Pending Sales of U.S. Existing Homes Rise by Most Since 2010

Contracts to purchase previously owned U.S. homes climbed in April by the most since October 2010, adding to signs that the industry’s busy selling season was off to a good start, according to data released Thursday by the National Association of Realtors.

Key Points

  • Index of pending home resales increased 5.1 percent (forecast was 0.7 percent) after a revised 1.6 percent gain in March
  • Measure increased 2.9 percent from April 2015 on an unadjusted basis (forecast was 0.2 percent)
  • Three of four regions increased, including a 11.4 percent surge in the West that was the biggest in records back to 2001
  • Sales gauge rose to a decade-high of 116.3 on a seasonally adjusted basis, with 100 indicating “historically healthy” buying activity, according to NAR

Big Picture

The boost in contract signings is a good sign that robust home-buying activity will continue during the spring-selling season, following reports that existing-home purchases jumped to a three-month high in April and new-home sales surged to the strongest in eight years. While would-be buyers are deterred by limited inventories especially among lower-priced homes, a steady jobs market and cheap borrowing costs are helping to fuel demand.

Economist Takeaways

“The ability to sign a contract on a home is slightly exceeding expectations this spring even with the affordability stresses and inventory squeezes affecting buyers in a number of markets,” NAR chief economist Lawrence Yun said in a statement. “The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers to the market.”

The Details

  • Pending sales in the South climbed 6.8 percent, the most since April 2010, and 1.2 percent in the Northeast
  • NAR’s Yun projects sales of existing homes to increase 3 percent in 2016 to 5.41 million

Dearborn Board well represented at the National Association of Realtors

Michigan Realtors meeting with Senator Peters

WASHINGTON — From May 9 to May 14, the National Association of Realtors held its annual legislative meetings and expo, with the Dearborn Area Board of Realtors well represented. 

Sam Baydoun, the 2016 president of the organization, attended many of the legislative meetings along with President Elect Robert Marx and Administrative Executive Laura Green. 

Realtors from Michigan discussed the importance of rejecting any tax reform plans to abolish or marginalize the mortgage interest deduction or the property tax deduction and preserving the Like-Kind Exchanges (1031 Exchange) with Sen. Gary Peters (D-MI). 

They also discussed those issues in a meeting with Sen. Debbie Stabenow (D-MI). 

Baydoun said Dearborn Board members could not meet with Rep. Debbie Dingell (D-Dearborn).

“Unfortunately, members of the Dearborn Board could not meet with our good friend and supporter of our industry, Congresswoman Debbie Dingell, because the White House briefing ran longer than expected,” Baydoun said. 

During the meetings, four of President Obama’s economic advisors briefed the realtors on many issues related to the real estate industry. 

Zaid Hassan (left) with Baydoun.Zaid Hassan, assistant director of the White House Business Council, delivered a powerful presentation on student debts in this country and what is being done to help graduates pay their loans.

“It was a proud moment for me to see a 29-year-old Muslim American, born and raised in Pakistan, now working at the White House for the president of the United States,” Baydoun said. “And this could only happen in America.”

Baydoun declared the White House Briefing for The National Association of Realtors the highlight of this year’s legislative meetings.

“Both of our senators are very supportive of our issues and we thank them for standing with us,” he said. 

NAR: Today’s Homes Are Selling Super-Fast

NAR: Days on Market shrinks to its lowest level for an April since such data has been tracked

Buy That House Before It’s Gone?

The housing market is its strongest in a decade.

According to the National Association of REALTORS® and the Census Bureau, more than 6 million homes changed hands last year, marking the first time that’s happened since 2006.

The rise in home sales can be attributed to many factors. However, three reasons stand out: rising U.S. rents, which has changed the math of “Buy vs Rent”; loosening mortgage guidelines nationwide; and, stubbornly low mortgage rates.

Today’s mortgage rates are in the mid-3s. ARMs are in the 2s.

Plus, there’s an abundance of available low- and no-down payment mortgage programs, including the new 3% down HomeReady™ loan which has widened the pool of potential home buyers nationwide.

Homes are selling quickly and they’re selling at higher prices.

Click to see today’s rates (May 26th, 2016)

Existing Home Sales: 5.45 Million Homes Sold Annually

Each month, the National Association of REALTORS® publishes its Existing Home Sales report, a tally of sold homes which have been previously-occupied, or are otherwise not considered as “new construction”.

