June, 2014

Job Growth Outpacing New Home Construction

Annualized housing starts crossed the 1 million mark in April for the first time this year, but little of that improvement came on the single-family side—and that’s a serious problem, says the National Association of Realtors (NAR).

JOBSMeasuring new homebuilding against employment numbers—which only recently recovered from their recessionary decline—NAR finds that historically, there is one new home built for every 1.5 jobs added to the economy. As of the first quarter, 32 states and the District of Columbia are above that ratio, meaning job growth has far outpaced new construction over the past three years.

“Our analysis found that a majority of states are constructing too few homes in relation to local job market conditions,” explained NAR chief economist Lawrence Yun. “This lack of construction has hamstrung supply and slowed home sales.”

The difference was greatest in Florida, Utah, California, Montana, and Indiana, where the ratio of new employment to housing starts is 3 or higher. Those areas, Yun warns, will continue to see “persistent housing shortages and affordability issues” unless homebuilding rises to match local job gains.

At the same time, NAR says price growth “looks to be manageable” in states where new jobs are near commensurate with new home construction, including Mississippi, Arkansas, Connecticut, Alabama, and Vermont.Housing Starts

With limited supply and rising costs already creating a serious challenge for homebuyers—particularly first-time buyers—Yun says it’s crucial for builders to step up production, even as they struggle with their own challenges, including rising construction costs and limited credit access for smaller firms.

“It’s critical to increase housing starts in these states facing shortage conditions or else prospective buyers may struggle with options and affordability if income growth cannot compensate for rising home prices,” Yun said.

Author: Tory Barringer

DS News

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May Housing Scorecard Shows Progress in Equity and Home Sales

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury released the May edition of the Obama Administration’s Housing Scorecard [1] on Friday. The government report showed progress, noting growth in key indicators such as increasing equity and a rebound in the sale of new and existing homes.

According to the Federal Reserve, homeowner equity was up nearly $795 billion in Q1 2014, totaling more than $10.8 trillion. May’s figure was the highest level since the second quarter of 2007. Equity has continued to rise since the beginning of 2012, up 73 percent (nearly $4.6 trillion) through the first quarter of 2014.

“May’s Housing Scorecard shows that the housing market recovery is picking up after the harsh winter months,” said HUD assistant secretary, Katherine O’Regan.Scorecard 6.23.2014 “More homeowners have positive equity, foreclosures continue their downward trend, and sales of new and existing homes are rebounding. While these are all good signs, it’s clear that we must remain committed to helping homeowners as they recover from the worst housing recession since the Great Depression.”

HUD cited figures from CoreLogic, which found that the number of underwater borrowers dropped 48 percent, lifting more than 5.8 million homeowners above water from 2012 to the first quarter of 2014. Despite first quarter gains of 300,000 homeowners who returned to positions of positive equity, approximately 12.7 percent of residential properties with a mortgage are still underwater.

HUD also celebrated new home sales, which were up 6.4 percent to 433,000 in April. Foreclosure starts continued on a downward slope, down 10 percent from the previous month and down 32 percent year-over-year. Foreclosures are the lowest they have been since December 2005.

Existing-home sales rose for the first this year. HUD cited a National Association of Realtors report that found existing home sales sold at a seasonally adjusted annual rate (SAAR) of 4.65 million in April, up 1.3 percent from March. However, existing-home sales are still 6.8 percent below the 4.99 million pace seen a year earlier.

“The standards set by the Making Home Affordable program have significantly changed the mortgage servicing industry,” said Treasury Acting Assistant Secretary Tim Bowler. “Treasury is committed to holding servicers accountable to these standards, and as a result has seen continued improvement by the largest servicers.”Making Home Affordable 6.23.2014

HUD noted that foreclosure mitigation programs continue to provide relief for distressed homeowners—more than 8.3 million mortgage modification and other homeowner assistance actions were completed between April 2009 and April 2014.

HUD commented, “More than 2.0 million homeowner assistance actions have taken place through the Making Home Affordable Program, including nearly 1.4 million permanent modifications through the Home Affordable Modification Program (HAMP), while the Federal Housing Administration (FHA) has offered 2.3 million loss mitigation and early delinquency interventions through April.”

 Author Colin Robins DS News
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Home Prices Moderate as Markets Stabilize

Roller CoasterAfter the rollercoaster ride that has been the past six years, the national housing market is finally in a place that, at least for the moment, looks stable. Better yet, it looks downright sustainable, if the latest Trulia Price Monitor is to be believed.

According to Trulia, for the first time since July 2012, none of the 100 largest markets in May—anywhere in the United States—saw home prices rise more than 20 percent year-over-year.

This is the first sign of sustainability in the housing market in years and is, according to Trulia’ chief economist, Jed Kolko, a welcome change from the hyper-rebounding that occurred in some markets—particularly in the West, where asking prices rose by as much as 30 percent from 2012 to 2013—that had several economists worried that an accelerated boom/bust cycle was brewing.

“That’s a good thing,” Kolko said. “Extreme price increases create unrealistic expectations, encourage flipping, and might discourage some owners from selling if they expect big increases to continue.”

While May’s asking prices rose at their slowest rate in 13 months, they still rose 8 percent, which remains well above the long-term historical norm for home-price appreciation. Furthermore, prices rose 2.4 percent quarter-over-quarter in May, Kolko said.

At the same time, the number of markets with year-over-year price declines is also at a post-recession low. According to Trulia, the only metros where asking prices were down year-over-year were El Paso, Hartford, Albany, and Little Rock. This belies a healthy deceleration in booming markets, where prices had been rising unsustainably fast, Kolko said.

