Consumer Confidence Relatively Unchanged in July

By Marla Martin

U.S. consumers remain optimistic: July’s confidence index is about the same as June’s, after gains in each of the prior 5 months – and the highest since Feb. 2020.

NEW YORK – The Conference Board Consumer Confidence Index was relatively unchanged in July, following gains in each of the prior five months. The Index now stands at 129.1, up from 128.9 in June.

The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – rose from 159.6 to 160.3. The Expectations Index – based on consumers’ short-term outlook for income, business, and labor market conditions – was virtually unchanged at 108.4, compared to 108.5 last month.

“Consumer confidence was flat in July but remains at its highest level since February 2020,” says Lynn Franco, senior director of economic indicators at The Conference Board. “Consumers’ appraisal of present-day conditions held steady, suggesting economic growth in Q3 is off to a strong start. Consumers’ optimism about the short-term outlook didn’t waver, and they continued to expect that business conditions, jobs and personal financial prospects will improve.”

Franco says short-term inflation expectations eased slightly but they’re still elevated. “Spending intentions picked up in July, with a larger percentage of consumers saying they planned to purchase homes, automobiles, and major appliances in the coming months.,” she added, and “consumer spending should continue to support robust economic growth in the second half of 2021.”

Present situation

Consumers’ appraisal of current business conditions improved slightly in July.

• 26.4% of consumers said business conditions are “good,” up from 25.2%.
• 19.3% of consumers said business conditions are “bad,” up from 19.1%.

Consumers’ assessment of the labor market was relatively flat.

• 54.9% of consumers said jobs are “plentiful,” up from 54.7%.
• 10.5% of consumers said jobs are “hard to get,” unchanged from June.

Expectations six months from now

Consumers’ optimism about the short-term business conditions outlook eased slightly in July.

• 33.4% of consumers expect business conditions will improve, down from 33.7%.
• 10.5% expect business conditions to worsen, down from 10.8%.

Consumers were mixed about the short-term labor market outlook.

• 27.7% of consumers expect more jobs to be available in the months ahead, up from 26.6%.
• Conversely, 16.8% anticipate fewer jobs, up from 15.7%.

Consumers remained upbeat about their short-term financial prospects.

• 20.6% of consumers expect their incomes to increase, up from 20.0%.
• Only 8.6% expect their incomes will decrease, up from 8.4%.

The monthly Consumer Confidence Survey is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market

© 2021 Florida Realtors®

Buyers’ Biggest Hurdle in June? Lack of Inventory

Buyers’ Biggest Hurdle in June? Lack of Inventory

By Kerry Smith

Today’s buyers have 27.4% fewer homes to choose from than they did one year ago, though in Fla. it ranges from 31.4% near Tampa to 9.4% in South Fla.

SANTA CLARA, Calif. – Buyer demand has risen thanks to record-low mortgage rates and frustration after spending time quarantined in less-than-ideal housing. As a result, sellers who enter the market find continually rising prices and, many times, competitive bids for their property.

But more sellers may be avoiding a potentially strong summer housing market, according to realtor.com’s June Monthly Housing Trends report. Economists found that housing inventory – the number of homes actively available for sale – continues to decline.

Nationally, housing inventory was down 27.4% year-to-year in June, which translates into 363,000 fewer homes listed for sale.

Some Florida metro areas have an even greater drop in inventory, but some have less. In a year-to-year comparison, four metros showed a year-to-year decline ranging from 31.4% to 9.4%:

• Tampa-St. Petersburg-Clearwater: Inventory down 31.4%

• Jacksonville: Down 21.8%

• Orlando-Kissimmee-Sanford: Down 14.4%

• Miami-Fort Lauderdale-West Palm Beach: Down 9.4%

Newly listed properties – ones that came onto the market within the past month – may suggest future improvements, and in Florida, one metro area even saw an increase. Also, every Florida metro bested the national average with rates ranging from an 18.6% decline to a 2.5% increase:

• Tampa-St. Petersburg-Clearwater: Inventory down 18.6%

• Orlando-Kissimmee-Sanford: Down 17.5%

• Jacksonville: Down 0.8%

• Miami-Fort Lauderdale-West Palm Beach: An increase of 2.5%

Nationally, the volume of newly listed properties was down 19.3% over last year – but that’s an improvement over the 44.1% and 29.4% year-over-year declines posted in April and May, respectively.

