Category: Real Estate

Why Staging With Plants Draws More Buyers | Realtor Magazine

Wellness-minded millennials are filling their homes with clean-air houseplants, and real estate developers are realizing that a love for greenery can be used as an amenity to attract buyers. 

Millennials are looking for spaces to add indoor gardens. Real estate developers are jumping on the trend. The ARC in Long Island City, a 428-unit luxury rental building, allows its residents to use a 1,100-square-foot glass greenhouse where they can plant and grow their own vegetables and herbs.

“It’s been a tremendous selling point to prospective tenants,” Scott Avram, senior vice president of development at Lightstone, told The New York Times.

The Margo in Brooklyn features a living wall in the lobby and a rooftop garden with plots that tenants can use as their own gardens.

“Wellness is a priority for our millennial-aged residents,” says Dave Maundrell, executive vice president of new developments for Brooklyn and Queens at Citi Habitats. “They’re willing to pay more for access to a green space.”

Millennials are adding more houseplants inside their homes, too. 

“Millennials were responsible for 31 percent of houseplant sales in 2016,” according to Ian Baldwin, a business adviser for the gardening industry. Of the 6 million Americans who started to garden in 2016, 5 million were ages 18 to 34, according to the 2016 National Gardening survey.

“Houseplants are a low-cost way to have a green space at home,” Baldwin says.

And it’s not just adding one or two houseplants, but they’re adding in hundreds to their home, featuring indoor gardens and divider walls of greenery. 

Summer Rayne Oakes has filled her 1,200-square-foot apartment with nearly 700 houseplants. She has a subirrigated living wall in her bedroom, a vertical garden made out of Mason jars in the living room wall, and a closet transformed into a kitchen grow garden with edible plants, like herbs.

Rebecca Bullene, the founder of Greenery NYC, a botanic design company, has filled her 1,800-square-foot apartment with more than a hundred plants, including a six-foot-by-six-foot steel shelving unit filled with a dozen wooden planter boxes and more than 50 plants alone that separates her living room and her office. She also uses large plants, like an 11-foot-tall ficus audrey tree to help break up an open floor plan.

She’s drawn to the health boost from the plants, not just the look. “Plants boost serotonin levels and dissolve volatile airborne chemicals,” Bullene says. “They actually make healthier spaces for humans to inhabit.”

She also uses a combination of plants in her bedroom that are known to release oxygen and clean the air, including aloe vera and sansevieria.

Homeowners Keep Getting Richer and Richer | Realtor Magazine

Homeowners with mortgages have seen their equity increase 12.2 percent year over year, according to CoreLogic’s newly released Home Equity Report. Homeowners gained more than $15,000 in home equity between the fourth quarter of 2016 and the fourth quarter of 2017—the highest growth in home equity in four years, according to the report. Western states saw the largest increases.

“Home-price growth has been the primary driver of home-equity wealth creation,” says Frank Nothaft, chief economist for CoreLogic. “Because wealth gains spur additional consumer purchases, the rise in home-equity wealth during 2017 should add more than $50 billion to U.S. consumption spending over the next two to three years.”

Meanwhile, the number of borrowers who are in a negative equity territory is decreasing. The total number of mortgaged homes in negative equity—those who owe more on their mortgage than their home is currently worth—dropped to 2.5 million homes, or 4.9 percent of all mortgaged properties in the fourth quarter of 2017. 

“There are wide disparities in home-equity gains by geographic area, with higher-priced, capacity constrained markets along the East and West Coasts registering the largest increases,” says Frank Martell, president and CEO of CoreLogic. “The average homeowner in California and Washington had a wealth gain of about $40,000, reflecting the high price of homes in California and the rapid appreciation in Washington. In contrast, the average owner in Louisiana had little change in their housing wealth during 2017, given much lower prices and modest price growth.”

How to Lower Utility Costs for Any Home | Realtor Magazine

Your clients may be able to decrease utility costs with just a few energy upgrades and tweaks. “There are so many small changes people can make to improve the energy efficiency of their homes, and it all adds up to significantly lower energy bills and a smaller environmental footprint,” says Christina Kielich of the U.S. Department of Energy. Kielich and home energy auditor Erlend Kimmich offered the following tips on Curbed.com about how to cut energy costs in a home, including:

Replace lightbulbs. The typical American household spends 5 to 10 percent of its energy budget on lighting alone, according to the DOE. Replace incandescent lightbulbs with LEDs, which on average are 85 percent more energy-efficient. You can shave $100 a year on your energy costs by making the switch.

