Mortgage Rates Stumble in Feeble Economy
House 02

Mortgage rates retreated this week as investors grew anxious over weaker-than-expected economic data and escalating tensions in Syria.

The benchmark 30-year fixed-rate mortgage fell to 4.62% from 4.74% last week, according to the national survey of large lenders. The mortgages in this week’s survey had an average total of 0.35 discount and origination points. One year ago, that rate stood at 3.8%. Four weeks ago, it was 4.59%.

The benchmark 15-year fixed-rate mortgage fell to 3.66% this week, compared to 3.75% last week, and the benchmark 5/1 adjustable-rate mortgage fell to 3.615 from 3.69%. The benchmark 30-year fixed-rate jumbo fell to 4.77% from 4.88%.
Weekly national mortgage survey
Results of’s Aug. 28, 2013, weekly national survey of large lenders and the effect on monthly payments for a $165,000 loan:
30-year fixed 15-year fixed 5-year ARM
This week’s rate: 4.62% 3.66% 3.61%
Change from last week: -0.12 -0.09 -0.08
Monthly payment: $847.84 $1,192.56 $751.09
Change from last week: -$11.88 -$7.36 -$7.44

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The drop brings rates closer to where they were before last week’s spike, when rates reached their highest levels in more than two years.

“Mortgage rates had increased a fair amount over the last 60 days. A pullback was inevitable,” says Bob Walters, chief economist for Quicken Loans.

Bad news pushes rates down

Weak economic news and concerns over the situation in Syria have helped keep a lid on rates this week, Walters says.

U.S. orders for long-lasting manufactured goods, such as cars and appliances, fell by 7.3% in July, the Commerce Department said this week. New-home sales plunged 13.4% in July, the Census Bureau reported. And pending home sales declined 1.3% in July, according to the National Association of Realtors.

“Bad economic news is good for interest rates,” Walters says. That’s because they cause nervous investors to seek safety in U.S. Treasury and mortgage bonds. Increased demand for bonds tends to result in lower mortgage rates.

The decline in home sales could be a reflection of higher mortgage rates, some industry observers say.

“The modest decline in sales is not yet concerning, and contract activity remains elevated, with the South and Midwest showing no measurable slowdown,” says Lawrence Yun, NAR’s chief economist. “However, higher mortgage interest rates and rising home prices are impacting monthly contract activity in the high-cost regions of the Northeast and the West.”

Despite the recent adjustment, mortgage rates are still 1 percentage point higher than they were in May.

Where are rates headed?

Homebuyers may get a short break on rising interest rates for now, mortgage professionals say. “Mortgage rates should ease through mid-September,” says Dan Green, a loan officer for Waterstone Mortgage in Cincinnati. “There’s little reason for rates to rise.”

Investors remain anxious about a potential U.S.-led attack on Syria and concerns over use of chemical weapons by President Bashar al-Assad’s government.

“The recent escalation of tensions in the Middle East has caused a flight to quality, where traders sell stocks and buy safer bonds,” Walters says.

It’s possible that the tension in Syria will push rates a little lower in coming days, but don’t bet on it.

“Rates falling one-eighth of a percentage point won’t change your life,” Green says.


Courtesy of your Arcadia Real Estate Agent

Housing recovery continues to heat up

Despite uncertainties, housing has found its footing

Christina Mlynski
August 13, 2013 4:06pm
Regardless of an inadequately housing supply, rising home prices reacting to strong demand and difficult lending environment, market expectations remain bullish on housing.

Nonetheless, housing is in its early stages of recovery and panelists at the Bipartisan Policy Center’s conference believe it’s not time for the Federal Reserve to take their foot off the bond-buying gas pedal just yet.

“There is a cyclical and structural nature to the problem,” explained Paul Weech of Housing Partnership Network.

He added, “We haven’t solved for the underlying structural problem and if we revert back to the norm, we still have millions of homes trying to get back in the full market recovery.”

One of the major factors still impacting the housing market is underwriting standards.

Fannie Mae senior vice president and chief economist Doug Duncan pointed out that there is a high correlation between the business cycle and the credit cycle, which will ultimately lead to an established fixed floor of the credit box.

“If in the regulatory process we can establish a fixed floor then we’ll change fundamentally the level of housing,” Duncan explained.

Looking to the future state of housing, experts agreed that immigration will play a significant role in the housing recovery.