“Our June data reinforces that buyers are out in force and serious about finding a home,” says realtor.com Chief Economist Danielle Hale. But “inventory continues to decline, indicating that what is coming onto the market is selling.”

Hale says the overall real estate market has shown resilience, “but conditions vary market by market. In particular, the nation’s largest metros are seeing a better new listings trend and smaller increase in the time it takes for a home to sell, which could signal they may lead the recovery.”

© 2020 Florida Realtors®

PENDING!!! 326 N 12th Street Flagler Beach 32136

The real estate market is still moving! I am representing both the Buyers and Seller on this gorgeous Flagler Beach Canal Home! Buyers are still looking! But they’re looking more online now through virtual tours. Having an online presence is of the upmost importance in today’s market! If you’re thinking about selling, I own multiple mobile friendly online platforms ranked on Google and other search engines, that will get your home in front of more buyers, that will in return get you more money for your property.

Give me a Call or Text at 386-793-1426 for more info. - Robert “Bobby” Keith, Realtor

March Pending Sales Plunge 20.8%; NAR Calls It Temporary

By Kerry Smith, Florida Realtors

The usual spring home-selling season took a hit due to the pandemic, but most experts consider it a bump in the road rather than a long-term change.

WASHINGTON – Pending home sales fell 20.8% in March – expected declines as a result of the coronavirus outbreak, according to the National Association of Realtors® (NAR).

The drop was widespread, and each of the four major regions tracked by the index saw drops in month-over-month contract activity and year-over-year pending home sales transactions.

The Pending Home Sales Index (PHSI) – a forward-looking indicator based on contract signings – decreased 20.8% to 88.2 in March. Year-over-year, contract signings declined too though not as much at 16.3%. An index of 100 is equal to the level of contract activity in 2001.

“The housing market is temporarily grappling with the coronavirus-induced shutdown, which pulled down new listings and new contracts,” said Lawrence Yun, NAR’s chief economist. “As consumers become more accustomed to social distancing protocols, and with the economy slowly and safely reopening, listings and buying activity will resume, especially given the record low mortgage rates.”

“The usual spring buying season will be missed, however, so a bounce-back later in the year will be insufficient to make up for the loss of sales in the second quarter,” Yun says. “Overall, home sales are projected to have declined 14% for the year.

“Although the pandemic continues to be a major disruption in regards to the timing of home sales, home prices have been holding up well,” Yun adds. “In fact, due to the ongoing housing shortage, home prices are likely to squeeze out a gain in 2020 to a new record high. I project the national median home price to increase 1.3% for the year, though there will be local market variations and the upper-end market will likely experience a reduction in home price.”

March pending home sales regional breakdown

The Northeast PHSI dropped 14.5% to 82.3 in March – 11.0% lower than a year ago. In the Midwest, the index decreased 22.0% to 85.6 last month, and it’s down 12.4% from March 2019.

Pending home sales in the South sank 19.5% to an index of 103.7 in March, a 17.8% drop from March 2019. The index in the West fell 26.8% in March 2020 to 71.4, down 21.5% from a year ago.

© 2020 Florida Realtors®

Mortgage Rates Hit All-Time Low – 3.23%

By Kerry Smith

The pandemic-slowed economy pushed the average 30-year mortgage rate to its lowest point in at least 50 years – since Freddie Mac started tracking rates in 1971.

WASHINGTON – The pandemic-slowed U.S. economy pushed the average 30-year mortgage rate to its lowest point in at least 50 years, according to Freddie Mac, which started tracking rates in 1971.

The size and depth of the secondary mortgage market is helping keep rates at record lows, Freddie Mac says. Today’s low rates are driving higher refinance activity and a modest uptick in demand for new-home purchases.

However, not everyone can take advantage of today’s low rates. In some cases, banks have tightened lending restrictions and are making loans only to well-qualified buyers or home refinancers. In addition, some potential homebuyers in January are now out of work as applications for unemployment skyrocket.

At 3.23%, the average 30-year fixed-rate mortgage is down 0.10% week-to-week (from 3.23%) and 0.91% compared to this same time last year.

The 15-year fixed-rate mortgage dropped to 2.77% this week. That’s down .0.09% from last week (from 2.86%) and down 0.83% year-to-year.

The 5/1 hybrid adjustable-rate mortgage averaged 3.14 % this week.