The trade group’s April 2016 report shows 5.45 million homes sold on a seasonally-adjusted annualized basis, a 6% increase from the year prior and the highest reading for an April since last decade.

The increase has been attributed to low mortgage rates, rising rents, and a simpler approach toward mortgage approvals for many U.S. banks.

Demand for homes has been high — so much so that supply can’t keep up. There are now just over 2 million homes for sale nationwide.

At the current pace of sales, the entire stock of homes for sale would be “sold out” by September.

In April, Median Days on Market for an MLS-listed home was 39 days. This is the fewest number of days for April since the National Association of REALTORS® been tracking such data.

  • April 2012: 83 days
  • April 2013: 66 days
  • April 2014: 48 days
  • April 2015: 39 days
  • April 2016: 39 days

It should also be noted that in each of these years, April was the third in a months-long slide in Median Days on Market. Should that trend hold through 2016, buyers should expect homes to sell in fewer days in the months ahead.

45% of homes sold in 30 days or less in April.

Click to see today’s rates (May 26th, 2016)

45% Of Homes Sold Within A Month

The April Existing Home Sales report showed homes selling quickly. Homes typically sold in 39 days last month — an 17% decrease over the month prior.

But, while Median Days On Market remains an imperfect measure of the housing market’s strength, the data sometimes highlights the relative ease with which a seller can sell a home, and the relative difficulty a buyer may face in buying one.

Three main factors affect Median Days On Market — the economy, median rent prices, and national sentiment toward housing.

When the economy is performing well, for example, consumers may be more likely to take risks, including the risk of buying a new home.

More risk-taking helps homes to sell faster, and moved Days on Market lower.

Rising rents can also cause Days on Market to drop.

When U.S. rents are rising, it puts a strain on the budget of the nation’s renters. It also affects the answer to the question “Should I buy or should I rent?”

Median rent is up more than six percent nationwide. In certain housing markets, though, such as San Francisco and Seattle, rents are rising even more quickly than that.

A number of U.S. households have had enough.

Rather than signing new leases, they’re choosing to buy new homes instead. And, because many are buying “starter homes”, they’ve found the 5-year ARM to be an excellent budgetary fit.

However, there’s a third, less obvious reason why Days on Market can change, and it’s linked to home seller sentiment.

Sometimes, regardless of the market’s strength, home sellers just feel “less confident” in the market. Now is one of those times.

Is It Really “A Good Time To Sell”?

According to a Fannie Mae consumer attitudes survey, nearly half of al consumers now think it’s “a bad time to sell” a home.

When sellers think “it’s a bad time to sell”, it’s typically because they believe housing has dropped from a peak and prices are on the way down.

These perceptions often favor buyers.

When sellers are concerned about falling prices, it can result in homes being listed for cheaper prices; and, in homes being sold at ”the first reasonable offer”. Strangely, though, sellers may have it all wrong.

According to the data, the housing market’s going quite strong.

The April Existing Home Sales report shows a national home supply of 4.7 months; and home supply of anything less than six months is believed to put sellers in prime negotiation position over buyers.

Today’s housing market is one of the strongest in a decade, in other words, but sellers are behaving like the market’s in a downturn. For buyers, this creates opportunity.

Sellers may be currently undervaluing their home. Demand outweighs supply, and values are expected to rise. You may pay less for a home today than you’ll pay in six months.

The market looks ripe for a deal.

What Are Today’s Mortgage Rates?

With mortgage rates sinking below four percent, sales of homes are soaring. The best deals you find in housing may be the ones you get today.

Get today’s live mortgage rates now. Rates are available with no social security number required to get started and all quotes come with access to your live mortgage credit scores.

Click to see today’s rates (May 26th, 2016)

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

Try the Mortgage Calculator

Pending Home Sales Reach Highest Level in a Decade

The National Association of Realtors released its April 2016 pending home sales report.

Pamela Moore/iStock

The number of homes under contract hit the highest level the housing market has seen since before the bubble burst, buoyed by a stronger economy and lower mortgage rates.

Pending home sales, which are purchases that haven’t closed yet, were up 4.6% in April compared with the same month a year earlier, according to the seasonally adjusted numbers in the monthly National Association of Realtors® Pending Home Sales Index. They also rose 5.1% from March to April. The report looked only at existing homes and not newly constructed residences.

This is the most homes under contract since February 2006, according to NAR.

“April is often a bellwether month for how the spring and year will wind up,” says realtor.com®‘s chief economist, Jonathan Smoke. “We saw almost a half-million new listings come onto the market in April, so buyers appear to be jumping on the fresh inventory.”