Data taken from 2012 and estimated through 2050 shows that the economy will have 15 million less workers if the immigration rate continues, meaning less people in the housing market and less people paying into their entitlements, Duncan noted.

Another group of Americans that will affect the future of housing is the baby boomer generation, which is the fastest growing age group.

Many have a desire to remain in a home, but want to be mobile. As a result, homebuilders are trying to find new ways to accommodate these needs as well as attract first-time homebuyers to market.

Conine Residential Group president Kent Conine explained that homebuilders are introducing new innovations and productions into the marketplace.

For instance, Conine is in the process of developing a system in which seniors sell their current homes and downgrade to plain vanilla property, which will allow them to travel, while still maintaining a home.

On the reverse side, many homebuilders are going back into the inner cities to tear renovate properties in the hopes of enticing first-time homebuyers into the market.

“While it’s far from where it needs to be, housing is improving,” stated Realogy Holdings Corp. chairman and chief executive officer Richard Smith.

He concluded, “If given a little nudge from regulators and Congress to put in some definitive rules, housing has only one way to go, up.”


Courtesy of your Arcadia Real Estate Agent

Housing supply catches up with demand


Prices expected to balance out month to month

Megan Hopkins

Those fearing the housing bubble apocalypse can finally breathe — it looks like home prices may begin to move laterally on a month-over-month basis moving forward.

While the median cost per square foot rose 14.9% year-over-year in July, inventory fell by almost 16% in the same period. Meanwhile, on a monthly basis, the median list price per square foot held steady from June to July, while the number of homes listed for sale increased.

The stagnant list price month-over-month is an indicator that the inventory supply is beginning to catch up with demand, according to the latest report from Movoto Real Estate.

Higher mortgage rates coupled with increased inventory will stunt price appreciation, slowing the quickly rising pace of home prices.

This goes hand-in-hand with the latest CoreLogic (CLGX)Case-Shiller report which states that slowly, as more and more homeowners consider selling their homes to lock in capital gains, the pressure that has been driving prices upward will subside. The report predicted that price appreciation will start to decelerate in 2014.

Currently, the real estate market is mixed, the report suggests. While sellers would be smart to list their homes in order to take advantage of the increase price per square foot, homebuyers would be wise to keep an eye on the monthly change in list price per square foot. June to July marked the first time this year that the price did not increase, which could imply the market is loosening, putting more power back into the hands of buyers, Movoto noted.

In 36 of the 38 cities tracked by Movoto, the median list price per square foot increased, up 14.9% year-over-year. The July 2012 median list price per square foot sat at $157; at the end of July, the median price jumped to $181.

However, before July, the median list price per square foot rose for six consecutive months, a negative sign for potential buyers looking to strike a deal. Fortunately for buyers, July put a stop to the price increase. While this is a good sign for homebuyers, data from Movoto indicated that there has been little change in the price between June and July over the past two years.


Inventory remained significantly below year-ago levels, down 16.2% from July 2012. However, on a monthly basis, inventory rose slightly more than 4% from June to July. According to Movoto, this is to be expected upon entering the busy part of the home-buying season when buyers are more likely to buy a home.


“To place this in perspective, during the same time in 2012 and 2011, inventory declined across the cities we track, which is a good sign for perspective buyers going into the second half of this year,” Movoto wrote in the report.

Courtesy of your Arcadia Real Estate Agent

1 in 3 buyers would bid above asking price

Trulia: 1 in 4 buyers would pay seller’s closing costs

Inman News
Staff Writer

Jul 25, 2013

One in 3 buyers are willing to bid higher than a home’s asking price, according to a survey conducted by Trulia in partnership with Harris Interactive.

That was just one of several other findings of the survey that appear to show that homebuyers are feeling the squeeze of market conditions that are significantly altered from those of a year ago. At the same time, they capture improved sentiment towards the housing market.

Today’s tight home inventory appears to be pushing some buyers to use aggressive tactics to beat out competing buyers, the survey found. In addition to a third of buyers being willing to make above-market offers, 1 in 4 said that they would offer to pay a seller’s closing costs.

“Tight inventory means slim pickings for buyers. Even though inventory is starting to expand, and rising home prices should bring more for-sale homes onto the market, people who actually want to buy within the next year are feeling the pressure of competing buyers and limited inventory,” wrote Trulia Chief Economist Jed Kolko in blog post about the survey.

Also seemingly a symptom of today’s limited housing stock, homebuyers who plan to buy within the next year said that finding a home that they like is their biggest worry.