Economists at Fannie Mae predicted this week that 30-year rates could go as low as 2.9% in 2021, however it’s unclear yet what effect the COVID-19 pandemic will have over the long term.

“In our view, the negative shock will apply to both the home purchase and rental markets. On the demand side, early indications are that the purchasing benefit of lower interest rates are being offset by the downturn in employment,” says Doug Duncan, senior vice president and chief economist at Fannie Mae.

“On the supply side, the number of listings is falling, as those with homes to offer may either be hesitant to allow strangers to tour their home or worry that the lack of demand is placing downward pressure on the sales price they might otherwise receive,” Duncan adds.

© 2020 Florida Realtors®

National Home Warranty Day

A question I get a lot from home buyers is “Do I need a home warranty?”

Since today is National Home Warranty Day, I wanted to go over what a home warranty is, and what it covers.

A home warranty is different from home owner’s insurance in that the home warranty covers the repair or replacement of your appliances that break down through normal wear and tear.

There’s also different types of home warranties out there that cover various things in your home, so you can choose the one that best fits your needs. Home warranties can be handy and help give you piece of mind knowing that if something does break, you’re covered.

Do you have a question about home warranties? Feel free to give Robert “Bobby” Keith a call/text at 386-793-1426.

Happy Floridians: July Consumer Sentiment Up 3.7 Points

Consumers felt better in both the short- and long-term measurements, suggesting optimism for the future and content in the present.

GAINESVILLE, Fla. – As the U.S. entered its longest economic expansion in its history, consumer sentiment among Floridians increased 3.7 points in July to 100.2 – an increase from June’s revised figure of 96.5.

All five components that make up the index increased.

Current conditions
Floridians’ opinions of their personal financial situation now compared with a year ago increased 3.6 points from 93.2 to 96.8, though opinions varied greatly by demographics; male respondents and those under age 60 reported less-favorable opinions. Similarly, opinions as to whether now is a good time to buy a major household item like an appliance increased 3.2 points from 100.3 to 103.5, though men reported less-favorable opinions.

“Overall, these two components showed that views regarding current economic conditions improved among Floridians in July,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research.

Future expectations
The three components corresponding to Floridians’ expectations about future economic conditions also improved. Expectations of personal financial situations a year from now increased 4.5 points from 103.5 to 108.

The outlook of U.S. economic conditions over the next year showed the greatest increase in this month’s reading, up 5.1 points from 92.6 to 97.7.

Finally, expectations of U.S. economic conditions over the next five years increased 2.2 points from 92.7 to 94.9. These expectations are shared by almost all Floridians; however, men again reported less-favorable expectations.

“Despite the divided views by gender, Floridians are overall more optimistic in July,” says Sandoval. “The gain in July’s reading comes from consumers’ expectations about the national economy in the short run.”

Economic indicators have remained positive. July is the 121st consecutive month of gross domestic product growth since the Great Recession, breaking the record of 120 months of economic growth between March 1991 and March 2001. Starting in June 2009, the current growth trend is now the longest economic expansion in U.S. modern history. 

In Florida, unemployment peaked at 11.3% in January 2010 as a result of the Great Recession, but Florida’s labor market strengthened with solid job gains statewide and has led to an unemployment rate of 3.4% in June 2019. Compared with a year ago, the number of jobs increased by 218,800 in June, an increase of 2.5%.

Among all industries, education and health services gained the most jobs, followed by professional and business services, leisure and hospitality, and construction. The information industry was the only sector losing jobs. Moreover, according to the U.S. Bureau of Economic Analysis, in the first quarter of 2019, Florida’s gross state domestic product increased 2.9%.

“Looking ahead, in view of the labor market conditions and current economic outlook, we expect consumer sentiment in Florida to remain high in the coming months, continuing the economic expansion,” Sandoval said.

© 2019 Florida Realtors®

U.S. Consumer Confidence Surges in July

While confidence took a small hit in June (124.3), it rose 11.4 points this month to 135.7, and results should “continue to support robust spending in the near-term.”

BOSTON – The Conference Board Consumer Confidence Index rebounded 11.4 points in July following a decrease in June.

The Index now stands at 135.7, up from 124.3 in June. The Present Situation Index – based on consumers’ assessment of today’s business and labor market conditions – increased from 164.3 to 170.9. The Expectations Index – based on consumers’ short-term future outlook for income, business and labor market conditions – increased from 97.6 last month to 112.2 this month.

