Fla. consumer confidence hits five-year high

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·         Fla. consumer confidence hits five-year high

·         GAINESVILLE, Fla. – Sept. 26, 2012 – Florida’s September consumer confidence reached a post-recession high of 79 – up three points from a revised August reading of 76 – according to a monthly University of Florida (UF) survey.

“The last time Florida consumer confidence hit 79 was in October 2007,” says Chris McCarty, director of UF’s Survey Research Center in the Bureau of Economic and Business Research. “At that time, confidence was on its way down as the housing crisis was getting under way. This month’s index comes at a time when the economy is still in recovery.”

The September survey showed increases in all five components that researchers use to assess the collective economic opinion of Floridians.

In September, the component measuring whether respondents’ think they’re better off economically today compared to a year ago rose one point to 62. In addition, the component that measures economic expectations one year from now rose one point to 86, while the component measuring expectations that personal finances will improve a year from now rose one point to 86.

Floridians had a rosier outlook for the state as well. That component rose three points to 78. The component that measured their outlook for the nation went up two points to 84.

Finally, the component that measures whether Floridians think it’s a good time to buy big-ticket items, such as automobiles and refrigerators, rose two points to 82.

Despite the uptick, McCarty says several economic conditions serve as a drag on Florida’s recovery: job losses in construction and government helped keep the state’s unemployment rate in August unchanged from the previous month at 8.8 percent. And “although inflation is currently under control, consumers should expect increases in prices next year, as the effects of the drought hitting much of the U.S. make their way into food prices.”

However, there is good economic news for Florida.

The median price for a single-family home in August was up 5.8 percent over the previous year’s average at $147,000, although it was down slightly from July’s figure.

“The stock market is getting closer to the all-time record and this, along with increases in housing prices, are certainly a boost to consumers’ sense of wealth,” McCarty says, adding that October should prove to be an “interesting month.”

Political ideology, which already plays a significant role in consumer confidence, could also become even more crucial as the presidential campaign heats up. “Obama supporters have much higher confidence than Romney supporters,” McCarty. “Whether Floridians react negatively or positively remains to be seen, but it will largely determine consumer confidence as we get close to the holiday shopping season.”

Conducted Sept. 12-20, the UF study reflects the responses of 419 individuals who represent a demographic cross-section of Florida. The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2; the highest is 150.

© 2012 Florida Realtors®

 

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Time to buy your first home is NOW

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·         Florida Housing Finance, the administrator of the Florida Bond program has just delivered some great news for area First Time Homebuyers.  The interest rate on the program has been lowered to a fixed rate of 3.5%!  Lender fees are still very limited on the program and no doc stamps or intangible taxes are collected on the note and mortgage which saves the borrower a significant amount at closing.

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·         A second program change that has been communicated is that the borrower’s minimum cash investment under the program of $1,000 can now be gifted!

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·         Most borrowers under the program will qualify for a $7,500 zero interest, zero payment second mortgage that can be used towards the down payment and closing costs of the loan.  Certain borrowers may qualify for additional assistance of up to $10,000 under the Lee County HOME program, up to $20,000 under the Collier County SHIP program or up to $5,000 under the Federal Home Loan Bank first time homebuyer program.  And if further assistance is needed, the seller can pay up to 6% of the purchase price towards closing costs!

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·         Keep in mind that to qualify for this program, the borrower and/or their spouse cannot have owned a primary residence over the last three years.  Also, maximum household income cannot exceed $79,800 for a family of three or more or $68,400 for a one or two person family in Lee County or $101,920 for a family of three or more or $87,360 for a one or two person family in Collier County.  The minimum credit score on the program is 640 and non-traditional credit can be developed for a borrower if no credit scores exist. 

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Contact us for more information

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Time to buy a house is NOW

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·         If you can pull it off, buy a house

·         NEW YORK – Aug. 13, 2012 – Investment opinions are like, um, noses: Everyone has one. Buy stocks, sell bonds? Go long steel and short copper? Buy sheep, sell deer?

It’s pretty easy to see both sides of an investment argument. But it’s hard to argue against buying a house now, assuming you can get a loan.

The housing cycle is a long one, in part because buying a house moves at a glacial pace, at least compared with the time it takes to buy a stock or bond. If you’re not pre-approved for a mortgage, you have to submit to a credit check, which, these days, is only slightly less intrusive than a CIA background check. You have to get the home inspected. You have to figure out the various fees your bank charges, including the one marked “Just because we can.”

How long is a housing cycle? Pretty long. A relatively modest housing bubble, by today’s standards, occurred in Boston in the late 1980s. Average home prices, adjusted for inflation, hit $310,000 in October 1987. Home prices didn’t hit that level again until May of 2000. Someone who bought at the high had a long wait to get even – particularly in light of the broker’s commission.

