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By Jesse McGreevy 239-898-5329 | Agent in 33928
  • New-Home Construction Ramps Up in Midwest, Northeast

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Property Q&A in Bonita Springs  |  April 17, 2014 1:58 PM  |  11 views  |  No comments

    Groundbreaking on new single-family homes posted a 6 percent rise in March, showing a gradual strengthening in the sector — particularly in the Northeast and Midwest — according to new figures by the Commerce Department.  

    On the other hand, the volatile multifamily market saw starts fall 6.1 percent in March. Overall, housing production, which reflects both multifamily and single-family starts, rose 2.8 percent month-over-month. Starts were down 5.9 percent compared to March 2013, the largest year-over-year decline since April 2011.

    Still, "we see improving signs of new-home construction as we move into the spring buying season," says Kevin Kelly, chairman of the National Association of Home Builders. "The strongest recovery is in the Northeast and Midwest, where builders were hampered by severe winter weather earlier in the year."

    Single-family and multifamily housing starts rose the strongest in the Northeast and Midwest with gains of 30.7 percent and 65.5 percent, respectively. Starts fell in the South by 9.1 percent and by 4.5 percent in the West.

    Builders remain cautious about demand, facing continued tight credit conditions for home buyers and erratic job growth, says NAHB Chief Economist David Crowe.

    Construction permits, a gauge of future construction, dropped 2.4 percent to 990,000 units in March. Permits rose 33.3 percent in the Northeast and 26 percent in the Midwest, while declining 17.1 percent in the South and remaining unchanged in the West.

    Source: National Association of Home Builders and “U.S. Industry Shows Some Vigor, But Housing Still Soft,” Reuters (April 16, 2014)

  • Mortgage Delinquencies Creep Up Again

    Posted Under: Market Conditions in Bonita Springs, Foreclosure in Bonita Springs, Credit Score in Bonita Springs  |  April 15, 2014 12:59 PM  |  20 views  |  No comments

    Reports are surfacing again of more home owners falling behind on their mortgage payments, a reversal from the dropping numbers seen over the last several quarters. Delinquency rates are also on the rise for credit card and auto loan borrowers, according to the Experian-Oliver Wyman Market Intelligence Reports.

    More mortgages were 30 to 59 days past due in the fourth quarter of 2013, rising to 2.13 percent from 2.05 percent at the end of 2012, according to the report.

    A new survey by FICO reports that nearly half of bank-risk professionals expect delinquency rates on all consumer loans to reach their highest levels this year since late 2011.

    "We've seen concerns about delinquencies creeping up for a few quarters," says Andrew Jennings, FICO's chief analytics officer. "These numbers mean more people are gaining access to credit, but we need to keep a close eye on the risk levels of these new loans. If delinquencies reach an uncomfortable level, we may see lenders pull back again."

    Source: “Missed Mortgage Payments Are Back on the Rise,” Credit.com (April 14, 2014)

  • Detroit Auctions Vacant Homes for $1K Apiece

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Foreclosure in Bonita Springs  |  April 15, 2014 12:58 PM  |  19 views  |  No comments

    The city of Detroit launched a website this week to auction off vacant homes seized in tax foreclosures. There are 15 homes up for grabs right now, and one will be auctioned off each day starting May 5. The starting bid for each home is $1,000, and the city is requiring any winning bidder to rehabilitate the home within 30 days of possession and have it occupied within six months, CNNMoney reports.

    BuildingDetroit.org is the latest move by Detroit officials in trying to fight the city’s blight stemming from the housing crisis. And they're serious: If winning bidders are unable to meet the terms of the auction, they stand to lose the house and their money.

    "We are moving aggressively to take these abandoned homes and get families living in them again," says Detroit Mayor Mike Duggan. "Knowing that other people are going to be buying and fixing up the other vacant homes at the same time will make it a lot easier for them to make that commitment."

    The city owns 16,000 vacant homes from tax lien foreclosures. These are homes that were seized after owners did not pay their property taxes or other municipal fees.

    Source: “Detroit to Auction Vacant Homes Online. Starting Bid: $1,000,” CNNMoney (April 14, 2014)

  • Mortgage Applications for Purchases on the Upswing

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Financing in Bonita Springs  |  April 10, 2014 9:23 AM  |  64 views  |  No comments

    While overall applications for home mortgages continue to fall, applications for home purchases, viewed as a leading gauge of future home sales, are on the rise, the Mortgage Bankers Association reports.

    Applications for home purchases rose 2.7 percent for the week ending April 4, the MBA reported Wednesday. On the other hand, a slip in refinancing activity caused the MBA’s overall mortgage application index, which reflects both purchases and refinance applications, to dip 1.6 percent for the week. Refinancing applications tumbled 4.9 percent last week.