NAR anticipates that about 5.41 million residences will be sold this year—a 3% bump from last year.

“The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers into the market,” NAR chief economist Lawrence Yun said in a statement.

Pending sales were higher across the U.S. except in the Midwest. Soon-to-be-finalized sales in the middle swath of the country dipped 0.6% in April from March, according to the report. But they’re still up 2% over the same time last year.

“We have less sales … because [of] the lack of homes for sale,” says longtime Minneapolis Realtor® Michael Sharp of Re/Max Results. “Sellers are afraid to put their homes on the market because they don’t know where they’re going to go.”

Please, Mr. Postman

Send me news, tips, and promos from realtor.com® and Move.

Demand is so high that he’s seeing residences get scooped up before they formally go onto the market. And too few new homes are going up to alleviate the supply crunch, he says.

In the West, the number of properties under contract shot up 11.4% from March to April, according to the report. They were also 2.8% higher than a year earlier.

“We’re seeing the uptick in the spring selling market,” says San Diego Realtor Michael Wolf of Ascent Real Estate. “This year, it happened to be a little more intense than other years.”

Sales were slower at the beginning of the year but began picking up in March and April, when a slew of new homes hit the market, he says.

“All those properties that came on the market are getting gobbled up quickly,” Wolf says of the built-up demand from buyers. “If you’re priced well and have done the necessary things to make your property look good, you should sell in a week or less.”

Pending sales edged up 1.2% month over month in the Northeast, according to the report. They were also up a none-too-shabby 10.1% over last year.

In the South, monthly sales climbed 6.8% from March to April. They were also up 5.1% higher than a year ago.

Agents say real estate market isn’t as fun as it used to be

NEW YORK (AP) – Real estate agents are flummoxed by a housing market that’s still trying to recover a decade after its historic collapse.


In this April 27, 2016, photo, Colorado realtor Mark Ferguson poses for a picture at his office in Greeley, Colo. Real estate agents are flummoxed by a housing market that´s still trying to recover a decade after its historic collapse. Our team is doing well, but I think in general, if there were more houses to sell, we´d be doing so much better, says Ferguson, a sales team leader with the Pro Realty agency. (AP Photo/Brennan Linsley) Slideshow





Agents are getting higher commissions as home prices rise, but have fewer houses to list because homeowners are reluctant to sell. Many owners don’t want to put their homes on the market until they have more equity to use toward higher-priced properties, agents say. And the uncertain economy has left owners inclined to hold on to their homes. Meanwhile, there are more agents in the market competing for commissions than even just a few years ago.

“Our team is doing well, but I think in general, if there were more houses to sell, we’d be doing so much better,” says Mark Ferguson, a sales team leader with the Pro Realty agency in Greeley, Colorado.

Ferguson, who’s been selling real estate since 2001, focused on foreclosed homes during the housing crisis and the early part of the recovery, and went back to traditional home sales in 2013 after most of the foreclosure backlog was cleared. The current lack of inventory was a surprising turn, and is now limiting any expansion plans. Ferguson wants to add another agent to his team, but doesn’t have the jump in sales he’d need to justify further hires. He had nearly $5.8 million in sales during the first quarter of this year, up nearly 6 percent from the first three months of 2015.

The drop in supply can be seen in the latest monthly statistics available from the National Association of Realtors, an industry trade group. In April, the inventory of homes available for sale was down 3.6 percent from a year earlier.

Stiffer competition among real estate agents also makes it harder to make money, especially since the improvement in the economy has made selling real estate more appealing to people in search of work. Membership in the National Association of Realtors totaled 1.17 million at the end of April, up from the post-collapse low of nearly 1 million in 2012. The Realtors had 1.36 million members in 2006, the year that the housing market began its crash.

“Everyone was dropping out of the business in 2008. Now we’re flooded with real estate agents without a lot of inventory,” says Janine Acquafredda, a broker with House N Key Realty in Brooklyn, New York.

Acquafredda’s sales over the past year are down about 25 percent from the previous year. In addition to a shortage of available homes, she sees fewer buyers with deep pockets from other countries who are able to put cash down and finalize a deal quickly. One reason: the stock market drop in China, where the Shanghai Stock Exchange’s major index is down 45 percent since June.

“The business is just not as much fun as it used to be,” Acquafredda says.

