Later Marriage Trends Don’t Postpone Homeownership

A study conducted by Harris Interactive for Coldwell Banker Real Estate looked a changing marriage trends in America and how they impact the purchase of a first home.

According to the study, the timing of a first-home purchase hasn’t changed a lot over the years, but an upswing in later marriages means more couples are buying a home before they walk down the aisle – if they ever do – or making a purchase earlier in the marriage.

About one in four married couples between the ages of 18 to 34 purchased their first home together before their wedding date, compared to 14 percent of those ages 45 and older. According to the survey, 35 percent of all married couples purchased their first home together by their second wedding anniversary; 80 percent of these married homeowners said it strengthened their relationship more than any other purchase.

“What we’re seeing is that young couples are switching up the order and purchasing their first home regardless of whether or not they have set a wedding date,” says Dr. Robi Ludwig, a psychotherapist and Coldwell Banker lifestyle correspondent.

“This is a huge movement within the American culture,” Ludwig adds. “While younger generations may be focusing more on their career, and in turn waiting longer to get married and have children, they are not delaying their dream of homeownership.”

Other survey trends

• 17 percent of all married couples surveyed purchased a home together before their wedding day.

• 72 percent of married Americans in the South waited until after they were married to purchase a home, compared to 60 percent of Americans in the Northeast.

• Only 16 percent of married U.S. adults have not purchased a home together with their current spouse.

Ludwig says the tasks involved with a home purchase can strengthen a marriage. “(Married couples) not only learn about each other’s wishes and dreams during this process, but they also learn how to be practical with each other and compromise,” he says. “Buying a home has more of an impact on a couple’s relationship than any other purchase they will ever make.”

Impact of home buying on a marriage

• 93 percent of homeowners who purchased their first home while married always planned on owning a home after marrying.

• 80 percent said purchasing a home with their spouse did more to strengthen their relationship as a couple and family than any other purchase they have made together.

• Over one-third of married homeowners (35 percent) wish they had taken the plunge (into homeownership) sooner than they actually did.

Ludwig offers the following tips for couples buying their first home together:

1. Decide “needs” vs. “wants,” and be willing to compromise. Ludwig says it’s common for a couple to uncover conflicting values, interests, likes, dislikes and tastes to come that create tension. But no one gets everything on their checklist, so it’s important to compromise to get a home that pleases both people. Patience, understanding, compassion and compromise are key.

2. Work together to prioritize what’s important in a home. Make an independent list and compare notes. Even the closest couples are still two people with separate ideas and agendas. Searching for a home can bring up a couple’s different priorities and ideas about life. Working together to decide what is best for a combined future strengthens the bond between individuals and prepares couples to effectively deal with future disagreements.

3. Be open, honest and organized with finances. This includes the ability to talk about personal savings, debts, budgets and credit ratings. Money is one of the leading causes of marital discord.

4. Think about the future for three, five and even 10 years down the road. Before buying a home, talk about plans for careers, having a family, and what that means in terms of neighborhood and space. For some people, talking about their future needs creates anxiety. Support each other if it does.

 





© 2013 Florida Realtors®

New-Homes Sales Rise 1.5% in March to 417K

U.S. sales of new homes rose in March to a seasonally adjusted annual rate of 417,000. The increase added to evidence of a sustained housing recovery at the start of the spring buying season.

The Commerce Department said Tuesday that sales of new homes increased 1.5 percent. The gain brought the level higher than February’s pace of 411,000, though below January’s 445,000 – the fastest pace since July 2008.

New-home sales are still below the 700,000 pace considered healthy by most economists. But the pace has increased 18.5 percent from 352,000 a year ago.

Most economists see more gains ahead, as housing is likely to remain a consistent driver of economic growth this year.

“With increasing signs of a softer U.S. economy springing up in the spring, we can take comfort in the resilience of the housing recovery,” said Jennifer Lee, senior economist at BMO Capital Markets.