“After a sharp decline in June driven by an escalation in trade and tariff tensions, Consumer Confidence rebounded in July to its highest level this year,” says Lynn Franco, senior director of economic indicators at The Conference Board. “Consumers are once again optimistic about current and prospective business and labor market conditions. In addition, their expectations regarding their financial outlook also improved. These high levels of confidence should continue to support robust spending in the near-term despite slower growth in GDP.”

Current conditions
Consumers’ assessment of present-day conditions improved. Those claiming business conditions are “good” increased from 37.5% to 40.1%; however, those saying business conditions are “bad” also increased slightly, from 10.6% to 11.2%.

Consumers’ appraisal of the job market was also more favorable. Those saying jobs are “plentiful” increased from 44.0% to 46.2%, while those claiming jobs are “hard to get” declined from 15.8% to 12.8%.

Future expectations
Consumers were also more optimistic about the short-term outlook. The percentage expecting business conditions to be better six months from now increased from 19.1% to 24.0%, while those expecting business conditions to get worse declined from 12.6% to 8.7%.

Consumers’ outlook for the labor market was also more upbeat. The proportion expecting more jobs in the months ahead increased from 17.5% to 20.5%, while those anticipating fewer jobs decreased from 13.9% to 11.5%. Regarding short-term income prospects, the percentage of consumers expecting an improvement increased from 20.5% to 24.7%, while the proportion expecting a decrease declined from 7.5% to 6.3%.

The monthly Consumer Confidence Survey is based on a probability-design random sample conducted for The Conference Board by Nielsen. The cutoff date for the preliminary results was July 18.

© 2019 Florida Realtors®

NAR: Pending Home Sales Climb 2.8% in June

It’s the second consecutive month with the number of listings under contract increasing and the first pending-sale year-over-year increase after 17 months of declines.

WASHINGTON – Pending home sales continued to rise in June, marking two consecutive months of growth, according to the National Association of Realtors® (NAR). Each of the four major regions recorded a rise in contract activity, with the West seeing the highest surge.

The Pending Home Sales Index (PHSI) – a forward-looking indicator based on contract signings – moved up 2.8% to 108.3 in June, an increase from 105.4 in May. Year-over-year contract signings jumped 1.6%, snapping a 17-month streak of annual decreases.

The 2.8% increase is likely the start of a positive trend for home sales, predicts NAR Chief Economist Lawrence Yun. 

“Job growth is doing well, the stock market is near an all-time high and home values are consistently increasing,” says Yun. “When you combine that with the incredibly low mortgage rates, it is not surprising to now see two straight months of increases.”

The uptick in pending sales suggests that buyers are enthusiastic about the market and of the potential wealth gain via homeownership – but Yun says home builders still need to increase inventory. 

“Homes are selling at a breakneck pace, in less than a month, on average, for existing homes and three months for newly constructed homes,” he says. “Furthermore, homeowners’ equity in real estate has doubled over the past six years to now nearly $16 trillion – but the number of potential buyers exceeds the number of homes available. We need to see sizable growth in inventory, particularly of entry-level homes, to assure wider access to homeownership.”

June pending home sales regional breakdown

All regional indices are up from May and from one year ago. The PHSI in the Northeast rose 2.7% to 94.5 in June and is now 0.9% higher than a year ago. In the Midwest, the index grew 3.3% to 103.6 in June – 1.7% greater than June 2018. 

Pending home sales in the South increased 1.3% to an index of 125.7 in June – 1.4% higher than last June. The index in the West soared 5.4% in June to 96.8 and increased 2.5% year-over-year. 

© 2019 Florida Realtors®

High-Debt Home Borrowers May No Longer Qualify in 2021

From Florida Realtors

The “Qualified Mortgage Patch” helps Fannie- and Freddie-backed lenders qualify people with higher debt-to-income ratios, but it expires, at least for now, in Jan. 2021.

WASHINGTON – The Consumer Financial Protection Bureau (CFPB) issued an Advance Notice of Proposed Rulemaking (ANPR) relating to its QM Rule, commonly called the qualified mortgage patch. Should the QM Rule expire in January 2021, home borrowers with enough debt to exceed the QM debt-to-income test will likely be turned down for a loan.

The QM patch was designed as a temporary provision applicable to certain mortgage loans eligible for purchase or guarantee by the Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac. Fannie and Freddie back loans for more than 50% of all U.S. mortgages.

