February Market Matters Report – Week Ending 02.21.14

Finding ways to help young adults make their first home purchases
Source: LA Times

Stricter mortgage underwriting standards, higher unemployment, and heavy student debt are among the key factors that stand in the way of many potential buyers in their 20s and 30s. But first-time home buyers in this age group may be able to turn to effective techniques that family members, friends, and even employers can use to bridge the generational gap by offering a helping hand.

Making sense of the story:

• Americans who were 30 to 34 in 2012 had the lowest homeownership rate of any similarly aged group in recent decades at 47.9 percent.

• In comparison, Americans born between 1948 and 1957 had a 57.1 percent ownership rate by the time they hit the 30-to-34 bracket. This is despite record low mortgage rates and bargain-priced foreclosures and short sales.

• A new federal rule imposing a 43 percent maximum debt-to-income ratio for “qualified mortgages” is particularly difficult for younger buyers with high student debt. Student debts average $21,402 but can balloon as high as six figures.

• According to one industry estimate, 27 percent of first-time buyers last year received gift money from relatives to help defray the down payment and closing costs.

• With professional help, some family members are providing either second mortgages or first mortgages, and properly structured, these loans provide annual returns to family members well in excess of money-market funds or bank deposits.

• Money provided as a loan cannot be disguised as a loan. If the money is a gift, there needs to be a formal letter making the purpose of the gift explicit and the specific transaction for which it is to be used. Documentation is also needed to attribute the source of the funds and the capacity of the gift giver to provide the money.

Read the full story

In other news …

U.S. Home Sellers Return for Spring as Buyers Get Relief
Source: Bloomberg

As the housing market’s busiest season approaches, escalating values are spurring more listings as homeowners regain equity lost in the worst crash since the 1930s. With more sellers looking to cash in on rising prices, would-be buyers likely will have more choice and therefore, relief from the bidding wars of last year.

Read the full story

If investors bail on housing, what then?
Source: CNBC

After the housing crash, investors bought thousands of distressed properties with billions of dollars in cash. It is estimated that institutional investors have purchased well over 100,000 homes, but some experts are concerned that if investors pull out of the housing market this year, there could be a “significant” or “somewhat significant” impact on the markets.

Read the full story

Student debt may hurt housing recovery by hampering first-time buyers
Source: Washington Post

Millions of Americans are carrying heavy student debt, which could prevent a generation of potential buyers from purchasing their first homes. Purchases from first-time buyers are well below the historical norm, thereby undermining the housing recovery’s momentum.

Read the full story

Cold weather saps homebuilder confidence in February
Source: The Hill

In February, homebuilder confidence fell to its lowest level since May due to unusually cold weather. In light of the decline in buyer traffic as rampant snowstorms blanketed the country, there was a 10-point drop on the National Association of Home Builders(NAHB)/Wells Fargo Housing Market Index (HMI).

Read the full story

Dirty Mortgage Words
Source: Forbes

Forbes outlines some of the dreaded terms used in the mortgage industry, whether they’re consumer-centric or industry words. “Adverse” is described as the dirtiest word in the consumer-centric mortgage world since it is mortgage-speak for decline.

Read the full story

Gap Between Most, Least Expensive Housing Markets Still Wide
Source: Wall Street Journal

Evidence of a widening price gap was made clear in the annual affordability survey from the NATIONAL ASSOCIATION OF REALTORS®. While homes in much of the nation are affordable, on the coasts, especially California, a familiar pattern is reemerging: Too many people, not enough homes, and price growth that outstrips income growth.

Read the full story

The best and worst housing markets for taxes
Source: HousingWire

According to analysis of data from the Office of Revenue Analysis, homeowners in the housing market with the heaviest overall tax burden paid a percentage of their income seven times greater than the burden borne by the housing market with the lowest overall tax burden.

Read the full story

Talking Points …

• Between the years 2007 and 2011, 42,000 new residents moved from Los Angeles County to San Bernardino County, which represents the largest migration into a region in the United States, according to the U.S. Census Bureau’s migration report. Affordability of housing is attributed as the number one reason for the migration.

• The median home price in the San Bernardino County is hundreds of thousands of dollars cheaper in comparison to Los Angeles County and Orange County. The huge savings have led to the greater inland migration, and the Inland Empire has a greater share of undeveloped property.

• According to the report, the second largest area of migration was from Los Angeles County to Orange County, with 40,000 people. The third largest is from Asia, with 35,000 people from Asia moving into Los Angeles County.

Thanks for reading!  Feel free to call with questions, (714) 963-8000!