    Overall application volume has fallen seven of the past eight weeks, mostly attributed to the fall in refinancing applications from a rise in mortgage rates earlier this year.

    Last week, however, mortgage rates mostly held steady. The 30-year fixed-rate mortgage was unchanged at a 4.56 percent average, the MBA reports.

    Source: “Mortgage Applications Fell Last Week as Refinance Down: MBA,” Reuters (April 9, 2014) and “U.S. Mortgage Application Volume Fell 1.6% Last Week, MBA Says,” The Wall Street Journal (April 9, 2014)

  • ZipRealty Ranks Most Affordable Housing Markets for 2014

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Home Selling in Bonita Springs  |  April 10, 2014 9:23 AM  |  65 views  |  No comments

    The Chicago metro area tops the list of the most affordable major markets this year, according to ZipRealty’s newly released list of the 10 most affordable housing markets in 2014. To create the list, the real estate brokerage analyzed median home sales price data from 30 major metro areas as well as family income data from the Department of Housing & Urban Development.

    “In the most affordable areas of the nation, homes are available for just over twice the annual average household income,” says ZipRealty CEO Lanny Baker. “While the cost of a home is still a very significant expenditure for families everywhere, it’s interesting to see these regional differences in affordability. The cities at the top of our list are far more affordable than other places, particularly the large California metros.”

    The following metros emerged at the top of its list for most affordable this year:

    1. Chicago
    Median home sales price (as of February 2014): $160,000
    2014 estimated family income: $72,400

    2. Philadelphia
    Median home sales price: $190,000
    2014 estimated family income: $78,800

    3. Orlando, Fla.
    Median home sales price: $140,000
    2014 estimated family income: $54,800

    4. Richmond, Va.
    Median home sales price: $187,750
    2014 estimated family income: $72,900

    5. Dallas
    Median home sales price: $180,000
    2014 estimated family income: $67,900

    6. Raleigh, N.C.
    Median home sales price: $203,000
    2014 estimated family income: $75,800

    7. Baltimore
    Median home sales price: $229,000
    2014 estimated family income: $83,500

    8. Houston
    Median home sales price: $185,000
    2014 estimated family income: $66,000

    9. Tucson, Ariz.
    Median home sales price: $157,000
    2014 estimated family income: $56,300

    10. Nashville, Tenn.
    Median home sales price: $187,000
    2014 estimated family income: $64,000

    Source: ZipRealty

  • Many Closings Temporarily Stalled After Ellie Mae Outage

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Financing in Bonita Springs  |  April 3, 2014 7:27 AM  |  94 views  |  No comments

    Ellie Mae, a mortgage technology developer, faced a series of outages and service disruptions that delayed loan closings on Monday and Tuesday. The outages were believed to be caused by a malicious attack on its software programs. But Ellie Mae assured its customers in a statement that no data breach had occurred and no client personal data had been compromised.

    Delays in many loan closings were caused by outages of Ellie Mae’s Encompass loan origination system, which Ellie in the past has estimated to handle more than 20 percent of all mortgage transactions nationwide.

    “Ellie Mae is experiencing an issue with Encompass that is affecting a number of our clients,” Jonathan Corr, Ellie Mae president and COO, confirmed in an e-mail to lenders. “This is resulting in delays in processing loans, or in some cases, the inability for some of our clients to close loans.”

    In some cases, lenders were forced to pay for rate lock extensions and hedge losses due to not being able to close on loans. Also, home closings funded by purchase mortgages also have been delayed, the National Mortgage News reports. Many loans at all stages of the underwriting process — from obtaining client credit reports to even generating closing documents — were also affected since they use technology through the Ellie Mae network.

    “We recognize the critical role our services play in enabling our clients to serve their customers and deeply regret the inconvenience and delays they are experiencing,” says Sig Anderman, founder and chief executive officer of Ellie Mae. “The performance and security of our platform is our number one priority. We are doing everything within our power to restore full operations as soon as possible.”

    Source: “Denial-of-Service Attack Likely Culprit in Ellie Mae Outage,” National Mortgage News (April 1, 2014); “Massive Software Outage Brings Some Mortgage Operations to a Standstill,” Mortgage News Daily (April 1, 2014); and Ellie Mae