Another encouraging sign of a good economy, according to Trulia, is the fact that rents are up nationwide, but also not by any huge margin. Nationally, rents are up 5.1 percent overall from a year ago.Rental-House-iStock-680x452

Apartment rents are up 5.8 percent, while and single-family rents are up 2.1 percent. As it has been in the home sales market, California’s coastal metros lead the pack in rising rent prices. Among the 25 largest rental markets, rents rose most year-over-year in San Francisco, San Diego, and Oakland.

Author: Scott Morgan, DSNews.com


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“If I Only Had More Time”

“I just don’t have enough time to get everything done.”

“There’s so much to do and so little time.”

“24 hours just isn’t enough time to get everything done.”

Have you ever found yourself uttering one of these phrases (or something similar) during an exceptionally busy period of your life? Perhaps you feel that way all the time, as our increasingly busy culture is always on the go, trying to squeeze as much activity as possible into our already crammed schedules. Just imagine how nice it would be if you in fact did have more than Clock24 hours in a day! What do you think you would do with all that extra time? The answer may be closer than you think.

Every year, our nation receives a time management “pop quiz” (except in Arizona & Hawaii), and yet most of us don’t even realize that a test is being administered. At 2:00 a.m. on the first Sunday of November, something magical happens…an hour is added to the day. So there is a single day each and every year (at the end of daylight savings time) when there is actually 25 hours. So, that begs a very serious question for each and every one of us. What do you do with it?

This past November, I woke up at the exact same time I always do on a Sunday, right around 6:00 a.m. Only this time it wasn’t 6:00 a.m., it was actually 5:00 a.m., so I had a free hour with which to do whatever I wanted. When the alarm went off, I was faced with the aforementioned pop quiz, and it answered a very important question. If I was given extra time in my day, would I actually use it to do something productive, or would I squander it? Much to my satisfaction, I got up and cleaned out my garage, while everyone else in the house was asleep. However, I must admit that it was the first year that I remember actually taking advantage of the extra time.

Many of the same people who complain incessantly about needing more time in the day rarely do anything significant on thesleep one day that they are given the additional time that they so earnestly desire. In fact, every year numerous online polls are conducted asking folks what they plan on doing with the extra hour, and the most common answer is “get an extra hour of sleep.” These people received an extra hour in the day, and yet accomplished the same amount (or less). Unbeknownst to them, they are victims of what is oftentimes referred to as Parkinson’s Law.

Parkinson’s law states that the amount of time which one has to perform a task is the amount of time it will take to complete the task. My wife and I joke about it all the time, and it’s never more evident than when we are getting ready for church. If we wake up late on Sunday morning, and only have 30 minutes to get ready for church, we race around like wild people and leave precisely at 9:30 am. If we wake up on time, with 2 hours or more to get ready, we get the same things done (though with slightly less stress) and STILL leave at precisely 9:30. Rather than hurry up and get ready in 30 minutes (which is obviously possible) and use the extra 90+ minutes for important tasks, we tend to take our time and get ready at our own pace.

To DoEntrepreneurs have a tendency to do the same thing with their task lists, allowing the tasks for the day to fill the entire day, instead of compressing them into a block of time that allows for other portions of the day to be used for brainstorming, business building, long term projects, etc. Their theory of needing “more time” is completely erroneous. In fact, they don’t need more time, they need to learn to utilize the time that they have in a more efficient manner.

The entrepreneur’s first (and biggest) time management mistake is starting their day with the easiest tasks first. They do this because it gives them a sense of accomplishment, as they are able to quickly cross things off the list. However, the problem with doing the small tasks first is that (per Parkinson’s law) it tends to take up most of the time you have allotted to work, 8 hours or so. This leaves very little time for the big projects, which are typically the most important, and the ones with the most profit potential. Every small business owner says that they want to spend more time working ON the business, rather than IN the business, because they realize that’s what it takes to make the company grow. But big projects take big time, and because we don’t get the satisfaction of drawing a big, bold line through it on the to-do list for days or even months, we unfortunately have a tendency of putting it off.

As you can imagine, I wear a lot of hats in my life…husband, father, blogger, entrepreneur, real estate trainer, pastor, and the list goes on and on. So, like many of you, I oftentimes find myself in the unenviable position of having what SEEMS to be more work than can be accomplished in the time I have available. For a long time I fell into the trap of trying to get all the little things done first, so my mind was clear and I could focus on the big things. But I never seemed to get around to the big stuff, and by the time I even THOUGHT about the long-term projects, the day was practically over. I always thought I would get to it “tomorrow”, but after 100 tomorrows, I realized it wouldn’t happen unless I changed my strategy.

After getting advice from some other successful businessmen, I found that the best way to accomplish my big goals is through a time management strategy known as “time-blocking”. On Sunday evening, I have a planning session in which I set my schedule for the upcoming week, including time for small items like e-mails & phone calls, but also time for blogging, strategy sessions, and what I call business builders…the BIG vision stuff. When my phone vibrates letting me know that a new time block has started, everything else is shut off and I eliminate all distractions. I turn my phone to silent, I close my office door, shut off my e-mail account (so I won’t be tempted to check new emails) and I spend all my allotted time on that specific project. This allows me to have focused intensity on the project at hand, and it has produced amazing results in regards to my productivity.

So, if you are guilty of wasting the extra hour you were given last month, or if you have a tendency to allow insignificant daily tasks to steal valuable time away from building your business, then give time-blocking a try. Take one week, and schedule EVERYTHING you do in your calendar, setting aside a 1 to 3 hour “block” for important projects that require focused intensity. You will be AMAZED at how you’ll be able to complete projects you’ve been trying to get done for months, and you will end each day with a tremendous sense of accomplishment.

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