Steady job creation and near-record-low mortgage rates are spurring more Americans to buy houses. The rise in demand is helping to boost sales and prices in most markets. Higher prices tend to make homeowners feel wealthier and encourage more spending.

A limited supply of both new and previously occupied homes has also helped boost prices.

The inventory of new homes for sale increased 2 percent in March to 153,000, the second straight gain. Still, that’s the equivalent of a 4.4-month supply at the current sales pace and historically lean, according to Jim O’Sullivan, chief U.S. economist at High Frequency Economics.

The median price of a new home rose to $247,000 in March. That’s 3 percent higher than a year ago.

The March sales gain came from a 20.6 percent increase in the Northeast and a 19.4 percent rise in the South. Sales fell 20.9 percent in the West, where problems of supply have hampered home buying. Sales were down 12.1 percent in the Midwest.

Sales of previously occupied homes dipped in March from February, according to the National Association of Realtors. Still, sales were 10.3 percent higher than a year earlier.

The Realtors’ group cited the low housing supply as a reason sales fell in March. But in a positive sign, the inventory of previously occupied homes increased for the second straight month. That suggests more sellers are confident that the recovery will continue and they can sell at a good price.

Low inventories have helped drive more construction of new homes.

U.S. homebuilders started work on more than 1 million new houses and apartments in March at a seasonally adjusted annual rate, the first time it had crossed that threshold in nearly five years. That reflected a surge in volatile apartment building.

Single-family home construction fell in March after reaching the fastest in nearly five years.

Still, a low supply of homes for sale is just one of several constraints that could limit sales. Since the housing bubble burst more than six years ago, banks have imposed tighter credit conditions and required larger down payments. That has made it harder for first-time homebuyers to qualify for the super-low mortgage rates that have resulted from the Federal Reserve’s efforts to ease credit.





Copyright © 2013 The Associated Press, Martin Crutsinger, AP economics writer. All rights reserved.

Florida’s Housing Market on Upswing in March

In March, Florida’s housing market reported increased closed sales, more pending sales, higher median prices and a reduced inventory of homes for sale, according to the latest housing data released by Florida Realtors®.

“Florida’s housing market continues to demonstrate its recovery – March marks the 15th consecutive month that the statewide median sales prices for both single-family homes and for townhouse-condo properties rose year-over-year, according to Florida Realtors’ data,” said 2013 Florida Realtors President Dean Asher, broker-owner with Don Asher & Associates Inc. in Orlando. “The median price is up more than 15 percent for both single-family homes and for townhouse-condos.

“Meanwhile, buyer demand is increasing, but supply continues to be constrained in many areas. In March, the median days on market (the midpoint of the number of days it took for a property to sell that month) was 57 days for single-family homes and 61 days for townhouses and condos. That means 50 percent of homes on the market in Florida sell in two months or less.”

Statewide closed sales of existing single-family homes totaled 19,631 in March, up 9 percent compared to the year-ago figure, according to data from Florida Realtors Industry Data and Analysis department in partnership with local Realtor boards/associations. Closed sales typically occur 30 to 90 days after sales contracts are written.

Meanwhile, pending sales – contracts that are signed but not yet completed or closed – for existing single-family homes last month rose 23.4 percent over the previous March. The statewide median sales price for single-family existing homes last month was $160,000, up 15.2 percent from the previous year.

According to the National Association of Realtors® (NAR), the national median sales price for existing single-family homes in February 2013 was $173,800, up 11.3 percent from the previous year. In California, the statewide median sales price for single-family existing homes in February was $333,880; in Massachusetts, it was $278,000; in Maryland, it was $224,048; and in New York, it was $220,000.

The median is the midpoint; half the homes sold for more, half for less. Housing industry analysts note that sales of foreclosures and other distressed properties downwardly distort the median price because they generally sell at a discount relative to traditional homes.

