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According to a new National Consumer Credit Trends Report, 2015 has been a booming year for mortgage origination growth. The report, from credit reporting agency Equifax, shows mortgage originations for the first quarter of the year increasing nearly 75% from last year – with first mortgages accounting for a majority of the growth. This article from HousingWire highlights the details of the report.
The latest Equifax National Consumer Credit Trends Report shows that total mortgage origination balances hit $466 billion in the first quarter, a 74.4% increase from the same time a year ago.
First mortgages grew 79.9% versus the first quarter of 2014 to $430 billion. The number of first mortgages originated in the first three months of the year was 1.78 million, a 54.9% increase over the same time a year ago and 13.6% higher than in the fourth quarter of 2014.
Originations of home equity lines of credit rose 30% to $30.9 billion and new home equity installment loans climbed 13.6% to $5.0 billion.
“The drop in mortgage rates that began in the fourth quarter of last year kicked off a refinance boomlet that accelerated in the first quarter, as rates fell further, averaging just 3.7% for the first three months of this year,” said Amy Crews Cutts, chief economist at Equifax. “While rates have recently reversed that trend and are back up to about 4%, they remain extremely low historically. These rates, coupled with a housing market that is showing signs of vigor, should carry the mortgage business over the summer.”
The April 2015 results for the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, were released this week. The results showed that home prices continued their rise across the country over the last 12 months. This article from MarketWatch highlights some interesting data from the release regarding home prices in individual cities.
The S&P/Case-Shiller 20-city composite showed that U.S. home prices rose 1.1% in April, supported by the spring sales market. There were gains in all the cities tracked by the Case-Shiller 20-city composite index.
Seattle posted the fastest monthly growth, reaching 2.3%. The slowest was Boston, where monthly prices rose 0.3% in April.
Denver saw the fastest year-over-year growth, hitting 10.3%. Meanwhile, the slowest annual growth was in Washington, where prices rose 1.1%.
Among the nine cities with a pick up in annual price growth, Las Vegas’s appreciation hit 6.3% in April, compared with 5.7% in March.
Two recent indexes measuring the outlook of consumers in the U.S. showed improvement in perceptions of current economic conditions and expectations for the future. The “Eye On Housing” blog from the National Association of Home Builders highlights the findings behind consumers’ optimistic outlook.
Consumer sentiment and consumer confidence are two indexes showing consumers’ perceptions of current business, income and employment conditions, as well as their expectations for the future’s economy.
In June, both the University of Michigan Index of Consumer Sentiment and the Conference Board Consumer Confidence Index rose. These gains reflect continuing improvement in several sectors of the economy. Strong job gains and an unemployment rate well off its peak, accumulating momentum in recent housing starts and sales, as well as a rebound in retail sales after a slow first quarter combine to point to consumers gaining confidence in the economic recovery.
In contrast to the slow, steady recovery in consumer confidence, plans to buy a home snapped back sharply after declining during the recession. The percentage of respondents planning to buy a home within 6 months more than doubled in the second half of 2010 and remains at elevated levels four years later.
Before you put your home up for sale, there are some steps you can take to increase its value, sometimes significantly. It can be as simple as updating furniture or lighting, using mirrors or shelving to enhance living spaces, or just painting an accent wall. If you’re ready and willing to put in some extra time and effort in order to boost your home’s selling price, this article from U.S. News offers a few ideas to get you started on an affordable renovation project.
It’s not always easy to figure out which home renovations will pay off for you and which will end up just being a sunk cost. In many cases, small and cheap decoration projects can do more to boost the value of your home than a more expensive and time-consuming undertaking.
According to Remodeling magazine’s annual cost-versus-value report, some of the most cost-efficient measures include a steel entry door replacement, which makes a strong first impression on potential buyers, and roofing replacement. Having a sturdier roof can make a home that much more appealing – and valuable – to buyers. Likewise, buyers tend to be willing to pay more for homes with wood decks and new windows.
Some of the worst investments include adding a back-up power generator and adding a bathroom, since doing so can be expensive. By the time you add plumbing, cabinets and electricity, you’ve spent far more than you can expect to get back, the magazine estimates.
One theme to emerge from the findings is that it pays to make a strong first impression, and homeowners can often boost their curb appeal with relatively little financial investment. Even sprucing up a front yard or planting some flowers can go a long way toward making a house look attractive to buyers.
A new study by economists from the University of Illinois and the University of Michigan, highlighted in this article from CityLab, looks into the factors that determine how much Americans are willing to pay to live in a more desirable area, and which amenities matter to them the most.
Location, location, location. When choosing where to live, we all make choices and tradeoffs between housing costs, commutes, and the kinds of amenities we need and want from communities – from better schools, safer streets, and warmer climates, to access to mountains or waterfronts, restaurants, and bars.
Just how much are we willing to pay for a better quality of life, and for the amenities and public services we believe will bring us that?
A new study published in the Journal of Urban Economics looked at more than 2,000 neighborhoods across the country, using people’s willingness to pay to live in specific areas as a measure of the quality of life there.
Using detailed data, the economists determined the real take-home pay in different areas across the country (taking wages, housing, and commuting costs into account), and then how much of that pay people are willing to sacrifice to live in the best neighborhoods and to access the best possible services and amenities.