When houses do go on the market, they can sell quickly because of the small supply. Bidding wars are common on the most attractive properties.

That makes it hard to find enough homes to show a prospective buyer. Deb Tomaro, who owns a one-person Re/Max agency in Bloomington, Indiana, recently picked out 12 homes and began driving the clients around for a quick look. Many of the properties were unsuitable for one reason or another, and two had been sold by the time Tomaro and the clients arrived. In the end, there were just four houses for the clients to seriously consider.

“We’ll have to expand their search higher in price or go further out in the area,” Tomaro says.

Because Tomaro is a solo agent and not part of a team, she has as much work as she can handle. Her sales have gone from $4 million in 2012 to about $10 million last year, and she expects to stay at about that level in 2016.

Brokerages that are expanding are doing so at a pace that reflects the current market.

“We’re actually about to open our third office in four years. We’re still growing, but it’s that slow, steady growth,” says Carl Billera, managing broker at BHGRE Valley Partners in Emmaus, Pennsylvania.

Billera expects his agency’s sales, which rose 24 percent last year, to match that increase in 2016 because prices are higher. But he’s not seeing listings at the pace he saw in the last several years.

“It’s challenging for agents to try and grow their business because of listing shortages,” he says.

___

Follow Joyce Rosenberg at www.twitter.com/JoyceMRosenberg . Her work can be found here: http://bigstory.ap.org/content/joyce-m-rosenberg

Single ladies in Texas more willing to commit … to housing purchases

A pool for the sweltering summertime, more space for her young teens to stretch out with their friends and access to the Richardson school district.

Those were 42-year-old Christine Burns’ criteria when she started looking for a new home.

When Maggie Lewis, 28, decided to find a place several years ago, she was in the market for something else: a low-maintenance townhouse, not far from the running trails and yoga studios she’d come to love as a renter in her Allen neighborhood.

Both, however, represent a perhaps unexpected force in the housing market: single women.

Texas Association of Realtors data shows that from mid-2014 to 2015, single women in the state were twice as likely to buy homes as unmarried men.

Across the country, single women have consistently purchased homes more often than single men since at least 2001, National Association of Realtors data shows.

The Texas association’s recent residential buyers and sellers report also found that the proportion of married couples buying homes in Texas decreased year-over-year by 2 percentage points.

That’s not a staggering change, experts say, but it’s telling in part because it contrasts with national numbers, which showed that the percentage of married couples buying homes trended up during that time. Experts say that’s in large part because young people are struggling to keep up with student loan payments, which can put on hold their ability to take on more debt.

Together, the stats point to the sway of single buyers — women, in particular — over the Texas housing market.

Kristi Davis, a real estate agent for Ebby Halliday who recently made a solo home purchase herself, said she’s noticed an increase in single women homebuyers.

“I think women are more able and more willing in the last several years to begin making that commitment, to feel like they’re not throwing money away on rent,” she said. “They could be the first woman that’s doing that for themselves in a family. … It’s a very empowering thing as a female to be able to have that ability to invest back into yourself and have a home.”

Wealth builder

Davis, 46, said she bought her townhouse after living in an apartment for a short time after the end of a long relationship.

It was her second time buying a place on her own. Her first was a condo shortly after she graduated from college, although it was in a much slower condo market.

Now she encounters buyers looking for “lock-and-go” properties like Lewis’ that don’t require as much upkeep but are still solid investments.

That’s true for younger first-time buyers and older empty-nesters, Davis said.

Jim Gaines, chief economist for Texas AM University’s Real Estate Center, said that the uptick in unmarried homebuyers could reflect the influx of college-educated workers moving into the state’s metro areas for high-paying jobs.

In metro areas like Dallas-Fort Worth, which make up most of the statewide home sales data, Gaines said, rising rents have prompted residents to rethink the traditional trajectory of life milestones: graduate from college, find a job, get married and buy a home.

“In Dallas, the rental market has gotten to the point financially, economically, if you can afford to buy a house, it’s a good wealth builder,” he said. “But you’ve got to be able to hold a house for at least three years, preferably five, to make any real money.”

He pointed to the report’s finding that first-time homebuyers in Texas got younger from 2014 to 2015 as a sign that the influx of young workers into urban areas like Dallas and Austin is affecting the housing market.

The trends

The gap between single men and women could be the result of a combination of factors, Gaines said — there’s no clear economic incentive for a man or a woman in a similar financial position to buy a house.