And highlighting two other defining characteristics of today’s market, consumers who said they might buy someday indicated that their two greatest fears were that mortgage rates and home prices would rise further.

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But in a sign that people’s attitudes towards homeownership have recovered significantly since the downturn, 60 percent of respondents said that they thought homeownership is one of the best long-term investments they could make, up from 47 percent two years ago.

Courtesy of your Arcadia Real Estate Agent

US Housing Market Strengthens

Published on:

Tuesday, July 16, 2013
Written by:
Global Property Guide
  • The S&P/Case-Shiller report for the first quarter indicates strong growth in the U.S. housing market as prices increase and foreclosures continue to fall. Consumer confidence and construction are both gaining steam and all 20 major cities are showing improvement. Data collected from the U.S. Census Bureau and the Federal Housing Finance Agency also show signs of a strong recovery, and even homebuilder sentiment is up, according to the National Association of Homebuilders. Experts are confident the growth will continue thanks in part to a strengthening economy and increases in the country’s GDP. For more on this continue reading the following article from Global Property Guide. 

Boomtime is back! U.S. house price rises are accelerating, consumer confidence is at a five-year high, construction activity is picking up, and foreclosures and delinquency rates are falling.

During the year to end-Q1 2013, the S&P/Case-Shiller seasonally-adjusted national home price index soared by 10.17% (8.31% in real terms), the biggest year-on-year increase since Q1 2006, according to Standard & Poor’s.  Quarter-on-quarter (q-o-q), the national home price index rose by 3.94% (3.3% in real terms) in Q1 2013.

All 20 U.S. major cities registered strong year-on-year house prices increases in March 2013. Pheonix recorded the highest annual house price increase, of 22.4%, followed by San Francisco (22.2%), Las Vegas (20.6%), Atlanta (19.1%) and Detroit (18.6%).

The Federal Housing Finance Agency (FHFA)’s house price indices were also encouraging. The U.S. seasonally-adjusted purchase-only house price index rose by 6.73% (4.93% in real terms) y-o-y to Q1 2013, the largest annual rise in house prices since Q2 2006. On a quarterly basis, the index increased by 1.95% (1.32% in real terms) in Q1 2013.

In April 2013, the median sales price of new homes sold in the U.S. increased by 14.9% y-o-y to US$271,600, according to the U.S. Census Bureau.

During the first four months of 2013, the total number of houses sold in the U.S. rose by 26.4% y-o-y to about 153,000 units, based on figures from the U.S. Census Bureau.  Demand started to pick up in 2012 when the number of houses sold increased by 16.8% to 368,000 units from the previous year.

Construction activity is also on the rise. In 2012 from a year earlier:

  • The number of house building permits authorized soared by 32.9% to 829,700 units
  • The number of housing units started rose 28.2% to 780,600 units
  • The total number of housing units under construction increased by 27.5% to 532,500 units

U.S. home builder sentiment rose 7.3% from the previous year in May 2013, according to the National Association of Home Builders.

Foreclosures and home repossessions are also falling, partly due to the increased efforts by the government and state lawmakers to delay property seizures. In California, a new law prohibits lenders from pursuing foreclosure while the borrower is still renegotiating his loan terms.

  • The total number of foreclosures completed dropped 16% to 52,000 units in April 2013 from the same period last year, according to data analytics firm CoreLogic. In addition, foreclosure inventory fell by 24% y-o-y to about 1.1 million homes in April 2013.
  • Home repossessions in the U.S. dropped by 32% y-o-y in April 2013, according to foreclosure listing firm,RealtyTrac Inc. Lenders repossessed 34,997 houses in April 2013, the lowest level since July 2007./li>

The market is likely to remain strong.  “The housing market continues to squeak out gains from already very positive conditions,” said National Association of Realtors (NAR) chief economist Lawrence Yun.

The U.S. economy grew by 2.2% in 2012, after real GDP growth rates of 1.8% in 2011 and 2.4% in 2010, according to the U.S. Bureau of Economic Analysis (BEA). Economic growth is expected to be 1.9% in 2013, and 2.8% in 2014, based on projections by the Organization for Economic Cooperation and Development (OECD).

Phoenix leads the recovery!

During the U.S. housing boom (1996-Q1 2006), all 20 main U.S. cities experienced spectacular house price rises. Los Angeles registered the biggest house price rise of 268.1%, followed by San Diego (250.1%), San Francisco (227.8%), and Miami (214.6%).

