Beyond the Headlines

The Decline in Geographic Mobility

Source: The Federal Reserve

During the past three decades, geographic mobility within the United States has declined steadily. A combination of factors is cited as the reason for the decline in a study from the Federal Reserve, including an aging population, rising homeownership rates, and a decrease in labor market transitions. These labor transitions are defined as a decline in the fraction of workers moving from job to job, changing industry, and changing occupation. The study notes, “Declines in internalmigration since the mid-2000s have attracted the attention of researchers and the public because they coincided with a dramatic housing market contraction and deep economic recession.”

Making sense of the story

  • Between 1984 and 1985, 20.2 percent or one out of every five Americans over the age of 1 year moved. In the most recent period, between 2012 and 2013, the mover rate was only 11.7 percent.
  • According to the Census Bureau, 23.2 percent of those 25 to 29 years moved between 2012 and 2013. After 30, the share declines with age and for those 65 years and older only 3.7 percent moved between 2012 and 2013.
  • As the population ages, measures of geographic mobility are unlikely to return to levels seen in the mid-1980s. After all, by 2030 it is predicted that there will be 72.1 million seniors.
  • Particularly important to the housing industry is the mobility of individuals between the ages of 25 to 29 years, as they represent future first-time homebuyers.
  • For the second straight period, the share of movers doing so to own rather than rent a home increased. Between 2012 and 2013, 5.2 percent of all movers in the younger age group did so to own rather than rent, whereas between 2011 and 2010, 4.4 percent did so to own rather than rent.
  • The most common reason for people in this younger age group to move between 2012 and 2013 was to establish their own household at roughly 14.2 percent.

Read the full story

http://eyeonhousing.org/2014/01/06/the-decline-in-geographic-mobility/

 

In other news …

 

Aging Boomers to Boost Demand for Apartments, Condos and Townhouses

Source: Wall Street Journal

Aging baby boomers could reshape the U.S. housing market if many move out of the houses where they raised families in order to move into cozier multifamily units, such as apartments, condominiums and townhouses. This could present a huge shift in the country’s housing demand.

Read the full story

http://blogs.wsj.com/economics/2014/01/07/aging-boomers-to-boost-demand-for-apartments-condos-andtownhouses/

 

Watt delays fee increase for Fannie, Freddie

Source: The Hill

Rep. Mel Watt took the reins on Monday as regulator of mortgage giants Fannie Mae and Freddie Mac, and Watt stuck to his plan to delay an increase on fees charged by the government-sponsored enterprises. Watt has stated he is concerned about the impact of a fee increase on the availability of mortgage credit.

Read the full story

http://thehill.com/blogs/on-the-money/housing/194763-watt-delays-fee-increase-for-fannie-freddie

 

Mortgage credit loosens a bit

Source: HousingWire

A new report from the Mortgage Bankers Association indicates that mortgage credit availability has improved slightly. The index rating rose 0.6 percent from 110.2 in November to 110.9 in December.

Read the full story

http://www.housingwire.com/articles/28496-credit-gets-a-little-easier

 

Federal Probe Targets Banks Over Mortgage Bonds

Source: Wall Street Journal

A new probe from federal regulators is examining whether Wall Street banks deliberately mispriced mortgage bonds to cheat clients in the aftermath of the financial crisis. While many post-crisis investigations have been winding down, this represents a new inquiry and a fresh round of scrutiny over questionable conduct when it comes to mortgage-bond sales by banks.

Read the full story

http://online.wsj.com/news/articles/SB1000142405270230488710457930694106901895

 

Mortgage Rates Start 2014 on the Up and Up

Source: DSNews.com

The new year started with a round of increases in mortgage rates, which many experts believe reflects an ongoing trend for 2014. The 30-year fixed-rate mortgage averaged 4.53 percent (0.8 point) for the week ending January 2, up from the last week of 2013, according to Freddie Mac’s weekly Primary Mortgage Market Survey.