Nevertheless, some demographic trends might provide clues. Census data show that both men and women are marrying much later in life. And, according to a recent Census Bureau report, women have outpaced men in educational attainment for two decades.

That has led to increasing, if still unequal, representation in the workforce, which means single women have more economic weight than in decades past.

“There are more women in the corporate world than there has ever been before,” Leslie Rouda Smith, chairman of the Texas Association of Realtors, wrote in an email.

She added that, according to the national association’s chief economist, women tend to focusing on prudent financial decisions earlier than men.

Single mom factor

Finally, there’s the prevalence of single mothers — a number that census data shows has grown nationwide the last few decades to 9.9 million in 2015. That’s compared with about 1.9 million American families that were headed by fathers only.

Burns rented a home with her kids for several years after she separated from her now-ex-husband.

Though she felt comfortable renting and “it was kind of scary to tack on more expense” for a home, she didn’t want to keep paying about $2,300 per month for a four-bedroom house she didn’t own.

Her North Dallas house was the third she’d bought but her first as a solo buyer.

“When I was married, he did all the financial stuff, all the paperwork, so me doing that was definitely a learning experience and stressful,” Burns said. “It felt good to do it on my own.”

Now Burns said she sees the house, which she bought in late 2014, as an investment, a place where she can raise her kids before moving closer into town.

“When my kids are done, I’m moving closer to the city,” she said.

Family advice

Lewis said that at age 24, she knew she had a job she liked in a community she loved. So, with advice from her dad, brother and sister-in-law — both of whom are in real estate — she took the plunge.

She bought a three-bedroom townhouse for about $163,000, a price she says has jumped to the $215,000 range. At first, she rented space to a roommate.

“I live alone now, and it’s no big deal,” she said. “I’ve got a security system and I know how to use a gun.”

Eventually, Lewis said, the house would be a good place for her and a future husband to start out. Then, she said, she could see the home becoming a rental property.

“If it makes sense for you in the market, it’s really nice having your own place,” she said. “I’ll get married at some point, and I will make smart financial decisions in the meantime.”

 

Twitter: @jillcowan

 

 

NAR: 2016 Existing Home Sales Figures Best Since 2007

National Association of REALTORS®: Existing Home Sales increases 6% from last year

Existing Home Sales Rising

With today’s mortgage rates still firmly in the 3s, the housing market remains strong.

5.45 million existing homes sold on a seasonally-adjusted, annualized basis last month, an increase of 6 percent from the year prior, marking the best April for home sales in a decade.

Home prices are up, too.

With an active scarcity of homes for sale nationwide, today’s buyers are finding it hard to find homes to purchase, and negotiations have often been difficult.

Multiple-offer situations are common in many U.S. markets, which is driving up prices.

Thankfully, low- and no-down payment mortgages remain readily available, and banks are approving purchase loans at a rapid clip.

According to data from Ellie Mae, more purchase mortgage applications are making it to closing than during any period this decade.

It’s an excellent time to consider homeownership.

Click to see today’s rates (May 23rd, 2016)

Existing Home Supply Still “Bull Market”

The National Association of REALTORS® (NAR) recently released its April 2016 Existing Home Sales report, which showed 5.45 million homes sold on a seasonally-adjusted, annualized basis.

The reading marks a 6 percent increase from the year prior.

Existing Home Supply worsened slightly, rising several days to 4.7 months nationwide.

At today’s pace of sales, therefore, the country’s entire supply of MLS-listed homes would be sold by mid-September, which suggests that there just aren’t enough homes for sale to meet the market’s needs.

There are now just 2.14 million homes for sale countrywide.

Ask any of today’s active home buyers — home supply is tight. Furthermore, the homes that are available for sale are selling quickly.

Properties were typically listed for sale for 39 days in April before going under contract, which is the fewest number of days for a Aril since NAR started tracking such data.

45% of all homes sold in less than one month.

First-time buyers account for slightly more than three-in-10 buyers; and real estate investors, many of whom use the 5-10 Properties program to finance more than four homes, represented less than two-in-ten.

Click to see today’s rates (May 23rd, 2016)

Repeat Buyers Moving Up To Larger Homes

Repeat buyers are the majority of today’s housing market.

Often, repeat buyers purchase homes which are more expensive than their current ones. This is one reason why repeat buyers are sometimes called “move-up” buyers — they’re buyers who are “moving up” to bigger, more valuable, homes.

We can see this trend in the National Association of REALTORS® data.

