July 4th Fun and Safety Tips

Fireworks safety. If you’re planning a home display, first check with local authorities to make sure it’s legal in your area, and then review the U.S. Consumer Product Safety Commission’s fireworks safety tips. Be sure to share them with your family.

Healthy patriotic snacking. Make an American flag fruit tray using strawberries, bananas and blueberries. Slice the strawberries and bananas, and arrange them in a cake pan or other high-sided pan in alternating red and white “stripes.” Leave an open square in the upper-left corner and fill it with blueberries. It’s easy, colorful and delicious.

Safe outdoor cooking. Proper food handling at holiday parties is especially important with the summer sun pushing food into bacterial temperature “danger zone.” Remember to keep all perishables below 41 degrees and check out more helpful tips for safe barbecuing from the USDA.

Don’t forget the pets! From fireworks to citronella candles, July 4th celebrations can hold hidden dangers for your pets. Keep them inside and keep them out of trouble. The ASPCA offers more 4th of July pet safety tips.

– Adapted from AHS Home Matters Inside & Out June 2014 Newsletter

August Existing-Home Sales and Prices Rise

WASHINGTON (September 19, 2012) – Existing-home sales continued to improve in August and the national median price rose on a year-over-year basis for the sixth straight month, according to the National Association of Realtors®.

Total existing-home sales 1 , which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 7.8 percent to a seasonally adjusted annual rate of 4.82 million in August from 4.47 million in July, and are 9.3 percent higher than the 4.41 million-unit level in August 2011.

Lawrence Yun , NAR chief economist, said favorable buying conditions get the credit. “The housing market is steadily recovering with consistent increases in both home sales and median prices. More buyers are taking advantage of excellent housing affordability conditions,” he said. “Inventories in many parts of the country are broadly balanced, favoring neither sellers nor buyers. However, the West and Florida markets are experiencing inventory shortages, which are placing pressure on prices.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 3.60 percent in August from a record low 3.55 percent in July; the rate was 4.27 percent in August 2011.

“The strengthening housing market is occurring even with difficult mortgage qualifying conditions, which is testament to the sizable stored-up housing demand that accumulated in the past five years,” Yun added.

The national median existing-home price2 for all housing types was $187,400 in August, up 9.5 percent from a year ago. The last time there were six back-to-back monthly price increases from a year earlier was from December 2005 to May 2006. The August increase was the strongest since January 2006 when the median price rose 10.2 percent from a year earlier.

Distressed homes3 – foreclosures and short sales sold at deep discounts – accounted for 22 percent of August sales (12 percent were foreclosures and 10 percent were short sales), down from 24 percent in July and 31 percent in August 2011. Foreclosures sold for an average discount of 19 percent below market value in August, while short sales were discounted 13 percent.

Total housing inventory at the end August rose 2.9 percent to 2.47 million existing homes available for sale, which represents a 6.1-month supply 4 at the current sales pace, down from a 6.4-month supply in July. Listed inventory is 18.2 percent below a year ago when there was an 8.2-month supply.

The median time on market was 70 days in August, consistent with 69 days in July but down 23.9 percent from 92 days in August 2011. Thirty-two percent of homes sold in August were on the market for less than a month, while 19 percent were on the market for six months or longer.

NAR President Moe Veissi , broker-owner of Veissi & Associates Inc., in Miami, said some buyers are involuntarily sidelined. “Total sales this year will be 8 to 10 percent above 2011, but some buyers are frustrated with mortgage availability. If most of the financially qualified buyers could obtain financing, home sales would be about 10 to 15 percent stronger, and the related economic activity would create several hundred thousand jobs over the period of a year.”

First-time buyers accounted for 31 percent of purchasers in August, down from 34 percent in July; they were 32 percent in August 2011.

All-cash sales were unchanged at 27 percent of transactions in August; they were 29 percent in August 2011. Investors, who account for most cash sales, purchased 18 percent of homes in August, up from 16 percent in July; they were 22 percent in August 2011.

Single-family home sales rose 8.0 percent to a seasonally adjusted annual rate of 4.30 million in August from 3.98 million in July, and are 10.0 percent above the 3.91 million-unit pace in August 2011. The median existing single-family home price was $188,700 in August, up 10.2 percent from a year ago.