Unplug. Leaving cellphones, TVs, computers, and other electronic devices plugged in can continue to pull power from the grid. That can add up over time. Unplug devices or plug your electronics into power strips that you can easily turn off whenever they’re not being used.

Use an automatic thermostat. Save up to 10 percent on your annual heating and cooling costs by just dropping the thermostat 7 to 10 degrees Fahrenheit from its normal setting for eight hours a day. An automatic thermostat, which can be purchased for just $18, can help to more easily adjust the thermostat during the day and cut energy use, too.

Seal your attic and basement. For a more substantial investment, seal and insulate the attic and basement—basically the top and bottom of your home, says Kimmich. “Especially if the house was built before World War II, that’s where you tend to find the most leakage,” Kimmich adds. “Think of your home’s air sealing and insulation like a windbreaker worn over a sweater. If there’s a rip or you leave the windbreaker unbuttoned, it can’t really help. So we fix the sweater by making the insulation more substantial and we improve that air seal anywhere the indoor space is connected to the outdoor space.”

Get more tips from Curbed.com and view the DOE’s instructions for DIY jobs like sealing air leaks with caulk, which could potentially offer energy savings of 10 percent to 20 percent.

Mortgage Rates Post First Decline of 2018 | Realtor Magazine

Following nine consecutive weeks of increases, borrowers finally got some relief this week with mortgage rates. The 30-year fixed-rate mortgage posted its first week-over-week decrease of 2018. 

“Tuesday’s Consumer Price Index report indicated inflation may be cooling down; headline consumer price inflation was 2.2 percent year over year in February,” says Len Kiefer, Freddie Mac’s deputy chief economist. “Following this news, the 10-year Treasury fell slightly. Mortgage rates followed Treasurys and ended a nine-week surge. The U.S. weekly average 30-year fixed mortgage rate fell 2 basis points to 4.44 percent in this week’s survey, its first decline this year.”

Freddie Mac reported the following national averages with mortgage rates for the week ending March 15: 

• 30-year fixed-rate mortgages: averaged 4.44 percent, with an average 0.5 point, dropping from last week’s 4.46 percent average. Last year at this time, 30-year rates averaged 4.30 percent. 
• 15-year fixed-rate mortgages: averaged 3.90 percent, with an average 0.5 point, dropping from last week’s 3.94 percent average. A year ago, 15-year rates averaged 3.50 percent. 
• 5-year hybrid adjustable-rate mortgages: averaged 3.67 percent, with an average 0.4 point, increasing from last week’s 3.63 percent average. A year ago, 5-year ARMs averaged 3.28 percent. 

Source: Freddie Mac

3 Smart Strategies for Investors | Realtor Magazine

Investors can see big returns on real estate, but the most successful tend to have a strong understanding of how to evaluate their options before purchasing. Forbes.com recently highlighted some winning strategies for profitable real estate investing:

1. Focus on potential income, not personal like and dislikes. Purchasing an investment property is different than buying residential real estate. Investments need to center on the numbers—the combination of the purchase price, estimated renovation costs, expected rental income, and market conditions that can support a purchase decision.
2. Don’t buy on future appreciation. You can’t trust that rents and home values in your area will always increase over time. Buy based on current returns, not what you think the future may hold, according to Forbes.com. The best deals are those that can make you money from day one—and where long-term appreciation just happens to be an added bonus.
3. Set aside extra funds. Several smaller ongoing operating expenses will be inevitable. Investors will want to budget for those, as well as possible bigger items, such as a new roof or HVAC unit. These projects can cost thousands or tens of thousands of dollars. Set money aside on a regular basis to cover these expenses as they arise. Also, investors will want to put aside extra money in case there are any vacancies in their rentals.

Most Markets Near Peak; No Signs of Bubble | Realtor Magazine

Home prices in most U.S. housing markets are reaching their peak, but there’s no need to fear a repeat housing bust, according to a new joint analysis by Florida Atlantic University and Florida International University. Throughout the majority of the country, home prices have been rising steadily since 2012, and there are signs the runup may be starting to slow.

“Housing markets are slowing, suggesting that we are nearing a peak in housing markets around the U.S.,” says Ken Johnson, a real estate economist at Florida Atlantic University. “But this is good news, as we are pulling back from the brink, unlike we did in 2007.”

Researchers at the universities created the Beracha, Hardin & Johnson Buy vs. Rent Index, which shows that out of 23 metros areas studied, 13 are slightly to moderately in “buy” territory. That means owning a home is more favorable than renting for the majority of residents in that area. On the other hand, 10 metro areas were slightly to moderately in “rent” territory.