Looking at Florida’s year-to-year comparison for sales of townhouse-condos, a total of 9,957 units sold statewide last month, up 1.1 percent compared to March 2012. Meanwhile, pending sales for townhouse-condos last month increased 10.6 percent compared to the year-ago figure. The statewide median for townhouse-condo properties was $120,000, up 15.9 percent over the previous year. NAR reported that the national median existing condo price in February 2013 was $172,500.

The inventory for single-family homes stood at a 5.3-months’ supply in March; inventory for townhouse-condos was at a 5.8-months’ supply, according to Florida Realtors.

“We continue to be encouraged by the depth and breadth of the housing recovery,” said Florida Realtors Chief Economist Dr. John Tuccillo. “State numbers are up in virtually all important categories and down where they should be down. Even with the difficulty of access to financing for households, we still see the growth in the market continuing for at least the next 18 months.

“Inventory remains an issue, but this is fast becoming a sellers’ market and as sellers realize this, we expect inventories to rise as we approach the last quarter of 2103. Over the long term, we need to correct the imbalance between investors and owner-occupier households that has developed because of financing issues if the market is to prosper for a long time.”

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.57 percent in March 2013, down from the 3.95 percent average during the same month a year earlier.

To see the full statewide housing activity report, go to Florida Realtors website and click on the Research page; then look under Latest Housing Data, Statewide Residential Activity and get the March reports. Or go to Florida Realtors Media Center  and download the March 2013 data report PDFs under Market Data.

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© 2013 Florida Realtors®

Fla. Metro Construction Up 15.3% Year-Over-Year

For major-metro regions in Florida – Jacksonville, Miami-Fort Lauderdale-Pompano Beach, Orlando-Kissimmee-Sanford, Tallahassee and Tampa-St. Petersburg-Clearwater – the BidClerk Construction Index (BCI) found a 15.3 percent increase in construction projects that were actively bidding. Private construction activity increased just 0.8 percent, but public construction increased of 25.4 percent compared to the same period last year.

In a quarter-over-quarter analysis for Florida construction projects in the major metro markets actively bidding, first quarter 2013 saw an increase of 35.3 percent compared to a decrease of 13.3 percent reported in  4th quarter 2012. First quarter public and private projects increased 48.4 percent and 17.1 percent, respectively.

In a year-over-year analysis for the Miami region, for example, public and private construction projects increased 4.8 percent compared to one year ago. Quarter-over-quarter, the projects rose 37.3 percent.

In Orlando, combined public and private construction projects that were actively bidding increased 10.8 percent compared to one year earlier. Construction projects quarter-to-quarter increased 12.8 percent.

Combined public and private construction projects in the Tampa-St, Pete area increased 24.2 percent year-to-year, and 46 percent quarter-to-quarter. BCI’s quarter-over-quarter analysis revealed that combined private and public construction projects that were actively bidding in the Tampa-St. Pete region experienced a large increase of 46 percent.

 





© 2013 Florida Realtors®

Lenders Loosen Up on Home Loans

Lenders are warming up to home shoppers lacking big down payments as the housing market improves, new data show.

In the first quarter of this year, 19 percent of conventional loan offers made by lenders on the LendingTree online exchange were for loans with downpayments between 5 percent and 10 percent, LendingTree says.

That was up from 6 percent of offers the same time last year and just 1 percent of offers two years ago, LendingTree says.

Meanwhile, the number of lenders quoting non-Federal Housing Administration loans with 5 percent to 10 percent downpayments on Zillow Mortgage Marketplace is almost double what it was two years ago, Zillow says.

The growth of the availability of low-downpayment loans is notable in that, following the housing bust, those consumers had little choice outside of generally higher-cost loans from the FHA. “For years, it’s been FHA or nothing,” for the low-downpayment borrower, says Guy Cecala, publisher of Inside Mortgage Finance. “This shift is a sign that mortgage origination is loosening up.”

But the industry is still a long way from the easy-lending standards that caused the housing bust. Borrowers now must show a strong credit history and documented income to get loans, Cecala says.

Several factors are driving more low-downpayment loans outside of the FHA, including:

• Higher FHA costs. While the FHA requires just 3.5 percent down, its annual insurance premiums have more than doubled in the past two years. The last increase took hold April 1.