Existing condominium and co-op sales increased 6.1 percent to a seasonally adjusted annual rate of 520,000 in August from 490,000 in July, and are 4.0 percent above the 500,000-unit level a year ago. The median existing condo price was $176,700 in August, which is 3.3 percent higher than August 2011.

Regionally, existing-home sales in the Northeast rose 8.6 percent to an annual pace of 630,000 in August and are also 8.6 percent above August 2011. The median price in the Northeast was $245,200, up 0.6 percent from a year ago.

Existing-home sales in the Midwest increased 7.7 percent in August to a level of 1.12 million and are 17.9 percent higher than a year ago. The median price in the Midwest was $152,400, up 7.8 percent from August 2011.

In the South, existing-home sales rose 7.3 percent to an annual pace of 1.90 million in August and are 11.1 percent above August 2011. The median price in the region was $160,100, up 6.5 percent from a year ago.

Existing-home sales in the West increased 8.3 percent to an annual level of 1.17 million in August but are unchanged from a year ago. With ongoing inventory shortages, the median price in the West was $242,000, which is 16.3 percent higher than August 2011.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

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In the News

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 7 rose 11.1%. Refinancing applications increased 12%. Purchase volume rose 8%.

The trade deficit increased to $42 billion in July from a revised $41.9 billion in June. Exports fell $1.9 billion or 1% to $183.3 billion. Imports fell $1.8 billion or 0.8% to $225.3 billion.

Wholesalers increased their inventories 0.7% to $485.2 billion in July. Sales at the wholesale level fell 0.1% to $402.4 billion in July. On a year-over-year basis, sales were 2.7% higher since July 2011.

The producer price index, which tracks wholesale price inflation, rose 1.7% in August, following a 0.3% increase in July. Compared to August 2011, wholesale prices have risen 2%. Core prices — excluding food and fuel — rose 0.2% in August.

Retail sales rose 0.9% to $406.7 billion in August. This follows a revised 0.6% increase in July. Compared to August 2011, retail sales have increased 4.7%.

Consumer prices rose 0.6% in August, following a flat reading in July. Compared to August 2011, consumer prices have risen 1.7%. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in August.

Industrial production at the nation’s factories, mines and utilities fell 1.2% in August after a 0.5% rise in July. Compared to August 2011, industrial production has increased 2.8%. Capacity utilization eased to 78.2% in August from 79.2% in July.

Initial claims for unemployment benefits for the week ending September 8 rose by 15,000 to 382,000. Continuing claims for the week ending September 1 fell by 49,000 to 3.282 million.

from Prospect Mortgage Economic Update

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In the News

Motor vehicle sales rose 2.8% in August to an annualized sales rate of 14.5 million cars and light trucks. It was the fastest pace since August 2009. Compared to August 2011, motor vehicle sales have increased 20%.

Manufacturing activity fell to 49.6 in August after a reading of 49.8 in July. A reading below 50 signals contraction. This was the third consecutive contraction since July 2009.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 31 fell 2.5%. Refinancing applications decreased 3%. Purchase volume fell 0.8%.

Total construction spending fell 0.9% to $834.4 billion in July, following a 0.4% increase in June. Compared to June 2011, construction spending has risen 9.3%.

The Labor Department reported that in the second quarter, productivity rose at an annual rate of 2.2% and labor costs increased at an annual rate of 1.5%.

Retail sales fell 0.4% for the week ending September 1, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.7%.

Non-manufacturing activity rose to 53.7 in August from 52.6 in July. A reading above 50 signals expansion. It was the 32nd straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending September 1 fell by 12,000 to 365,000. Continuing claims for the week ending August 25 fell by 6,000 to 3.322 million. The unemployment rate fell to 8.1% in August from 8.3% in July. Employers added 96,000 jobs in August.

from Prospect Mortgage Economic Update

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In the News

Pending home sales, a forward-looking indicator based on signed contracts, rose 2.4% in July after a 1.4% decrease in June. On a year-over-year basis, pending home sales are up 12.4% compared with July 2011.