Read the full story

http://www.dsnews.com/articles/mortgage-rates-start-2014-on-up-and-2014-01-02

 

Burbank to Brookline Soar in Suburb Shift: Real Estate

Source: Bloomberg

Experts posit that more capital will flow into secondary markets and select suburbs as the recovery broadens in 2014 because investors see areas just outside major metros as high quality investments. Many areas just beyond major markets are selling at premiums to real estate in cities.

Read the full story

http://www.bloomberg.com/news/2014-01-07/burbank-to-brookline-soar-in-suburb-shift-real-estate.html

 

Yellen gets final stamp of approval to head U.S. Fed

Source: Reuters

This week the Senate confirmed Janet Yellen as the successor to Ben Bernanke as chairman of the Federal Reserve. She is the first woman to run the Fed in its 100-year history, and she will be tasked with scaling down the central bank’s bond-buying program.

Read the full story

http://www.reuters.com/article/2014/01/06/us-usa-fed-yellen-idUSBREA0506C20140106

 

What You Should Know…

  • Mortgage applications increased by 2.6 percent for the week ending Jan. 3, according to index ratings from the Mortgage Bankers Association (MBA).
  • In addition, the MBA’s refinance index escalated 5 percent from the previous week after falling by 9 percent one week earlier. Comparatively, the purchase index dipped 1 percent from a week ago.
  • Overall, the refinance share of mortgage activity maintained the same level at 63 percent of total applications.

 

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Beyond The Headlines

NEWS FLASH

 

Call your member of congress today to protect the mortgage interest deduction
Congress, as part of negotiations on avoiding the “Fiscal Cliff,” has made direct references to “closing loopholes” and “limiting deductions” as a way to raise revenues. Clearly, the mortgage interest deduction is high on this list of revenue raisers.

 

Losing the mortgage interest deduction will disproportionately affect the middle class because a larger proportion of the middle class takes the deduction. In California 89% of those who took the mortgage interest deduction earned less than $200,000. Losing the deduction would cost the average California taxpayer over $3,900.

 

What you can do to help:

 

Call Congress. First and foremost, we are urging the public to get involved by calling Congress to ask that the mortgage interest deduction be preserved. The public may reach Congress by calling 202-224-3121.

 

The Capitol switchboard operator will help callers identify their member of Congress and connect them.

 

The public can reach Congress by calling (202) 224-3121.

 

Monday-Friday from 9 a.m. – 6 p.m., Eastern Time.

 

Get the word out. Many people seem to be blissfully unaware that their mortgage interest deduction is in danger. Please do the following to make sure that the message spreads.

 

  1. Forward this message to your family, friends, and clients.
  2. Post this information on your personal and office websites and blogs.
  3. Share this information on Facebook and urge others to share it as well.
  4. Tweet about it on Twitter and urge others to retweet. Use the hashtag: #keepthemid.
  5. Link to the following web page: www.KeepTheMID.com.  This site has information about contacting Congress, more information on the MID, and links to articles.
  6. As you see new information and articles, share these on all your social networking sites.

Watch and share this video about preserving the MID.

 
Mercury News

 

How to stage your home to sell during the holidays
By properly staging a home, it is possible to sell a house during the holidays, even with the slowdown in house hunting during November and December.

 

Making sense of the story

  • Homeowners should make cleaning and decluttering the house their number one priority when looking to sell their home.  The house should show at its absolute best, which means light, bright, and extremely clean.
  • It’s okay to decorate for the holidays, which can make the home feel warm, inviting, and festive.  But the “less is more” mantra definitely holds true.  The goal is to have the house appear spacious and open, and too many decorations may do the opposite.
  • A tall Christmas tree is great for those trying to accentuate a two-story foyer or great room, but otherwise, homeowners should opt for a smaller and thinner tree.  Additionally, sellers should use a cohesive color scheme and theme for ornaments that are used for the interior holiday décor.
  • Even the gift wrap for presents under the tree should complement the color and style of the décor and tree.  Limit the gift wrap to beautiful neutral colors such as silver or gold metallic, then choose colorful ribbon that matches the rest of the scheme.  Limiting the number of gifts under the tree also may help.
  • No matter what time of year, when a house is available for sale, it’s always recommended that homeowners remove all or most family photos.  During the holidays, take this one step further by keeping the personalized stockings over the fireplace put away.
  • It’s also recommended that specific religious or cultural decorations be stowed away in order to appeal to the largest group of people and so as not to offend anyone.