“Our data indicates that prices are above their 40-year trend but not significantly so, as they were in 2007,” says Eli Beracha, co-creator of the index and associate professor in the Hollo School of Real Estate at FIU. “Rather than a crash, I anticipate slower growth in prices accompanied by longer marketing times for sellers and increasing inventories, which should bring prices back in conjunction with their 40-year trend.”

Household Net Worth Reaches Record High | Realtor Magazine

Americans are feeling richer. Household net worth neared $100 trillion in the final quarter of last year, falling into record territory, according to new data released by the Federal Reserve on Thursday. Rising stock markets and property prices were attributed to the jolt in the fourth quarter. (Household net worth is the value of all of a consumer’s assets, like stocks and real estate, minus any liabilities like mortgage and credit card debt.)

Household net worth increased more than $2 trillion last quarter to a record $98.7 trillion in the final three months of last year, according to the report. Households in the U.S. saw their net worth increase to nearly seven times their disposable personal income in 2017.

The impact real estate has had on that increase can’t be understated, economists say. The value of households’ real estate rose $511.2 billion, which reflects recent run-ups in home prices.

But the rate at which consumers are saving is concerning, JPMorgan Chase Economist Michael Feroli told The Wall Street Journal. The saving rate was 3.74 percent in 2017, down from 7.19 percent in 2015.

Report: Average salary needed to buy home in San Jose is over

 

 

SAN FRANCISCO (KRON) – A new report shows that San Jose and San Francisco have the most expensive homes in the country.

According to the report, the average salary needed to buy a home in San Jose is more than $235,000 a year.
 
The average home price is more than $1.2 million.
 
Things are a little bit better in San Francisco.
 
The average salary needed to by a house there is just over $170,000 a year.
 
And the average home price is just over $900,000.
 
In fact, the most expensive cities to buy a house are all in California.

Mortgage Rates Tick Up for 9th Straight Week | Realtor Magazine

 

Borrowers were once again faced with rising mortgage rates this week. The 30-year fixed-rate mortgage continues to be at its highest average in four years.

“The 10-year Treasury yield has been bouncing around in a narrow 15 basis point range for the last month,” explains Len Kiefer, Freddie Mac’s chief economist. “While the yield on the 10-year Treasury is currently below the high of 2.95 percent reached two weeks ago, mortgage rates are up for the ninth consecutive week. The U.S. weekly average 30-year fixed mortgage rate rose 3 basis points to 4.46 percent in this week’s survey, its highest level since January 2014.”

Lawrence Yun commented this morning on the likely impact of the surprising job numbers on mortgages.

“The strong job growth assures at least three interest rate hikes by the Federal Reserve in 2018. Because of the low unemployment rate, further normalization in monetary policy should be expected in 2019 as well, meaning another three or four rate hikes next year. Mortgage rates will therefore rise and rise—that in itself hurts housing affordability,” Yun said. “But factors that can help with affordability are more income to households (possibly a second income earner getting a job) and if home prices can finally moderate. For slower home price growth, more home construction is needed. Job openings in the construction industry remain at historic highs. It is now a matter of providing necessary skills to go into the industry.”

Freddie Mac reports the following national averages with mortgage rates for the week ending March 8:

• 30-year fixed-rate mortgages: averaged 4.46 percent, with an average 0.5 point, increasing from last week’s 4.43 percent average. Last year at this time, 30-year rates averaged 4.21 percent.
• 15-year fixed-rate mortgages: averaged 3.94 percent, with an average 0.5 point, increasing from last week’s 3.90 percent average. A year ago, 15-year rates averaged 3.42 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 3.63 percent, with an average 0.4 point, rising from last week’s 3.62 percent average. A year ago, 5-year ARMs averaged 3.23 percent.

The Necessary Income For Buying in 15 Cities | Realtor Magazine

As home prices rise, more buyers are finding they need to earn more to break into some housing markets. SmartAsset, a personal finance resource, recently analyzed the salary residents need to buy a median-priced home in 15 of the nation’s largest cities.

In some cities, buyers may need to bring more than just savings from a paycheck. For example, in three big cities—San Francisco, San Jose, Calif., and New York—buyers need to make more than $110,000 to afford a home (including the mortgage, property taxes, and homeowners insurance), which is nearly double the nation’s median household income of $57,617.

However, owning a home is much more affordable in other cities. Researchers found that in 10 of the 15 cities analyzed, the median household income was sufficient enough to afford the median-priced home. For example, in Indianapolis, after making a 20 percent down payment on a median-priced home, residents only need an annual income of $21,955 to afford their monthly home payments.