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 2.3% in June, following a 2.2% increase in May. On a year-over-year basis, prices rose 0.5% compared with June 2011.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 24 fell 4.3%. Refinancing applications decreased 6%. Purchase volume rose 1%.

The consumer confidence index fell to 60.6 in August from a revised 65.4 in July. The index was benchmarked at 100 in 1985, a year chosen because it was neither a peak nor a trough in consumer confidence.

The Commerce Department announced that gross domestic product — the total output of goods and services produced in the U.S. — increased at a revised annual rate of 1.7% in the second quarter of 2012, compared to the initial estimate of 1.5%. This follows a 2% pace of growth in the first quarter of 2012.

Retail sales rose 0.5% for the week ending August 25, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.4%.

Factory orders rose 2.8% in July to a seasonally adjusted $478.6 billion, following a 0.5% decrease in June. Excluding the volatile transportation sector, orders increased 0.7% in July.

Initial claims for unemployment benefits for the week ending August 25 were unchanged at 374,000. Continuing claims for the week ending August 18 fell by 5,000 to 3.316 million.

from Prospect Mortgage Economic Update

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Last Week in the News

Retail sales fell 1.5% for the week ending August 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.1%.

Existing home sales rose 2.3% in July to a seasonally adjusted annual rate of 4.47 million units from 4.37 million units in June. Compared to a year ago, existing home sales were up 10.4% in July. The inventory of unsold homes on the market increased 1.3% to 2.4 million in July, a 6.4-month supply at the current sales pace, down from a 6.5-month supply in June.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 17 fell 7.4%. Refinancing applications decreased 9%. Purchase volume rose 0.9%.

New home sales rose 3.6% in July to a seasonally adjusted annual rate of 372,000 units from an upwardly revised rate of 359,000 units in June. The initial June reading was 350,000. On a year-over-year basis, new home sales are up 25.3% compared with July 2011. At the current sales pace, there’s a 4.6-month supply of new homes on the market.

Orders for durable goods — items expected to last three or more years — rose $9.4 billion or 4.2% to $230.7 billion in July. This increase follows a 1.6% increase in June. Excluding volatile transportation-related goods, July orders posted a monthly decrease of 0.4%.

Initial claims for unemployment benefits for the week ending August 18 rose by 4,000 to 372,000 from an upwardly revised 368,000 the prior week. Continuing claims for the week ending August 11 also rose by 4,000 to 3.317 million.

from Prospect Mortgage Economic Update

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Last Week in the News

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 2.2% in May, following a 1.3% increase in April. On a year-over-year basis, prices fell 0.7% compared with May 2011.

The Bureau of Economic Analysis reported that personal income increased $61.8 billion or 0.5% in June. Consumer spending was flat in June, following a 0.1% decrease in May.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending July 27 rose 0.2%. Refinancing applications increased 0.8%. Purchase volume fell 2%.

Manufacturing activity rose to 49.8 in July after a reading of 49.7 in June. A reading below 50 signals contraction. This was the second consecutive contraction since July 2009.

Total construction spending rose 0.4% to $842.1 billion in June from an upwardly revised 1.6% increase in May. Compared to June 2011, construction spending is up 7%.

Factory orders fell 0.5% in June to a seasonally adjusted $465.8 billion, following a revised 0.5% increase in May. Excluding the volatile transportation sector, orders decreased 1.8% in June.

Non-manufacturing activity rose to 52.6 in July from 52.1 in June. A reading above 50 signals expansion. It was the 31st straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending July 28 rose by 8,000 to 365,000 from an upwardly revised 357,000 the prior week. Continuing claims for the week ending July 21 fell 19,000 to 3.272 million. The unemployment rate rose to 8.3% in July from 8.2% in June. Employers added 163,000 jobs in July.

from Prospect Mortgage Economic Update

 

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Last Week in the News

New home sales fell 2.3% in August to a seasonally adjusted annual rate of 295,000 units from a revised rate of 302,000 units in July. Compared to a year ago, new home sales were up 6.1%.

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 0.9% in July after a 1.2% increase in June. On a year-over-year basis, prices fell 4.1% compared with July 2010.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 23 rose 9.3%. Refinancing applications increased 11.2%. Purchase volume rose 2.6%.

