Topping Home Buyers’ Shopping Lists

Topping Home Buyers’ Shopping Lists

Home buyers are looking for storage, energy efficiency and outdoor space, according to the latest preference survey released by the National Association of Home Builders and Better Homes and Gardens during the NAHB International Builders’ Show in Las Vegas this week.

Some of the top new-home desires cited by home buyers of all ages include separate laundry rooms, energy-star appliances and windows, exterior lighting, and a patio.

On the other hand, buyers are showing less interest in cork flooring, elevators, pet washing stations, expensive outdoor kitchens and fireplaces, and two-story entryways and family rooms, the survey reveals

More homebuilders are particularly focused on the wants of the millennial generation when it comes to home design, ensuring they build a home that this anticipated large wave of buyers will want to buy.

“They are the first generation to walk into home ownership with a smartphone in their hands,” says Jill Waage, executive editor of Better Homes and Gardens Brand.

Millennials are showing a strong desire to be able to use technology for entertainment and monitoring in the home. They also are looking for well-equipped kitchens and casual, comfortable living spaces and outdoor living spaces, she says.

“This generation is searching out ideas, following bloggers, and creating Pinterest boards with their preferences,” Waage says. “They’ve already curated their dream home online, saving it on their boards so they can [be ready] when the day finally comes.”

Source: National Association of Home Builders

Poor Decor Choices New Home Owners Make

Poor Decor Choices New Home Owners Make

When your client finally closes on their home, they’re going to be excited to start making the place their own. But going overboard with decorating concepts or placing furniture in the wrong configurations can make a home look cramped and uninviting. Help guide your client’s eye for interior design by steering them away from these furnishing mistakes recently highlighted by realtor.com®:

1. Oversized furnishings. “Measuring a space is imperative before you purchase anything,” Will Saks, a designer with Homepolish, told realtor.com®. “You need to understand the dimensions of a space so the scale will feel balanced. … While a large, overstuffed Chesterfield might look great in the store, in a tiny apartment it might end up looking like a fat guy in a little coat.”
2. Cramming too much in one room. Empty spaces and walls in a room can be a good thing. How much furniture should you put in? It depends on the aesthetic you are trying to achieve. “If you’re going for a more sleek look, stick to a few key pieces in a room to create the feeling of openness,” Saks says. “The same goes for artwork — one large frame can create an art gallery feeling.”
3. Decorating a room around a legacy piece. Your client’s armoire or overstuffed chair may hold sentimental value to them, but decorating an entire room around it may be a mistake. Home owners who feel attached to a piece of furniture may feel compelled to do a certain layout or color scheme that could be completely wrong for the space, realtor.com® notes. Suggest that your client place the furniture nonfocal part of the house — if it’s a chair, put it in a corner of the bedroom, for example — or have them place it in storage until they can figure out how it fits into their overall design concept.
4. Looking like a catalog or interior design magazine. Don’t try to copy a catalog. While it can be beautiful, it doesn’t always have a “home” vibe. “The most interesting designs are ones that are aesthetically mixed,” Saks says. He suggests adding a vintage or one-of-a-kind piece that makes the space feel more personal and curated — a new sofa paired with a vintage credenza, for example. Artwork and accessories from Etsy and flea markets can also help make a home feel unique, he says.

Source: “5 Huge Mistakes People Make Furnishing Their New Home,” realtor.com® (Jan. 19, 2016)

U.S. to Start Tracking ‘Secret’ Luxury Buyers

U.S. to Start Tracking ‘Secret’ Luxury Buyers

The Treasury Department announced Wednesday that it will begin tracking all “secret buyers” of luxury properties as concerns mount about money laundering in high-end real estate. The initiative requires shell companies that make all-cash real estate purchases to expose the buyers’ identities. The Treasury is asking title insurance companies to discover and report the identities of these buyers.

The government said it would allocate more resources into investigating luxury real estate sales that involve shell companies, such as limited liability companies, partnerships, and other entities. The government will begin its new program in New York’s Manhattan as well as Miami-Dade County in Florida. In Manhattan, buyers who purchase property at a sale price of more than $3 million must be reported, and in Miami-Dade County, more than $1 million.