In Q2 2006, house prices started to fall. From Q2 2006 to Q4 2011, the S&P/Case-Shiller composite-10 home price index plunged 34%. Of the ten largest U.S. metro areas, Phoenix registered the biggest drop (down 55.5%), followed by Detroit (-44.4%), San Francisco (-41%), Los Angeles (-40.6%), and San Diego (-39.9%).

Now Phoenix is leading the recovery. Phoenix house prices rose 18.8% y-o-y to August 2012, its fourth consecutive month of double-digit y-o-y house price increases. Seventeen of the 20 largest cities in the U.S. saw house price rises in August, from a year earlier. Only three cities have seen their house prices fall during the year to August 2012—Atlanta (-6.1%); New York (-2.3%); and Chicago (-1.6%).



Housing boom
(Jan 1996 – Mar 2006)
Housing crash, global crisis
(Apr 2006 – Dec 2011)
August 2012
New York
Los Angeles
San Diego
San Francisco
Source: S&P

During the year to August 2012, the Mountain region registering the biggest house price increase of 11.4%. Other strong regions include the Pacific (8.1% y-o-y), West South Central region (5.3%), South Atlantic region (4.6%) and the West North Central region (4.4%).

Demand rising again fast

Demand for houses is rising. The number of houses sold (seasonally-adjusted) during the first eight months of 2012 rose 20.8% compared with the same period last year, according to the U.S. Census Bureau.

January to August 2012 houses sales (compared to same period last year):

  • Western region: sales up 37.6%
  • Northeast: sales up 27.1%
  • Midwest: sales up 18%
  • South: sales up 13.5%

The ratio of houses for sale to houses sold in August 2012 was 4.6 – down from 6.6 the same month last year.

The total number of new houses for sale was at a record low at the end of August 2012, at 143,000 units. About 55.9% of the new houses for sale are in the Southern region, 19.6% in the West, 13.3% in the Midwest, and 11.2% in the Northeast.

Residential construction strongly rising

Residential construction has begun to turn around.

  • For the first three quarters of 2012, the total number of new privately owned housing units completed increased 8.9% from the same period last year, to 462,100 units, according to the US Census Bureau.
  • The total number of housing starts increased 26.7%, to 582,500 units during the year to September 2012.
  • The total number of houses under construction rose by 13.2% y-o-y to 4,275,300 units during the first nine months of 2012.

From 1990 to 2007, the total number of housing starts averaged 1.5 million units per year. However due to the global crisis, housing starts fell to 1.1 million units in 2008, 794,400 units in 2009, 651,700 units in 2010 and 584,900 units in 2011.

In the second quarter of 2012, the U.S. housing inventory increased 0.4% to reach 132.72 million. Of these, 86% were occupied, and the remaining 14% were vacant. About 66% of the occupied housing units were owner-occupied; the other 34% were rented.

Delinquency rate stabilizing, foreclosures falling

The residential real estate delinquency rate has stabilized, another clear signal of a housing market recovery. In Q3 2012, 42 U.S. states showed a drop in delinquency rates. California and Arizona, two of the hardest hit by the global financial and economic crisis, showed the best year-on-year results. However, the national delinquency is still exceptionally high compared to the 1.39% delinquency rate registered in Q4 2004. The delinquency rate of outstanding residential real estate loans was 10.61% in Q2 2012, down from 10.69% in Q2 2011, according to theUS Federal Reserve System.

In addition, the total number of foreclosures (default notices, scheduled auctions, and bank repossessions combined) in September 2012 fell to their lowest level in five years, at 180,427 units, according to RealtyTrac.

“The five-year low, combined with the fact that the year-over-year decrease in foreclosures was in its twenty-fourth straight month, is evidence that we´re past the worst of the foreclosure crisis,” said RealtyTrac vice president Daren Blomquist.

In Q3 2012, San Francisco had seen the biggest drop (-36%) in foreclosure activity from a year earlier, followed by Detroit (-31%), Los Angeles (-29%), Phoenix (-27%) and San Diego (-26%).

“Two-thirds of the nation’s largest metros posted decreases in foreclosure activity in the third quarter,” said Blomquist.

Mortgage interest rates falling

The U.S. Fed’s key rate remained unchanged at 0.13% in October 2012, having been cut in December 2008. The rate can hardly fall further.

The fed funds rate peaked at 5.25% in August 2007.