Cordially,
David S. Wilfert
RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue, Suite A-100, North Tustin, CA 92705
Real Estate Broker – BRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 963-8000 or Email: David@WilfertGroup.com

December Market Matters Report III

How Important Is Down Payment in Determining Default?
Source: DSNews.com

The Federal Housing Finance Agency (FHFA) recently released a working paper on the impact of down payment amounts on loan performance at the GSEs and Federal Housing Administration (FHA). In light of new regulations and increased focus on underwriting standards, the agency issued the findings, and overall found a nonlinear relationship between loan-to-value (LTV) ratio and foreclosure rates.

Making sense of the story:

—> For loans with FICO scores of 620 and debt-to-income (DTI) ratios of 31 percent, the foreclosure rate for GSE loans with 100 percent LTV is a little more than twice that of loans with 80 percent LTV.

—> When it comes to FHA loans with the same credit characteristics, the foreclosure rate is almost three times as much among loans with LTVs of 100 percent compared to loans with LTVs of 80 percent. 

—> LTV ratios hold a stronger relationship with foreclosure rates among FHA loans than GSE loans.

—> The FHFA found that the LTV-foreclosure rate relationship is sensitive to FICO. This finding was evident when observing various LTV ratios among different classes of FICO scores.

—> According to the FHFA, once LTV rises above 95 percent, the foreclosure rate tends to correlate less with LTV ratio.

—> The relationship between LTV and foreclosure is most dramatic between LTVs of 90 and 95 percent when it comes to FHA loans. 

Read the full story…

In other news…

Housing starts surge in November — sign of housing pickup?
Source: LA Times

The U.S. Commerce Department reported this week that housing starts in November increased by nearly 23 percent from the previous month. Clearly, the housing market recovery is picking up pace heading into next year. The number of homes that builders started last month was well above October estimates.

Read the full story… 

Jumbos Surge 34% With Record ARMs Belying ’08 Anxiety: Mortgages
Source: Bloomberg

Jumbo loans, both adjustable and fixed-rate, increased by 34 percent to $216 billion in the first nine months of this year, with ARMs comprising the majority of the gain. 

Read the full story…

Where the Renters Live Now
Source: The Atlantic

The Census Bureau has unveiled a new mapping tool which allows for the visualization of the share of residents, by census tract, who live in homes they own themselves. This data maps out where homeownership rates are the highest and, conversely, where renters live.

Read the full story… 

U.S. Home Builders’ Confidence Climbs
Source: Wall Street Journal

The National Association of Home Builders has reported that its housing-market index rose to 58 this month from 54 in November. This is the highest level since August, and an index rate over 50 indicates expansion for the industry. 

Read the full story…

FHA reports improvements in finances, but net worth still negative
Source: LA Times

Coming off a $1.7-billion bailout, the Federal Housing Administration is projecting that it will replenish its financial reserves to required levels in 2015. The agency’s net worth is still in the red by $1.3 billion, but its finances have improved by $15 billion from a year ago. 

Read the full story…

Many California families struggle to pay for basics, study says
Source: LA Times

According to the California Budget Project, a nonpartisan research group, many California families are struggling from paycheck to paycheck, and expensive housing, high childcare costs and rising healthcare expenses are the main factors. Nearly one-third of households in the state spent at least half their income on rent.

Read the full story… 

US Federal Reserve pulls back on stimulus effort
Source: BBC News

The Federal Reserve has announced that it will scale back its stimulus for the economy by cutting the amount of bonds it purchases every month by $10 billion, citing the improved outlook of the labor market. With the start of the new year, it will buy $35 billion in mortgage bonds and $40 billion in Treasury debt.

Read the full story…

Talking Points…

—> According to the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.), an increase in home prices, coupled with higher interest rates, put downward pressure on housing affordability and led to the fourth straight month of sales declines in November. 

—> The available supply of existing, single-family detached homes for sale edged up in November to 3.6 months, up from October’s Unsold Inventory Index of 3.4 months. The index was 3 months in November 2012.  The index indicates the number of months needed to sell the supply of homes on the market at the current sales rate.

—> The median number of days it took to sell a single-family home also increased to 36.7 days in November, up from 33.1 days in October, but was down from 37.5 days in November 2012.

Hope this information helps!

Cordially,
David S. Wilfert
RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue, Suite A-100, North Tustin, CA 92705
Real Estate Broker – BRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 963-8000 or Email: David@WilfertGroup.com

Why Buy Now?

Why should you buy a home now instead of waiting?

