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Despite a monthly decline in the Consumer Confidence Index for October, recently released by The Conference Board, confidence has been trending up and remains relatively high by historical standards. This article from the NAHB Eye On Housing blog delves further into the results of the report, specifically highlighting respondents’ expectations regarding interest rates, and their plans to buy new homes.
In the October survey, 62.7% of respondents reported they expect interest rates to be higher in the upcoming twelve months, down from 64.4% in September, and more people expected interest rates to remain at the same level in the upcoming twelve months, perhaps anticipating the lack of action taken at the Federal Reserve regarding increasing interest rates (FOMC).
The impact of expectations of changing interest rates on plans to buy a home is relatively weak. Instead, overall consumer confidence has a much stronger impact on plans to buy a home. Despite the monthly decline in overall confidence and consistent with the steady upward trend since the end of the recession, the Conference Board reported an increase in the share of respondents planning to buy a home within six months, from 5.8% in September to 6.3% in October. Also, 1.4% of respondents reported they have plans to buy a new home within six months, higher than 1.3% in September.
According to Deloitte’s 30th annual holiday survey, consumers are in the mood to decorate…and are planning to spend more money on holiday home decorations this season. This article by Tonya Garcia of MarketWatch looks at how increased spending on holiday décor may also lead to bigger-ticket purchases like home furnishings.
Retailers that sell home furnishings hope to use consumer interest in holiday décor to drive sales of big-ticket furniture items during the first quarter of 2016.
With consumer confidence high and holiday parties right around the corner, consumers are in the mood to decorate. The latest results from Deloitte’s 30th annual holiday survey indicate a spike is coming in spending on everything from ornaments, lights and miniature Santas to holiday-themed serving plates and other items.
The survey, which polled 4,009 consumers between Sept. 11 and Sept. 22, found that consumers plan to spend $1,440 on average this holiday season, 12.5% more overall compared to 2014, on everything from socializing to decorating to gifts. The biggest increase year-over-year was for home and holiday furnishings, up 33% to $124.
“As consumers spend more time entertaining, they are spending more on accessories and soft goods to adorn their homes. We expect growth in many of the categories of furnishings,” Rod Sides, the retail and distribution practice leader at Deloitte, wrote in an email.
This gives retailers an opportunity to not only sell holiday items, but to plant the seed for a new couch, dining-room table, or other large piece of furniture, according to Mike Hudgens, southeast regional manager of CIT Commercial Services.
“It is… the time of year where people are beginning to think about buying bigger ticket items. In response, retailers are putting product on their floors as people are holiday shopping,” Hudgens said.
The furniture industry is growing at a 6% to 7% clip this year, Hudgens wrote in a recent furniture outlook report, quoting Smith-Leonard Accounting Firm. This growth “compares very favorably to the overall economy,” the report said. Bedroom and dining room furniture are among the areas doing particularly well.
This article from BrightNest offers helpful tips for decorating your home with mirrors.
The bigger the better (especially in small spaces). Don’t be afraid to put a huge mirror in a tiny bathroom or hallway. The mirror will create depth and work with the space, not against it. Unlike a huge oil painting in a small room, big mirrors are not overwhelming.
Place your mirrors so they reflect something you enjoy. Avoid placing your mirror in a spot where it reflects something boring like a stove or the entrance to the bathroom. Take advantage of a mirror’s ability to double anything awesome and position it across a window, light fixture or favorite painting. You can also reflect an area of the home that you love like a reading nook in the living room.
Try hanging a mirror over your fireplace. A mirror over the fireplace is a great idea for a few reasons: First, hanging art over the fireplace poses a risk of smoke damage, so that’s not a great idea. Second, if you’re into Feng Shui, experts recommend mirrors over fireplaces because a mirror is a water element and it will create balance with the fire. If you have a non-functioning fireplace, we love the idea of filling it with candles. Try placing a mirror behind the candles to reflect the flames and colors.
Mirrors are great in narrow spaces. If you’re looking to decorate a narrow hallway or staircase, try a mirror to open up the space and prevent claustrophobia.
Hang mirrors next to light fixtures. If you want to double your light source with a mirror, place the mirror next to the light fixture. It’s double the light’s illumination power!
According to a new report from Trulia, Millennials are better off buying a home than renting in 98 out of 100 metro areas across the U.S. Comparing the median cost of rent against median home prices in the nation’s top housing markets, the report highlights Houston, Miami, Fort Lauderdale, Tampa and San Antonio as the top metros where buying a home beats renting. In this article, Richard Florida of CityLab.com and The Atlantic covers some of the details of the Trulia report.
