South Florida……the eighth most expensive rental market in America

October 29, 2015 04:30PM
By Sean Stewart-Muniz

Despite prices declining slightly in recent months, Miami was the eighth most expensive rental market in the country during the third quarter of 2015. The ranking, formulated by listing service Zumper, looked at median prices for one-bedroom and two-bedroom apartments in cities across the country. The median price for a one-bedroom apartment in Miami as a whole was $1,850 a month: slightly higher than Los Angeles at $1,840, but a far cry from the $3,620 per month renters pay in San Francisco. For a two-bedroom rental, the median price was $2,500 per month — half of the $5,000 median price in San Francisco. Prices for both types of apartments are down by just over 1 percent month-to-month, but that could be chalked up to a seasonal change: One-bedroom prices are up 5.7 percent and two-bedrooms are up 4.2 percent year-over-year. Here is where the data gets interesting: prices vary wildly depending on what part of Miami you’re in. Fisher Island, for instance, fetches a median price of $4,650 per month for a one-bedroom, while Liberty City has a median price of $740. Popular neighborhoods for rentals such as Brickell and South Pointe in South Beach, had rates of $2,100 and $2,230, respectively. – See more at: http://therealdeal.com/miami/blog/2015/10/29/miami-eighth-most-expensive-rental-market-in-america/?utm_source=rss&utm_medium=rss&utm_campaign=miami-eighth-most-expensive-rental-market-in-america#sthash.sIUxlKhd.dpuf

Cash sales down – but some Fla. cities don’t notice

NEW YORK – Oct. 27, 2015 – Cash sales made up 30.8 percent of all home sales nationwide in July, down from 34.2 percent the same month a year ago. It’s the 31st year-over-year monthly drop in a row.

According to CoreLogic, cash transactions slipped 0.5 percentage points on a month-to-month basis. The five states where these deals were highest during July were Alabama (47.4 percent), Florida (44.7 percent), New York (42.8 percent), West Virginia (41.1 percent) and New Jersey (39.5 percent).

REO properties accounted for 56 percent of all cash home purchases. Cash deals for resales and short sales made up about 30.2 percent and 28 percent, respectively. All-cash sales of new homes, meanwhile, tallied 15.6 percent of the total sales volume in that niche.

Of America’s 100 biggest metro areas, Florida is home to all five markets with the greatest percentage of July cash sales: West Palm Beach-Boca Raton-Delray Beach, at 53.2 percent; Miami-Miami Beach-Kendall, at 52.2 percent; North Port-Sarasota-Bradenton, at 50.1 percent; Fort Lauderdale-Pompano Beach-Deerfield Beach, at 48.4 percent; and Cape Coral-Fort Myers, at 47.9 percent.

Source: 24/7 Wall St. (10/23/15) Ausick, Paul

© Copyright 2015 INFORMATION, INC. Bethesda, MD (301) 215-4688

Fla.’s single-family home sales up 13.4% in Sept.

ORLANDO, Fla. – Oct. 22, 2015 – Florida’s housing sector continued its momentum with more sales, rising median prices and a tight inventory of homes for sale in September, according to the latest housing data released by Florida Realtors®. Closed sales of existing single-family homes statewide totaled 23,574 last month, up 13.4 percent over September 2014.
“Florida’s housing sector continues to show strength with more closed sales and an uptick in new listings,” says 2015 Florida Realtors President Andrew Barbar, a broker with Keller Williams Realty Services in Boca Raton. “September marked the 46th month that statewide median sales prices increased year-over-year for both single-family homes and townhouse-condo properties. Sellers received a higher percentage of their original list price, with single-family homes getting on average 94.3 percent and townhome-condos getting 93.2 percent on average. It also took less time to make the sale in September: a median of 46 days for single-family homes and 53 days for townhouse-condos.
“Sellers should take advantage of the strong market conditions with rising median prices, while would-be buyers can benefit from interest rates that currently remain at historically low levels and greater access to mortgage financing.”

The statewide median sales price for single-family existing homes last month was $199,900, up 11.1 percent from the previous year, according to data from Florida Realtors Industry Data and Analysis department in partnership with local Realtor boards/associations. The statewide median price for townhouse-condo properties in August was $150,000, up 5.1 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors®(NAR), thenational median sales price for existing single-family homes in August 2015 was $230,200, up 5.1 percent from the previous yearthe national median existing condo price was $217,400.In California, the statewide median sales price for single-family existing homes in August was $493,420; in Massachusetts, it was $365,000; in Maryland, it was $270,956; and in New York, it was $252,500.

