Fannie Mae: ‘Home Price Expectations Were Up Strongly This Month’

Monday, October 12, 2020

by Christie Cannon

Fannie Mae: ‘Home Price Expectations Were Up Strongly This Month’

The Fannie Mae Home Purchase Sentiment Index (HPSI) increased 3.5 points in September to 81.0, rising for the second consecutive month and continuing the rebound from late spring.

Three of the six HPSI components increased month over month, with consumers reporting a substantially more optimistic view of home-selling conditions, expected home price growth, and the labor market, but a more pessimistic view of home-buying conditions and mortgage rate expectations.

Year over year, the HPSI is down 10.5 points.

“The HPSI has recovered more than half of the early pandemic-period decline, mirroring the strong home purchase activity of the past few months,” says Doug Duncan, senior vice president and chief economist. “Consumers’ home price expectations were up strongly this month, with high home prices playing an increasingly – though unsurprisingly – important role in driving both the increase in ‘good time to sell’ sentiment and the decline in ‘good time to buy’ sentiment.

“Going forward, we believe the wild card to be whether enough sellers enter the market to continue to meet the strong home-buying demand,” Duncan says. “The home purchase market requires the proper mix of home price growth and continued economic recovery to achieve sustainable levels of housing activity.”

Some highlights from September’s National Housing Survey:

Good/Bad Time to Buy: The percentage of respondents who say it is a good time to buy a home decreased from 59% to 54%, while the percentage who say it is a bad time to buy increased from 35% to 38%. As a result, the net share of Americans who say it is a good time to buy decreased 8 percentage points.

Good/Bad Time to Sell: The percentage of respondents who say it is a good time to sell a home increased from 48% to 56%, while the percentage who say it’s a bad time to sell decreased from 44% to 38%. As a result, the net share of those who say it is a good time to sell increased 14 percentage points.

Home Price Expectations: The percentage of respondents who say home prices will go up in the next 12 months increased this month from 33% to 41%, while the percentage who said home prices will go down decreased from 26% to 17%. The share who think home prices will stay the same was unchanged at 34%. As a result, the net share of Americans who say home prices will go up increased 17 percentage points.

Mortgage Rate Expectations: The percentage of respondents who say mortgage rates will go down in the next 12 months decreased this month from 17% to 11%, while the percentage who expect mortgage rates to go up increased from 33% to 38%. The share who think mortgage rates will stay the same decreased from 45% to 44%. As a result, the net share of Americans who say mortgage rates will go down over the next 12 months decreased 11 percentage points.

Job Concerns: The percentage of respondents who say they are not concerned about losing their job in the next 12 months increased from 78% to 83%, while the percentage who say they are concerned decreased from 22% to 16%. As a result, the net share of Americans who say they are not concerned about losing their job increased 11 percentage points.

Household Income: The percentage of respondents who say their household income is significantly higher than it was 12 months ago decreased from 25% to 24%, while the percentage who say their household income is significantly lower increased from 16% to 17%. The percentage who say their household income is about the same remained unchanged at 59%. As a result, the net share of those who say their household income is significantly higher than it was 12 months ago decreased 2 percentage points.

By

Michael Bates

-

October 7, 2020

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Builders & Realtors Agree: Real Estate Is Back

Tuesday, August 25, 2020

by Christie Cannon

Builders & Realtors Agree: Real Estate Is Back

When shelter-in-place orders brought the economy to a screeching halt earlier this year, many believed the residential housing market would follow suit. Countless analysts predicted buyer demand would disappear and home values would depreciate for the first time in almost a decade. That, however, didn’t happen. It appears the opposite is taking place.

After the bottom fell out of the real estate market immediately following the shutdown, it has come roaring back – and seems to still be gaining steam. Here’s a look at two recent reports – one from the National Association of Home Builders (NAHB) and one from the National Association of Realtors (NAR) – showing this growing strength.

Builder Confidence Hits All-Time High

Last week, it was reported that applications for new home purchases with home builders were 39% higher than in July of 2019. That has builder confidence soaring.

Each month, NAHB releases its Housing Market Index, a survey of NAHB members who rate market conditions for the sale of new homes at the present time and over the next six months, as well as prospective buyer traffic for new homes.

This month, they reported that builder confidence in the market for newly-built single-family homes increased to the highest reading in the 35-year history of the series. NAHB Chairman, Chuck Fowke, explained:

“The demand for new single-family homes continues to be strong, as low interest rates and a focus on the importance of housing has stoked buyer traffic to all-time highs…Housing has clearly been a bright spot during the pandemic and the sharp rebound in builder confidence over the summer has led NAHB to upgrade its forecast for single-family starts, which are now projected to show only a slight decline for 2020.”

The number of newly constructed homes being built will be almost at the same level as last year, even though the economic shutdown crushed home building earlier in the year.