The year 2013 can be categorized by a significant turnaround in the housing market across the nation. While lack of homes available for sale constrained home sales in many markets across California, it contributed to a substantial increase in home prices. Existing single family sales for 2013 are predicted to fall 2.1 percent short of 2012 sales, yet median home prices are expected to show a 28 percent improvement over 2012 – - with the median reaching $408,600.

The increase in home prices coupled with a percentage point increase in mortgage interested rates led to a sharp decrease in affordability. Despite decreased affordability, current market conditions still warrant buying a home sooner rater then later. First, interest rates are still at historical lows but are poised to increase in 2014. Over the past year, mortgage interest rates increased by about one percentage point, from about 3.5 percent to 4.5 percent. On average, a half percentage point fluctuation in the mortgage rate changes the payment by $100 per month on a median priced home of $415, 770. Most of the predictions for 2014 put the 30-year fixed rate mortgage at 5.3 percent.

While interest rates have moved down since their spike during the summer, the uncertainty over the Fed’s policies make it difficult to hope for any improvement in interest rates. The Fed’s bond buying is the key consideration – - not just the tapering, but the general pace of withdrawal. While tapering was considered certain in September, December 2013 is now an increasingly possible date after the most recent employment report showed marked improvement in hiring.

The second reason to buy a home sooner has to do with the new lending rules going into effect on January 1, 2014 which are set to raise the cost of borrowing. The ability-to-repay rule and the associated qualified-mortgage definition will raise the overall cost of originating home loans, with borrowers taking the brunt of the financial hit.

There are two other important market conditions to keep in mind. We started the year with a heated market that was at times described as “a bubble”. Since the autumn, the housing market has cooled off. On one hand, due to decreased affordability and increased mortgaged rates, demand for housing has subsided and bidding wars are not as frequent or as aggressive as we saw earlier in the year. Additionally, inventory of homes for sale has shown improvement with more homes on the market now. These two conditions suggest a more favorable market for buyers and one that resembles a shift towards a ‘’normal” market.

Cordially,
David S. Wilfert
RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue, Suite A-100, North Tustin, CA 92705
Real Estate Broker – BRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 963-8000 or Email: David@WilfertGroup.com

December Market Matters Report I

Housing markets rebound faster when foreclosures proceed quickly
Source: The LA Times

Appraisal industry experts have posited that real estate markets rebound much faster in areas where state law permits foreclosures to proceed quickly. Allowing homes with defaulted loans to move into new owners’ hands quickly prevents them from being tied up in court procedures for years, which negatively affects values of neighboring properties and the overall health of the housing market.

Making sense of the story:

—> Delays are most pronounced in judicial states, where post-default proceedings can stall foreclosure completions for two to three years or even longer.

—> The fastest-rebounding markets, comprised of strong sales, price increases and low inventories of unsold houses, were located in so-called nonjudicial states, where foreclosures can proceed without the intervention of courts.

—> Home-price recoveries are hindered when lenders are prevented from recovering and reselling the units to buyers due to legal limbo. Also, investors and other buyers can’t swoop in and return them to residential use rapidly.

—> Since California is a nonjudicial state, some of the best-performing market areas were Los Angeles and San Diego. In California, foreclosures now account for just 10 percent of all sales, while in slow-moving judicial states, 25 to 50 percent of sales are foreclosures.

—> The worst performers were judicial states. Specifically, Florida markets such as Tampa and Fort Myers, as well as parts of Illinois and Wisconsin.

Research reveals nonjudicial states bottomed out sooner than judicial states, and have seen greater appreciation since the bottom (typically 50 to 80 percent compared with just 10 to 45 percent for judicial states).

Read the full story…

In other news…

White House Representative Speaks on Housing Finance Reform
Source: DSNews.com

Gene Sperling, director of the National Economic Council for the White House, recently discussed the president’s four major principles for housing finance reform at an industry symposium. Sperling emphasized maintaining widespread access to the 30-year, fixed-rate mortgage, and enhancing the role of private capital in the market.

Read the full story…

New home sales surge in October
Source: The LA Times

The Commerce Department is reporting that sales of newly built single-family houses rose 25.4 percent from September to a seasonally adjusted annual rate of 444,000. Sales are up 21.6 percent in comparison to October 2012.

Read the full story…

Mortgage loan quality improved in 2013
Source: HousingWire

Home loan eligibility jumped to 96.44 percent in the first half of the year from 93.66 percent in 2012, according to a new report from compliance technology firm Quality Mortgage Services.

