It’s Tuesday News Day and these are this weeks hot topics concerning the real estate market, the financial market, general market conditions, and interest rates.HousingWire – One in Three adult Americans has no emergency savings
The housing industry will likely be impacted by the results of a new survey from NeighborWorks America due to findings about the finances of Americans, which serve as a stark reminder of affordability challenges. The survey found that almost 70 million working age Americans – about one-third – have no emergency savings. This highlights a primary problem facing potential homebuyers, as one in three homes are deemed unaffordable to the average buyer, and mortgage originations are reportedly at a 14-year low.
- Only 25 percent of American have enough saved to cover 30 days of living expenses.
- About one in five have enough savings to cover three months – about the average time of unemployment for many Americans – while 28 percent expect their emergency funds to cover a year.
- Approximately 29 percent of adult Americans have no emergency savings in place—whether to pay for the repair of a car that’s required to get to work, or fix a major household necessity such as a roof or furnace.
- Retirement and buying a home are the top savings goals at 28 percent and 13 percent, respectively.
- Just 5 percent of consumers say that they are currently saving to create a buffer in case of a financial emergency.
- About 43 percent of blacks and 39 percent of Hispanic adults said that they had no emergency savings. Also, 52 percent of people earning less than $40,000 said that they had no reserve.
In other news…
The Atlantic – The Search for Affordable Housing Is Pushing Middle Class to Exurbs
The median family needs to devote up to nearly 40 percent of its income on mortgage payments for a median home in metros like San Jose (36 percent); San Francisco (39 percent); and Los Angeles (40 percent). The locations of homes that are within reach for the median family vary substantially, which indicates the uneven nature of housing prices across several major U.S. cities and metros.
MarketWatch – What a mortgage calculator won’t tell you
Resources like mortgage calculators can help you figure out the price range of homes you may be able to afford and estimate your monthly mortgage payment. However, the math alone won’t always tell you if you’re ready to buy a home, since other big factors are credit standing, job security, family plans, and other financial goals.
CNBC – 3 reasons cheap mortgages won’t help first-timers
Mortgage rates hit a record low about a year ago, but they are still pretty cheap, making now a good time to get into the market, according to Anika Khan, Wells Fargo Securities senior economist. However, these cheap mortgages are still out of reach to many first-time home buyers due to tight lending requirements, low inventory, and high prices pushed up by investors.
Today – Rent a home or buy? Depends where you live
As the housing market stages an uneven recovery, whether it is cheaper to rent or buy a place depends on where you live. In addition, just because it’s cheaper to buy in some markets doesn’t mean potential homeowners will be able to qualify for a loan—especially if they’re one of the 7 million former homeowners who lost their property to a foreclosure or short sale.
Eye on Housing – Residential Construction Employment Up 9,100 in March
According to data from the Bureau of Labor Statistics, there was solid job growth for home builders and remodelers in March. The residential construction industry added 9,100 jobs for the month, bringing total industry employment to 2.2 million.
San Jose Mercury News – Lack of sellers, preponderance of buyers pushing housing prices
Real estate experts observe that the U.S. housing market currently has too few people selling homes and at the same time too few buyers can afford the homes that are for sale. In addition, higher mortgage rates and higher prices have made homes costlier for first-time buyers as well as for all-cash investors.
Wall Street Journal – The Key to a Home Sale?
Some metros saw a 20 percent increase in turnkey listings over the past year, with these listings being described as “move-in condition.” Turnkey properties are reportedly more popular on the West Coast, and for luxury residences often include furnishings and art.
- International home buyers prefer purchasing properties in the United States over other countries, according to the “2013 International Clients Survey” from the CALIFORNIA ASSOCIATION OF REALTORS®. Los Angeles County was the top location in California where international buyers purchased properties (35 percent).
- International buyers cited the following factors in their decision to purchase in the U.S.: Desirable location and climate (20 percent), to be closer to family and friends (20 percent), investment opportunities (9 percent), changes in work and employment (9 percent), educational opportunities (6 percent), and affordable prices (4 percent).
- Sixty-nine percent of international buyers paid all cash for their properties, compared to 27 percent of traditional buyers who paid all cash.
If you have any questions about the current real estate market give me a call at (408) 840-3852 or shoot me an email at Thomas.Feng@gmail.com to discuss your situation and how to get the most out of the current real estate housing market.
Because of the many legal and tax situations that can arise through the sale and purchase of real estateALWAYS consult with your ATTORNEY or ACCOUNTANT before making ANY decisions in ANY transaction
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* THIS ARTICLE WAS POSTED AT Thomas Feng’s Bay Area Connect *