Millennials have been slow to buy homes. In fact, the homeownership rate for adults under 35 remains at record lows, even though the economy has picked up and interest rates remain low.
And that’s the case even though Millennials (ages 25-34) would be better off buying than renting in all but two metros across the country, according to a new report from real-estate website Trulia. Using data for median home price and median monthly rent from the U.S. Census’ 2014 American Community Survey and their own consumer poll, Trulia finds that buying a home is 23 percent cheaper than renting for Millennials nationwide.
Buying was cheaper in 98 out of 100 of the nation’s top housing markets, even though home prices vary widely by metro. Unsurprisingly, the metros where renting beats buying – or comes close to it – are among the most expensive metros in the U.S. Of the 10 metros with the lowest rent vs. buy gap, three were located in the uber-expensive Bay Area (San Jose, San Francisco, and Oakland) and yet another three were located in Southern California (Orange County, Ventura County, and San Diego), in addition to Sacramento and New York. The only two metros where renting beats buying outright are Honolulu, Hawaii and San Jose, California – two of the most expensive places on the planet.
But the picture is very different in much of the country, especially in the South and Midwest. In Houston, for instance, buying a home is 46 percent cheaper for Millennials than renting. Buying is a much better bet than renting even in Fort Lauderdale (44 percent) and Miami (43 percent), two of the hottest vacation markets in the country that have attracted a ton of foreign investment in recent years. (These prices are driven by non-waterfront homes, which are considerably cheaper.)
A new article by Crissinda Ponder from Bankrate.com highlights some trends to look for in housing over the next few months.
Autumn is typically known as the time of year when housing activity starts to slow down.
“Generally, home sales tend to be very robust in spring and summer, then begin to soften somewhat during the autumn and winter months,” says Lawrence Yun, chief economist and senior vice president of research for the National Association of Realtors, or NAR.
The slowdown begins in the fall because school is starting, and families with kids would rather not move during this time, he adds.
Mortgage rates likely won’t change pace, however. They’ve been volatile in recent months, but the trend for mortgage rates is still upward, says Logan Mohtashami, senior loan officer for AMC Lending Group in Irvine, California.
“Unless we get more (weak) data from Europe and China, the 10-year (Treasury) note and mortgage rates have room to climb up higher than these levels,” he says.
Nela Richardson, chief economist at real estate brokerage firm Redfin, agrees. She says the 30-year fixed rate has been under 4% on average for the past several weeks but may end up under 4.5% by year’s end.
“I think that as the economy improves, rates will increase a bit and also whatever the (Federal Reserve) does this year in terms of raising short-term rates might have an effect on mortgage rates, as well,” she says.
Lending standards will loosen but will do so at a “glacial pace,” Yun says.
“Those people who are getting approved (for) mortgages, their credit scores have been exceptionally high, but now (they) may begin to slide down,” he says.
Richardson agrees; she doesn’t expect credit standards to significantly loosen until 2016.
“Even (for) FHA loans, if you have something lower than a 680 credit score, you still don’t see a lot of mortgages being originated to the lower end of the credit spectrum.”
Mortgage credit availability has increased, meaning that lending standards have somewhat loosened for most of 2015, according to the Mortgage Bankers Association’s Mortgage Credit Availability Index.
As a symptom of inventory shortages, home prices are predicted to continue moving higher.
“I hope the home price growth moderates because some of the price growth has been quite sharp – near double-digit rates of appreciation,” Yun says. He predicts annualized price growth of 3% to 5% toward the end of this year and into 2016.
Freddie Mac recently released its updated Multi-Indicator Market Index, showing further improvement in the U.S. housing market. Here are some of the details of the report, highlighted by Xhevrije West in this article from DS News.
As consumers purchase more homes, remain current on mortgage payments thanks to low rates, and employment continues to grow, the housing market continues to show improvement, according to data released by Freddie Mac on Friday.
Freddie Mac’s Multi-Indicator Market Index (MiMi) showed that the U.S. housing market continued to stabilize as the national MiMi value reached 81.2 as of August 2015. This means that the market is on its outer range of stable housing activity.
“The nation’s housing market continues to improve riding the wave of the best year in home sales since 2007,” said Len Kiefer, Freddie Mac deputy chief economist. “With the MiMi purchase applications indicator at its highest level in more than seven years we expect home sales to remain strong. Low mortgage rates are fueling the recovery across the country.”