Read the full story…

FHFA: Conforming Loan Limits Remain Unchanged
Source: DSNews.com

The Federal Housing Finance Agency has announced that the 2014 maximum loan limit for mortgages acquired by Fannie Mae and Freddie Mac will remain at $417,000 for one-unit properties in most areas of the country. There is a cap of $625,500 in high-cost areas.

Read the full story…

Senate opens door for immediate housing finance reform
Source: The Hill

Due to the Senate’s elimination of the filibuster for presidential nominations, many experts believe Rep. Mel Watt (D-N.C.) finally will be as the next director of the Federal Housing Finance Agency, and with that change in leadership, there could be immediate major housing finance reform that provides greater access to the conventional housing finance market for a variety of buyers.

Read the full story…

Key U.S. housing markets challenged by lack of multifamily builds
Source: HousingWire

The latest building permit numbers indicate there were 387,000 authorizations for new multifamily units in October, which is an increase from the past two months. However, experts argue the number is too low and that equity financing for apartment projects is not growing.

Read the full story…

Southland home buyers shifting to condos as house prices rise
Source: The LA Times

Since home prices jumped in price this year, southern California home buyers purchased fewer single-family homes in October due to affordability concerns. However, since condos are the only affordable path to homeownership in many urban areas, demand increased this year.

Read the full story…

Talking Points…

—> According to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.), California pending home sales rose in October, with the Pending Home Sales Index (PHSI) climbing 2.5 percent in October to 109.3, up from 106.7 in September, based on signed contracts.  The monthly increase was considerably greater than the average September-to-October change of 0.7 percent over the past five years.

—> The share of equity sales – or non-distressed property sales – dipped slightly in October, but still made up more than eight in 10 sales, marking the fourth straight month that equity sales have been more than 80 percent of total sales.

—> Housing inventory levels tightened slightly for the first time in five months but were still extremely low.  The Unsold Inventory Index for equity sales dipped from 3.5 months in September to 3.4 months in October.

Thanks for reading.

Cordially,
David S. Wilfert
RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue, Suite A-100, North Tustin, CA 92705
Real Estate Broker – BRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 963-8000 or Email: David@WilfertGroup.com

 

Buying vs. Renting

RentingvsBuying

 

Brought to you by:

David S. Wilfert RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue Suite A-100 North Tustin, CA 92705
Real Estate Broker – DRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 963-8000 or Email: David@WilfertGroup.com

SOLD: 12832 Elizabeth Way Tustin, CA 92780

Notes:

Welcome to the City of Tustin, centrally located in the heart of Orange County. This property is situated in a safe, quiet, family oriented neighborhood, and is conveniently close to shopping, schools, and freeways.  Look no further for charm, this three bedroom, two bathroom property has approx. 1,600 sqft of livable space and rests on an expansive lot just under 11,000 sqft. Wood framed windows and original hardwood floors flow throughout this ranch style home. Forced air furnace coupled with a central air conditioning will be sure to keep you comfortable year round. The property includes a newer composition shingle roof, an extended driveway with possible RV access, breezeway, private patio with a HUGE backyard…the possibilities are endless. Don’t let this one pass you up, CALL TODAY.

 

Tustin School System:
  • School District:  Tustin Unified School District
  • Elementary School:  Barbara Benson Elementary
  • Junior High School:  C.E. Utt Middle School
  • High School:  Tustin High School

Listed @ $529,000

SOLD @ $532,000

Cordially,
David S. Wilfert
RE/MAX R.E.O. – The Wilfert Group
12341 Newport Avenue, Suite A-100, North Tustin, CA 92705
Real Estate Broker
– DRE# 01861699
Notary Public – Commission# 1987439
Direct: (714) 357-1422 or Email: David@WilfertGroup.com

Directions:

Take the 55 Northbound, EXIT Fourth Street, LEFT on Newport Avenue, RIGHT on Wass, LEFT on Elizabeth and END at 12832 Elizabeth Way.

Photos:

Map: 12832 Elizabeth Way Tustin, CA 92780


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SOLD: 2955 Peppertree Costa Mesa, CA 92626

Notes:

FANTASTIC starter home in the coveted Mesa Verde community of Costa Mesa!  Three (BIG) Bedrooms, two bathrooms with a master suite.  Refurbished bathrooms!  Tiled floor, with partial carpet and dual pane windows.  Direct garage access.  Kitchen has breakfast bar and dine-in area.  GREAT backyard, perfect for summer BBQs.  Close to shopping, entertainment and freeways.  Perfect for the commuter.  Call today!

Directions:

Take the 55 Southbound to the 405 Northbound, Exit Harbor, Right on Baker, Left on Royal Palm, Left on Peppertree Lane and end at 2955 Peppertree Lane Costa Mesa, CA 92626.  See you soon!