As of October 2012, the average interest rate for 30-year Fixed Rate Mortgages (FRMs) was 3.38%, down from 4.07% the same month last year, based on figures released by Freddie Mac. Likewise, the average rate for 15 year FRMs fell from 3.35% to 3.69%, while the average rate for 5 year FRMs fell from 3.03% to 2.74%.

One-year adjustable rate mortgages (ARM) had an average lending rate of 2.59% in October 2012, down from 2.92% in October 2011.

Stimulating the housing market

A new mortgage relief plan, actually a revamp of the existing Home Affordable Refinance Program (HARP), was announced by President Barack Obama in October 2011, to stimulate the economy and to revitalize the housing sector.

HARP’s previous maximum loan-to-value (LTV) ratio has now been scrapped, and the 2% fees paid by some high-risk borrowers have been reduced or abolished, while HARP’s deadline has been extended to December 31, 2012.

To be eligible for the HARP refinance program:

  • The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
  • The mortgage must have been sold to Freddie Mac or Fannie Mae on or before May 31, 2009.
  • The mortgage cannot have been refinanced under HARP previously, unless it is a Fannie Mae loan refinanced under HARP from March-May 2009.
  • The current LTV ratio must be higher than 80%.
  • The borrower must have no late payment in the past six months, and no more than one late payment in the past 12 months.

In another stimulus measure, the Federal Reserve Board said in September 2012 that every month, it would buy US$40 billion in mortgage-backed securities.

Mortgage market still shrinking

The U.S. mortgage market has been shrinking. In Q2 2012, the size of the mortgage market was equivalent to 84.4% of GDP, down from 103% of GDP in 2009, according to the Fed.

The total mortgage debt outstanding fell by 2.4% to US$13.216 trillion in Q2 2012, from the same period last year.

In Q2 2012, the homeownership rate (seasonally-adjusted) in the U.S. was 65.6%, the lowest since Q1 1997.

Rental vacancies falling

The median asking rent in the U.S. fell by 0.7% to US$716 per month from the previous quarter in Q2 2012, but was still 4.7% higher than the same period last year, according to the U.S. Census Bureau’s Housing Vacancy Survey.

In Q2 2012:

  • In the Northeast region, the median asking rent was 5.8% lower the previous quarter – but 1.5% higher than a year ago, at US$878 per month.
  • In the Midwest, the median asking rent fell by 1.3% q-o-q, but rose by 2% y-o-y to US$599 per month.
  • In the Southern region, the median asking rent rose by 1.4% q-o-q, and was also up 3.4% y-o-y, to US$669 per month.
  • In the West, the median asking rent rose by 6.5% q-o-q, and was also up 7.3% y-o-y, to US$911 per month.

The rental vacancy rate in the U.S. fell to 8.6% in Q2 2012, from 9.2% in Q2 2011, according to the U.S. Census Bureau.

Rents rising faster than house prices

The house price-to-rent ratio has been falling since 2008. From 2008 to Q2 2012, house prices have plunged deeply, while median rents have been more or less static, according to the U.S. Census Bureau.

A falling price-to-rent ratio is a signal that the market has good potential for recovery, in the long term.

Slowing economic growth

During the first quarter of 2013, the U.S. economy expanded by an annual rate of 2.4%, lower than the 3% average projection by economists.  Growth has mainly been fuelled by inventory accumulation, and by an increase in consumption and residential investment.

Economic growth is expected to slow to 1.9% for the full year 2013, but recover to 2.8% in 2014, according to theOrganization for Economic Cooperation and Development (OECD).
Growth is being slowed by the U.S. government’s increasingly contractionary fiscal policy, which includes hiking taxes starting January 2013, and cutting the federal budget in March 2013. In addition, the ongoing Eurozone debt crisis is also adversely affecting the U.S. economy.

The federal deficit is expected to fall to about US$642 billion by end-2013 from its nosebleed US$1 trillion-plus heights in 2012, as tax revenues soar, according to the Congressional Budget Office. As a result, the shortfall is projected to drop from 10.1% of GDP in 2009 to about 4% of GDP in 2013 and finally to just about 2.1% of GDP in 2015.

With increasing investor confidence, the national jobless rate dropped to a four-year low of 7.5% in April 2013, according to the U.S. Department of Labor.