Looking at Florida’s townhouse-condo market, statewide closed sales rose last month with a total of 9,348, up 8.4 percent compared to September 2014. The closed sales data reflected fewer short sales in August: Short sales for townhouse-condo properties declined 43 percent while short sales for single-family homes dropped 36 percent. Closed sales typically occur 30 to 90 days after sales contracts are written.

“The Florida real estate market continues to hum along,” says Florida Realtors Chief Economist Dr. John Tuccillo. “We’re seeing increases in both sales and prices in virtually every metropolitan statistical area (MSA) and in both single-family homes and townhouses and condos. Inventory continues to decline and those declines have now reached homes at the $250,000 level.

“However, with pending sales down, mortgage accessibility increasing and interest rates due to rise, we think the market will even out as we go forward into 2016.”

Inventory continues to tighten, with a 4.4-months’ supply in September for single-family homes and a 5.2-months’ supply for townhouse-condo properties, according to Florida Realtors. Most analysts consider a 6-month supply of inventory as the benchmark for a balanced market between buyers and sellers.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.89 percent in September 2015, down from the 4.16 percent average recorded during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors’ website under “Research.” Association members (login required) also have access to local data specific to their market.  

More buyers qualify for subprime loans

NEW YORK – Oct. 22, 2015 – “Subprime.” The word holds dramatically different meanings.
Before the housing crisis, the term generally referred to mortgages made to borrowers who didn’t have to prove much – if anything – about their income or financial stability.

Now, the “subprime” mortgages, which the credit bureau Equifax recently reported increased 30.5 percent in the first five months of 2015 from the same period a year earlier, are simply defined as loans to borrowers with a credit score below 620 (the FICO score used in mortgage lending ranges from 300 to 850).

Even though the number of subprime loans jumped by about one-third, they represent just a tiny slice of the mortgage market. Of the 3.26 million mortgages Equifax studied, only 4.6 percent were subprime, growing from less than 4 percent.

Still, the increase means “some lenders will work with a low-score borrower,” notes Keith Gumbinger of HSH.com, a mortgage data firm.

Even government-back Federal Housing Administration mortgages, which before the housing crisis were more forgiving, essentially disappeared for the credit-blemished, says Brian Chappelle of mortgage advisory firm Potomac Partners.

Recently, government changes to the FHA aimed to boost loans to those with scores under 640, says Chappelle. Lenders are still leery, though. “Ask a Realtor if they know of lenders, search the Internet, make calls,” says Chappelle.

In many instances, an FHA mortgage will be more economical because lenders don’t charge a higher interest rate for low scores on these, says Gumbinger. Borrowers can browse a list of FHA lenders at hud.gov.

The business is inching toward a “new normal,” notes Chappelle, finding the middle ground between overly liberal and excessively stringent rules. In the meantime, a low-score borrower has to be prepared for rejection.

“Some will say, ‘Thanks for calling, but we can’t help you,'” concludes Gumbinger.

Copyright © 2015 The Hub, Marilyn Kennedy. All rights reserved, CTW Features.  

Changes coming to Fannie’s credit history analysis

WASHINGTON – Oct. 22, 2015 – Fannie Mae is enhancing its automated underwriting system to improve the analysis of credit histories and the use of nontraditional credit.
Loans underwritten on Desktop Underwriter (DU) will require the utilization of trended credit data provided by Equifax and TransUnion.
According to the secondary lender, by using trended data, a more intelligent and thorough analysis of the borrower’s credit history will be enabled.
Fannie announced the planned update on Monday.
The Washington-based company explained that credit reports currently used in mortgage lending only indicate the outstanding balance and whether a borrower has been on time or delinquent in paying existing accounts like credit cards, mortgages or student loans.
But trended data will indicate monthly payments made over time – enabling lenders to determine if revolving credit lines are paid off each month or if a balance is carried from month-to-month while making minimum or other payments.

Trended data requirements will be implemented around the middle of next year, while more details will be provided in the coming months.

DU is also being enhanced to more efficiently address borrowers without a traditional credit history. More information will be available in the coming months, and the functionality is expected to go live sometime next year.