“On Thursday, members of NAR’s (National Association of Realtors®) policy staff, Joe Ventrone and Ken Fears, were briefed by Consumer Financial Protection Bureau (CFPB) Director Kathy Kraninger on the agency’s review of the Qualified Mortgage Patch,” says NAR President John Smaby.

“The QM patch was intended as a temporary measure to prevent turmoil in the mortgage and real estate market as the CFPB implemented the Ability to Repay rule,” Smaby explains. “Analysts estimate that as much as 30% of mortgages for home purchases fall into this market segment, and its disruption could result in higher costs and/or reduced access to mortgages for otherwise creditworthy homebuyers. This, in turn, could send ripples throughout the U.S. housing market.

Through the ANPR, the CFPB will solicit comments on possible amendments to the rule, including whether to revise Regulation Z’s definition of a qualified mortgage in light of the GSE Patch’s scheduled expiration. The ANPR seeks information and comment on whether the definition of qualified mortgage should retain a direct measure of a consumer’s personal finances (for example, debt-to-income ratio), and whether that definition should include an alternative method for assessing financial capacity. 

“The national mortgage market readjusting away from the patch can facilitate a more transparent, level playing field that ultimately benefits consumers through stronger consumer protection,” says CFPB Director Kathleen L. Kraninger. “We want to hear all perspectives on how to move beyond the GSE Patch, the impact on credit, the role of the private mortgage market, and possible modifications to the definition of qualified mortgages and the rules governing the documentation of debt and income. The Bureau is committed to ensuring a smooth and orderly mortgage market throughout its consideration of these issues and any resulting transition away from the GSE Patch.”

“Going forward, NAR will continue to advocate for an extension of the patch and a permanent solution that will prevent disruption as we work with CFPB to secure stability in the housing market,” says Smaby.

A copy of the ANPR with instructions on how to submit a comment are posted online.

© 2019 Florida Realtors®

NAR: U.S. Existing-Home Sales Falter 1.7% in June

“Imbalance persists for mid-to-lower priced homes with solid demand and insufficient supply, which is consequently pushing up home prices,” says NAR economist.

WASHINGTON – Existing-home sales weakened in June, and total sales saw a small decline after a previous month of gains, according to the National Association of Realtors® (NAR).

While two of the four major U.S. regions recorded minor sales jumps, the other two – the South and the West – experienced greater declines last month.

Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-op – dropped 1.7% from May to a seasonally adjusted annual rate of 5.27 million in June. Sales as a whole are down 2.2% from a year ago (5.39 million in June 2018).

“Home sales are running at a pace similar to 2015 levels – even with exceptionally low mortgage rates, a record number of jobs and a record high net worth in the country,” says Lawrence Yun, NAR’s chief economist. Yun says the nation is in the midst of a housing shortage and much more inventory is needed.

“Imbalance persists for mid-to-lower priced homes with solid demand and insufficient supply, which is consequently pushing up home prices,” he adds.

Yun says other factors could also be contributing to the low number of sales.

“Either a strong pent-up demand will show in the upcoming months, or there is a lack of confidence that is keeping buyers from this major expenditure,” he says. “It’s too soon to know how much of a pullback is related to the reduction in the homeowner tax incentive.”

The median existing-home pricefor all housing types in June reached an all-time high of $285,700, up 4.3% from June 2018 ($273,800). June’s price increase marks the 88th straight month of year-over-year gains.

Total housing inventory at the end of June increased to 1.93 million, up from 1.91 million existing-homes available for sale in May, but unchanged from the level of one year ago. Unsold inventory is at a 4.4-month supply at the current sales pace, up from the 4.3-month supply recorded in both May and in June 2018.

Properties typically remained on the market for 27 days in June, up from 26 days in May and in June of 2018 – but 56% of homes sold in June were on the market for less than a month.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage decreased to 3.80% in June, down from 4.07% in May. The average commitment rate across all of 2018 was 4.54%.

“Historically, these rates are incredibly attractive,” says NAR President John Smaby. “Securing and locking in on a mortgage now – given the current, favorable conditions – is a decision that will pay off for years to come.”

First-time buyers were responsible for 35% of sales in June, up from 32% the month prior and up from the 31% recorded in June 2018. NAR’s 2018 Profile of Home Buyers and Sellers – released in late 20184 – revealed that the annual share of first-time buyers was 33%.