Read the full story

 

 

In other news …

 

Los Angeles Times

 

Index of California consumer sentiment falls slightly in quarter
The California Composite Index of Consumer Confidence decreased to 92.7 from a revised third-quarter reading of 93.4, which was its highest level since the recession, according to a Chapman University index released Tuesday.

 

Read the full story

 
CNN Money

 

The automated home is one step closer
By remotely controlling heat, locks, even the sprinklers, one company is making the house of the future a reality.

 

Read the full story

 
Mercury News

 

“Boomerang” home buyers bounce back from foreclosure
The number of boomerang buyers – locals who lost their home to foreclosure or short sale, but are jumping back into the market just two to three years after default – are small now, but real estate agents and home builders say that while these buyers don’t currently make up a big share of their clients, there’s evidence that their ranks are set to rise noticeably, and that could have implications for local home sales and neighborhood vitality.

 

Read the full story

 

Los Angeles Times

 

Housing is adding more vigor to the recovery, report says
The U.S. housing market is becoming the leading source of strength for the long-sluggish American economic recovery, outpacing both business investment and exports.  But even with the return of that crucial linchpin, job growth is expected to remain weak next year, a new report by UCLA says.

 

Read the full story

 
The New York Times

 

Upshot of the foreclosure backlog
Foreclosures are taking significantly longer in states where lenders must go through the courts, and the delay may or may not be good for borrowers, depending on their circumstances.  But some researchers say that dragging the process out hurts society at large.

 

Read the full story

 
Los Angeles Times

 

House flipping gets an expensive twist
Luxury-home flipping is heating up in affluent neighborhoods as well-heeled builders and investors seek better returns than they get on other investments.

 

Read the full story

 

 

 *Talking Points

  • During the holidays there are several organizations requesting donations for various causes – many of them legitimate.  However, consumers should take precautions and adhere to certain guidelines to stay safe and avoid being scammed.
  • Consumers should be cautious of individuals representing themselves as victims or officials asking for donations via email, in person, or social networking sites.
  • Also, never respond to any unsolicited (spam) incoming emails, including clicking links contained within those messages, because they may contain computer viruses.
  • Additionally, beware of organizations with copycat names similar to, but not exactly the same as, those of reputable charities.

 

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California home sales post second consecutive monthly gain in September;median price down from August

California State Route 1 shield
Image via Wikipedia

September 2010 Regional Sales and Price Activity*
Regional and Condo Sales Data Not Seasonally Adjusted

   

 

 

Median Price

 

 

 

Percent Change in Price from Prior Month

 

 

 

Percent Change in Price from Prior Year

 

 

  

Percent Change in Sales from Prior Month

 

 

 

Percent Change in Sales from Prior Year

   

Sept. 2010

 

Aug. 2010

   

Sept. 2009

   

Aug. 2010

 

Sept. 2009

Statewide              
Calif. (sf) $309,900 -2.7%   4.5%   3.8% -12.2%
Calif. (condo) $252,880 -2.0%   -6.4%   -7.4% -14.8%
               