Existing Homes Are Also Selling Like Hotcakes

Last Friday, NAR released its Existing Home Sales Report. The report revealed that month-over-month sales increased by 24.7%, setting another record for the category. The Wall Street Journal reported that the increase crushed expert forecasts:

“Economists surveyed by The Wall Street Journal expected a 14.2% monthly increase in sales of previously-owned homes, which make up most of the housing market.”

Home sales increased by 8.7% year-over-year.

Lawrence Yun, Chief Economist for NAR, explained how the resale market is just as hot as the new construction market:

“The housing market is well past the recovery phase and is now booming with higher home sales compared to the pre-pandemic days. With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.”

In addition, the Housing Market Recovery Index, which is released monthly by realtor.com, also showed the market is recovering nicely. The latest index reading was 104.8, which means the housing market is doing better than it was in January and February of this year. As a reference, the highest point in the index was a 106.5 in early March, just prior to the health crisis setting in.

Bottom Line

Both the newly constructed and existing home sale markets are posting numbers greater than a year ago. Real estate is back. If you’re thinking of buying or selling, let’s connect so you have the expert counsel you need along the way.

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Forney, Fort Worth and Frisco: Millennials are moving to DFW, report says

Wednesday, June 24, 2020

by Christie Cannon

Article by: Brian Womack – Staff Writer, Dallas Business Journal

North Texas is welcoming thousands of millennials to the area, though the Dallas may not have benefited as much recently. That's according to some new research.

Four cities in North Texas ranked among the top 20 in the nation for net migration, according to the latest analysis by SmartAsset, a financial-information provider. Texas was the clear No. 1 among the states.

Among cities, Fort Worth came in at No. 11; McKinney took No. 13; Irving was No. 18, and Frisco grabbed No. 20. The rankings, which had even stronger showings by Austin, Houston and San Antonio, were based on Census Bureau data from 2018.

Millennials are playing an increasingly important role in local economics – including Dallas-Fort Worth – as companies look for young talent in areas such as software development, cybersecurity, marketing and finance. It’s a generation that is inclined to move more – and that could be the case even more as COVID-19 shakes up people’s lives.

Still, Dallas itself did not make the top 25 list. And that came after being at the top of the rankings in the release last year.

The city had a net migration of number of negative 1,922, even with more than 12,000 moving into Dallas from another state, a spokesperson said.

Yet there have been fluctuations with the report. Dallas didn’t make the list the previous two years before grabbing the top spot, the spokesperson said. And there was some change in the approach to the data. SmartAsset looked at those between the ages of 25 and 39 to account for the generation getting older. Formerly, it was between 20 and 34.

New research by the National Association of Realtors puts the Dallas area among the top ten markets for millennial homebuyers during the pandemic. Others in Texas included the Austin and Houston metros.

“Record-low mortgage rates have improved housing affordability, bringing more buyers into the market, and multiple offers for starter homes could become common in these metro areas,” said NAR’s Chief Economist Lawrence Yun, in the report.

Millennials make up about 30 percent of North Texas, and 44 percent of the renters in that group can afford to buy a home, the research said.

In the SmartAsset report, the winners, amid the moves, tend to be cities with no income tax – making Texas locales a stronger choice. Other states of choice include Washington, which was No. 2, along with Colorado, Georgia and Florida in the top five.

New York City fared the worst in the nation. It had a net migration losses of more than 50,000. Chicago was No. 2 while others in the top ten included Washington, D.C., San Diego, Calif., and Provo, Utah.

Earlier this year, Fred Balda, president of Dallas-based Hillwood Communities, talked up the arrival of millennials in the local region. The firm is one of North Texas’ largest developers of masterplanned residential projects.

Families aren’t making up as much of the customer base these days, Balda said.

“The millennial buyers are coming in droves now, and they’re buying off the phone, so how we market to them is a little bit different than how we’ve dealt in the past,” Balda said in an interview published in early March.

Check out the list here!

christiecannon.com

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Three Reasons Homebuyers Are Ready to Purchase This Year

Wednesday, June 17, 2020

by Christie Cannon

Three Reasons Homebuyers Are Ready to Purchase This Year

A recent survey by Lending Tree tapped into behaviors of over 1,000 prospective buyers. The results indicated 53% of all homebuyers are more likely to buy a home in the next year, even amid the current health crisis. The survey further revealed why, naming several reasons buyers are more likely to move this year (see graph below):Let’s break down why these are a few of the key factors motivating buyers to actively engage in the home search process, and the corresponding wins for sellers as well.

1. Low Mortgage Rates

The biggest reason potential homebuyers indicated they’re eager to purchase this year is due to current mortgage rates, which are hovering near all-time lows. Today’s low rates are making it more affordable than ever to buy a home, which is a huge incentive for purchasers. In fact, 67% of respondents in the Lending Tree survey want to take advantage of low mortgage rates. This is no surprise when comparing historic mortgage rates by decade (see below):Sam Khater, Chief Economist at Freddie Mac recently said:

“As the economy is slowly rebounding, all signs continue to point to a solid recovery in home sales activity heading into the summer as prospective buyers jump back into the market. Low mortgage rates are a key factor in this recovery.”