The most desirable areas include communities along the West Coast, the Boston-Washington corridor, in coastal Florida, and in Colorado. East Oahu, Hawaii, tops the list, according to the economists’ analysis; households sacrifice 25% more than the average American to live there. California’s Marin, San Mateo, and San Francisco are not far beyond. Santa Cruz, San Jose, and Oakland do well, as do parts of Colorado and Washington State.
To determine what makes places more or less desirable, and which amenities matter the most, the study sorted out how much value households place on schools, crime, and climate, and on access to waterfronts and urban amenities.
The National Association of Realtors released the May results of its Pending Home Sales Index today, with the index hitting its highest level since April of 2006. This article from Forbes highlights the results.
The number of contracts signed to buy previously-owned homes rose again in May to reach its highest level in more than nine years, the National Association of Realtors said Monday.
NAR’s Pending Home Sales Index, which tracks contract signings (as opposed to closed sales), rose 0.9% in May to a level of 112.6. (An index of 100 represents an average level of contract activity.) That level was 10.4% higher than in May 2014, when the index stood at 101.9, and marks the ninth consecutive month of year-over-year gains.
“The steady pace of solid job creation seen now for over a year has given the housing market a boost this spring,” said Lawrence Yun, NAR’s chief economist. “It’s very encouraging to now see a broad-based recovery with all four major regions showing solid gains from a year ago and new home sales also coming alive.” He also indicated that 2015 may be the best year for home sales since the recession.
From labs at Purdue, Caltech and the University of Missouri here in the USA to the University of Manchester and University College London in the UK, researchers are developing new and better materials that could shape the future of construction. This article from EcoBuilding Pulse highlights five of those innovations.
The building blocks of the future are being developed in research labs today. From graphene production en masse to metamaterials that rethink the form and function of conventional construction mediums, here are five innovations with the potential to change architecture today, tomorrow, and beyond.
At Purdue University, researchers are developing a better, stronger concrete, by adding cellulose nanocrystals derived from wood fiber. Nano-reinforced materials typically outperform conventional alternatives across a range of mechanical and chemical properties – among them strength, impact resistance, and flexibility. When applied to construction materials like concrete, they help to reduce a structure’s environmental footprint by requiring less material to achieve a similar effect.
The nanocrystal additive can be extracted as a byproduct of industrial agriculture, bioenergy, and paper production. Its addition enhances the concrete-curing process, the researchers say, allowing the concrete to use water more efficiently and without impacting its weight or density significantly.
Construction materials are among the target applications for the additive, Purdue associate professor Jeffrey Youngblood says, but the team is still working to scale it up from current dimensions of 1 foot tall by 6 inches in diameter, assessing data to standardize and optimize the material’s behavior.
“We hope to be at a large test scale in a few years,” he says.
When is the right time to start teaching your kids about money, and how to save it? If you wait until the time they’re a teenager, they might have missed out on opportunities to learn important financial lessons. According to U.S. News, children can understand the concepts of saving and spending from as early as age five.
Ultimately, as a parent, teaching your children about money is probably one of the most important gifts you can ever give them. Smart money management will set them up for a lifetime of stability and freedom, and who doesn’t want that for their kids?
There is unfortunately a significant lack of financial education in our country, which makes it more important than ever for parents to teach basic money lessons to their children.
Although some financial topics might seem challenging, you might be surprised what your children can absorb.
For example, most children can understand the feeling of greed, especially in terms of not wanting to share toys. However, they need to understand the consequences of greed. Explain to them what happens when one person hoards all the resources. Teach them to be giving instead of greedy.
Budgeting is one of life’s most essential skills, right up there with learning how to do your own laundry and make a simple dinner. When you teach a child to budget, or better yet, have them learn from your budgeting skills, you will give them a lifetime of financial security.
It’s important to teach your children how to save for large purchases. Not only will it give them time to decide if it’s something they really want, but they can get the satisfaction of paying for something that they worked so hard to save for.
“Welcome to the housing market. We’re glad you’re finally here.” That’s how Jonathan Smoke, chief economist of Realtor.com, wraps up his letter to today’s growing number of millennials who plan to become homeowners in the near future. In his letter, Smoke offers advice for millennials as they embark on their home-buying journey.
Dear Millennial Future Home Buyer:
This is shaping up as your year! Congratulations. You and your older siblings are jumping into the housing market en masse. And it’s happening for all sorts of reasons, including the fact that you’re getting older and wiser.
Approximately 43 million of you are 25 to 34 now. (Hey, where did the time go?) That’s the age when Americans typically buy their first homes, and we expect nothing less of you. You and your cohorts outnumbered all other age groups of home buyers last year – even though not as many of you were buying as usual in a healthy economy.
So it is no surprise to us that in June you officially became the age group most likely to purchase a home this year.
Over 60% of you are looking at real estate online each month. More and more of you are waking up to the fact that rents are rising now faster than home prices. Because homeowning builds wealth over time, when home prices, rents, and mortgage rates are all going up – like they are now and will be for the next several years – there is a substantial opportunity cost to waiting to buy.