C.A.R. Region              
               
High Desert $124,960 -2.3%   6.1%   -7.7% -33.1%
Los Angeles $349,040 -0.2%   -0.8%   1.2% -10.0%
Monterey Region $343,000 -2.6%   11.7%   -3.7% -12.3%
Monterey County $250,000 -3.8%   8.7%   -1.8% -15.0%
Santa Cruz County $532,500 3.6%   -0.3%   -7.2% -6.6%
Northern California $245,190 -1.3%   -7.0%   1.2% 1.0%
Northern Wine Country $358,040 -5.1%   4.5%   -2.5% -3.2%
Orange County $510,530 2.2%   2.8%   1.6% -10.4%
Palm Springs/Lower Desert $169,320 -3.3%   6.0%   5.2% -7.0%
Riverside/San Bernardino $191,080 1.3%   10.8%   -3.1% -24.8%
Sacramento $181,780 -2.7%   -1.3%   -4.2% -12.3%
San Diego $388,850 1.1%   0.7%   -4.4% -10.9%
San Francisco Bay $563,480 -4.8%   5.1%   -4.3% -17.4%
San Luis Obispo $354,880 -1.1%   -8.9%   -3.6% -9.0%
Santa Barbara County $487,500 -3.3%   15.2%   -1.3% -18.8%
Santa BarbaraSouth Coast $879,750 13.5%   17.3%   -8.6% -12.9%
NorthSanta Barbara County $233,000 -6.8%   -5.6%   4.3% -24.7%
Santa Clara $620,000 -2.1%   12.1%   -3.7% -22.2%
Ventura $453,290 4.3%   2.6%   -3.9% 5.6%

 
* Based on closed escrow sales of single‑family, detached homes only (no condos).  Movements in sales prices should not be interpreted as measuring changes in the cost of a standard home.  Prices are influenced by changes in cost and changes in the characteristics and size of homes actually sold.

 sf = single‑family, detached home

Source:  CALIFORNIA ASSOCIATION OF REALTORS ® 

Median Price By Region – Current Month vs. Year Ago

  Sept. 2010 Aug. 2010   Sept. 2009
Statewide        
Calif. (sf) $309,900 $318,660   $296,610
Calif. (condo) $252,880 $257,930   $270,170
         
C.A.R. Region        
         
High Desert $124,960 $127,860   $117,820
Los Angeles $349,040 $349,600   $351,680
Monterey Region $343,000 $352,270   $307,140
  Monterey County $250,000 $260,000   $230,000
  Santa Cruz County $532,500 $514,000   $534,000
Northern California $245,190 $248,490   $263,620
Northern Wine Country $358,040 $377,110   $342,620
Orange County $510,530 $499,580   $496,790
Palm Springs/Lower Desert $169,320 $175,140   $159,810
Riverside/San Bernardino $191,080 $188,570   $172,420
Sacramento $181,780 $186,750   $184,200
San Diego $388,850 $384,700   $386,050
San Francisco Bay $563,480 $591,990   $536,080
San Luis Obispo $354,880 $358,890   $389,530
Santa Barbara County $487,500 $504,310   $423,330
     Santa BarbaraSouth Coast $879,750 $775,000 r $750,000
     NorthSanta Barbara County $233,000 $250,000   $246,870
Santa Clara $620,000 $633,250   $553,000
Ventura $453,290 $434,480   $441,670

 

r – revised

Source: CALIFORNIA ASSOCIATION OF REALTORS®

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Should you buy a home NOW???

Historical U.S. Prime Rates
Image via Wikipedia

I say Yes , here are some of my reasons.

For the same amount you qualified before ,to buy a smaller,fixer upper home,you now can buy a nicer,bigger home.It is a win ,win situation.Also at the present time you have less competition ,since the tax credit is gone,now you have more homes in the market,more chance for you to find something that meets your criteria.

Another reason I think now it is a good time to buy a home is the fact that mortgage rates are cheap( that is if you can get one,banks are also more strict in their qualification)a 30 year fix rate is around 4.4% versus 6.3% as it was recently  as two years ago.One other thing to keep in mind is the fact that you can deduct your mortgage interest from your income tax( so far).

So, at this time what do you think? let’s see,you can get a bigger home,cheaper mortgage,why not buy a home?

Will prices fall further?? you ask .Maybe? they could,but it doesn’t really Mather so much in the long haul.Right?? you tell me.

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