2. Reduced Spending

Some people have also been able to save a little extra money over the past few months while sheltering in place. One of the upsides of staying home recently is that many have been able to work remotely and minimize extra spending on things like commuting expenses, social events, and more. For those who fall into this category, they may have a bit more saved up for down payments and closing costs, making purchasing a home more feasible today.

3. Re-Evaluating Their Space

Spending time at home has also given buyers a chance to really evaluate their living space, whether renting or as a current homeowner. With time available to craft a wish list of what they really need in their next home, from more square footage to a more spacious neighborhood, they’re ready to make it happen.

What does this mean for buyers and sellers?

With these three factors in play, the demand for housing will keep growing this year, especially over the summer as more communities continue their phased approach to reopening. Buyers can take advantage of additional savings and low mortgage rates. And if you’re thinking of selling, know that your home may be in high demand as buyer interest grows and the number of homes for sale continues to dwindle. This may be your moment to list your house and make a move into a new space as well.

Bottom Line

If you’re ready to buy or sell – or maybe both – let’s connect to put your plans in motion. With low mortgage rates leading the way, it’s a great time to take advantage of your position in today’s market.

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4th Of July Events In DFW

Tuesday, June 16, 2020

by Christie Cannon

🎆Things may be different this year, but that doesn't mean you can't still celebrate!
Check out all these Fourth of July events and firework shows across DFW.

❗️Remember to continue to be cautious and safe as we celebrate thru COVID!

Do you have any Real Estate needs? Give us a call today!

The Christie Cannon Team
972-215-7747

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D-FW’s Home Market Ranked Among Least At Risk From COVID-19

Wednesday, April 8, 2020

by Christie Cannon

A new study identifies the most vulnerable home markets to be affected by the pandemic. Most major Texas metro areas are not expected to be affected as much as other areas, especially in the northeast and in Florida.(Vernon Bryant / Staff Photographer)

Texas’ biggest markets — including Dallas-Fort Worth — are among the metro areas least likely to see a major housing market shakeout from the pandemic.

Housing markets that will be most negatively affected by the COVID-19 infections and resulting economic recession are mostly in the Northeast and Florida, according to a new report by analysts at Attom Data Solutions.

Researchers looked at almost 500 home markets around the country and rated them based on foreclosures, homeowner equity, wages and other factors.

“It’s too early to tell how much effect the coronavirus fallout will have on different housing markets around the country. But the impact is likely to be significant from region to region and county to county,” Attom Data’s Todd Teta said in the just-released report. “What we’ve done is spotlight areas that appear to be more or less at risk based on several important factors.

“From that analysis, it looks like the Northeast is more at risk than other areas,” he said. “As we head into the spring homebuying season, the next few months will reveal how severe the impact will be.”

Attom Data estimates the major housing markets most at risk from the virus include four in New Jersey and the New York area, three in Connecticut and 10 from Florida. Only one was in California, and none were located in other West Coast states.

“Texas has 10 of the 50 least vulnerable counties from among the 483 included in the report, followed by Wisconsin with seven and Colorado with five,” Attom Data analysts said. “The 10 counties in Texas include three in the Dallas-Fort Worth metro area (Dallas, Collin and Tarrant counties).

Harris County in the Houston area and Travis County in the Austin area were also ranked low for coronavirus-related housing shakeouts.

The pandemic and shelter-in-place orders are already affecting North Texas’ housing markets because there are fewer home shoppers in the market at a time of year when home sales typically boom.

And the Dallas-Fort Worth area was one of the few major metros in the country that saw a decline in the median list prices of homes listed for sale in March — they were down 3% from a year ago, according to Realtor.com

Dr. James Gaines, chief economist with the Real Estate Center at Texas A&M University, said he’s seen forecasts that predict Texas’ home markets will fare better coming out of the pandemic. But he’s wary of making any predictions.

“Obviously, the New York market will be collapsed and the tourist areas,” Gaines said. “Beyond that, we simply flat don’t know.

“The hit of the virus here in Texas so far has been considered light compared to other areas of the country.”

Gaines said it will be several months before sales and pricing numbers show where the Texas home markets land.

“I’ve seen some preliminary March numbers that indicate that we have had a slowdown but not a collapse,” he said. “But going forward, it’s going to look really bad year-over-year.

“March, April, May, June and July are usually our hot housing months.”

Texas markets are expected to outperform.(Attom Data Solutions.)

Steve Brown, Real Estate Editor. Steve covers commercial and residential real estate in Dallas-Fort Worth.

Article Provided By: Steve Brown at Dallas Morning News

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