Note how home sales are growing at higher price points relative to lower ones – especially among “jumbo” homes.

  • Home sales between $0-100,000 : -5% since last year
  • Home sales between $100,000-$250,000 : +7% since last year
  • Home sales between $250,000-$500,000 : +16% since last year
  • Home sales between $500,000-$750,000 : +16% since last year
  • Home sales between $750,000-$1,000,000 : +9% since last year
  • Home sales over $1,000,000 : +11% since last year

It’s clear that home sales are faring better at high price points as compared to low ones.

This data, of course, may be influenced by San Francisco, California housing market; the Seattle, Washington housing market; and the Denver, Colorado housing market — each of which is expanding rapidly and characterized by high home sale prices.

However, it’s a trend which we see in other markets as well.

Click to see today’s rates (May 23rd, 2016)

Buying Homes With Low Or No Downpayment

According to the National Association of REALTORS®, first-time home buyers accounted for 32% of April home resales.

That number might have been higher, the trade group said, if home affordability were improved. Renters have expressed a concern that homes are too expensive to purchase and to afford on a monthly basis.

Yet, many feel pressured to buy before home affordability worsens.

Rents are predicted to rise at twice the rate of home prices in 2016; and few people expect mortgage rates to fall from their current levels near 3.75 percent.

Homes may be more affordable than you think, however.

For instance, you don’t need 20% down to purchase a home and there are some good reasons to avoid putting 20% down.

There are a myriad of low- and no-down payment loans available to today’s buyers.

The most common low-downpayment loan remains the FHA loan, which has been available to U.S. homeowners since the 1930s.

FHA loans account for close to 1-in-4 of all purchase loans and require just 3.5% down. FHA loans offer flexible mortgage approval terms and include an allowance for average and below-average credit scores.

Another low-downpayment option is the conventional 97% program. This government-backed loan tends to work well for buyers with above-average credit scores who are buying single-family, detached properties (i.e. not condos or town homes). Only 3% down is required and buyers can receive cash downpayment gifts.

Another 3% down program is the newly-released HomeReady™ mortgage.

Aimed at multi-generational families living under the same roof, HomeReady™ is backed by Fannie Mae and can be used by anyone. It’s an interesting program offering below-market mortgage rates and reduced mortgage insurance.

You can read a complete HomeReady™ FAQ here.

For buyers in rural and suburban areas, the USDA loan can be an excellent no-downpayment option, too. Backed by the U.S. Department of Agriculture, USDA loans provide below-market mortgage rates and cheaper mortgage insurance rates than comparable low-downpayment products.

VA loans are another good 100% financing option.

For military borrowers, VA loans are available as part of the G.I. Bill, granting access to extra-low mortgage rates and never requiring mortgage insurance.

Lastly, for jumbo mortgage borrowers, the changing mortgage market has brought the 80/10/10 loan back into availability. This has helped spur the luxury housing market forward and is among the reasons why home sales over $750,000 have stayed strong.

What Are Today’s Mortgage Rates?

The U.S. housing market is advancing through early-2016. It’s an excellent time to consider your options as a buyer; and to plan for your future as a homeowner.

Get today’s live mortgage rates now. Your social security number is not required to get started, and all quotes come with access to your live mortgage credit scores.

Click to see today’s rates (May 23rd, 2016)

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

Try the Mortgage Calculator

Single women continue to impact real estate market


Bonita Kolb remembers being a young, single mother in 1979 trying to buy her first house and how difficult it was to qualify for a mortgage.

“It was unheard of for a single woman to buy. It just wasn’t done. It was the man who made the money,” said Kolb.

Times have changed in the past 37 years. Kolb, a retired university professor who recently moved to Nashville to work on her next book, closed earlier this month on a townhome on the city’s south side. She had no problem getting a mortgage.

She is not alone. Single women are the second-largest group of homebuyers in the country, according to the National Association of Realtors (NAR).

Single women accounted for 15 percent of home sales in 2015. Only married couples were a bigger force in the market. They made 67 percent of all purchases. Single men accounted for nine percent of home purchases nationally, the NAR reported.

The number of single women buying homes reached a peak in 2006, when they accounted for 22 percent of home sales nationally. That number declined as a result of the downturn in the real estate market.

“There hasn’t been much entry-level home construction. It’s a little less affordable for single men and women to buy,” said NAR spokesman Adam DeSanctis.

Single women have consistently purchased more homes than single men. The number of single male homebuyers peaked in 2010, when they made 12 percent of all purchases, according to the NAR.