One other change outlined in the announcement is the integration of The Work Number from Equifax into DU. As a result of the enhancement, which will also happen sometime next year, lenders won’t have to provide copies of pay stubs or other documents to verify income.

“In addition to efficiency for borrowers and lenders, this could reduce the frequency of mortgage fraud,” the notice said. “Going forward, Fannie Mae will determine if validation services can be offered for additional borrower data, such as bank statements, and additional income documents, such as tax returns.”

Copyright © 2015 Mortgage Daily. Distributed by Tribune Content Agency, LLC.  

Apartments drive home construction gains in Sept.

WASHINGTON (AP) – Oct. 20, 2015 – Construction companies built more apartment complexes in September, sparking a temporary rise in housing starts for a real estate market that otherwise appears to have crested during the summer.
Housing starts last month rose 6.5 percent to a seasonally adjusted annual rate of 1.21 million homes, the Commerce Department said Tuesday. But a 17 percent surge in multi-family housing – which includes apartments – accounts for almost all of that increase.
New construction and sales of existing homes surged in the first half of the year as more Americans found work and the unemployment rate dipped to a solid 5.1 percent. But tight inventories, rising prices and the absence of meaningful wage growth have capped growth as affordability has become an issue – a problem that new construction can help resolve.
“Builders are stepping up to meet that demand but doing so cautiously,” said Stephen Stanley, chief economist at Amherst Pierpont Securities. “So, for beleaguered buyers who can’t find what they are looking for because of a dearth of listings, there is a bit of help on the way.”
Construction rose last month in the Northeast, South and West, while falling in the Midwest.
Housing starts have soared 12 percent in the first nine months of 2015. But the pace of building retreated from its June apex, in part due to the expiration of tax incentives for developers in New York.
Approved permits fell 5 percent in September to an annual rate of 1.1 million, a sign that construction will likely slow in the coming months.
Sales of existing homes similarly accelerated through the start of the summer, only to decline in August. The tight inventories – just 5.2 months’ supply of homes were listed for sale – have propped up prices, as the median cost to buy a home increased 4.7 percent over the year to $228,700, according to the National Association of Realtors.
A greater share of the country is also choosing to rent. The percentage of Americans owning homes has dipped to 63.4 percent, the lowest level in 48 years. The influx of millennials and downsizing baby boomers into the rental market has caused monthly leases to jump 3.8 percent over the past year, according to the real estate firm Zillow.
But price appreciation has also slowed as many Americans lack the income to spend more on housing. Average hourly earnings have increased just 2.2 percent to $25.09, meaning that home values and rental costs are rising at roughly double the rate of incomes.

There are signs that more Americans are renovating their homes instead of buying new properties. A new index compiled by BuildZoom – which identifies contractors for projects – found that renovations are running 2.8 percent above their 2005 level. Meanwhile, despite the gains of the past year, new home construction remains 57 percent below its 2005 level during the housing bubble.

Still, remodeling activity has been flat during the past year as new home construction has advanced. The gains have left construction firms more optimistic.

The National Association of Home Builders/Wells Fargo builder sentiment index released Monday rose this month to 64. The last time the reading was higher was October 2005 at 68.

Readings above 50 indicate more builders view sales conditions as good rather than poor. The index has been consistently above 50 since July last year.

Realtors say Fla. home prices to rise 5-6% next year

WASHINGTON – Oct. 9, 2015 – Realtors® in the U.S. expect home prices to rise 3.5 percent over the next 12 months, according to the August 2015 Realtors® Confidence Index Survey, which is based on the responses of a monthly survey to more than 50,000 real estate professionals.

However, Florida’s Realtors are more optimistic about price gains than Realtors in other states, predicting a median home price growth of 5 percent to 6 percent over the next 12 months.

Only four other states came close – Washington, Oregon, Colorado and Georgia – where real estate professionals expect median price growth to be 4 to 5 percent.

Realtors surveyed say that sharp price increases in recent months have made homes unaffordable for many potential homebuyers, and that they expect prices to moderate in the coming weeks. The median price of all existing homes sold in the U.S. as of July was $234,000, a 6 percent increase on an annual basis. Home prices have risen at a faster pace than annual growth in median household income of 2 percent since 2010, according to NAR.

“Strong demand amid tight supply has pushed up prices,” according to the report. “While rising prices are lifting homeowners out of negative equity, the strong price recovery amid the modest growth in incomes is also making homes less affordable and dampening demand.”

