Real Estate Market Update

According to the Census Bureau, HUD and Commerce Department This Week in Real Estate the market to start the year for newly built single-family homes experienced significant growth year-over-year. Permits in January reached their highest level since June 2007 and housing starts were 21.4% above January 2019. Below are a few highlights from the third week of February that influence our business:

Housing Starts Mark a Solid Start in 2020. Relative to January 2019 total housing starts are 21.4 percent above the annual pace of 1.29 million units. The three-month moving average for single-family in January is an annual rate of 1,008,000 units, which is the highest pace since the Great recession. Single-family permits have registered a 20.2 percent gain compared to a year ago. This is in line with the NAHB/Wells Fargo Housing Market Index, which held builder confidence in the market for newly-built single-family homes at a solid level of 74 in February. Regional data show, on a year-over-year basis positive conditions for single-family construction in the West (+24.7 percent) and Midwest (+17.7 percent) while South (-3.7 percent) and Northeast (-15.4 percent) have posted declines. 

Full Story…  http://eyeonhousing.org/2020/02/housing-starts-mark-a-solid-start-in-2020/

* Single-Family Building Permits Rise to a 12-Year High. Permits for new houses rose to a more than 12-year high in January as builders began shifting into high gear amid a property shortageSingle-family home

authorizations, as permits are known, jumped to 987,000 at a seasonally adjusted annual pace, the highest since June 2007, the Commerce Department said on Wednesday. The January rate was a gain of 6.4% from December. Overall permits, including multifamily units and single-family homes, jumped 9.2% to an annual pace of 1.551 million, the highest level since March 2007.

Full Story… https://www.housingwire.com/articles/single-family-building-permits-rise-to-12-year-high/

* $221M Lost to Wire Transfer Fraud in 2019. Incidents and losses due to real estate wire fraud continue to increase, according to the FBI’s 2019 Internet Crime Report. The report shows there were 11,677 victims in 2019 with $221 million in losses. This compares to 11,300 reported victims and $150 million in losses in 2018. According to the FBI, only 15 percent of all wire fraud incidents are reported. Overall, the FBI reported that IC3 received 467,361 complaints in 2019 – an average of nearly 1,300 every day – and recorded more than $3.5 billion in losses to individual and business victims. The most frequently reported complaints were phishing and similar ploys, non-payment/non-delivery scams and extortion. The most financially costly complaints involved business email compromise, romance or confidence fraud, and spoofing, or mimicking the account of a person or vendor known to the victim to gather personal or financial information. Donna Gregory, the chief of IC3, said that in 2019 the center didn’t see an uptick in new types of fraud but rather saw criminals deploying new tactics and techniques to carry out existing scams. “Criminals are getting so sophisticated,” Gregory said. “It is getting harder and harder for victims to spot the red flags and tell real from fake.” While email is still a common entry point, frauds are also beginning on text messages—a crime called smishing—or even fake websites—a tactic called pharming. Individuals need to be extremely skeptical and double check everything, Gregory emphasized. “In the same way your bank and online accounts have started to require two-factor authentication—apply that to your life,” she said. “Verify requests in person or by phone, double check web and email addresses, and don’t follow the links provided in any messages.”

Full Story…   https://www.alta.org/news/news.cfm?20200218-WTF-221M-Lost-to-Wire-Transfer-Fraud-in-2019

This Week in Real Estate

photo credit: housingwire.com

September 10th, 2019

Mortgage Rates May Tumble to Record 3.3% by 2019’s End. Fixed mortgage rates could fall to 3.3% by the end of the year as the nation’s economy slows, according to Lawrence Yun, chief economist of the National Association of Realtors. That would put the rate just a smidge below the 3.31% seen in November of  2012 – the lowest average for a 30-year fixed mortgage in Freddie Mac data going back to 1971. “But lower rates may not help with affordability because home prices are re-accelerating higher, easily above the latest wage growth. Housing inventory has recently stopped rising, putting upward pressure on home prices of moderately priced homes,” Yun said. “But there is still a time to get the economy into a higher gear with increased home building of affordable homes and lessening trade tensions.”

Full Story… https://www.housingwire.com/articles/50102-nars-yun-mortgage-rates-may-tumble-to-record-33-by-2019s-end

A Smaller Share of Prospective Buyers is Actively Looking For a Home. A national poll in the second quarter of 2019 revealed that 12% of adults are thinking about buying a home in the next 12 months. Of that group, 41% are already actively engaged in the process of finding a home to purchase, which is a smaller share than a year earlier, when 50% of prospective buyers were engaged in the search process. This finding suggests that the lower mortgage rate environment of 2019 has not had the expected effect of nudging more people to start looking for a home to buy. Across generations, about 40% of Millennials, Gen X’ers, and Boomer buyers have moved beyond just planning and begun the home search, compared to only 21% of Senior buyers. Geographically, prospective buyers in the Northeast are the most likely to be actively looking for a home (47%), followed by those in the West (43%), and those in the Midwest and South (both 39%). How long are buyers who are actively engaged in the search process hunting for a home? In the second quarter of 2019, 45% had been at it for less than 3 months while the other 55% had been trying to find the right home for 3 months or longer. Those shares were essentially unchanged from a year earlier, when they stood at 46% and 54%, respectively.

Full Story… http://eyeonhousing.org/2019/09/a-smaller-share-of-prospective-buyers-is-actively-looking-for-a-home/

Residential Construction Spending Drops Further Off 2018 Pace. Construction spending inched up by 0.1 percent in July, to a seasonally adjusted annual rate of $1.289 trillion compared to $1.288 trillion in June. The July figure is 2.7 percent lower than the rate of spending in July 2018. On an unadjusted basis, spending for the month was $119.214 billion and for the year-to-date (YTD) stands at $733.782 billion, down 2.1 percent from the $749.888 billion spent during the first seven months of 2018. Private sector spending on residential spending was at an annual rate of $506.743 billion compared to $503.515 billion in June, an increase of 0.6 percent but down 6.6 percent from the prior July. Single family construction was at a rate of $268.138 billion a 1.4 percent month-over-month gain but a decrease of 8.5 percent on an annual basis. For the YTD, total residential spending has totaled $289.891 billion, $150.219 billion of it on single-family houses. During the same period in 2018 the respective totals were $316.929 billion and $164.529 billion. These represent declines of 8.5 and 8.7 percent. 

Full Story… http://www.mortgagenewsdaily.com/09042019_construction_spending.asp

aimeehartwigrealestate.com / 541-579-9213 / aimeehartwig@bhhsrep.com