Kolb purchased a previously owned townhome in Lenox Village, where it’s possible to purchase a residence in the $200,000 range, said Angela Durr, her Realtor.

“Affordability and walkability” attracted Kolb to Lenox Village, a mixed-use community that features restaurants and shops, Durr said.

“I encourage young women to buy. You’re building equity,” said Kolb, who has bought several fixer-uppers over the years and sold them for a profit.

She isn’t surprised that single women are having an influence on the real estate market. More women than men are earning bachelor’s degrees and women have greater career options than they did in 1979, so it makes sense they would want the benefits of home ownership.

“Women have good jobs and they have the income. They are just as likely to be a doctor as a receptionist,” Kolb said.

Men and women are waiting longer to get married —  the average age is 29.5 for men and 27.6 for women, according to the U.S, Census Bureau — but women aren’t waiting to buy a home, said Realtor Bridget Ottoh.

“Women are sensing they can do it on their own without waiting to be married,” she said.

Her client Ashley Bohacz decided to invest in a new townhome in the Percy Priest Lake area. She closed on her home in February.

“I’d rather have it in my name than throw money away renting,” said Bohacz, who had rented since moving to Nashville in 2013 for her career.

Buying a home can be more difficult when there is only one income in a household, Bohacz said. She participated in the Tennessee Housing Development Agency’s Great Choice down payment assistance program for first-time home buyers. The agency provides down payments for up to 4 percent of the mortgage.

“I’m a single woman, single income. I’m still working on building my credit. I didn’t have a nest egg for a down payment,” she said.

The NAR’s research shows that rising prices nationally have discouraged some single women from buying a home, but rising prices in Nashville had the opposite effect on Bohacz. The median price of a single-family home was $245,000 in March, 10 percent higher than a year earlier. The median price of a condominium was up 18 percent to $181,894, according to the Greater Nashville Association of Realtors.

Bohacz decided to buy before prices went higher.

“That’s one reason I wanted to get in now,” she said.

Debra Beagle, managing broker for Re/Max Advantage the Ashton Real Estate Group, said she began seeing more single women buying houses beginning in 2009, when federal incentives were available.

“I saw more women step into the market at that time, and they just remained,” said Beagle. “The catalyst was that women decided they could go out and buy.”

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Existing-home sales posted best first quarter in nearly a decade

In an odd conundrum, despite constant headlines on lack of inventory and outrageous home prices, existing-home sales witnessed the best first quarter in nearly a decade.

“In spite of deficient supply levels, stock market volatility and the paltry economic growth seen so far this year, the housing market did show resilience and had its best first quarter of existing-sales since 2007 (5.66 million),” said Lawrence Yun, National Association of Realtors chief economist.

“The demand for buying is there, but unless the stock of new and existing-homes for sale increases significantly – especially in several markets in the West – the housing market will struggle to reach its full potential,” added Yun.

According to the latest quarterly report from NAR, total existing-home sales, including single family and condo, ticked up 1.7% to a seasonally adjusted annual rate of 5.29 million in the first quarter, up from 5.20 million in the fourth quarter of 2015. This is also 4.8% higher than the 5.05 million pace during the first quarter of 2015. 

The problem remains though that buyers looking to jump into the market are dealing with ever-increasing home prices, locking out a lot of would be homeowners.

The median existing single-family home price grew in 87% of measured markets, with 154 out of 178 metropolitan statistical areas showing gains based on closed sales in the first quarter compared with the first quarter of 2015. Only 24 areas (13%) recorded lower median prices from a year earlier.

Inventory supply slipped even lower at the end of the first quarter. There were 1.98 million existing homes available for sale, which was below the 2.01 million homes for sale at the end of the first quarter in 2015. The average supply during the first quarter was 4.3 months – down from 4.6 months a year ago.

“Current homeowners in many metro areas – especially those who purchased a home immediately after the downturn – have enjoyed a sizeable boost in housing equity and household wealth in recent years,” said Yun. “At a time of stagnant wage growth and mounting rent increases, the same cannot be said for renters. Their inability to reach the market because of affordability and supply restrictions is contributing to rising wealth inequality in the U.S.”

Broken up regionally, total existing-home sales in the Northeast decreased 4.1% in the first quarter but are 11.2% above the first quarter of 2015. The median existing single-family home price in the Northeast posted the smallest increase out of all the regions, up 1.8% from a year ago to $249,400 in the first quarter.

