David Lereah, NAR’s chief economist, said the changes are necessary for the long-term health of the housing market. “We want to people to be able to stay in their homes with mortgage terms they understand and can handle,” he said. “Simply stated, a loan with the lowest monthly payment probably isn’t in your best interests – borrowers need to understand worst-case scenarios. If you’re in a mortgage you aren’t comfortable with, now is an excellent time to refinance, if you can, with historically low rates on safer conventional loans.”
Last week, Freddie Mac reported the 30-year fixed-rate mortgage was 6.17 percent. The 30-year fixed rate should rise slowly to 6.6 percent by the end of this year, so borrowers who need to refinance should act soon.
“Tighter lending standards will dampen home sales a bit, but by less than a couple of percentage points from initial projections. We still forecast 2007 to be the fourth highest year on record for existing-home sales, and housing remains a great long-term investment,” Lereah said.
Existing-home sales are likely to total 6.34 million in 2007 and 6.52 million next year, in contrast with 6.48 million in 2006. New-home sales are seen at 904,000 this year and 935,000 in 2008, below the 1.05 million last year. Housing starts are estimated at 1.47 million in 2007 and 1.55 million next year, down from 1.80 million units in 2006.
“As home sales moderate, overall home prices will be essentially flat this year,” Lereah said. “The good news is that inventories remain well below the levels experienced during the last housing downturn in the early 1990s, and supplies are close to balance in many areas.”
The national median existing-home price will probably slip 0.7 percent to $220,300 in 2007, following a 1.0 percent rise last year. The median new-home price is projected to increase 0.4 percent to $246,200 this year, after gaining 1.8 percent in 2006. Modest growth is expected next year, with existing-home prices increasing 1.6 percent and new-home prices rising 2.0 percent.
“When you look at housing activity in 2007, especially during the first half of this year, the percentage change in median home price is being distorted as the composition of sales shifts geographically from high-cost markets to moderately priced areas, in contrast with the sales distribution a year earlier,” Lereah said. “Within given markets, most areas can expect minor price gains.”
The unemployment rate should average 4.6 percent in 2007, the same as last year. Inflation, as measured by the Consumer Price Index, is likely to decline to 2.1 percent this year, compared with 3.2 percent in 2006, while growth in the U.S. gross domestic product is forecast at 2.3 percent in 2007, down from 3.3 percent last year. Inflation-adjusted disposable personal income will probably rise 3.1 percent this year, up from a gain of 2.6 percent in 2006.
The other interesting thing that I noticed is that the 2 largest gambling cities Las Vegas and Atlantic City come in 8th and 9th on the list of foreclosures.
4/30/07 Not yet, but the time will be coming soon.
Almost every real estate agent I talk to hates to put a classified advertisement in the newspaper. They only do it because the seller expects the ad to be there and are afraid to tell the seller that it is a waste of money.
But the downturn in home sales is making the real estate agents get smarter. Knowing that listings are moving slower and that newspapers advertising costs lots of money smarter agents are instead going to the web. They are creating custom sites, marketing on websites such as Zillow, and getting exposure where the buyers are. Many agents also create web pages dedicated to property listings such as this property on my website 304 Stirrup.
And the newspaper industry is noticing as their revenue is taking a hit. Once conventional wisdom by sellers changes that newspaper advertising is passe, watch out below.
4/29/07 AUSTIN (Austin American-Statesman) – Marking the third month in a row of stalled or declining sales, March preowned single-family homes sales totaled 2,343, a 1 percent increase over this time last year, according to the Austin Board of Realtors.
Central Texas is seeing the effects of the collapse of the subprime lending market, which typically involves lending to borrowers with dubious credit histories and not requiring down payments. The subprime shakeout is hitting first-time buyers harder and is contributing to slowing sales in lower price ranges — $180,000 and below.
"The lenders are becoming a little bit more leery about the loans they are making and underwriting," said Jim Gaines, a research economist with the Real Estate Center at Texas A&M University.
Builders are also slowing production, said Eldon Rude, director of the Austin office of Metrostudy.
Agents are still seeing multiple offers in the area’s premium locations. Overall, homes sold in about 65 days, which is a 4 percent decrease from the same month a year ago. The median price rose to $177,080, up 6 percent from a year ago.
Condominium and townhome sales were also flat compared with a year ago. However, the median price increased 14 percent from last year to $170,000.
"Austin is still continuing to be a fairly strong market," Gaines said. "But nothing goes up forever. Eventually you will hit a year when it's not better than the year before."
4/26/07 Texas (San Antonio Express-News) – Twelve of the nation's 100 largest private landowners hail from South or Central Texas, according to the debut issue of The Land Report. Leading the state is the King Ranch.
The King Ranch landed at number five on the magazine's national list with more than 850,000 acres. Briscoe Ranch Inc., owned by two-time Texas Governor Dolph Briscoe Jr. of Uvalde, ranked 12th in the nation, while the heirs of Alice Kleberg East ranked 17th.
