How Long It Takes to Save for a Down Payment

How Long It Takes to Save for a Down Payment

Renters in some cities may face a long road toward home ownership. Faced with high rents, some may even have to wait a few decades before they’ll be able to save enough for a down payment – that is, if they keep saving at the same rate, finds a new survey by Apartment List.

Millennial renters in San Francisco may have the most trouble saving for a down payment. Renters living there will need to wait, on average, 28 years in order to save for a 20 percent down payment on a home (assuming rates of saving remain the same), the survey finds. In places like Sacramento, renters can expect 27 years of saving, and 18 years in Denver.

Apartment List researchers analyzed median prices of starter homes in 130 cities and 93 metro areas and then asked survey respondents to reveal how much they were saving and what they think their family or friends would also chip in for a down payment. From there, they calculated how long it would take renters to buy a home in their city.

Researchers found that for many survey respondents, they just aren’t saving enough for a down payment. For example, in San Francisco, millennial respondents estimated that they need about $69,650 for a down payment, which is about half the $142,800 really needed for a 20 percent down payment (the median home price in San Francisco is $1.2 million, according to realtor.com®). In Sacramento, millennial renters said they’re saving about $26,720 for a down payment, but they really need about $43,580 for a 20 percent down payment.

“It’s not really surprising, as home prices have really shot up so much,” says Andrew Woo, a data scientist at Apartment List. But “it seems like a lot of millennials don’t realize they’re not saving enough.”

The survey does not take into account those who can use other savings accounts, such as a 401(k) to fund a down payment, and those with strong credit who may be able to qualify for a mortgage with only a 10 percent down payment. Also, there are special loan programs that require only a 3 percent down payment, in some cases.

In some places, renters aren’t having a problem and won’t need to save nearly as much to jump into home ownership. For example, in Detroit, many young home buyers already have around the $3,600 down payment needed to buy the median price starter home there at about $18,000. In Dallas and Houston, renters need about six years to save for a down payment in their city, the survey finds.

Source: “The Affordability Crisis: What Happens When Millennials Can’t Afford to Buy Homes?” Apartment List (April 13, 2016) and “How Long Will It Take to Save Up for a Home in Your City?” realtor.com® (April 20, 2016)

Dorms for Adults Is a Trend Gaining Steam

Dorms for Adults Is a Trend Gaining Steam

Cities such as New York, San Francisco, and Washington, D.C., have been seeing an explosion of micro apartments—units ranging from 175 square feet for a studio to 550 square feet for a one- or two-bedroom—in an effort to combat skyrocketing rents for larger spaces. But many of these apartments are now coming with new social layers that foster more community among residents.

So-called coliving apartment complexes, where units typically start around $1,800, feature shared kitchens and lounges for potluck dinners and movie nights—a veritable dorm hall for adults. But is this a lasting trend that young adults will embrace as a means to move into an affordable home?

Many of these buildings are trying to attract resident with services that often come with luxury properties, such as maid service. What’s the future of this trend?

Source —REALTOR® Magazine

Get to Know the Transitional Kitchen

Get to Know the Transitional Kitchen

When it comes to kitchen design, it’s time to throw some of the old traditional rules out and embrace the mix-and-match transitional kitchen approach.

What is a transitional kitchen exactly? It’s a style that equal parts functional and expressive. It accommodates the individual needs of the family, showcases the personality of the home owners, but is also universally appealing and homey. And it’s hotter than ever.

In a recent survey by the National Kitchen and Bath Association, home owners listed the transitional kitchen as their top style pick, beating the traditional kitchen for the first time in many years.

John Reha, editorial director of Black & Decker’s Home Improvement Library, recently shared tips with Houselogic on how your clients can embrace the mix-and-match approach of the transitional kitchen.

4 common elements that make up transitional kitchen design:

• Mixing neutrals: Neutral tones like black, white, gray, and tan are a staple of transitional design, and mixing different textures and neutral colors keeps the space from looking clinical and dull. A wood kitchen floor offset with black cabinets will be equal parts homey and visually interesting.
• Balancing old and new design elements: Why narrow down your taste to one design concept when you can incorporate many? A transitional kitchen can be minimalist and contemporary and also include older, more rustic elements like wood floors, a subway tile backsplash, and farmhouse doors.
• Adding unusual materials: Transitional design is at its heart functional and a blank canvas, and owners should not be scared to add dramatic unconventional paint accents or choose counter materials like concrete instead of the popular and more traditional granite.
• Embracing quirkiness: A transitional kitchen is supposed to be designed for the individual needs of the owner, so a kitchen including objects that have personal meaning to the family like antiques, family member’s artwork, a chalkboard for writing messages, and one-of-a-kind fixtures will never feel out of place.