As the share of first-time buyers rose, individual investors, who account for many cash sales, purchased 10% of homes in June, down from 13% recorded in both May 2019 and June 2018. All-cash sales accounted for 16% of transactions in June, down from May and a year ago (19% and 22%, respectively).

Distressed sales – foreclosures and short sales – represented 2% of sales in June, unchanged from May but down from 3% in June 2018. Less than 1% of June 2019 sales were short sales.

Regional breakdown
Compared to May, June existing-home sales rose slightly in the Northeast and Midwest but decreased in the South and West regions. Sales in all regions were still lower compared to one year ago, with the most significant declines in the Northeast and West. Median home prices rose in all regions, with the highest gains in the Midwest and South.

June existing-home sale numbers in the Northeast increased 1.5% to an annual rate of 680,000, a 4.2% decline from a year ago. The median price in the Northeast was $321,200, up 4.8% from June 2018.

In the Midwest, existing-home sales inched up 1.6% to an annual rate of 1.25 million, which is a 1.6% decline from June 2018. The median price in the Midwest was $230,400, a 6.7% jump up from a year ago.

Existing-home sales in the South fell 3.4% to an annual rate of 2.25 million in June, down 0.4% from a year ago. The median price in the South was $248,600, up 4.9% from one year ago.

Existing-home sales in the West fell 3.5% to an annual rate of 1.09 million in June, 5.2% below a year ago. The median price in the West was $410,400, up 2.3% from June 2018.

Single-family and condo/co-op sales
Single-family home sales sat at a seasonally adjusted annual rate of 4.69 million in June, down from 4.76 million in May and down 1.7% from 4.77 million a year ago. The median existing single-family home price was $288,900 in June, up 4.5% from June 2018.

Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 580,000 units in June, down 3.3% from the prior month and down 6.5% from a year ago. The median existing condo price was $260,100 in June, which is up 2.8% from a year ago.

“Condos are typically more affordable than a detached single-family home, but only a small fraction of condos are FHA-certified,” says Yun.

© 2019 Florida Realtors®

Fla.’s Housing Market: Median Prices, Inventory Up in June

Florida Realtors Pres. Sain: Fla.’s home sales cooled slightly in June though median prices rose. Year-over-year, single-family median prices up 3.8% to $270,000, sales were down 1.9%. Condo median prices up 2.6% to $194,900, sales were down 9.4%.

ORLANDO, Fla. – In June, Florida’s housing market reported rising median prices and increased inventory, including pending inventory and active listings inventory compared to a year ago, according to the latest housing data released by Florida Realtors®. Sales of single-family homes statewide totaled 27,283 last month, down 1.9% from June 2018.

“Sales cooled slightly in June, following what was a record-breaking month for home sales in Florida in May,”says 2019 Florida Realtors President Eric Sain, a Realtor and district sales manager with Illustrated Properties in Palm Beach.“However, inventory levels continued to improve in June, which helps ease the pressure of rising home prices and offers more options for potential homebuyers who may have been waiting to enter the market. Florida’s single-family inventory (active listings) last month rose 2% over June 2018, while condo-townhouse inventory increased 4.6%. Meanwhile, pending inventory for existing single-family homes was up 4.9% year-over-year, while pending inventory for existing condo-townhouse properties was up 2.5%.

“It may be difficult for a buyer or seller to stay on top of changing conditions in local housing markets, but a local Realtor will put his or her knowledge and expertise to work for you.”

Pending inventory is the number of listed properties that were under contract at the end of the month or data collection period.

June’s statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year for 90 months in a row. The statewide median sales price for single-family existing homes was $270,000, up 3.8% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month’s statewide median price for condo-townhouse units was $194,900, up 2.6% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors® (NAR), the national median sales price for existing single-family homes in May 2019 was $280,200, up 4.6% from the previous year; the national median existing condo price was $257,100.In California, the statewide median sales price for single-family existing homes in May was $611,190; in Massachusetts, it was $420,000; in Maryland, it was $312,500; and in New York, it was $273,200.

Looking at Florida’s condo-townhouse market in June, statewide closed sales totaled 10,094, down 9.4% compared to a year ago. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

“Sales of existing homes in Florida eases a little in June,”said Florida Realtors Chief Economist Dr. Brad O’Connor. “Single-family home sales were down compared to last June in 14 of the state’s 22 metro areas, falling by slightly less than 2% on a statewide basis. Year-to-date, however, single family home sales are still up by 2.1%.

