NJ Homeownership Rates Surpass National Numbers

In the second quarter of 2015, U.S. homeownership is at 63.4%, the lowest rate since 1967. However, Realtors® in New Jersey have been busy, and pending sales for July reached 9,597 — a 20.4% increase over July of last year.  The NJ Realtors® Skinny Video provides a complete recap in under three minutes.

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2 Common Mortgage Deal Delays

A last-minute problem with financing can quickly delay a closing on a home sale. Here are two of the most common financing problems that can surface:

  • Failure to disclose key financial information. One of the biggest reasons for a financial issue is the failure of the buyer to disclose key financial information, The New York Times reports. Buyers who are not forthright about their financial circumstances can face a delay. Lenders will quickly find borrowers who are behind on child support obligations or real estate taxes, for example.
  • Running up credit as a mortgage application is pending. Buyers may go out and purchase new furniture or a car prior to closing on a home, but doing so, could cause them a delay to the closing of their home sale. Lenders will recheck borrowers’ credit right before the closing date. If new debt obligations suddenly appear, that can be a red flag to a lender. Prior to making any large purchases prior to closing, borrowers should check with their lender, says Douglas Rotella, an executive vice president and loan originator with HomeBridge Financial Services.

In some metro markets, a delay to securing financing could mean missing out on a home. For example, in hot markets like California’s Silicon Valley, sellers may even balk at deals that are contingent on a mortgage approval, says Mia Simon, a real estate professional with Redfin’s Silicon Valley office. Nearly every home is getting multiple offers there so buyers must go beyond pre-approval and receive a loan commitment before they submit an offer, she says. The loan commitment indicates that the borrower’s paperwork has passed underwriting and the only thing necessary for final approval is the appraisal and verifying the borrower’s employment.

Source: “How Mortgage Problems Unravel Home Deals,” The New York Times (Aug. 14, 2015)

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6 Key Housing Stats to Gauge the Market

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Existing-home sales were back on the rise in July, marking the third consecutive month of increases, while low inventories of homes for-sale and rising prices were the reason behind first-time buyers falling to their lowest share since January, according to a new report from the National Association of REALTORS®.

Regional Breakdown

Here’s how existing-home sales fared across the country in July:

  • Northeast: sales fell 2.8 percent to an annual rate of 700,000, but are 9.4 percent above a year ago. Median price: $277,200, which is 1.3 percent higher than a year ago.
  • Midwest: sales held steady at an annual rate of 1.32 million, unchanged from June but 10.9 percent above a year ago. Median price: $186,500, up 6.6 percent from a year ago.
  • South: sales rose 4.1 percent to an annual rate of 2.29 million in July, and are 9.6 percent higher than a year ago. Median price: $203,500, up 7 percent from a year ago.
  • West: sales increased 3.2 percent to an annual rate of 1.28 million in July, and are 11.3 percent above a year ago. Median price: $327,400, which is 8.4 percent above a year ago.

Source: National Association of REALTORS®

Total existing-home sales – which include single-family homes, townhomes, condos, and co-ops – rose 2 percent in July to a seasonally adjusted annual rate of 5.59 million. Sales are at the highest pace since February 2007, and are 10.3 percent above a year ago.

“The creation of jobs added at a steady clip and the prospect of higher mortgage rates and home prices down the road is encouraging more household to buy now,” says Lawrence Yun, NAR’s chief economist. “As a result, current home owners are using their increasing housing equity toward the down payment on their next purchase.”

Here’s a look at five main indicators from NAR’s latest housing report:

1. Home prices: The median existing-home price for all housing types was $234,000 in July – 5.6 percent above a year ago. “Despite the strong growth in sales since this spring, declining affordability could begin to slowly dampen demand,” says Yun. “REALTORS® in some markets reported slower foot traffic in July in part because of low inventory and concerns about the continued rise in home prices without commensurate income gains.”

2. Housing inventories: At the end of July, the inventory of homes for-sale fell 0.4 percent to 2.24 million existing homes available for sale. The inventory now is 4.7 percent lower than a year ago and at a 4.8-month supply at the current sales pace.

3. First-time home buyers: The percentage of first-time home buyers fell for the second consecutive month, reaching 28 percent in July – the lowest share since January. Last year at this time, first-time buyers comprised 29 percent of all buyers.

“The fact that first-time buyers represented a lower share of the market compared to a year ago even though sales are considerably higher is indicative of the challenges many young adults continue to face,” says Yun. “Rising rents and flat wage growth make it difficult for many to save for a down payment, and the dearth of supply in affordable price ranges is limiting their options.”

4. Days on the market: Properties stayed on the market for an average of 42 days in July, below the 48 days average from a year ago. Forty-three percent of homes were on the market for less than a month in July. Short sales were on the market the longest at a median of 135 days while foreclosures were on the market for 49 days and non-distressed homes sold in 41 days.

5. All-cash sales: The percentage of all-cash sales rose to 23 percent of transactions in July, down from 29 percent a year ago. The share of individual investors – who account for the bulk of cash sales – was 13 percent in July, down from 16 percent a year ago.

6. Distressed sales: The percentage of foreclosures and short sales declined to the lowest share since NAR began tracking it in October 2008. Distressed sales fell 7 percent in July month-over-month and are 9 percent below a year ago. In July, 5 percent of sales comprised foreclosures while 2 percent were short sales. On average, foreclosures sold for a discount of 17 percent below market value while short sales sold for an average discount of 12 percent.