Pending home sales, a forward-looking indicator based on signed contracts, fell 1.2% in August after a 1.3% increase in July. On a year-over-year basis, pending sales are up 13.1%.

Initial claims for unemployment benefits unexpectedly fell by 37,000 to 391,000 for the week ending September 24. Continuing claims for the week ending September 17 fell by 20,000 to 3.7 million.

from Prospect Mortgage Economic Update

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3 reasons the real estate crisis will worsen

Foreclosures are old news. Down real estate values? Been there, done that, right? Well, we might all have gotten tired of hearing bad news about the real estate market, but the facts show that in many areas, foreclosure rates will rise before they decline, and a number of other indicators point to things getting worse before they get better.

Reality check: A down market is not all bad news. Weak home values translate into opportunity for buyers — especially when the government keeps rates as low as they presently are to encourage homebuying. Many of the mortgages being foreclosed were toxic and could stand to be purged.

Today’s low prices and record-low interest rates also portend well for the future stability of the housing market in that new homeowners are much less likely to face the problems this last generation of homeowners did (i.e., spiking mortgage payments and plummeting home values).

In any event, the real estate market is likely to stay down or continue to decline, in terms of home values and sales activity, and increased foreclosures, before it improves, for the following reasons:

1. The massive foreclosure backlog. The New York Times recently reported that it would take lenders 62 years — years! — to repossess the 213,000 New York state homes currently in some stage of foreclosures. New Jersey homes? Forty-nine years. Illinois and Massachusetts? A decade.

While the foreclosure pipeline moves more quickly in states where homes can be foreclosed without a court’s involvement, like California (three years), Nevada and Colorado (two years each), the fact remains that there is a massive backlog of homes in mortgage default that will take years to work through.

And the trend is for these foreclosures to take more, not less, time than before — after the robo-signing scandal and related self-imposed freezes, courts and law enforcement have imposed more verification requirements, settlement conferences and more detailed audits of foreclosure files before they will allow repossession to take place.

Despite the fact that the rate of new foreclosure filings has slowed (some say this has more to do with banks being slower to file than any real change in the default rate of homeowners), the rate of foreclosures will increase and/or stay elevated for years to come.

2. Too-tight lending guidelines. How tight is too tight? Lending guidelines are too tight when they screen out creditworthy borrowers, which many industry insiders say today’s loan standards do.

Sixteen percent of Realtors reported a contract failure in July, which usually indicates that a borrower who was probably preapproved (i.e., had a good job and credit history) had her loan declined because she failed to pass tough underwriting standards, the property didn’t pass the lenders’ muster, or there was an appraisal problem.

Ron Phipps, president of the National Association of Realtors, described this number as “unacceptably high,” explaining that with “both mortgage credit and home appraisals, there’s been a parallel pendulum swing from very loose standards, which led to the housing boom, to unnecessarily restrictive practices as an overreaction to the housing correction.”

Loans originated in 2009 have a default rate right around 1 percent, compared with the 22-27 percent default rate on 2007 loans and the 3 percent default rate on 2003 vintage loans.

These numbers, taken along with the contract-failure numbers, suggest that today’s lending guidelines are a knee-jerk overcorrection that is prohibiting many worthy would-be buyers from becoming owners and limiting the much-needed absorption of the excess inventory of homes on the market.

3. Job market woes and transitions. The national unemployment rate of 9.1 percent is just barely better than the average 2010 rate of 9.6 percent — and job growth totally flat-lined from July to August of this year, the latest available figures.

And those numbers are, many feel, misleadingly optimistic, as many long-term unemployed have stopped being counted, and are underemployed in part-time jobs or working freelance gigs because they have no other option.

Clearly, none of these people will be buying homes anytime soon (most thriving freelancers will need to file two years of tax returns as self-employed before they can qualify to buy); and even some employed would-be buyers are hesitant to enter the market as long as jobs are scarce because they view their own positions as insecure. Job market health is a prerequisite to housing market health.

By Tara-Nicholle Nelson, Monday, September 19, 2011.   Inman News™

Tara-Nicholle Nelson is author of “The Savvy Woman’s Homebuying Handbook” and “Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions.” Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com

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