Listed @ $499,000!

SOLD @ $499,000!

Call me today with all your real estate questions!

Cordially,
The Wilfert Group©
David S. Wilfert
DRE#: 01861699
Direct: (714) 357-1422
Info@WilfertGroup.com

Photos:

Map: 2955 Peppertree Lane Costa Mesa, CA 92626

View Larger Map

SOLD @ $340,000: 996 S. Siet Place Anaheim, CA 92806

Notes:

GREAT opportunity to buy in Anaheim, fix as you go and build equity on the go.  This home will be sold ‘As-Is.’  Please ask me with questions.  Thanks!

Directions:

Listed: $319,000

SOLD: $340,000

Call with questions!

Cordially,
The Wilfert Group©
George & David Wilfert
DRE#: 01861699
Direct: (714) 357-1422
Info@WilfertGroup.com

Map: 996 S. Siet Place Anaheim, CA 92806


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College Park: Third Quarter 3Q SOLD Listings

Costa Mesa Homes for Sale

Orange County Real Estate

Links:

City of Costa Mesa: September, End of Month Report

College Park: Second Quarter Q2 SOLD Listings

Featured Costa Mesa Listing:

Costa Mesa CA

For more detailed information specific to your property call today or request a FREE market evaluation!

Best regards,
The Wilfert Group©
George & David S. Wilfert
Direct: (714) 357-1422
Info@WilfertGroup.com

Disclaimer:

The generated data is gathered from the SoCal Multiple Listing Service (MLS) and is deemed reliable but not guaranteed.  This information should be used objectively as the foundation for your research.  For more detailed community information or a Computerized Market Evaluation please contact us at the Wilfert Group.

City of Costa Mesa: September, End of Month Report

Single Family Residences (SFR):

City of Costa Mesa

City of Costa Mesa

Condominiums (Condos):

City of Costa Mesa

City of Costa Mesa

Links:

City of Costa Mesa: August, End of Month Report

Featured Listings:

Costa Mesa CA

For more detailed information specific to your property call today or request a FREE Market Evaluation!

Best regards,
The Wilfert Group©
George & David S. Wilfert
Direct: (714) 357-1422
Info@WilfertGroup.com

Disclaimer:

The generated data is gathered from the SoCal Multiple Listing Service (MLS) and is deemed reliable but not guaranteed.  This information should be used objectively as the foundation for your research.  For more detailed community information or a Computerized Market Evaluation please contact us at the Wilfert Group.

 

Old Town Tustin: August, End of Month Report

City of Tustin

City of Tustin

Links:

City of Tustin: August, End of Month Report

Old Town Tustin: July, End of Month Report

Featured Tustin Listings:

Peppertree, City of Tustin

For more detailed information specific to your property call today or request a FREE market evaluation!

Best regards,
The Wilfert Group©
George & David Wilfert
Direct: (714) 357-1422
Info@WilfertGroup.com

Disclaimer:

The generated data is gathered from the SoCal Multiple Listing Service (MLS) and is deemed reliable but not guaranteed.  This information should be used objectively as the foundation for your research.  For more detailed community information or a Computerized Market Evaluation please contact us at the Wilfert Group.

 

Peppertree: August, End of Month Report

City of Tustin

Links:

City of Tustin: August, End of Month Report

Peppertree: July, End of Month Report

Featured Tustin Listings:

Peppertree, City of Tustin

For more detailed information specific to your property call today or request a FREE market evaluation!

Best regards,
The Wilfert Group©
George & David Wilfert
Direct: (714) 357-1422
Info@WilfertGroup.com

Disclaimer:

The generated data is gathered from the SoCal Multiple Listing Service (MLS) and is deemed reliable but not guaranteed.  This information should be used objectively as the foundation for your research.  For more detailed community information or a Computerized Market Evaluation please contact us at the Wilfert Group.

 

Tustin Meadows: August, End of Month Report

City of Tustin, CA

City of Tustin

Links:

City of Tustin: August, End of Month Report

Tustin Meadows: July, End of Month Report

Featured Tustin Listings:

Peppertree, City of Tustin

For more detailed information specific to your property call today or request a FREE market evaluation!

Best regards,
The Wilfert Group©
George & David Wilfert
(714) 357-1422

Disclaimer:

The generated data is gathered from the SoCal Multiple Listing Service (MLS) and is deemed reliable but not guaranteed.  This information should be used objectively as the foundation for your research.  For more detailed community information or a Computerized Market Evaluation please contact us at the Wilfert Group.