  • Vacation Home Sales Surge in 2013; Investment Property Declines

    Posted Under: Market Conditions in Bonita Springs, Home Buying in Bonita Springs, Investment Properties in Bonita Springs  |  April 3, 2014 7:26 AM  |  90 views  |  No comments
    Vacation home sales rose strongly in 2013, while investment purchases fell below the elevated levels seen in the previous two years, according to the National Association of REALTORS®.
    NAR’s 2014 Investment and Vacation Home Buyers Survey, covering existing- and new-home transactions in 2013, shows vacation-home sales jumped 29.7 percent to an estimated 717,000 last year from 553,000 in 2012. Investment-home sales fell 8.5 percent to an estimated 1.1 million in 2013 from 1.21 million in 2012. Owner-occupied purchases rose 13.1 percent to 3.7 million last year from 3.27 million in 2012. The sales estimates are based on responses from households and exclude institutional investment activity.
    NAR Chief Economist Lawrence Yun expected an improvement in the vacation home market. “Growth in the equity markets has greatly benefited high-net-worth households, thereby providing the wherewithal and confidence to purchase recreational property,” he said. “However, vacation-home sales are still about one-third below the peak activity seen in 2006.”
    Vacation-home sales accounted for 13 percent of all transactions last year, their highest market share since 2006, while the portion of investment sales fell to 20 percent in 2013 from 24 percent in 2012.
    Yun said the pullback in investment activity is understandable. “Investment buyers slowed their purchasing in 2013 because prices were rising quickly along with a declining availability of discounted foreclosures over the course of the year,” he said.
    “In 2011 and 2012, investment property was a no-brainer because home prices had sharply overcorrected during the downturn in many areas, creating great bargains that could be quickly turned into profitable rentals. With a return to more normal market conditions, investors now have to evaluate their purchases more carefully and do their homework,” Yun added.
    The median investment-home price was $130,000 in 2013, up 13 percent from $115,000 in 2012, while the median vacation-home price was $168,700, up 12.5 percent from $150,000 in 2012.
    All-cash purchases remained fairly common in the investment- and vacation-home market: 46 percent of investment buyers paid cash in 2013, as did 38 percent of vacation-home buyers.
    Of buyers who financed their purchase with a mortgage, large downpayments continued to be the norm in 2013. The median down payment for investment buyers was 26 percent, while vacation-home buyers typically put 30 percent down.
    Forty-seven percent of investment homes purchased in 2013 were distressed homes, as were 42 percent of vacation homes.
    Lifestyle factors remain the primary motivation for vacation-home buyers, while rental income is the main factor in investment purchases.
    The typical vacation-home buyer was 43 years old, had a median household income of $85,600, and purchased a property that was a median distance of 180 miles from his or her primary residence; 46 percent of vacation homes were within 100 miles and 34 percent were more than 500 miles. Buyers plan to own their recreational property for a median of 6 years, down from 10 years in 2012.
    Five percent of vacation-home buyers had already resold their property, while another 9 percent plan to sell within a year. “This reflects the 28 percent of recreational property buyers who said they purchased to diversify investments or saw a good investment opportunity,” Yun said.
    Buyers listed many reasons for purchasing a vacation home: 87 percent want to use the property for vacations or as a family retreat, 31 percent plan to use it as a primary residence in the future, 28 percent wanted to diversify their investments or saw a good investment opportunity, 23 percent plan to rent to others, and 22 percent intend it for use by a family member, friend, or relative.
    Forty-one percent of vacation homes purchased last year were in the South, 28 percent in the West, 18 percent in the Northeast and 14 percent in the Midwest.
    Investment-home buyers in 2013 had a median age of 42, earned $111,400, and bought a home that was relatively close to their primary residence – a median distance of 20 miles.
    Fifty percent of investment buyers said they purchased for rental income, 34 percent wanted to diversify their investments or saw a good investment opportunity, and 22 percent bought for a family member, friend, or relative to use – often to house a son or daughter while attending college.
    Seven percent of homes purchased by investment buyers last year have already been resold, and another 10 percent are planned to be sold within a year. Overall, investment buyers plan to hold the property for a median of 5 years, down from 8 years in 2012.
    Thirty-eight percent of investment properties purchased last year were in the South, 25 percent in the West, 18 percent in the Northeast, and 19 percent in the Midwest.
    More than eight out of 10 second-home buyers, both for vacation and investment homes, said it was a good time to buy.
    Approximately 43.4 million people in the U.S. are ages 50-59 – a group that dominated second-home sales in the middle part of the past decade and established records. An additional 42.7 million people are 40-49 years old, which is the historic prime age range for purchasing second homes, while another 40.4 million are 30-39 years of age.
    NAR’s analysis of U.S. Census Bureau data shows there are 8.0 million vacation homes and 43.7 million investment units in the United States, compared with 74.7 million owner-occupied homes.
    The 2014 Investment and Vacation Home Buyers Survey, conducted in March 2014, includes answers about 2,203 homes purchased during 2013 from a representative panel of 2,008 U.S. households. The survey controlled for age and income, based on information from the larger 2013 NAR Profile of Home Buyers and Sellers, to limit any biases in the characteristics of respondents.
    The 2014 Investment and Vacation Home Buyers Survey can be ordered by calling 800-874-6500 or online by visiting www.realtor.org/prodser.nsf/Research. The report is free to NAR members and costs $149.95 for nonmembers.

    Source: National Association of REALTORS®
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