Home prices bottomed, however, in March 1993 – roughly six years after the top. History doesn’t repeat itself precisely, but it’s interesting to note that the top of the last housing bubble was six years ago, in 2006.

Why be bullish on housing?

Prices. You can always buy low and watch prices go lower. But by many measures, home prices are still cheap. The median single-family home price – half higher, half lower – hit its nadir in January, dropping to $154,600, the lowest since October 2001, according to the National Association of Realtors. That’s down from a high of $230,900 in July 2006.

Existing-home prices rose in June to a median $190,100, up 8 percent from June 2011. Those are still 2003 levels.

Supply. The good news is that the enormous supply on the market is shrinking. It takes a wearisome amount of time for supply to shrink, in part because there are people who have wanted to sell their homes for many years, but haven’t been able to get the price they want. As prices rise, more homes come on the market.

Nevertheless, Ned Davis Research, a respected institutional research firm, estimates that excess supply of houses on the market should be eliminated by the end of 2013. When excess supply dries up, people start building more new houses, which has the virtuous effect of reducing the unemployment rate and increasing the economy generally.

Mortgage rates. The average 30-year fixed-rate mortgage rate is 3.59 percent, according to mortgage giant Freddie Mac. That’s above the all-time low of 3.49 percent the week of July 26, but close enough. It’s conceivable that at some point in the next 30 years, your interest rate would be less than the rate of inflation.

Assuming you financed 80 percent of the median single-family home, or $152,080, your mortgage payment would be about $691, excluding taxes and other irritations. About $5,589 of your first year’s payments would be tax-deductible mortgage interest.

Thanks mainly to low home prices and interest rates, the NAR’s housing affordability index rose to its highest level on record. (The higher the index, the more affordable the average home. The index also takes into account average family income, which has been falling since 2008.)

What could go wrong? All sorts of things. You may not be able get a loan. Bankers are insisting on checking things that seemed far too troublesome during the housing bubble, like whether you have a decent credit rating, a down payment, or a job.

The other problem is that houses are leveraged investments – that is, you borrow money to buy them. Let’s consider the example above, where someone buys a $190,100 house and finances $152,080.

Your investment is $38,020. Let’s say that the worst happens: Home prices fall, and you have to sell the house for $175,000.

Unfortunately, the bank won’t split the loss with you. You’ll get back $22,920 from the sale, and wave goodbye to $15,100 of your downpayment. That’s a 40 percent loss, even though your house has fallen 8 percent in value.

There are other risks with homeownership, ranging from termites to ghosts in the hall closet. But if you’re planning to live in your home for a long time, you have the money, and you can get financing, it’s a fine time to buy.

© Copyright 2012 USA TODAY, a division of Gannett Co. Inc.

 

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Housing market turning around. Prices moving up

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National Association of REALTORS(R) FROM THE President Encouraging Signs

 

We're seeing a lot of encouraging signs in the housing market across the country. NAR's latest existing–home sales report shows there's not inventory to meet the demand in many areas and that's driving up prices and creating multiple bidding situations. These findings vary greatly from what we've had before. Hear more from an interview I did recently with XM radio, and be sure to share it with your clients. Listen to President Moe Veissi's radio interview http://www.realtor.org/audio/moe-veissi-discusses-encouraging-signs-in-housing-market-on-xm-radio?om_rid=AABhLk&om_mid=_BQGxlvB8tHU1W6&om_ntype=NARWeekly Moe Veissi Discusses Encouraging Signs in Housing Market on XM radio 02:04 ·moe-veisse-xm-radio-discusses-encouraging-housing-market-signs-2012-07-30.mp3 Listen to an interview with NAR President Moe Veissi on XM radio where he talks about encouraging signs in the housing market, including year-over-year price increases, lower inventory, and even multiple bids in some instances. He provides tips for people considering buying a home and what to do ahead of time before beginning the search for the perfect home

 

 

 

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Housing market lifts off from the 'bottom'

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Housing market lifts off from the ‘bottom’

WASHINGTON – Aug. 2, 2012 – Recent housing indexes have shown single-family home prices are on the rise, providing more evidence that the “bottom” of the market is already behind.

“We’re wiping out just about all of the decline,” Joel Naroff, chief economist at Naroff Economic Advisors, told NBC.com about recent housing data showing home prices inching up. “It indicates the market has turned the corner on the pricing side.”

Some recent housing indexes suggest that the “bottom” of the market was reached in January 2012. Since that time, housing prices have been picking up in many housing markets.

But “the turnaround in home prices was unexpected,” says Patrick Newport, an economist with IHS Global Insight. “The conventional wisdom in February, following that landmark agreement (of the $26 billion mortgage settlement with the nation’s five largest banks), was that we would see a surge in foreclosures of some size that would lead to lower home prices. This surge never materialized and home prices have turned.”