A New York Times series last year revealed that real estate professionals in the luxury market often don’t know much about their buyers as the use of shell companies rose with foreign investment in U.S. real estate. In fact, the Times found that nearly half of homes nationwide worth at least $5 million were purchased using shell companies.

Jennifer Shasky Calvery raises alarms about the lack of transparency in such transactions.

“We are concerned about the possibility that dirty money is being put into luxury real estate,” says Calvery, director of the Treasury’s Financial Crimes Enforcement Network. “We think some of the bigger risk is around the least transparent transactions.”

UPDATE: A previous version of this article misstated who is responsible for disclosing the identity of buyers who use shell companies to purchase luxury real estate. The Treasury is asking title insurance companies, not agents and brokers, to report the identities of such buyers.

Source: “U.S. Will Track Secret Buyers of Luxury Real Estate,” The New York Times (Jan. 13, 2016)

This Lender Says It’s Going FICO-Free

This Lender Says It’s Going FICO-Free

SoFi, an online lender, is making a bold move: Eliminating FICO scores from its consideration when reviewing borrowers’ for a mortgage. It claims to be the first large lender to embrace the “FICO-Free Zone.”

The company says it plans to use three other factors instead to determine whether borrowers are credit-worthy: Employment history, the applicant’s record of making on-time payments and meeting financial obligations; and monthly cash flow minus expenses.

“Banishing traditional credit scores stems from SoFi’s belief that the FICO model is flawed and outdated; it’s less of an indicator of how a borrower will behave in the future, but rather, a reflection of past behavior,” the company states. “While the industry is moving toward evaluating non-traditional factors during the application process, most lenders still incorporate FICO scores into their proprietary algorithms and underwriting models.”

The move could help millennials, a group where credit scores could be becoming less relevant too. Sixty-three percent of millennials between the ages of 18 and 29 say they don’t have a credit card, according to a survey by Bankrate and Princeton Survey Research Associates International.

“Our approach to underwriting is based on transparency and balancing the needs of our members and investors, and we found that the FICO score was anything but transparent. So we threw it out,” says Mike Cagney, CEO and co-founder of SoFi, a company that has funded more than $6 billion in loans. “We’re proud to be the only major lender that does not use the score for any lending. Instead of relying on a three-digit number to tell us who’s qualified, we look for applicants who have historically paid their bills on time and make more money than they spend. It’s that simple.”

SoFi’s announcement comes at a time when the industry has been taking a closer look at the accuracy of FICO scores. For example, a current bill being considered – the Credit Score Competition Act of 2015 – would allow Freddie Mac and Fannie Mae to be able to use credit scoring models besides FICO, if approved.

Source: “Lender Drops FICO From Underwriting Decisions; Stearns’ TRID Defects,” Mortgage News Daily (Jan. 14, 2016)

How to Celebrate 100 Years of REALTORS®

How to Celebrate 100 Years of REALTORS®

This year marks the centennial of the REALTOR® mark. The National Association of REALTORS® adopted the term “REALTOR®” 100 years ago to identify that its members are committed to protecting property ownership.

To celebrate, NAR has launched a website for REALTORS® to submit pictures and stories that highlight the work they’ve done across the nation.

“In 2016, we are proud to celebrate 100 years of distinction of REALTORS® and the power they hold in protecting the American dream, advocating for property ownership and healthy communities, and making tomorrow a better place to live,” NAR notes on the site.

NAR’s latest consumer advertising campaign also focuses on defining the value of the REALTOR® brand. The campaign sets out to help consumers understand how REALTORS® offer a competitive edge and greater insights into local markets, serve as consumer advocates, and form connective tissues in their communities. The campaign uses the “Get REALTOR®” logo, and NAR is asking its members to watch for the messaging on social, digital, radio, and television platforms beginning later this month and into early February.

Source: “REALTOR®: Celebrating 100 Years of Distinction,” RISMedia (Jan. 13, 2016)