And there is more good news for Texas. The Dallas-based magazine reported that 40 of the 100 biggest ranch families have most or all their lands in the Lone Star State.
The common denominator among Texas' great spreads is beef, said Kaare Remme, manager of the 45th-ranked McCoy Remme Ranches of West Texas.
"A third of the beef in the nation comes out of Texas," Remme said. "Livestock production is a big deal."
Topping the national list was CNN founder and former Atlanta Braves owner Ted Turner, owner of two million acres dedicated mostly to bison.
The Land Report's complete list is available online.
The first phase will consist of the 200-acre, $125 million Villa Muse Studios, which will include a 50,000-square-foot soundstage, recording studios, a scoring stage and a 70,000-seat amphitheater. The studios are expected to be completed by the end of 2008.
Villa Muse Inc. is partnering with Carpenter & Associates Inc. of Austin, which sold the land and will oversee construction and site work. Project designers are locally based Land Design Studio, Steve Durr Designs in Nashville; Studio Bau:ton in California; and Sam Toyoshima, Acoustics Design Office, a division of JVC Audio Engineering Research Center.
The median price for single-family homes was just over $177,000, a 6 percent increase over last year's price. March homes spent an average of 65 days on the market, a 4 percent decrease from a year ago.
Townhouse and condominium sales collected close to $60 million for the local economy, a 19 percent increase from last year. The median price also rose 14 percent from a year ago to $170,000.
The state constitution caps school property taxes for homeowners 65 years and older and those who are disabled. However, they DID NOT get the same reduction when the property tax cut for schools was voted on two years ago. So an amendment is on the May ballot to correct this error. The problem is that most voters who are younger than 65 or not disabled probably won't even notice the amendment or care. PLEASE get out and vote for this amendment if not for yourself then for your parents, grandparents, aunts, uncles, friends. We would really appreciate your getting the word out to all your friends and families to vote for this amendment.
The fear is that with a low voter turnout, the amendment could very well not pass. So, please, please pass the word and VOTE for the constitutional amendment. Early voting will take place will April 30 - May 5 from 7 am to 7 pm; May 6 from noon to 6 pm and May 7 - May 8 from
7 am to 7 pm. Election day is May 12 from 7 am to 7 pm. So there are plenty of options to stop by a polling place and vote. VOTE!!!
Inventories of unsold homes are trending downward; annual positive price appreciation is up; buyer-seller ratios are more balanced; average time on the market from listing to sale is improving; and more home sellers say they are getting 95-100% of asking prices.
Specifically:
- Inventory of unsold homes - After a steady buildup, 59% of member agents reported that the number of unsold existing homes in their exclusive territories was either down or about the same as a year ago. Latest estimate from the National Association of Realtors (NAR) is a 6.7 month supply, down from October's 7.4 month supply.
- Price Appreciation - Sixty-one percent of member agents report positive annual price appreciation compared to only 53% in the fourth quarter of 2006. Hardest hit region of the country is the Northeast, which reported only 21% positive price appreciation. The Chicago Metro area reported 88% positive price appreciation.
- Buyer-Seller Ratio - Home sellers still outnumber buyers but the ratio is slowly moving toward a more balanced market, which many observers feel was achieved nationally a year ago before moving to a buyer's market.
- Time On the Market - A vast majority of member agents reported that it is still taking more than 60 days, on average, from listing to contract. Currently, 78% of respondents report 60 days or more compared to 84% in the fourth quarter of 2006.
- Ask/Sale Price Ratio - No change nationally over two quarters. It's still 65%. In the South Region, only 52% report that their sellers are getting 95-100% of asking prices. In the Chicago Metro area, only 58% of member agents report their clients are getting 95-100%.
4/14/07 Independence Title has moved to their new offices in Dripping Springs. They won't be hard to find though as they just moved next door into a larger space in Wallace Place. When Mary Blanck moved over from Gracy Title they saw a need to expand and have leased the larger space next door to where they have been located. They are up and running now at the new address:
310 W. US-290, Suite BDripping Springs, TX 78620
I heard an unsubstantiated rumor that one of the Sales people at Belterra has been telling potential buyers that HEB has given up on building at the corner of RR12 and Highway 290. They are now considering a location close to Belterra where they can access the existing sewer in Belterra.
Not sure if that will end up being true but it is interesting.
4/13/2007
Greg Rich of Siepiela Development Corp. resurfaced after disappearing from Dripping Springs after 9/11. He had plans for Caliterra, which is a 600 acre planned development that included a golf course, Luxury Hotel, 400 Single Family homes and 50 smaller garden homes. The city of Dripping Springs has not been consulted about renewing the subdivision plat but Mr. Rich claims that the project will break ground in late 07.
Caliterra is planned to be south on RR12 across from where the Outlook Motel and Catholic Church are located. Look for land prices in that area to skyrocket soon.