Source: “REALTORS® Expect Price Growth Moderate in Next 12 Months,” National Association of REALTORS® Economists’ Outlook blog (Oct. 5, 2015)

© Copyright 2015 INFORMATION, INC. Bethesda, MD (301) 215-4688

Chinese all-cash buyers tripled since 2005

NEW YORK – Oct. 13, 2015 – An analysis of housing sales in the U.S. shows that 46 percent of Mandarin Chinese-speaking buyers who purchased homes in the 17 months ending in May 2015 paid all-cash, according to RealtyTrac.

The analysis by the Irvine, California-based realty research company and Ethnic Technologies, a New Jersey-based multicultural marketing company, also showed that since 2005, Mandarin-speaking buyers paying all cash had an increase of 229 percent from the 14 percent share paying all cash in 2005 – the biggest increase of any language group.

The two companies looked at 10 million publicly recorded residential property sales deeds in 2014 and 2015 compared with 2005 by ethnicity and native language spoken. The results were determined by software that can determine ethnicity and language preference based on first name, last name, and address of the record, according to Ethnic Technologies.

“Cash buyers across the board are playing a much bigger role in the housing market now than they were 10 years ago, and that is particularly true for Chinese Mandarin-speaking cash buyers, who are more likely to be foreign nationals,” said Daren Blomquist, vice-president at RealtyTrac, in a release accompanying the analysis on Oct 6.

Overall, Mandarin speakers are the second largest non-English speaking cash-paying group, totaling nearly 18 percent of all cash deals, second behind those buyers speaking Spanish at 43 percent, according to the analysis.

Blomquist said that markets with a higher share of foreign cash buyers may expect to see a stronger upside in the short term because of continued global economic instability. “But those markets are also more susceptible to a downside in the longer term when demand from foreign cash buyers dries up,” he added.

RealtyTrac quoted several US brokers in various parts of the U.S. about sales. Mark Hughes, chief operating officer with First Team Real Estate, covering the Southern California market, said: “Given the somewhat laid-back Chinese government attention to withdrawal limits, we expect these funds to continue to be a driver of activity and bidding throughout this year.”

Asian buyers make up more than one-third of all international real estate buyers in the U.S., and Chinese buyers spent $22 billion on US housing in the 12 months through March 2014 – 72 percent more than a year earlier, according to the National Association of Realtors, buying mostly high-end, expensive homes with a median price of more than $500,000.

Copyright © 2015 China Daily Information Company, Ai Heping. All rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

Realtors divided on open house looky-loos

SEATTLE – Oct. 13, 2015 – A reader on Reddit said that she feels bad attending an open house as a looky-loo, but her 6-year-old daughter loves going into houses. The topic opened up a discussion among Realtors on how they feel about visitors with no interest in purchasing a home. Her post received over 40 comments in the last week.

“I know other people (tour open houses) all the time, but hey, a lot of people are really rude and inconsiderate,” the mother states. “I don’t want to be one of them. Is there anyway I can fulfill my daughter’s request to attend an open house without wasting anyone’s time and/or coming across as obnoxious? I was thinking maybe just walk straight in and very directly state: ‘We live in the neighborhood and just wanted to take a peek out of curiosity. Please don’t mind us.’ Would that be acceptable to a listing agent? Or would it be better to ‘pretend’ to be interested, and just try to get in and out quickly and not monopolize their time?”

The post prompted HousingWire to offer tips to consumers who want to crash an open house, saying there’s a right way and a wrong way to do it. For example, it tells snoopers not to pose as a buyer, be polite, listen to the real estate agent’s sales pitch and don’t act as if they know more about the housing market than the real estate agent.

But many agents responded to the post saying they welcome visitors who want to snoop.

“They may be interested in what homes are selling for,” said Christine Donovan to The Orange Register when a reporter asked her the question. “They may want to get ideas for remodeling or redecorating their home. They may be looking for a friend of family member, or they may just be bored. Neighbors are more interested than anybody else, (and) they often know something about the neighborhood or another house that sold that the agent might like to know.”

Donovan says she’s “happy to have someone come in and just let me know they are curious and not looking to buy. We do ice cream open houses for our sellers, and you have to expect the kids are going to want to bring the parents. Who knows, it might turn out to be the right house for somebody they know even if that wasn’t the original plan.”