“Buoyed by strong employment growth, housing supply is struggling to keep pace with demand, which is driving house prices higher,” Kiefer said. “Fortunately, low mortgage interest rates are helping to keep homebuying affordable for some prospective homebuyers.”
United States homebuilders are feeling more optimistic about the housing market, lifting their confidence this month to the highest level in 10 years.
The National Association of Home Builders/Wells Fargo builder sentiment index released on Monday rose this month to 64 points, up from 61 in September. The last time the reading was higher was October 2005, at 68 points.
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.
Builders’ improved optimism bodes well for a pickup in new home construction, which could help the overall economy. The supply of new homes has been scarce, so greater construction could result in more sales.
Healthy hiring and smaller price increases for new homes have begun pushing up sales, which were crippled during the financial crisis and recovered slowly even after the downturn ended in 2009. Sales of new homes have soared nearly 22 percent in the past year. They hit a seasonally adjusted annual rate of 552,000 homes in August, the strongest pace since February 2008.
Industrial long before ‘industrial chic’ entered our vocabulary, the West Loop was once neighborhood non-grata for house hunters. But with its recent geyser of development – including Lennar’s tony Gateway high rise – the area now boasts the trendy cache of previous up-and-comers like Wicker Park and Bucktown. Here, some meditations on why the West Loop is Chicago’s coolest quarter.
Posh housing has infiltrated the West Loop, with Lennar’s Gateway building leading the pack. A pet-friendly high-rise that’s in close proximity to Mariano’s and Whole Foods, its 16 floors boast sleek, contemporary units treated with wood floors and stainless steel appliances (with a sky lounge, valet dry cleaning service, and complimentary coffee center to boot). The only challenge about living there? Deciding what hour to Instagram from the rooftop pool deck.
What it lacks in lakefront vistas, the West Loop makes up for in green environs. Mary Bartelme Park’s smartly-designed 1.4 acres boasts a sunken dog park, roomy walking paths, and a fountain plaza for warm-weather relief. Further west on Adams Street is leafy Skinner Park, just a few blocks south of spacious Pitchfork Festival-host Union Park.
Lennar’s revolutionary concept for The Home Within A Home® – began in our Arizona Division, with our first communities of multigenerational homes opening throughout the Phoenix area in 2011. Today, there are several locations in both the Phoenix and Tucson areas where families are discovering the advantages of Lennar’s The Home Within a Home, as highlighted in this new article from The Arizona Republic.
Edward and Christine Leydon weren’t looking for a new home. The couple and their three children were happy in the Gilbert house they bought in 2009.
But the Leydons had been thinking about where their 16-year-old son with special needs would live after he graduated from high school. They want him to have more space and independence while still being close to them.
Then last summer, they found a new home built with an apartment tucked inside. The multigenerational house, from Lennar, is just five minutes from where they live now. So their son Jordan’s commute to Higley High School will be the same.
“We wanted to plan ahead, knowing Jordan may live with us forever,” Christine Leydon told me. “He is so excited to have his own space, but still just be a door away from us.”
The Leydons’ new house is under construction. They plan to move in early next year.
The home is called the The Home Within a Home model. It will have an attached apartment with about 750 square feet of space. The apartment has its own outside entrance, as well as a door to the rest of the home. A kitchenette, bedroom, bathroom, living space and laundry area are included. The apartment even has its own garage and backyard.
The Arizona division of homebuilder Lennar launched The Home Within a Home a few years ago for multigenerational homebuyers. Now the home-plus-apartment design is so popular, it’s for sale in Lennar communities nationwide.
The multigenerational house is also another example of how metro Phoenix has long been a proving ground for new home designs.
Analysis of census data from the Pew Research Center shows a record 57 million people live in multigenerational households. The trend grew during the recession when families, who lost jobs and homes, moved in together.
A growing number of baby boomers are living with their parents and grown children.
Lennar’s stats say 1 in 6 people in the U.S. already live in multigenerational homes.
Families are saving money by sharing a mortgage and cutting expenses on both assisted-living care and babysitting.
Arizona Lennar executives said one of their NextGen buyers is a father who moved into the apartment so his two daughters and their children could live in the main house.
Another house was sold to a couple who has their college-age grandson living with them in the apartment.
Prices for Lennar’s multigenerational homes in the Valley start in $250,000s. Pretty affordable, particularly when the mortgage can be shared.
