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A year ago, Gallup reported on Americans’ confidence in real estate as a solid long-term investment. Now, for the second straight year, more Americans name real estate than stocks, gold, savings accounts/CDs or bonds as the best long-term investment.
Today real estate is either the top choice or tied for the top choice as the best investment among all major gender, age and income groups.
Real estate took a pounding in home values and consumer confidence after the subprime mortgage crisis that started in 2007 spurred the financial crisis of 2008, deepening the 2007-2009 recession. A return of Americans’ confidence in real estate as a solid long-term investment was first evident a year ago, and its continued strength this year indicates that was no fluke.
The March existing sales report, released Wednesday by the National Association of Realtors, shows that home sales jumped by the most in four years. Bloomberg reports on how the sales figures position the U.S. residential real estate market on firm footing heading into its busiest time of the year.
Purchases increased 6.1% to a 5.19 million annualized rate, the highest level since September 2013. Homes were snapped up in 52 days on average, the fastest since July, and property values appreciated.
“It’s consistent with a bit of a spring rebound,” said Gennadiy Goldberg, a strategist at TD Securities LLC in New York. “You’ve had more job growth over the last year or so. A lot of those people who did find employment would be driving some demand for housing.”
The share of first-time buyers inched up while distressed properties were a smaller part of the market, indicating a healthier mix in demand leading up to the May through July period when sales typically surge.
The gain in March was the biggest since December 2010. Figures from the Mortgage Bankers Association on Wednesday showed stronger demand is extending into April. The group’s index of purchase applications climbed last week to the highest level since June 2013.
The median price of an existing home surged 7.8 percent from a year ago, the most since February 2014, to $212,100.
In this new Forbes article, Millennial Money blog contributor Lucy Mueller examines Gen Y’s current impact on the U.S. housing market, and how that will become even greater in the next few years.
The dream of homeownership hasn’t been lost amid the pragmatism of Gen Y-ers. The desire to own a home of your own remains the No. 1 reason people buy homes across all generations, according to the NAR, far more so than financial incentives.
As the older tier of Gen Y rounds into their early 30s, millennial homeowners are turning out more than ever before.
For the second year in a row, millennials represent the biggest group of home buyers in America, 32% of the market, according to a March 2015 report from the National Association of Realtors.
This number is only going to go up in the coming years. According to the 2015 TD Bank Mortgage Service Index, 50% of millennials say they are either “extremely” or “very” likely to buy a house in the next year.
“Millennials will have a huge impact on the housing market for the next decade, just because of demographics alone,” said Nela Richardson, the chief economist for Redfin. “So whatever a few of them do, there’s enough of them that they’ll make a big impact.”
A fun new “Livability Index” tool from AARP scores neighborhoods for the services and amenities that impact its residents the most.
The index allows you to punch in an address or zip code, and find out how it scores, on a scale from 1 to 100, in seven different categories: housing, transportation, environment, health, engagement, opportunity, and the catchall “neighborhood” category, which encompasses proximity to services as well as personal safety. The site covers 200,000 communities around the country, and includes county- and state-level data as well.
The index also allows you to customize your priorities. If, for instance, you value clean air and water over access to quality health care, you can weight “environment” more heavily and dial back the importance of “health.”
While the AARP index is designed to be of special use to people aged “50-plus,” the researchers who put it together emphasize that it is useful for people of all ages who are trying to figure out where they want to live, either now or in the future.
The National Association of Home Builders/Wells Fargo Housing Market Index, which was released today, showed that homebuilder confidence increased in the month of April. According to the index, builder confidence in the market for newly built, single-family homes in April rose four points to a level of 56.
“As the spring buying season gets underway, home builders are confident that current low interest rates and continued job growth will draw consumers to the market,” said NAHB Chairman Tom Woods.
“The HMI component index measuring future sales expectations rose five points in April to its highest level of the year,” said NAHB Chief Economist David Crowe. “This uptick shows builders are feeling optimistic that the housing market will continue to strengthen throughout 2015.”
An article from The Wall Street Journal highlights a new study by the Federal Reserve Bank of Boston, and the effects of homeownership on the future income of homeowners’ children.
The study, recently published in the Journal of Urban Economics, found that when households included a 17-year-old, a 1% rise in prices that year resulted in about 0.9% higher annual income for the child later in life – if the parents owned the home.
The Wall Street Journal spoke with Daniel Cooper and Maria Jose Luengo-Prado, both senior economists at the Federal Reserve Bank of Boston, about their report.
“If home prices are rising, parents who are homeowners may have additional resources to finance a child’s higher education, either because they feel richer or they can borrow against the home’s equity,” said Dr. Luengo-Prado. “This may allow their children to attend college or attend a higher-ranked [more expensive] school.”
What’s your favorite spot to relax at home? It could be the place you go to read and enjoy your morning coffee. Or where you like to watch your favorite shows. No matter which room your favorite relaxing spot is in, BrightNest offers some fun tips on how to make the best part of your home even better.
We’re all a little different when it comes to relaxing at home, but we all need an actual place to do our relaxing. So why not make your spot a little more awesome? Here’s how to improve your home sanctuary, no matter how you use it:
For example: rearrange your chairs. One big comfy couch is awesome, until you’re trying to host a happy hour. Then it’s just awkward. Instead, opt for chairs and arrange them in a semicircle, primed for conversation. If you have a large window or fireplace, arrange the seating area around the focal spot to take advantage of the natural light, views or fire.
Also, establish a sense of privacy by separating your happy place from the rest of your home. Even if you’re just able to carve out a corner in the living room or kitchen, placing stylish barriers will give the area a sense of separation. To carve out your hangout area from the rest of your home, try glass dividers, hanging fabric or a divider screen.
There’s optimism aplenty in the housing market, according to a new article from The Wall Street Journal. A monthly survey of real-estate agents across the country by Credit Suisse Securities LLC found “solid demand” for homes in the early spring. And last month saw home sales gains in cities across the U.S.
On Friday, the Atlanta Board of Realtors reported 3,993 finalized home sales in March, up 13.8% from a year earlier. The San Antonio Board of Realtors reported a 17% sales gain in that span, and the Realtor association in Washington, D.C., disclosed a 5.7% gain in sales of single-family homes.
Those reports came after the Minneapolis Area Association of Realtors on Thursday announced 3,907 closed home sales in March, up 21% from a year earlier. Several other cities, including Houston, Seattle and Jacksonville, Fla., earlier this week posted big March gains, stoking optimism among Realtors, home builders and economists for a robust spring season.
Buyers are emboldened by a year of strong job growth, generally improving personal credit and low interest rates that might not last much longer.
What effect will an interest rate hike have on America’s housing market? A new article from Forbes highlights that a reasonable rate hike by the Federal Reserve is a reflection of strong economic growth. And the housing market, like the rest of the economy, will not only survive – it will also thrive.
The conventional wisdom holds that the housing market suffers when rates rise, causing affordability to drop. But the housing market isn’t nearly as weak as most experts claim it is. The foreclosure rate has dropped rapidly since its peak. The legacy of housing distress is quickly disappearing. And the housing market is forging ahead on the strength of an improving economy.
Between February 2014 and February 2015, the number of new homes sold rose by rose by 24.8%. Existing-home sales were up were up 4.7% over the same period. Best of all, the median existing-home price was nearly $203,000 in February 2015 – more than 7% higher than it was the year before.
Put another way, the housing market is healthier than it has been at any point in recent memory. There is no better time for the Federal Reserve to end this unprecedented period of low interest rates.