The higher costs are “causing a shift back toward conventional loans,” says Cameron Findlay, chief economist at Discover Home Loans.

Following the latest rate increase, FHA applications for home loans fell by almost 14 percent for the week ended April 5 while applications for conventional loans rose more than 5 percent, the Mortgage Bankers Association says.

• A rebounding private mortgage insurance industry. Lenders generally don’t make loans that they can’t resell to mortgage giants Fannie Mae or Freddie Mac. While Fannie Mae will buy a loan with as little as 3 percent down, and Freddie Mac at 5 percent, loans with less than 20 percent down require borrowers to also get private mortgage insurance.

When the housing market crashed, the private mortgage industry lost billions and such insurance was tough to get. Now, the industry is on the rebound and the cost for insurance for borrowers with higher credit scores has dropped. As such, more home loan borrowers are finding it a better financial move not to put 20 percent down and instead pay for the insurance, says Matt Johnson, loan officer at Sterling Bank in Seattle.

Rising home prices have also helped lenders get more comfortable with low-downpayment loans.

The growth of lower downpayments is also reflected in Fannie Mae’s portfolio. In the first quarter of 2012, downpayments between 3 percent and 10 percent accounted for 15 percent of Fannie’s home purchase loan business. That rose to 18 percent in the third quarter.

The borrowers are still high quality. Last year, home loans acquired by Fannie Mae with less than 20 percent downpayments originated from borrowers with an average FICO score of 755, Fannie Mae says. Scores of 740 or higher are generally needed to get the best pricing on home loans.







Copyright © USA TODAY 2013

Housing Starts Surpass 1 Million in March

U.S. homebuilders broke the 1 million mark in March for the first time since June 2008. The gain signals continued strength for the housing recovery at the start of the spring buying season.

The overall pace of homes started rose 7 percent from February to March to a seasonally adjusted annual rate of 1.04 million, the Commerce Department said Tuesday.

Apartment construction, which tends to fluctuate sharply from month to month, led the surge: It jumped nearly 31 percent to an annual rate of 417,000, the fastest pace since January 2006.

By contrast, single-family home building, which makes up nearly two-thirds of the market, fell 4.8 percent to an annual rate of 619,000. That was down from February’s pace of 650,000, the fastest since May 2008. The government said February’s pace was a sharp 5.2 percent higher than it had previously estimated.

Applications for building permits, a gauge of future construction, declined 3.9 percent to an annual rate of 902,000. It was down from February’s rate of 939,000, which was also nearly a five-year high.

Paul Ashworth, chief U.S. economist at Capital Economics, called the data “obviously good news.” But he noted that the surge was due to a jump in volatile apartment construction and said the pace of building could drop in April.

Steady job growth, near record-low mortgage rates and rising home values have encouraged more people to buy. In response to higher demand and a low supply of available homes for sale, builders have stepped up construction.

March’s pace of homes started was nearly 46 percent higher than in the same month in 2012.

Housing construction fell 5.8 percent in the Northeast but gained in the rest of the country, led by a 10.9 percent rise in the South. It rose 9.6 percent in the Midwest and 2.7 percent in the West.

The National Association of Home Builders/Wells Fargo April survey released Monday showed that builders are concerned that limited land and rising costs for building materials and labor could slow sales in the short term. That led to a third straight monthly drop in confidence.

Still, the builders’ outlook for sales over the next six months climbed to the highest level in more than six years, suggesting that the obstacles could be temporary.

And construction firms have stepped up hiring in recent months. They added 18,000 jobs in March and 169,000 since September, according to the Labor Department.

Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to statistics from the homebuilders.





Copyright © 2013 The Associated Press, Martin Crutsinger, AP economics writer. All rights reserved.

Time for Low Interest Rates to Rise? Some Say Yes

Tried taking out a mortgage lately or refinancing one? Chances are that it took a ton of paperwork. And if your credit score was not perfect, it might not have happened at all.