While existing-home sales the Midwest were unchanged in the first quarter (compared to the fourth quarter), they are 6.1% higher than a year ago. The Midwest posted the largest increase in median existing single-family home prices, rising 7.3% to $167,900 in the first quarter from the same quarter a year ago.

Existing-home sales in the South grew 5.2% in the first quarter and are 3.6% higher than the first quarter of 2015, while the median existing single-family home price in the South was $192,100 in the first quarter, 5.8% above a year earlier.

In the West, existing-home sales inched up 0.9% in the first quarter and are 2.1% above a year ago. The median existing single-family home price in the West increased 7.1% to $315,900 in the first quarter from the first quarter of 2015. 

Is FHA reviving its condo financing?

Housing and Urban Development secretary Julian Castro

Housing and Urban Development secretary Julian Castro

Could the Federal Housing Administration (FHA) finally be opening its doors again to financing more condominium units?

If so, that could be excellent news for young, first-time buyers and for seniors who own condo units and need a reverse mortgage to supplement their post-retirement incomes.

Here’s why: FHA financing offers not only 3.5 percent minimum down payments but is far more lenient than other options on crucial issues such as credit scores and debt-to-income ratios.

Plus FHA is the dominant source of insured reverse mortgages — the only game in town for the vast majority of seniors.

But if a condo building is not certified as eligible for financing by FHA, all the individual units in the project are ineligible for mortgage financing as well. Young families can’t buy using FHA loans, sellers can’t sell and seniors can’t tap their equity through a reverse mortgage. It used to be different — for years FHA allowed so-called “spot” loans on individual units — but no more.

But maybe things are about to change. In a speech last week to the National Association of Realtors, Housing and Urban Development secretary Julian Castro said revisions to controversial FHA rules on condos have been completed and only await final Obama administration approval. The changes would simplify controversial certification procedures for condo buildings and amend other rules that have knocked thousands of condominium buildings out of eligibility.

Since adopting highly restrictive qualification rules early in the current administration, FHA — once a major player in the condo field and the go-to source of financing for moderate-income purchasers — has steadily seen its market share shrink. FHA once financed 80,000 to 90,000 condo units a year, but last year volume fell below 23,000. Many condo homeowner associations began losing their eligibility several years ago, and because of what they consider onerous recertification requirements, have never sought to reapply.

Castro provided no details on what changes are coming. But real estate and condo industry sources say they could build upon reforms announced last November that appear to have had at least modest success in encouraging condo homeowner boards to get onboard again.

Two California-based consultants who help associations and community managers work through the certification hoops told me they’ve seen a jump in activity in recent weeks. Condo boards that had been resistant to the FHA rules “aren’t fighting them as much any more,” says Natalie Stewart, president of FHA Review. “People need to sell their homes, people need to buy” affordable condo units, so some associations grudgingly are returning to the FHA fold.

Jon Eberhardt, president of Condo Approvals, LLC, said “we certainly have seen an uptick” in FHA certification applications. “I wouldn’t call it monumental, simply a steady growth” in the wake of last November’s changes, he added.

Dawn Bauman, senior vice president for government affairs at the Community Associations Institute, a Virginia-based group that represents 33,000-plus condo and homeowner associations and managers, confirmed that she’s also detected “an increase in the number of applicants” for condo certification and that regional FHA offices have been “more flexible” in recent months in evaluating applications.

What will be crucial to continuing the positive trend, industry experts say, is for the upcoming guidelines to make changes beyond simply streamlining condo certifications.

On the list of needed reforms:

— The return of spot loans. That alone would significantly expand opportunities for millennials, minorities and seniors.

— An end to FHA’s blanket prohibitions against community-benefit homeowner transfer fees collected by some condo associations when units change hands. In California, this ban alone has led to the loss of thousands of units from FHA financing — a huge problem in areas where affordability is tough and condos are the lowest-cost alternative for many consumers.

— Relaxation of strict limits on commercial space in residential condo properties. Revenues from commercial leases are important to the financial health of urban condominiums, but current FHA caps render many buildings ineligible.

Since officials at FHA are mum about what’s in the upcoming package of regulations, it’s not clear how much — if any — of this might be included. But the same officials have to know there’s congressional action hovering in the wings: Bipartisan remedial legislation (H.R. 3700) passed the House in February by a 427-0 vote and is now pending in the Senate. The bill would require a dramatic streamlining of current rules and other changes designed to revive the condo financing business at FHA.