Newport points to several signs of a housing market on the mend. For one, housing starts are up after reaching a low in the fourth quarter of 2011. Also, he says the Federal Housing Finance Agency’s (FHFA) monthly House Price Index shows a 3.7 percent increase in May year-over-year, which he notes is higher than inflation and “means that real housing wealth, a consumer spending driver, was also up.”

The increase in home prices is also leading to a fewer number of homeowners underwater on their mortgages. The number of underwater homeowners fell from 12.1 million at the end of 2011 to 11.4 million at the end of the first quarter this year, according to CoreLogic data.

Source: “Evidence Mounts that Home Prices Hit Bottom Last Winter,” NBC News (July 31, 2012)

© Copyright 2012 INFORMATION, INC. Bethesda, MD (301) 215-4688

 

 

 

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Zillow says it's official: Market hit bottom

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Zillow says it’s official: Market hit bottom

SEATTLE – July 24, 2012 – Experts still question Zillow’s forecasts, but their latest one could convince skittish buyers to jump into the market: The company says its Zillow Home Value Index (ZHVI) rose on an annual basis for the first time since 2007 in the second quarter, increasing 0.2 percent year-over-year to $149,300. Zillow execs say a pattern of price increases indicates that the real estate market has hit bottom.

“After four months with rising home values and increasingly positive forecast data, it seems clear that the country has hit a bottom in home values,” says Zillow Chief Economist Dr. Stan Humphries. “The housing recovery is holding together despite lower-than-expected job growth, indicating that it has some organic strength of its own.

Nearly one-third of metros in the ZHVI – 53 out of 167 – posted an annual increase in home values. The largest increase came in Phoenix, where home values are up 12.1 percent compared to the second quarter of 2011.

In a separate report that forecasts future home values, Zillow expects 67 of 156 markets to see value increases over the next year, with the largest increases expected in the Phoenix (9.9 percent) and Miami areas (6.1 percent). U.S. home values are expected to rise 1.1 percent.

“Of course, there is still some risk as we look down the foreclosure pipeline and see foreclosure starts picking up,” says Humphries. “This will translate into more homes on the market by the end of the year, but we think demand will rise to absorb that, particularly in markets where there are acute inventory shortages now. Looking forward, we expect home values to remain relatively flat as the market works through a backlog of foreclosures and high rates of negative equity.”

© 2012 Florida Realtors®

 

 

 

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Renten Alarm

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·          Berlin – Der große Renten-Alarm: Betroffen sind allein 17 Mio. Deutsche, die mit Betriebsrenten vorsorgen. Sie müssen sich auf niedrigere Auszahlungen einstellen, so Rentenexperte Bernd Raffelhüschen (Uni Freiburg) in der „Frankfurter Allgemeinen Sonntagszeitung“. July 2012

·         Gefährlich wird es aber auch für Riester-Sparer und alle jene, die auf Lebensversicherungen setzen!

·         Der Grund: Vorsorge-Gelder müssen besonders sicher angelegt werden. Doch Staaten mit hoher Kreditwürdigkeit zahlen in der Euro-Krise nur noch geringe Zinsen! Eine deutsche Bundesanleihen mit einer Laufzeit bis 2017 bringt gerade mal 0,32 % (2022: 1,28 %).

·         Finanzexperte Prof. Stefan Homburg (Uni Hannover) zu BILD: „Die Renditen sinken von Jahr zu Jahr. Für Anbieter privater Altersvorsorge wird es immer schwieriger, die Gelder gewinnbringend anzulegen und den Garantiezins zu erwirtschaften. Die Deutschen müssen sich mit Mager-Zinsen zufriedengeben.“

·         Nach Berechnungen der Anleiheberater Bantleon dürfte die Verzinsung von derzeit 4 % auf 2,5 % in 2017 sinken. Das heißt: 1000 Euro Rente, die heute noch im Vertrag angepriesen werden, schmelzen auf 650 Euro zusammen.

·         Und diese Mager-Renditen drohen auch noch von steigenden Preisen aufgefressen zu werden!

·         Der Grund: Die Europäische Zentralbank (EZB) verleiht zurzeit Geld zu Mini-Zinsen (0,75 %) an die Banken, um die Wirtschaft anzukurbeln.

·         Problem: Je mehr Geld Banken verleihen, desto mehr wird ausgegeben. Das steigert die Nachfrage – und treibt die Preise. Zwar lag die Teuerung im Juni nur bei 1,7 %. Aber Finanzexperte Homburg rechnet mit weiter steigender Inflation, sollte sich die Euro-Krise verschärfen. Konkret: Steigen die Preise um 5 %, sind 1000 Euro nach 10 Jahren nur noch 614 Euro wert.

 

 

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