As of last fall, the average successful applicant for a Fannie Mae-backed mortgage (the typical circumstance) had a FICO credit score nothing short of stellar at 769. That’s on a scale of 300 to 850, with nearly 80 percent of the public having a score below 750, according to Fair Isaac Corp., the rating’s developer.

What’s more, the average applicant denied a mortgage had a quite respectable score of 734. Not long ago, that was the type of score expected from the average person approved for a mortgage.

Add in the millions of people who don’t even apply for mortgages because they know they will be rejected, and the picture comes into focus. Interest rates are at rock bottom, but only available to a select group.

This poses a question: What good are all the government’s efforts to revive the housing market if they help only an elite few? Or, to put a finer point on it: Are Washington’s efforts to boost housing doing more harm than good?

A strong case can be made that the answer is yes. It is taken for granted that low interest rates – engineered by the Federal Reserve’s program of flooding money into credit markets – boost the housing market. But they also have perverse side effects and unintended consequences.

The biggest of these, as it relates to housing, is that artificially low rates make banks reluctant to lend. They don’t want to because they know they can get burned when rates inevitably rise to more natural levels.

Right now, banks can make a handsome profit from a portfolio of mortgages in the range of 3.5 percent to 4 percent. That’s because they can borrow at next to nothing and because inflation is negligible. But suppose rates rise to 5 percent to 6 percent, as most people expect will happen in the not too distant future. The banks would then have to write down the value of their portfolios of existing loans. That would have an adverse effect on their balance sheets, and could force them to raise more capital to maintain appropriate cushions and buffers mandated by law.

To deal with this prospect, banks are doing two things: They are being cautious about how much they lend. And they are lending only to people with great credit, offsetting the risk of loss through rising rates by decreasing their risk of defaults.

Add to this a host of new lending regulations and a desire among prosecutors to show their toughness toward banks to atone for their laxness in prior years, and banks have even more reason to lie low.

The solution is not to trot out some new housing plan every few months, as the Obama administration is wont to do. These sound appealing, but they run into the fundamental reluctance of lenders to lend. Nor is it to return to the lax standards that led to the housing bubble.

Rather, the solution is to let market forces repair lending markets. When the Fed unwinds its easy money policies, interest rates will rise. This will be a drag on the economy. But it’s increasingly clear that easing is necessary to promote robust lending. The sooner the Fed feels safe making that move, the quicker the mortgage hassles will fade away.

What good are government efforts to revive the housing market if they help only a few?

 






Copyright USA TODAY 2013, Nam Y. Huh, AP

Younger Buyers Jumping into Retirement Real Estate

Century Village in Boca Raton, one of the biggest retirement communities in the country, has seen the average age of new buyers drop over a decade – from the mid-70s to the low 60s.

Although residents in the active-adult community must be 55 or older or be married to someone that old, buyers can be any age. As a result, a number of younger investors are snapping up units now as they prepare for retirement, figuring prices are relatively low right now.

In the meantime, they’ll rent the units as they wait for retirement.

“People are looking at this in terms of their long-term future,” says Ben Schachter of Century Village Real Estate Inc. “They’re looking at the market as it increases, as the economy is strengthening, and they want to buy now while it’s the best opportunity to do so.”

 





Source: CNBC.com (03/25/13) Olick, Diana

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

When Prices of Homes with Pools Take a Dip

A study led by Brigham Young University assistant professor of economics Jaren Pope shows that buyers will pay more for a home with a swimming pool in August, with these residences selling for an additional 0.22 percentage points on average during the summer months. That translates into an extra $4,000 on a $1 million property.

However, homes with swimming pools sell for 0.15 percentage points less than the base line when they go into contract in January.

The study involved over 4 million transactions in 27 states between 1998 and 2008, focusing on homes sold at least twice during the study period.

Pope says early spring is the best time to list a home for sale, although it depends on how hot or cold the local market is. Sellers whose homes are on the market in the winter should keep their pools clean and use Christmas lights and heaters to make the space attractive despite the temperature.