The overall inflation rate slowed to 1.1% in April 2013 mainly due to lower gasoline prices, according to the U.S. Department of Labor, well below the Fed’s 2% target, and below the 2012 inflation rate of 2.1%, and 2011 rate of 3.1%. The muted inflation could bolster the case for the Fed to continue its monetary easing.

With the government’s recent belt tightening, the question now is whether the housing recovery will continue to power economic growth?

In our view the likely answer is, yes.  A house price collapse created the recession.  It is important not to underestimate the significance of the housing market as a major influence on the U.S. economy. The strong housing recovery is likely to buoy economic growth in the U.S. for the medium term.


Courtesy of your Arcadia Real Estate Agent

Home sellers’ ranks grow as home prices rise

The big jump in home prices in the past year is finally bringing more sellers to the housing market, but inventories remain lean.

The number of existing homes for sale ticked up to 2.2 million in May, up 3.3% from April, the National Association of Realtors said Thursday.

When adjusted for seasonal factors, inventory has risen for four months in a row, suggesting the supply bottom came in January, says Jed Kolko, economist for real estate website Trulia.

The new sellers are making moves they’ve put off for years as home prices tanked. They’re taking jobs in other locations, enjoying fast sales of existing homes. And some are pricing properties at levels higher than Realtors think prudent — and getting their price anyway.

The new sellers hardly constitute a flood, more like a trickle from a huge lake. They still are far too few for the balance of power in many markets to shift from sellers to buyers, says Budge Huskey, CEO of Coldwell Banker. But with home prices up 12% in April from a year ago, more are expected if prices continue to rise.

“There is huge pent-up seller demand,” Huskey says. “Every Realtor knows a seller who’d like to move to the next chapter in their life.”

Martha Gove and Josh Cohen are doing just that.

They’re moving just three blocks from their current home in Ann Arbor, Mich., to a bigger home they just bought.

The couple were “waiting and watching” for three years to find a suitable home for sale. In recent months, “things finally started to loosen up,” says Gove, 40, a lawyer.

In May, Ann Arbor posted an 11% jump in homes listed for sale from April, says — almost twice as much as the national average. And its May asking prices tracked by were up 17% from a year earlier.

Ann Arbor’s market is so strong that the couple are attempting to sell their home themselves. That’s not something they would have attempted even six months ago, Gove says.

In the first week after listing their home, they had six showings. “People are suddenly on the move,” Gove says.

In May, existing home sales nationwide were up a robust 4.2% from April and almost 13% from a year ago, NAR says.


The shift in supply is broad-based.

Earlier this month, the number of homes listed for sale on real estate website Zillow was down 12.2% year-over-year. That’s still better than in January, when listings were down almost 18% year-over-year., which tracks listings in 146 markets nationwide, shows listings up 5.8% in May from April.

But in 18 of the markets, including Los Angeles, Orlando and Seattle, inventory was up 10% or more in May from April.

In the California cities of Stockton and Sacramento, May listings were up more than 35% from April. Both cities posted 22% price gains in April from a year earlier, market researcher CoreLogic says.

Rising home prices are likely driving the increase, Kolko says.

“Every day as prices rise, more people get back above water,” Kolko says. That makes selling easier.

Nationwide, 9.7 million, or almost 20% of homeowners with a mortgage, owed more on their homes than they were worth as of March, CoreLogic says. That’s down from 12.1 million at the end of 2011, just as home price gains were kicking off in many markets after a roughly 30% national drop.

“Sellers have finally noticed that they have some equity,” says Coldwell Banker agent Ramon Macias in San Diego. Prices there were up 17% in April year-over-year, CoreLogic says.

Gonzalo and Grace Hernandez never worried about whether they’d get back what they paid for their San Diego home.

That’s because they bought it just 11 months ago when prices were starting to move off their bottom. They’re now selling it to relocate to Nashville for a job change.

They paid $355,000 for the home and now have it under contract to sell for $420,000. It took a week to sell.

Nationwide, the median time on market for all homes that sold in May was just 41 days. That’s down from 72 days a year ago, NAR says.

Knowing that they’d turn a solid profit was a “big part of the decision” to accept a job transfer with his hotel chain employer, says Gonzalo Hernandez, 40.

Some sellers are getting prices that surprise even their Realtors, given tight supplies for sale in some markets and frequent multiple-offer situations.

Redfin agent Bree Al-Rashid recently handled the sale of a home in a popular Seattle neighborhood that sold for 10% more than she thought it was worth, based on comparable sales. The sellers were adamant that the listing price be higher than what she recommended, Al-Rashid says.

