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Housing Sentiment Cools Heading Into Fall

There are many reasons autumn is a good time to buy a house. But, because spring and summer are traditionally seen as the best seasons for home shoppers, the housing market often cools in the months following its busiest season. Evidence of this can be found in Fannie Mae’s most recent Home Purchase Sentiment Index. The index – which asks Americans for their feelings about buying and selling homes, mortgage rates, home prices, etc. – reached an all-time high in September but saw a decline in October. In short, fewer Americans feel now is a good time to buy or sell a house. But that’s normal, according to Fannie Mae’s chief economist, Doug Duncan. “The modest decrease in October’s Home Purchase Sentiment Index is driven in large part by decreases in favorable views of the current home-buying and home-selling climates, a shift we expect at this time of year moving out of the summer home-buying season,” Duncan said. “Indicators of broader economic and personal financial sentiment remain relatively steady.” In other words, because Americans generally feel better about their economic security, the dip in sentiment is likely to be temporary. More here.

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Early Forecast Sees Housing Gains Next Year

This year’s real-estate market has been a mixed bag. On the one hand, demand from home buyers has been strong and an increasing number of renters say they hope to one day own a home. But though there has been strong demand from buyers, there has been a lack of homes available for sale in many markets. Low inventory has caused home prices to continuing rising and sales – though higher than the year before – to fall below expectations considering the level of demand from potential buyers. So what’s in store for next year? Well, Lawrence Yun, the National Association of Realtors’ chief economist, sees improvement. According to Yun, continued economic gains should lead to more home sales and more new home construction. However, because for-sale inventory will remain a concern, Yun is cautiously optimistic. “An overwhelming majority of renters want to own a home in the future and believe it is part of their American Dream,” Yun said. “Assuming there are no changes to the tax code that hurt homeownership, the gradually expanding economy and continued job creation should set the stage for a more meaningful increase in home sales in 2018.” More here.

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How Will Homes Change As Americans Grow Older?

Ipsos, an independent market research company, recently gathered a panel of experts to weigh in on the future of housing. From climate concerns to home automation, the panel looked at what changes may be necessary in order for our homes to meet our needs in the future. One of the topics focused on the fact that Americans are growing older. In fact, by 2060, nearly 100 million Americans will be over the age of 65 and – if current numbers are any indication – the vast majority of them will prefer to stay in their own homes and communities as they age. According to Rodney Harrell, director of livable communities for AARP’s Public Policy Institute, the current housing stock may not be suited to the needs of an aging population. “The problem is you can’t create a new housing stock overnight, so we have to start working now,” Harrell said. “Nobody should be forced from their home because it doesn’t work for them.” How our homes adapt to our needs will depend, in part, on advancements in smart-home technology but also on how soon builders and home remodelers begin installing features that make it easier for the elderly to preserve their independence. More here.

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Which U.S. Metros Have Changed Most Over 10 Years?

Choosing a place to live involves many different factors. From the type of kitchen you want to the school district and the commute to work, there are a lot things to take into consideration. But there are also things that you can’t possibly know, like what your prospective neighborhood will look like in 10 years. A lot can change in a decade. For that reason, LendingTree recently analyzed a number of metropolitan areas in an effort to narrow down which are changing fastest in terms of home prices, crime rates, building permits, commute times, income, rent, etc. On a scale from 1 to 100, cities were ranked in terms of how much change they underwent in particular categories between 2006 and 2016. According to the results, the most rapidly changing U.S. cities are in Texas, with Austin, Dallas, and Houston filling the top three positions on the list. Home prices were the big mover in all three cases, with each city ranking in the top five among 50 cities. The least changed cities overall included Birmingham, Ala., Milwaukee, and New Orleans. Also among the results, the top five cities for percent of residents who moved into their homes since 2010 were Las Vegas, Phoenix, Austin, Orlando, and Denver. More here.