 





Source: Wall Street Journal (03/15/13) P. M12; Tanaka, Sanette

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Are Banks Easing up on Mortgage Standards?

A very tight mortgage lending environment “promises improvements this year as the drivers of tough credit standards reverse,” according to Moody’s Analytics ResiLandscape Report. Still, lending will remain tight by historical standards, the report notes.

Tight underwriting conditions have been one of the main obstacles to a housing market recovery. But the credit agency says that those conditions began to ease somewhat this year and likely will continue to do so.

“Rising house prices give lenders more breathing room to extend credit,” the analysts at Moody’s noted.

Over the past year and a half, large lenders have loosened up or, at least, held standards stable on prime loans for mortgage originations, according to the Survey of Senior Lending Officers.

Aiding lenders’ confidence is that mortgage delinquencies have fallen to pre-recession rates.

“Being right-side up on the mortgage improves a borrower’s credit profile. It also lowers the risk of default and increases the likelihood of trade-up buying,” according to Moody’s report.

Mortgage supply will remain constrained, but “improved consumer credit quality combined with steady growth in jobs, low mortgage interest rates and modestly rising house prices makes it clear that more households will be able to qualify for a mortgage,” Moody’s said. “Greater credit availability will, in turn, help drive stronger home sales and stronger price appreciation.”

 




Source: “Slight opening of credit spigot aids housing outlook,” HousingWire (March 4, 2013)

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Buyers Value Storage Space, In-Law Suites

Purchasing a home is an important life decision, and many factors can influence the home choices buyers make.

The National Association of Realtors® released its 2013 Profile of Buyers’ Home Feature Preferences. It looks at the features buyers prefer when it comes to purchasing a home, including regional differences, as well as factors such as geography, demographics and household composition. The survey captures buyers who purchased a home between 2010 and 2012.

Buyers in the South, including Fla., for example, predictably prefer air conditioning. Compared to other areas, many Southern state buyers also seek out a home less than five years old on a wooded lot.

“Deciding where to live comes with a lot of options, but buyers quickly realize that some features are more important than others when it comes to choosing the right house for them,” said NAR President Gary Thomas.

Geography and demography strongly influence what buyers value in a home. The typical recently purchased home was 1,860 square feet built in 1996. Repeat buyers, buyers of new homes, married couples and families with children typically purchased larger homes.

First-time buyers and single women tended to buy older homes. The typical buyer purchased a home with three bedrooms and two full bathrooms. Slightly over half of the homes purchased were on a single level.

Other findings

• While more than three-fourths – 78 percent – of all buyers purchased a home with a garage, garages were more popular among new-home buyers, Midwesterners and suburbanites.

• Forty-one percent of homes purchased had a basement, but this feature was more popular among buyers in the Midwest and Northeast.

• Southerners typically bought the largest home at 2,000 square feet. Those in the Northeast followed closely behind with a typical home purchase of 1,850 square feet.

• Among buyers 55 and older, 42 percent considered finding a single-level home very important, compared to just 11 percent of buyers under age 35. Single women also placed higher importance on single-level homes, while single men wanted finished basements.

• Both single men and married couples placed higher importance on new kitchen appliances.

• Among all 33 home features in the survey, central air conditioning was the most important to the most buyers; 65 percent of buyers considered this feature very important.

• The next most important feature was a walk-in closet in the master bedroom; 39 percent of buyers considered this feature very important. Closely behind that was a home cable-, satellite TV-, and/or Internet ready, as well as a master bathroom.

• When it came to actually buying a home, among buyers who considered central AC and cable-, satellite TV-, and/or Internet ready very or somewhat important, 94 percent bought a home with these features. The next most common feature was an eat-in kitchen; 89 percent of buyers who thought this was important purchased a home with an eat-in kitchen.

• Buyers value some features so much that they are willing to spend more money to have them. Sixty-nine percent of buyers who did not purchase a home with central AC would be willing to pay $2,520 more for a home with this feature.

