Happy Mother’s Day!
This Week in Real Estate rental rates continue to climb making buying more attractive. Will the April jobs report answer the question of when the Feds will increase interest rates: June or September? Below are a few of the highlights from the first full week of May that influence our business:
* More Consumers Positive on Housing, But Not Quite Ready to Leave the Sidelines. The spring and summer home buying season has gotten off to a stronger start, reflected in some of the improvement in consumer housing sentiment,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. The share of consumers who intend to own rather than rent their next home rebounded after a two-month slide. Meanwhile, home price growth expectations strengthened to the strongest pace since last October. “sWhen we consider both the continued caution of consumers and the positive start to the year, we believe that these results support our expectations that 2015 will be a year of modest growth in housing activity,” Duncan said. Full story… http://www.fanniemae.com/portal/about-us/media/corporate-news/2015/6248.html
* 4 Percent of All U.S. Single Family Home Sales in First Quarter Were Flips. According to RealtyTrac’s Q1 2015 U.S. Home Flipping Report, 17,309 single family homes were flipped – sold as part of an arms-length sale for the second time within a 12-month period – in the first quarter, 4.0 percent of all single family home sales during the quarter. The average gross profit for completed flips in the first quarter was $72,450, up from $65,290 in the previous quarter and up from $61,684 in the first quarter of 2014 to the highest level going back to the first quarter of 2011, the earliest where data is available. “The strong returns for home flippers in the first quarter demonstrates that there is still a need in this recovering real estate market for move-in ready homes rehabbed to more modern tastes, particularly given the dearth of new homes being built,” said Daren Blomquist, vice president at RealtyTrac. The challenge for flippers in 2015 will be finding inventory to flip. Full story… http://www.realtytrac.com/news/real-estate-investing/q1-2015-u-s-home-flipping-report/
* The Cost of Renting vs. Buying? If you are renting and think you can’t afford a home… THINK AGAIN! Renting will cost you 30.1% of your income compared to buying a median home at 15.3% of your income. Full story… http://www.keepingcurrentmatters.com/2015/05/08/do-you-know-the-cost-of-renting-vs-buying-infographic/
* April Jobs Report Comes in Below Expectations. Employers added 223,000 jobs in April according to the Bureau of Labor Statistics, below consensus expectations of 228,000. This pushed the three month average below replacement levels, and based on Federal Reserve comments before, means employment probably won’t be pulling forward expectations for a rate hike. “The strengthening in overall hiring is in line with our forecast for a moderate rebound in economic activity, though not quite the bounce-back we saw a year ago, as the economy is facing more than just transitory headwinds. With today’s report, we are comfortable with our call for a September liftoff in the fed funds rate.” Full story…
* Housing Regulator Extends Mortgage Modification Programs Through 2016. The director of the Federal Housing Finance Agency, which regulates mortgage-finance companies Fannie Mae and Freddie Mac said that the companies would extend for another year the deadline to participate in a pair of programs meant to help struggling borrowers. Fannie and Freddie had been set to stop allowing modifications under the programs at the end of the year, but both will participate in the Home Affordable Modification Program (HAMP) and Home Affordable Refinance Program (HARP) through December 2016. FHFA Director Melvin Watt said that the FHFA wouldn’t extend Fannie’s and Freddie’s participation in HAMP again, and that he didn’t expect for there to be another extension of HARP after 2016. Full story…
Have a productive week!