacted and made it too hard for some people to get a mortgage.
Today, things are much better and anyone that wants to buy a home should take the first step and talk to several mortgage lenders. See what is possible by getting Pre-Approved.
You have nothing to lose and so much to gain…
It is possible you could achieve the American Dream!
Home Ownership Still a Big Part of the American Dream
Fewer than 1 in 5 Americans think they’re living the full American Dream. Well that disturbing statistic is from the 2017 State of the American Dream report from Hearth.
Despite various reports which say the importance of home ownership is decreasing, the survey revealed that the desire to own a home is still very healthy. The report also found that “all generations–including millennials–agree homeownership is very important to achieving the American Dream”.
“Owning a home I love” was the number one thing that people in the survey feel they need to achieve the American Dream. Owning a home they love even beat “starting a family” and “finding a fulfilling career”) as an important part of the American Dream.
70% of Americans who said they think achieving the American Dream is important also think home ownership is important to the dream. Do you see owning a home as part of the American Dream?
Homeowners are 126% more likely than non-homeowners to view home ownership as a way to build wealth. I have often talked about the wealth building benefit of owning real estate.
The survey also showed that homeowners are 24% more likely than non-homeowners to see home ownership as an achievement that reflects hard work. It is hard work but the reward can be huge.
Both financially and in the ways that are much much more important than money…
U.S. Government Increasingly on Hook for Non-Bank Mortgages
From The District Sentinel:
Ginnie Mae has struggled to keep tabs on the rapid growth of the lightly-regulated non-bank mortgage market.
The wholesale mortgage guarantor’s unpreparedness may leave it struggling “to immediately respond to increased risks posed” by recent industry changes, according to a report published Monday by the Department of Housing and Urban Development (HUD) inspector general.
“As a result, Ginnie Mae may not identify problems with issuers in time to prevent default,” the report warned.
How is it we have let something like this happen? More importantly, what should be done to prevent any costly problems for taxpayers?
This needs to be corrected ASAP!
More Than 40 Percent of U.S. Adults Struggle to Make Ends Meet
Today, the Consumer Financial Protection Bureau (CFPB) released the results of a first-of-its-kind national survey on the financial well-being of U.S. consumers that showed that more than 40 percent of U.S. adults struggle to make ends meet.
Of the nationally representative sample of consumers surveyed, 43 percent of consumers report struggling to pay bills. Additionally, over one third—34 percent—of all consumers surveyed reported experiencing material hardships in the past year. For the survey, examples of material hardships include running out of food, not being able to afford a place to live, or lacking the money to seek medical treatment.
I think it is safe to say this is NOT good. Not good for society, the economy or the real estate market since these people are not going to be buying a home any time soon.
The big question is what are our elected officials doing TODAY to solve this problem?
I would say they are NOT doing anything.We cannot rely upon politicians to make our lives better!
It is something we must do for ourselves.
The ugly but honest truth is that bad things happen to good people…
If you get knocked down, you have to get back up. It doesn’t matter if your progress is slow as long as you are making progress.
If you are struggling today, please keep fighting and working to reach your goals and improve your life.
If you keep trying your hardest, you will be amazed at what you can accomplish!
That’s it for today! Please share or subscribe!