• Sixty-nine percent of buyers who did not purchase a home with new kitchen appliances would be willing to pay $1,840 more for a home with this feature.

• A walk-in closet in the master bedroom was the third most common feature on which buyers would spend more. Sixty percent of buyers who did not purchase a home with a walk-in closet would be willing to pay $1,350 more for a home with this feature.

• The features on which buyers placed the highest dollar value were waterfront properties and homes that were less than five years old. Thirty-two percent of buyers would be willing to pay a median of $5,420 more for a home on the waterfront, and 40 percent of buyers would be willing to pay a median of $5,020 more for a home that was less than five years old.

• The rooms buyers were willing to pay the most for were a basement and an in-law suite. Thirty-three percent of buyers would be willing to pay a median of $3,200 more for a home with a basement, and 20 percent of buyers would be willing to pay a median of $2,920 more for a home with an in-law suite.

• When it came to rooms that buyers want in a home, 55 percent of buyers thought it was very important to have a living room, although buyers in the Northeast placed more importance on a home with a dining room. Buyers aged 55 and older placed more importance on a bedroom on the main level of the house. Buyers aged 35 to 54 placed more importance on a laundry room, while those with children placed more importance on a family room.

• The two most common rooms buyers were willing to spend more for were a laundry room and a den/study/home office/library. Sixty-three percent of buyers who did not purchase a home with a laundry room would be willing to pay $1,590 more for a home with this room. Forty-four percent of buyers who did not purchase a home with a den/study/home office/library would be willing to pay $1,920 more for a home with this room.

• 97 percent of recent buyers were satisfied with their home purchase.

• Within three months of a home purchase, 53 percent of buyers undertook a home improvement project. The typical buyer spent $4,550 on various projects. Of those who did a home improvement project, 47 percent worked on the kitchen; 44 percent redid a bathroom; 41 percent added or replaced lighting; and 37 percent added or replaced appliances.

In October 2012, NAR, working with a private firm, surveyed a sample of households that had purchased any type of residencal real estate during 2010 to 2012 and still owned the property.

NAR sells the 2013 Profile of Buyers’ Home Feature Preferences. Members pay $14.95 and non-members pay $49.95. It can be ordered on NAR’s website.







 



© 2013 Florida Realtors®

Study Shows Home Preferences of Millennials

The Millennial generation is showing a preference for fixer-upper houses over the “cookie cutter” luxury homes their parents’ generation tended to desire, according to a national survey by Better Homes and Gardens Real Estate.

About one in three 18-to-35 year olds recently surveyed say they prefer a “fixer-upper” home with minimal repairs needed. Forty-seven percent say they would be more likely to handle home maintenance jobs themselves over calling in a professional for help. What’s more, 72 percent of Millennials consider themselves handy, earning the nickname the “Fix-It Generation,” according to the survey.

They also aren’t looking for big, luxury homes like their parents, and they don’t mind if a home is smaller, as long as it’s unique, the survey showed. Forty-three percent say they want a home that is more customized and different – less “cookie cutter.” They expect each room in the house to fit their lifestyle.

Also, 56 percent say that home technology capabilities are more important than a house with great curb appeal. Sixty-four percent of Millennials said they wouldn’t even consider living in a home that doesn’t have the latest tech capabilities. Eighty-four percent say that technology is essential for their new home, with the most sought-after tech in the home being an energy-efficient washer and dryer, a security system and a smart thermostat.

“It’s critical that real estate professionals understand what embodies a quintessential home for the millennial generation, which vastly differs from the traditional norms of generations before them,” says Sherry Chris, president and CEO of Better Homes and Gardens Real Estate LLC. “Understanding technologies to communicate with this generation is now only one piece of the puzzle for agents; ‘smart’ technological capabilities must now be ingrained into the home itself.”

 





Source: Realogy

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

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Young Adults’ Finances May be Hard to Repair

Young generations were badly hit in the recession, and it could have widespread effects on their lives, from delaying homeownership to starting a family and even retiring one day.