“Five years ago, distressed sales represented 33 percent of the market in July,” says Chris Polychron, NAR’s president. “For many previously distressed homeowners throughout the country, rising home values in recent years have helped recover equity and the vast improvement in several local job markets means fewer are falling behind on their mortgage payments.”

Source: National Association of REALTORS®

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45% of Homes Sold in Less Than A Month! [INFOGRAPHIC]

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Some Highlights:

The National Association of REALTORS® surveyed their members for their Confidence Index

The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.

Homes sold in 60 days or less in 35 out of 50 states and Washington D.C.
Only 7 states had a median sold date longer than 90 days.

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Two Graphs That Scream List Your House Today

Two Graphs That Scream You Should List Your House Today! | Keeping Current Matters

The spring and summer months have always been known as a very popular time for homebuyers to start the search for their dream home. This year is no different!

We all learned in school that when selling anything, you will get the most money if the demand for that item is high and the inventory of that item is low. It is the well-known Theory of Supply & Demand.

If you are thinking of selling your home, here are two graphs that strongly suggest that the time is now. Here is why…

DEMAND

According to research at the National Association of Realtors (NAR), buyer activity this year has far outpaced the same months in 2014. Purchasers who are ready, willing and able to buy are in the market at great numbers.

Foot Traffic | Keeping Current Matters

According to NAR, “Foot Traffic has a strong correlation with future contracts and home sales, so it can be viewed as a peek ahead at sales trends two to three months into the future.”

SUPPLY

The most recent Existing Home Sales Report from NAR revealed that the current supply of housing inventory is at a 5.1 month supply, which remains below the 6-months necessary for a normal market.

Inventory of Homes for Sale | Simplifying The Market

Buyer demand is far outpacing the supply of homes available for sale.

Bottom Line

Listing your house for sale when demand is high and supply is low will guarantee the offers made will truly reflect the true value of your property.

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Spring Surge in New-Home Sales

New-home sales climbed 6.8 percent in April reaching a seasonally adjusted annual rate ofhome-for-sale-sign-1 517,000, as home prices also saw a big jump too, the Commerce Department reported Tuesday.

“Sales are moving forward and our builder members are telling us they are starting to see more activity as more buyers get off the fence and enter the marketplace,” says Tom Woods, chairman of the National Association of Home Builders.

Inventories of new homes for sale also saw a slight increase in April to 205,000 units. This now represents a 4.8-month supply at the current sales pace – still, most economists consider a 6 month supply healthy for the sector.

With tight supplies, the median price for a new home soared 8.3 percent in April compared to a year ago, now at $297,300.

“While higher home prices could reduce affordability, they boost household equity, which could boost consumer spending,” Reuters reports.

Across the country, new-home sales rose by the highest percentage in the Midwest, increasing nearly 37 percent in April month-over-month and reaching a seven-month high. New-home sales also rose nearly 6 percent in the South. However, new-home sales were down in the Northeast, falling 5.6 percent month-over-month, and falling by 2.3 percent in the West.

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Who wants to have a pool party?? The True Costs of Owning a Pool Here –>

As summer approaches, perhaps you’re daydreaming about putting in a swimming pool or buying a property with a backyard pool. That way you can take a dip and cool off in your own pool whenever the mood strikes, never mind piling the kids in the car on a hot summer day or jockeying for space at a community pool. (Plus, a beautiful pool can make you feel like you live the glamorous life.)

But before you dive in (pun intended), consider these financial implications of a swimming pool.

Upfront Cost

If you’re planning to install a pool, be prepared to open your wallet. PK Data reports that the average cost of a residential in-ground swimming pool was $39,084 last year. Don’t expect to recoup all of that money when you sell your house in the future, cautions Sabine H. Schoenberg, a home improvement expert and founder of SabinesHome.com. “It’s not something that’s value-enhancing to a lot of people,” she says. “Just as there are people with positive feelings towards pools, there are those with negative feelings. I would never put a pool in as a speculative builder.” Whether to buy an investment property with a pool is another decision to consider carefully.

If you decide to move forward with a pool installation, Schoenberg suggests thinking carefully about the placement of the pool in your yard. “If it’s in one faraway corner, people aren’t going to use the pool,” she says. “You need to look at the natural daylight as it travels around the house. I don’t think it’s a good idea to put a pool into a dark, shadowy place.” She also suggests finding an installer who offers a five-year warranty, not just a one-year warranty.

Also investigate your town or municipality’s regulations around pools. “Each town will have its own definition of a ‘pool,’ often based on its size and water depth,” says Loretta Worters, spokeswoman for the Insurance Information Institute, an industry organization that provides insurance information to the public. “If the pool you are planning to buy meets the definition, then you must comply with local safety standards and building codes. This may include installing a fence of a certain size, locks, decks and pool safety equipment.”

Ongoing Maintenance

Before you buy a home with a pool, try to get the pool inspected. “The best way, I find, is to get a pool company to come and look at the pool closely,” Schoenberg says. “Sometimes that’s a challenge if it’s the winter, and the pool is partially drained down, so you may not be able to do a full inspection.”

Also, find out if the previous homeowner had a pool company servicing the pool so you can find out if it’s been serviced regularly and what that company charges. Peter Wingskam, owner of Crystal Clean Pools of New York, says the quality of a pool’s construction matters more than its age. “You might have above-ground pools where you’ve got ladders pulling on the side and ripping the vinyl,” he says. “Some people cut costs, and there’s thicker vinyl or better grade vinyl available.” In-ground pools can also get cracks, he adds.

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