“I’ve been humbled in this market. We cannot predict what can happen,” Al-Rashid says. Seattle prices were up 16% in April from a year ago.

The supply of existing homes for sale in May was at 5.1 months, down from 5.2 months in April. But the supply was just 4.3 months in January, NAR data show.

That means that all homes would sell in that time frame if no more supply came on the market and sales continued at May’s pace. Generally, Realtors consider a six-month supply to be a balanced market between buyers and sellers.

It will be next year before the supply of existing homes for sale climbs to a six- or seven-month level, says Lawrence Yun, NAR chief economist.

One big factor is how fast home builders ramp up construction, which will increase the overall supply of homes for sale.

In the meantime, sellers still have big advantages in many markets, especially in the West where inventory tends to be tighter.

In California, May’s data show just a 2.6-month supply of single-family homes for sale — leaving that market firmly in the sellers’ camp after years of rampant foreclosures and big price drops.

“It’s amazing how quickly the dynamics have changed from a buyer’s market to a seller’s market,” Huskey says.


Courtesy of your Arcadia Real Estate Agent

Why It’s True: You Should Own, Not Rent

By Jeff Brown

The “American Dream” means owning a home rather than renting. And despite the huge losses millions of homeowners suffered in the past decade, the dream is still alive and well. But what, exactly, do people value the most in owning over renting? A study by Fannie Mae shows that most renters aspire to own someday, though they feel it may be more difficult to buy than in the past. The strong appeal to owning is rooted in the sense of control.

A full 90% of renters said they expected to own at some point in the future. Of those renters surveyed, 84% cited “having control over what you do with your living space” as a reason owning is better than renting. “Having a sense of privacy and security” was cited by 80%, “having a good place for your family or to raise your children” by 78% and “living in a nicer home” by 71%. Many also cited the presumed financial benefits of owning over renting, with 78% citing “having the best investment plan,” 70% saying “building up wealth” and 69% saying “saving for retirement.”

More from Housing Market Rises Halfway Back to Normal

Still, renting did seem to offer some advantages over owning, with 57% citing “living within your budget,” 52% “having less stress” and 50% “making the best decision given the current economic climate.” This last figure reflects the especially high hurdles facing would-be homeowners today, including high down payment requirements and tough loan-approval guidelines. A decade ago, loans were easy to come by and buyers had to put little or nothing down.

“Renters who prefer to own perceive potential financial hurdles, and many of them think it would be difficult for them to get a mortgage today,” Fannie Mae reported. “Compared to the owners they aspire to become, renters are more likely to have fewer assets, higher debt stress, and less income.”

More from Where Are All the Baby Boomers Going?

Asked their primary reason for renting now, 49% of those aged 18 to 34 cited making themselves “financially ready to own.” Of those aged 35 and older, 26% cited that reason. In the younger group, 15% said they rent because it is more affordable than owning, while 23% of the older renters cited that reason. In comparison, all the other reasons for renting were relatively unimportant. Renting as a protection against a possible decline in home prices, for instance, was cited by just 1% of those 18 to 34, and 3% of those 35 and older.

So do renters’ survey responses reflect a sound understanding of the benefits of owning over renting? For the most part, yes. There’s no doubt owning is preferable for anyone who values control. Not many landlords will let tenants change paint colors, let alone knock down the wall from the kitchen to dining room.

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Financially, owning is preferable so long as one will stay put long enough. Generally, it takes four or five years for a home’s price to rise enough to offset the various costs of buying and selling, such as transfer taxes and real estate agent’s commission. Over longer periods, owners build equity from appreciation and the gradual reduction of mortgage debt.

But homes have not proven to be terrific investments. On average, prices grow at about the inflation rate of around 3% a year — while alternatives such as stocks earn much more. So when those renters do look to buy, the best move is to buy the least expensive home that satisfies their needs and to invest the savings in some other way.


Courtesy of your Arcadia Real Estate Agent

Home prices show strong gains in April

Julie Schmit, USA TODAY

The pace of home price increases stayed strong in April with prices up 12.1% year-over-year, CoreLogic says.

The annual increase is the biggest in more than seven years. Prices were up 3.2% in April from March.

“Increasing demand … coupled with low inventory, has created a virtuous cycle for price gains, says Mark Fleming, CoreLogic chief economist, noting that home price growth continues to “surprise to the upside.”

