The Housing Market Is Outperforming

The Housing Market Is Outperforming

The housing market has been off to a roar this spring. In fact, the market is performing so strongly that the National Association of REALTORS® has upgraded its forecast for the year.

At the start of the year, home sales were expected to match last year’s pace due to higher mortgage rates and diminishing affordability. But the market is hardly slowing down, notes Lawrence Yun, NAR’s chief economist. He now predicts existing-home sales to rise by 3.5 percent, and home prices likely will increase 5 percent this year.

Home sales are strong: Real estate professionals report an increase in foot traffic at listings and mortgage applications to buy a home remain above year-ago levels. Also, signed contracts to purchase a home are essentially running at decade highs, Yun notes.

“Not only are the buyers out in the market, but they are committing quickly,” Yun notes in a recent column for The Hill. “The typical days on the market for a newly listed property is short at only a month. A month’s supply of inventory is less than four months, which is well below the six to seven months that is considered more balanced.”

Escalation clauses in contracts are reportedly growing. This is where a potential buyer bids on a home at one price but is willing to raise the bid if the seller receives any higher bid.

But the hot market shouldn’t offer up any fears of a housing bubble, Yun notes. Unlike years past, buyers are coming in with higher down payments and higher credit scores. Also, the lack of new-home construction is another reason not to fear a bubble, he says. Prices don’t drop when there are inadequate supplies, and homebuilding is basically at half the level it was in the mid 2000s.

The strengthening housing market is becoming one major contributor to economic growth too, Yun notes. Higher home prices and housing equity will help give a boost to consumer spending, he adds.

“With no imminent threat of a recession, the housing market’s strong first quarter sets the foundation for continued gains the rest of the year,” Yun writes.

Source: “First Quarter GDP May Be Cool, But Housing Market Downright Balmy,” The Hill (May 1, 2017)

Cities With the Most Cash Sales

Cities With the Most Cash Sales

Cash sales made up about 30 percent of all single-family and condo sales in the first quarter of this year, according to ATTOM Data Solutions’ First Quarter 2017 U.S. Home Sales Report. That is well below their peak of 44.7 percent in the first quarter of 2011 but higher than the prerecession average of 20.4 percent from 2000 to 2007.

“With a stronger market and overall sales increasing, we are seeing a decrease in foreclosure sales across the markets we serve, as well as a decrease in institutional investors purchasing homes,” says Matthew Watercutter, senior regional vice president and broker of record for HER, REALTORS®, in Dayton, Ohio. “With the stronger market and availability of money from institutional lenders such as mortgage companies and credit unions, we are seeing a decrease in cash purchases, as more properties are being sold to owner occupants and fewer to investors.”

Out of 150 metro areas with populations of at least 200,000, the highest share of cash sales were in these cities, according to ATTOM Data Solutions’ analysis:

• Salisbury, Md.: 61.2%
• Raleigh, N.C.: 60.6%
• Naples, Fla.: 56.6%
• Binghamton, N.Y.: 54.3%
• Spartanburg, S.C.: 53.3%

Fifty-one of the 150 metros analyzed posted a year-over-year increase in the share of all-cash sales. Some of the markets seeing the largest year-over-year increases were New York; San Francisco; Riverside-San Bernardino, Calif.; Seattle; and Minneapolis-St. Paul, Minn.

Source: RealtyTrac

How Trees Benefit Home Values

How Trees Benefit Home Values

Today is Arbor Day, the perfect time to send clients information on landscaping that can boost their home’s value and reduce energy bills.

The U.S. Forest Service Pacific Northwest Research Station says that planting a tree in front of a house increases the home’s sale price by an average of $7,130. So, in essence, money can grow on trees.

Planting a tree on the west side of a home can reduce a home’s energy bills 3 percent within five years and 12 percent within 15 years. Specifically, west-side trees can bring summertime electric bills down by an average of $25 a year and reduce air conditioning use by 30 percent, according to the Forest Service.

Trees and other landscaping can also lower the impact of damaging winds on a home, potentially reducing 35 mph winds to 10 mph, according to the Arbor Day Foundation. This also lessens the load on the furnace working to heat the home on those cold, windy days, which can bring energy bills down by 30 percent.

Additionally, a Clemson University study found that landscaping has the potential to increase the value of homes by about 6 percent. Some of the most desired landscape trends among consumers include: rainwater harvesting, native plants and drought-resistant plants, permeable paving, and fire pits, according to the 2016 Residential Landscape Architecture Trends Survey conducted by the American Society of Landscape Architects.

Source: The Davey Tree Expert Company

Checks to Protect a Home in the Spring

Checks to Protect a Home in the Spring

The spring season can bring about dangers to a home from strong wind gusts, rains, and fluctuating temperatures. Be sure to take steps to protect your home this season.

1. Check outside faucets and exteriors for flood risks.

Inspect your outside hose faucets for any damage from the winter. Hold your thumb over the opening. If the flow stops completely, the pipe indoors could possibly be damaged and may need to be replaced. Also, check the hose for dry rot and examine the foundation and exterior walls for any cracks or potential areas where water could enter.

2. Check the roof and gutters.

The roof may have been damaged by heavy storms or hail. Don’t assume that because there are no visible signs of damage, there isn’t some beneath the shingles. Have it inspected. Also, clean the gutters to avoid risks of pooling water and leaks.

3. Check the landscaping.

Beware of trees that are too close to the home. In a storm, these could pose a threat. Have any tall overhead branches trimmed if they could potentially fall and hit the roof or damage the home.

4. Check the foundation.

Examine the lawn and near the foundation for any low areas. Water will collect and pool in any low areas. This could then potentially seep through any cracks in the home’s foundation or create a breeding ground for insects. Fill any low areas with compact soil and repair cracks in the foundation.

Source: “How to Help Your Clients Keep Their Homes Safe From Spring Weather,” Remodeling (April 21, 2017)

Use the Power of Gratitude to Spark Loyalty

Use the Power of Gratitude to Spark Loyalty

It’s important to thank your customers for their business, and that couldn’t be easier with the rise of social media as a mass communications method. Gratitude should be at the core of a marketer’s brand, says Bardi Toto Drake, author of “The Power of Asking.” She encourages marketers to avoid “bragging and selling” strategies but instead find ways to show gratitude to increase business. She offers some of the following tips on how in a recent article at Forbes.com:

Try retweeting: On Twitter, show appreciation for someone’s photo, article, or post by republishing it to your own Twitter following. “A retweet is a recognition of someone’s value to you,” Toto says. “That’s a form of thanks.”

Offer public recognition on social media: Go beyond just pressing the “like” button. Show clients you are grateful for their post by commenting on the person’s update or news story on social media. “It only takes a second to comment and that goes much further,” she says.

Endorse them: On LinkedIn, you can express gratitude by endorsing others in the real estate industry and beyond. “It takes less than five minutes to do this, and adds weight and credibility to their profile,” Toto says. “If a connection performs a great service for you, write them a recommendation.”

Regardless of how you show it, the number one rule when showing gratitude is being genuine. “You are working to build a relationship, not just to win a bit of business,” Curtis Hale, a business consultant, told Forbes.com.

Source: “How Gratitude Advances Marketing and Business,” Forbes.com (April 26, 2017)