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September Home Sales Improve Slightly

After consecutive months of decline, sales of existing homes – including single-family homes, townhomes, condominiums, and co-ops – rose 0.7 percent in September, according to the National Association of Realtors. The improvement may have been even greater if not for lack of inventory in some markets and the effects of recent hurricanes in Texas and Florida. Lawrence Yun, NAR’s chief economist, says the fact that there are too few homes for sale has been holding the housing market back, as there has been no shortage of interested home buyers this year. “Realtors this fall continue to say the primary impediments stifling sales growth are the same as they have been all year: not enough listings – especially at the lower end of the market – and fast-rising prices that are straining the budgets of prospective buyers.” But while inventory has been an issue this year, recent data shows listings have been on the rise lately. In fact, they were up another 1.6 percent in September. And, following the busy summer sales season, competition for available homes usually begins to cool, meaning there may be good opportunities for potential home buyers who want to take advantage of improved conditions this fall. More here.

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What Do Americans Say Is Their Ideal Down Payment?

The results of a new survey show Americans prefer a 10 percent down payment when buying a house. The 2017 Mortgages In America Survey found it was the most popular option among young, middle aged, and older home buyers when asked to choose among down payments up to 30 percent. And it lines up pretty well with actual data. In fact, the average down payment in 2016 was 11 percent, with borrowers under the age of 35 putting down something closer to 8 percent. But, though Americans clearly prefer it, lower down payments come with tradeoffs. For one, if you put less money down upfront, you may have to pay private mortgage insurance, which can add to your monthly mortgage payment. Which means, though home buyers have options and won’t necessarily have to put 20 percent down on the house they’re buying, it is always a good idea to save up as much as possible, so you have a substantial amount to invest in your home. It’ll make you a more attractive buyer to home sellers, in addition to helping keep your mortgage payment more affordable. More here.

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List Ranks Top Cities For Trick-Or-Treating

If you have kids – or have ever been one yourself – you know that Halloween is an important time of year. The opportunity to amass large quantities of free candy is irresistible to most kids. Combine that with the chance to dress up in costume and parade through the streets and Halloween becomes one of the year’s most anticipated days. Because of this, Zillow ranks the best cities for trick-or-treating each year. Their rankings are based on home values, the share of population under 10 years old, and single-family home density. This year, five of the top 10 cities are in California, with San Francisco topping the list. Of course, much of that has to do with higher home values in the West, but kids in Los Angeles, Sacramento, San Jose, and Long Beach can look forward to a happy Halloween this year. Other cities that made the top 10 included Philadelphia, Baltimore, Washington D.C., Milwaukee, and Seattle. But regardless of where you are, Dr. Svenja Gudell, Zillow’s chief economist, says there’s a surefire way to tell the best local neighborhoods for trick-or-treating. “These are places we think will have plenty of candy and lots of young kids running around from door to door,” Gudell says. “If you don’t live in one of these cities, look for areas that are getting into the Halloween spirit with decorations and lots of costumed kids.” More here

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Index Finds Homes Have Become More Affordable

ATTOM Data Solutions’ Q3 2017 U.S. Home Affordability Index looks at how affordable homes are based on the percentage of average wages needed to make a monthly payment on a median-priced house in 406 counties across the country. According to the results, affordability conditions improved, compared to the previous quarter, in 60 percent of all analyzed counties. That’s an encouraging trend for anyone thinking about buying a home this fall, as it means buyers can expect to find more favorable conditions than they did over the summer. Daren Blomquist, ATTOM’s senior vice president, said the improvement was brought on by decreasing interest rates. “Falling interest rates in the third quarter provided enough of a cushion to counteract rising home prices in most U.S. markets and provide at least some temporary relief for the home affordability crunch,” Blomquist said. “More sustainable relief for the affordability crunch, however, will need to be some combination of slowing home price appreciation and accelerating wage growth.” For example, since hitting bottom in 2012, home prices have risen 73 percent, while average weekly wages have only improved 13 percent over the same time period. More here.