The states with the highest year over year home price appreciation were Nevada, up almost 25%; California, 19%; Arizona and Hawaii, 17%; and Oregon, almost 16%.

A rise in the supply of homes for sale should lead to moderating price gains later this year, says Ed Stansfield, an economist with Capital Economics.

In April, the supply of existing homes for sale grew to 5.2 months, up from 4.7 months in March, the National Association of Realtors says. Realtors generally consider a 6-month supply to be balanced between buyers and sellers.

More listings are expected given that more people think it’s now a good time to sell, Stansfield says, and because rising prices enable more people to sell at smaller or no losses.

In April, only two states posted lower home prices year-over-year. Prices were off 1.7% in Mississippi and 1.6% in Alabama, CoreLogic says.

The cities showing the biggest gains year over year for single family homes continue to be Los Angeles and Phoenix, up 19%. They were followed by Atlanta and Riverside, Calif., up almost 17%.

Courtesy of your Arcadia Real Estate Agent

Survey: Majority of Americans forecast home prices to rise

The majority of Americans now are forecasting home prices to rise, and only about a third are expecting prices to fall, a reversal in attitudes of a year ago.

A monthly survey by mortgage finance firm Fannie Mae found 51% of those questioned in April believe prices will rise in the next 12 months, while only 35% are projecting a drop in prices. It is the first time in the three-year history of the survey that a majority said they expect prices to increase.

A year ago, 49% were expecting further price declines while only 32% said they though prices were on their way up.

The latest data from the housing market back up the this new level of confidence in the housing recovery. The S&P Case-Shiller Home Price Index rose 9.3% over the last 12 months, the biggest annual rise in home prices since the height of the housing bubble in 2006.

“Crossing the 50% threshold marks a significant milestone, as most Americans believe a housing recovery is truly occurring throughout the country,” said Doug Duncan, chief economist for Fannie Mae.

People who were sitting on the sidelines because of concerns that prices were still falling can be drawn back into the market once they believe prices are on their way up again. Home sales are up 10% from a year ago, helped not only by the climbing prices but also record low mortgage rates and falling unemployment.

The survey found that those expecting prices to go up are forecasting a 7.2% rise, on average. It also found 71% think it is a good time to buy a home, relatively unchanged from a year ago, but the percentage who think it’s a good time to sell has doubled over the last year to 30%.

The increase in those thinking positively about selling is also important for the market, as a tight supply of homes for sale has been one of the drags on the market.

The survey is based on the responses of 1,001 respondents, ages 18 and older.

Courtesy of your Arcadia Real Estate Agent

New Lease listing in Downtown LA $2,000/mo

Brettany Harrison | Coldwell Banker Residential | (626) 272-0816
460 S Spring St Apt 502, Los Angeles, CA
Beautiful updated modern one bedroom condo w/ washer, dryer and 1 parking spot- Rowan Building
1BR/1BA Condo
Bedrooms 1
Bathrooms 1 full, 0 partial
Sq Footage 720
Parking None
Pet Policy Cats, Dogs
Deposit $2,000


This beautiful 1 bedroom loft that sits on the 5th floor of a Los Angeles historic landmark with 180 degree views of Los Angeles. With wood floors throughout, this urban place is perfect for someone looking to be in the middle of hip n trendy little soho. Offered is 24 hour security, spa and lounge room for studying or relaxing. Pets allowed! Being in the heart of downtown LA, you are very close to fabulous restaurants, entertainment and shopping all around. Call this loft your home today!
Los Angeles
see additional photos below

- Living room - Dishwasher - Dryer
- Garbage disposal - Microwave - Refrigerator
- Stainless steel appliances - Washer - Central A/C
- Cable-ready - High-speed internet - Controlled access
- Doorman - Elevator - Secured entry
- Wheelchair access - Hardwood floor - Spa


- Barbecue area - Covered parking - New property
- Vintage building    


*Long term lease is desired.

*$2,000.00 Per Month

*$2,000.00 Security Deposit (Increased with pet)

*$35 Application Processing Fee

*Will work with Credit Issues, no Evictions

* Every Applicant over the age of 18 needs to apply

* Available for move IMMEDIATE move in


Photo 7



Common Area – Lounge

Common Area – Lounge

Common Area – Lounge

Photo Common Area – Loung
Contact info:
Brettany Harrison
Coldwell Banker Residential
DRE Lic#01814189
(626) 272-0816

Posted: May 2, 2013, 11:11am PDT