Source: “Open House Crashing: Are You For or Against It?” realtor.com® (Oct. 8, 2015); “Reddit Posters, Real Estate Agents Kick it Around: Are Looky-Loos Really Welcome at Open Houses?” The Orange County Register (Oct. 9, 2015); and “Is It OK to Gatecrash a Realtors®’s Open House?” HousingWire (Oct. 6, 2015)

© Copyright 2015 INFORMATION, INC. Bethesda, MD (301) 215-4688

Study ranks the risk of damage from a storm surge

TAMPA – Oct. 14, 2015 – The Miami area, including Fort Lauderdale and southern Broward County, is the nation’s fourth-most vulnerable region to the economic cost of storm surge in a 100-year hurricane, according to a recently released report.

A 100-year hurricane is one that has a 1 percent chance of occurring during any calendar year and a 10-percent chance of occurring within 10 years.

In the Miami area, that’s a Category 5 hurricane with top wind speeds of 165 mph, according to the report by Karen Clark & Co. a catastrophe modeling firm based in Boston. It said the tidal surge from such an event would have devastating consequences for the region, causing some $80 billion in damages. Wind damages were not measured in the report.

The study is the first based on probability and losses from an equally likely 100-year hurricane, the study’s authors said. Loss estimates were based on Karen Clark & Co.’s high-resolution coastal flooding model, which the company says was developed to allow private insurance companies to more accurately estimate levels of risk and sell more flood insurance.

As devastating as $80 billion in property damage might be for the Miami region, three cities would suffer more expensive losses in a 100-year storm.

And while four Florida cities are among the eight most vulnerable to storm surge flooding, the west coast of the state – with a shallower sea bed and more inlets – is more vulnerable than the east coast, the study said.

The Tampa region was ranked as the nation’s most vulnerable city, with estimated losses of $175 billion. One reason is that the wide and shallow continental shelf off Florida’s west coast would create higher sea levels. Another reason is that Tampa Bay would act as a large funnel when maximum winds moved into the mouth of the bay.

A severe storm with the right track orientation could cause an “enormous buildup of water that will become trapped in the bay and inundate large areas of Tampa and St. Petersburg,” the report said.

Half of the area’s population lives on ground less than 10 feet above sea level.

New Orleans, with half of the city at or below sea level, is the second-most vulnerable city, with estimated losses of $130 billion. Its low elevation and marshy terrain means storm surges can travel long distances before peaking, with additional flooding likely from Lake Ponchatrain as happened during Hurricane Katrina a decade ago.

With losses estimated at $100 million, New York City is third-most vulnerable. High surges would flow into Lower Manhattan, Staten Island and the south shore of Long Island, including Rockaway Beach and Islip.

Storm surge is less likely in the Miami region because the continental shelf falls off steeply off the coast, and there are few bays or other water features to create channeling, the report said. The area’s vulnerability stems from the high value of properties on low-elevation land near the coast. “It’s also one of the most likely areas for a direct hit from a severe Category 5 storm,” the report said.

Rounding out the report’s eight most vulnerable cities are Fort Myers (estimated loss: $70 billion), Galveston-Houston, Texas ($55 billion), Sarasota ($50 billion) and Charleston, S.C. ($45 billion).

Most of the loss potential for the eight cities is not currently insured, and private flood insurance has been difficult to obtain, primarily because loss potential has been difficult to assess, the report states.

The National Flood Insurance Program, which provides total coverage for most residential homes, caps coverage for businesses at $500,000 per building and $500,000 for a building’s contents. That leaves untold millions of dollars of coastal property value uninsured for flooding and many companies reluctant to offer policies because they have a tough time pricing the risk.

The authors say their high-resolution forecast model could help private flood insurers write more coverage.

Lynne McChristian, Florida representative for the Insurance Information Institute, an industry trade group, said in an email that different companies offer different models for predicting flood damage. Insurers price risk based on various models for the same reason weather forecasters rely on multiple hurricane tracking models.

More data means better risk modeling, and that gives insurers information they need to more accurately estimate flood insurance rates, and to better understand how much capital and reinsurance they would need to pay anticipated claims.

They need “some type of insurance that they will be allowed to charge a premium that accurately reflects the flood risk,” she said. “Without that, it would be very difficult for insurers to commit to a large private flood market.”

2015 the Sun Sentinel (Fort Lauderdale, Fla.), Ron Hurtibise. Distributed by Tribune Content Agency, LLC.