A new study from the Urban Institute shows that those under the age of 40 have accumulated less wealth than their parents did at the same age. That coincides with a time when the average wealth of Americans has doubled over the last quarter-century, according to the study.

“In this country, the expectation is that every generation does better than the previous generation,” Caroline Ratcliffe, an author of the study, told The New York Times. “This is no longer the case. This generation might have less.”

Young adults are facing stagnant pay, a tough job market, soaring student loan debt and some who did own a home may have faced lost equity or even foreclosure during the housing crisis.

Will younger adults ever be able to catch up?

According to the Urban Institute study, if a person delays buying a home to age 40 instead of age 30, that alone could result in a $42,000 loss in home equity by the time that person reaches age 60.

Still, “strong and sustained job and wage growth would cure many of the ills facing younger workers,” The New York Times reports. “But their delayed or diminished wealth accumulation might still have a lasting impact on their finances.”

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Source: “Younger Generations Lag Parents in Wealth-Building,” The New York Times (March 14, 2013)

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Home is Where the Tax Breaks Are - 7 Tips

While economists and investors can debate whether buying a home is still part of the American dream, it’s undeniable that the tax code remains highly favorable to people who own instead of rent.

Whether you were a first-time buyer, a longtime homeowner who refinanced or a seller, there are a host of important deductions available.

The easiest way for a family to get more than just the standard deduction is to claim tax breaks related to a house. Charitable deductions or a smattering of health care costs might not get you above the $5,950 deduction for individuals or the $11,900 mark for married couples. But a few of these big-time breaks in housing can push you over the top and result in a much bigger refund.

The downside is no more simple tax returns since you’ll have to itemize. But the money you’ll get back makes it worthwhile.

Here are seven important tax tips for homeowners:

• Mortgage interest is your best friend. Taxpayers collectively get roughly $100 billion annually in mortgage interest breaks. If you bought a home or refinanced in the last few years, the savings are even more significant, as more than half your monthly payment goes toward interest.

• Mortgage insurance is still deductible. There were fears that the deduction for personal mortgage insurance would fall victim to fiscal fights in Washington. However, Congress left it in place. That’s a huge boon to lower-income homeowners who often can’t afford a big down payment and must pay private mortgage insurance until they have at least 20 percent equity in their homes.

• Taxes are tax deductible. It sounds odd and is frequently overlooked, but homeowners can deduct their local and state property taxes on federal tax returns. There also may be special property tax benefits for lower-income homeowners based on your state or municipality of residence, so look into further breaks specific to your community.

• Qualified renovations count. Fixing a leaky faucet or putting crown molding in the living room is not tax deductible. But there are a number of items in the tax code that allow for tax breaks and credits. A host of items covered under residential energy efficiency can provide tax relief, including new solar panels or certain water heaters. There are also deductions available for home office improvements, as well as for medically necessary changes, such as an entry ramp or a handicap-accessible bathtub.

• Unqualified renovations can count later. While that addition might not be “necessary,” the expense could be an important part of reducing your tax burden when you sell. This is especially noteworthy in hot real estate markets or for homeowners sitting on big property appreciation. The IRS allows you only $250,000 of tax-free profit when you sell a primary residence, but you can deduct any renovations that boosted your home’s value from any total profit to get under that threshold. Find those receipts if you’re sitting on a big profit and planning to sell.

• Claim selling costs. If you sold a home in the past year, costs including title insurance, advertising and real estate broker fees can be claimed. You can claim certain repairs to reduce capital gains on the sale, presuming they were made within 90 days of sale and clearly for the intent of marketing the property.

• Don’t forget moving expenses. If you bought a home in 2012, there’s a chance you did so because of a job-related move. If this is the case, you may be able to deduct some expenses, provided you have the receipts. You must have moved 50 miles or more, and the reasons for your move can’t be personal.

 










Copyright USA TODAY 2013; Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks.