Where Americans Are Moving To?

Where Americans Are Moving To? Image courtesy of Stuart Miles/ FreeDigitalPhotos.net

About 18 percent of people who moved last year – or 8.5 million – moved from one large metro area to another. But also a growing number moved to a smaller city that was not too far away from their prior residence, U.S. Census Bureau data shows.

The top destination of movers continues to be Los Angeles, which had nearly 245,000 people relocating from other metro areas. Other top moving destinations included New York and Washington, D.C.

However, these large cities appear to be losing more residents than they’re gaining. For example, nearly 400,000 people moved out of New York last year and 340,000 left Los Angeles.

On the other hand, smaller cities like Austin, Texas, and Riverside, Calif., are gaining more residents – more people are moving in than out.

Realtor.com® reports the following are the top 10 city-to-city mitigation paths from 2009 to 2013:

1. Los Angeles, Calif. to Riverside, Calif.: 90,494
2. Riverside, Calif. to Los Angeles, Calif.: 54,711
3. New York, N.Y. to Philadelphia, Pa.: 26,957
4. San Jose, Calif. to San Francisco, Calif.: 24,536
5. Washington, D.C. to Baltimore, Md.: 22,944
6. New York, N.Y. to Miami, Fla.: 22,226
7. Baltimore, Md. to Washington, D.C.: 21,457
8. San Diego, Calif. to Riverside, Calif.: 19,667
9. Philadelphia, Pa. to New York, N.Y.: 19,336
10. San Francisco, Calif. to San Jose, Calif.: 18,680

Source: “Bright Lights, Not-So-Big Cities: Where Americans Are Moving,” realtor.com® (Aug. 26, 2015)

10-Year Housing Surge on the Horizon?

10-Year Housing Surge on the Horizon? Image courtesy of ddpavumba / FreeDigitalPhotos.net

The housing market is poised for one of its largest expansions in history. By 2024, demographic and economic changes are forecasted to bring 15.9 million additional households on board, according to a new study released by the Mortgage Bankers Association.

That means an average of 1.6 million additional households per year, sparking “housing market growth over the next decade that would be among the strongest the U.S. has ever seen,” according to the report.

The MBA report says the bulk of that growth will be from increases in the number of households who are headed by those age 60 and older and households headed by age 45 and younger. Those age group increases are expected to mitigate the decline among households age 45 to 60.

“An aging population should gradually increase demand for home ownership, partially offsetting the influence of a more racially and ethnically diverse population on home ownership rates,” the MBA report notes.

The Census Bureau projects the following breakdown in ages emerging in 2024, as compared to 2014:

• 20 million more people age 60 and over than there are today (as Baby Boomers age),
• 4 million fewer people age 45 to 59 (as the large Baby Boomer cohorts are replaced by smaller Generation X cohorts) and
• 18 million more people age 18 to 44 (as smaller Generation X cohorts are replaced by larger Millennial cohorts)

Household growth is also expected to be driven by 5.5 million additional Hispanic households. For other races, 3.4 million additional non-Hispanic White households are expected to form by 2024, 2.4 million additional black households, 1.8 million more Asian households, and 730,000 additional other households.

Source: “Housing Demand,” Mortgage Bankers Association (2015)

New-Home Sales Climb in July

New-Home Sales Climb in July. Image courtesy of fantasista / FreeDigitalPhotos.net

Sales of new single-family homes rose 5.4 percent in July, as more builders reported higher buyer traffic. Such traffic may lead to an increase in building activity as well, as home builders add more inventory to meet a heightened confidence in the market. The Commerce Department reported Tuesday that sales of newly built single-family homes rose to a seasonally adjusted annual rate of 507,000 units in July.

Regionally, the Northeast saw the largest gains in new-home sales, with sales rising 23.1 percent month-over-month in July to a 14-month high. New-home sales also posted a 6.7 percent gain in the West and a 5.8 percent increase in the South. The Midwest was the only region to post a decline, with sales falling nearly 7 percent month-over-month.

The stock of new homes for-sale reached 218,000 units in July – a 5.2-month supply at the current sales pace. That marks the highest inventory level since March 2010. Nevertheless, supply still remains less than half of what it was during the housing boom.

“As job growth and consumer confidence continue to strengthen, the housing market should make additional gains this year,” says David Crowe, chief economist at the National Association of Home Builders.

Source: National Association of Home Builders and “Consumer Confidence, Housing Data Signal Economy’s Resilience,” Reuters (Aug. 25, 2015)

6 Home Buyer Concerns

6 Home Buyer Concerns. Image courtesy of jscreationzs / FreeDigitalPhotos.net

Rising home prices tops the list of home buyer concerns this year, a shift from last year when nearly half of buyers said their chief concern was the limited number of homes for-sale, according to a new survey of more than 3,500 buyers released by the real estate brokerage Redfin.

In this year’s survey, nearly 27 percent of respondents cited high or rising home prices as their top concern. Another 17 percent of respondents said they were most concerned about competition from other buyers.

First-time buyers were particularly worried about rising home prices. Thirty-one percent of first-time buyers said that higher home prices were their top concern.

The survey identified the following top six home buyer concerns this year:

1. Affordability: “Prices are rising too high” – 27%
2. “There’s too much competition from other buyers” – 17%
3. “There aren’t enough homes to choose from” – 14%
4. “I need to sell a home first” – 8%
5. “I might not have enough for a down payment” – 6%
6. “Mortgage rates will go up before I can buy” – 5%

Last year, the top buyer concern identified was inventory, followed by home prices, competition from other buyers, rising mortgage rates, and home-shopping fatigue.

Source: “Home Prices Weigh Heavily on Buyers as Mortgage-Rate Worry Recedes,” Redfin Research Center (Aug. 19, 2015)

Homelessness Rising Among Families

Homelessness Rising Among Families. Image courtesy of Serge Bertasius Photography / FreeDigitalPhotos.net

Total homelessness has fallen 10 percent in the country since 2010, but among one segment, homelessness is on the rise. A new blog post from Harvard University’s Joint Center for Housing Studies notes that homelessness among families remains persistently high.

More than a third of the total homeless population is made up of people in families, and more than 60 percent of this segment have children who are under the age of 18.

The number of homeless families living in shelters – such as emergency shelters, transitional housing programs, or safe havens – is growing. Nearly nine in 10 homeless people in families were staying in shelters in 2014.

In some pockets across the country, the number has risen to the highest on record, JCHS notes. For example, in New York City, homeless families are estimated to comprise the majority of homeless shelter residents, rising by 67 percent alone between January 2005 and January 2015, according to the advocacy group Coalition for the Homeless.

“Since the end of the recession, the affordable housing shortage has continued to play a major role in rising rates of family homelessness,” JCHS research assistant Irene Law notes on the Housing Perspectives blog. “Between 2010 and 2014, in high-cost locations where affordable rentals are in short supply, the number of homeless people in families increased substantially: by 50 percent in the District of Columbia, 41 percent in Massachusetts, and 22 percent in New York.  The problem is acute in urban areas across the country.”

Indeed, 45 percent of all homeless families lived in major cities in 2014. Nearly 20 percent lived in New York City, which had the highest concentration of homeless families nationwide at 41,633, followed by Los Angeles City and County at 6,229.

“The current inventory of permanent supportive housing largely targets single adults, especially those with chronic patterns of homelessness,” notes Lew at the JCHS blog. “Although the number of permanent supportive housing beds has increased significantly since 2007, a substantial share of permanent supportive housing beds are set aside for individuals rather than families.  The limited availability of subsidies for the services component, as well as higher operating expenses compared to affordable housing, present challenges for expanding the supply of permanent supportive housing.”

Source: “Despite Declines in Homelessness, Family Homelessness Persists,” Harvard University’s Joint Center for Housing Studies (Aug. 12, 2015)

Common Mortgage Deal Delays

Common Mortgage Deal Delays. Image courtesy of Stuart Miles / FreeDigitalPhotos.net

A last-minute problem with financing can quickly delay a closing on a home sale. Here are two of the most common financing problems that can surface:

• Failure to disclose key financial information. One of the biggest reasons for a financial issue is the failure of the buyer to disclose key financial information, The New York Times reports. Buyers who are not forthright about their financial circumstances can face a delay. Lenders will quickly find borrowers who are behind on child support obligations or real estate taxes, for example.
• Running up credit as a mortgage application is pending. Buyers may go out and purchase new furniture or a car prior to closing on a home, but doing so, could cause them a delay to the closing of their home sale. Lenders will recheck borrowers’ credit right before the closing date. If new debt obligations suddenly appear, that can be a red flag to a lender. Prior to making any large purchases prior to closing, borrowers should check with their lender, says Douglas Rotella, an executive vice president and loan originator with HomeBridge Financial Services.

In some metro markets, a delay to securing financing could mean missing out on a home. For example, in hot markets like California’s Silicon Valley, sellers may even balk at deals that are contingent on a mortgage approval, says Mia Simon, a real estate professional with Redfin’s Silicon Valley office. Nearly every home is getting multiple offers there so buyers must go beyond pre-approval and receive a loan commitment before they submit an offer, she says. The loan commitment indicates that the borrower’s paperwork has passed underwriting and the only thing necessary for final approval is the appraisal and verifying the borrower’s employment.

Source: “How Mortgage Problems Unravel Home Deals,” The New York Times (Aug. 14, 2015)