Bottom line: A transitional kitchen at its essence should be functional for owners’ specific needs, but the other main rule is that there are no rules. The days where kitchen design had to solely embrace one style may be over, and buyers and owners alike are looking for a space that mixes and matches elements that reflects their individual personality.

Source: “Elements of Transitional Kitchen Style,” Houselogic.

Churches Find New Life as Condos

Churches Find New Life as Condos

Empty church buildings for sale across the country are being resurrected as condo developments.

“The same qualities that once made churches cultural and artistic centers – their central locations in neighborhoods, their size, their vast windows, and cavernous chambers – also make them perfect for a real estate market that commodifies light and space in a crowded city,” Curbed reports.

Many churches with dwindling attendance numbers are downsizing their buildings, while others are selling their old churches to build new ones. Religious construction is expected to rise in 2016, The Wall Street Journal reports. In either case, a record 1,502 sales of religious-affiliated properties in 2014. That is nearly double the 889 sales made in 2010, The Christian Post reports.

Churches can be pricey to renovate into a residential unit. For example, in Newburgh, New York, Mike Lidgus, a retired aerospace engineer, purchased a former Christian Science Church for $30,000 from the government. He is renovating it, which so far has included a $50,000 new slate roof and $40,000 in copper piping alone.

But the aesthetics of a converted church may attract those who like lofts, developers are finding. The high ceilings, big windows, and excess of space tend to be a big attraction to these converted areas.

“Industrial spaces aren’t as easy to come by as they once were because real estate developers are on to that,” says Sharon Butler, a painter who previously kept her studio in a church in Old Mystic, Conn. “Churches are sort of undiscovered. You can find a really big space and they’re relatively inexpensive, because who else is going to buy it?”

Source: “Living on a Prayer,” Curbed.com (April 13, 2016) and “Why Some Big City Churches Are Turning Into Condo Developments,” Deseret News (April 16, 2016)

Foreclosures Become a Tougher Find

Foreclosures Become a Tougher Find

Thirty-six percent of U.S. housing markets – or 78 out of 216 metro areas studied — are now below their pre-recession levels in foreclosures, according to the latest Foreclosure Market Report from RealtyTrac.

Foreclosure filings – including default notices, scheduled auctions, and bank repossessions – were down 8 percent from last year and make up 289,116 U.S. properties.

That marks a nine-year low and the lowest quarterly total since the fourth quarter of 2006, RealtyTrac reports.

“Despite a seasonal bump higher in March, foreclosure activity in most markets continues to trend lower and back toward more healthy, stable levels,” says Daren Blomquist, senior vice president at RealtyTrac. “More than one-third of the 216 local markets we analyzed were below their pre-recession foreclosure activity averages in the first quarter, and we would expect a growing number of markets to move below that milestone the rest of this year — while the number of markets with a lingering low-grade fever of foreclosure activity continues to shrink.”

Some of the metros seeing large dips in foreclosure filings below pre-recession levels in the first quarter of 2016 included Los Angeles (27 percent below pre-recession average); Dallas (down 65 percent); Houston (down 64 percent); Miami (down 19 percent); and Atlanta (down 57 percent).

However, in some markets, foreclosures remain elevated, including New York (80 percent above the pre-recession average); Chicago (up 17 percent); Philadelphia (up 97 percent); Washington, D.C. metro area (up 134 percent); and Boston (up 46 percent).

Source: RealtyTrac

Ultra-Luxury Sellers Are Slashing List Prices

Ultra-Luxury Sellers Are Slashing List Prices

More luxury home sellers are reportedly cutting their asking prices, hoping for a quicker sale, The Wall Street Journal reports.

In January, 4.1 percent of homes for sale at $5 million or above had their asking prices reduced – a 50 percent increase from a year ago, according to data from realtor.com®. The median price of the reduction was $501,000 or 7.2 percent of the list price.

For comparison, 12.2 percent of all homes for sale saw a reduction in their list prices, which is up just 4 percent over the year.

As sales have slowed among real estate’s priciest homes, home sellers are getting more realistic, The Wall Street Journal reports. In 2014, record sale prices grabbed national headlines. That prompted more luxury sellers to want to test the market with their hefty asking prices too. But in the second half of 2015, sales have fallen.

More luxury home owners are receding from “aspirational pricing,” which will help more deals move through, says Jonathan Miller of the appraisal firm Miller Samuel in New York. “The high-end of the market peaked well before the balance of the market.”

Source: “More Luxury-Home Sellers Drop Their Asking Prices,” The Wall Street Journal (April 12, 2016)