“The latest figures on inventory levels for June suggest that the recent reprieve in our longer-term single-family home shortage may be coming to an end. Year-over-year differences in inventory levels have been declining since the end of January, when there were almost 14% more homes listed than a year prior. As of the end of June, however, this gap narrowed to just 2%. It’s possible that at the end of July, in fact, we might just be back right where we started a year ago.”

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.80% in June 2019, down from the 4.57% averaged during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Research & Statistics section on floridarealtors.org. Realtors also have access to local market stats (password protected) on Florida Realtors’ website.

© 2019 Florida Realtors®

Realogy and Amazon Announce Co-Marketing Agreement

TurnKey, an “Amazon Move-In Benefit,” provides $1,000 to $5,000 of complimentary Amazon home services and fully-installed smart home products courtesy of Realogy.

MADISON, N.J. – Realogy Holdings Corp. announced a collaboration with Amazon to launch TurnKey, a new homebuying program. The program is currently available in 15 U.S. markets, including Orlando and Tampa.

It’s also offered in San Francisco, Chicago, Dallas/Fort Worth, Seattle, Phoenix, Houston, Atlanta, Denver, Minneapolis/St. Paul, Charlotte, Sacramento and Washington, D.C. Expansion is likely but not announced.

“The Amazon move-in benefit will enable homebuyers to adapt the offering to their needs – from help assembling furniture, to assisting with smart home device set up, to a deep clean and more,” says Pat Bigatel, director, Amazon home services.

Amazon calls TurnKey an “easier and more rewarding homebuying experience” that offers Amazon customers the following benefits:

• Real estate agent recommendations: It says that homebuyers will be connected to an agent “according to the homebuyer’s profile,” and that the recommended agent will be “affiliated with one of Realogy’s trusted residential real estate brands … based on their exceptional customer service record and local market expertise.”

• Free Amazon move-in benefit:After closing, Amazon will connect TurnKey buyers with services and experts in their area to perform upgrades, with the value of the upgrade based on the purchase price of the home. At the base level of homes valued from $150,000 to $399,000, buyers get a $450 credit toward moving expenses and three Amazon-brand smart-home products. Homes worth $400,000 to $699,000 get a package worth $2,500 ($1,000 for moving expenses and six various Amazon smart-home products). Homes valued over $700,000 get a $5,000 package ($1,500 toward moving expenses and 26 various smart-home products).

© 2019 Florida Realtors®

What Are You Willing to Do to Own a Home?

Survey: Almost half of Americans saving to buy or renovate a home took a side job; slightly more than a third have done other things, such as selling stuff online.

SAN FRANCISCO – According to a Wells Fargo survey, Americans are willing to do what it takes to make their homeownership goals a reality – such as taking on a side job, cutting expenses or considering a less-expensive location.

The Wells Fargo 2019 “How America Views Homeownership” survey was conducted by The Harris Poll April 17–29, 2019, among 1,004 U.S. adults 21 and older. Key findings include:

• Nearly half of Americans who are saving to buy or renovate a home (49%) have done work outside their primary job to supplement their income to pay for it, such as selling items online (37%), starting a small side business (21%), driving for a rideshare company (18%) and dog sitting/walking (16%).

• Nearly eight in 10 non-homeowners (78%) say they would be willing to accept their second choice of a city or town in order to afford their own home.

• Nearly three quarters of non-homeowners (74%) say they would be willing to buy a smaller home with fewer amenities.

• Over seven in 10 Americans (72%) say they would give up something to save for a down payment, including dining out (44%), going to events (43%) and vacations (38%).

• Millennials who don’t own homes are even more willing to make trade-offs, such as considering a second choice of city (85%), and millennials as a whole say they are more willing to take steps – such as side jobs (70%) or cutting expenses (83%) – in order to save.

Homeownership is still the goal

Even in the wake of the Great Recession and current affordability concerns, Americans see homeownership as a clear metaphor for adulthood and achieving the American Dream. For most Americans (70%), owning a home is seen as a sign that someone is a “successful adult,” on par with having a career (73%). In fact, homeownership is much more widely equated with being a successful adult (more than twice as much) than having children (34%) or getting married (32%).

Nearly nine in 10 adults (89%) say the benefits of homeownership outweigh any drawbacks. Although most current homeowners (69%) had to make hard sacrifices to afford their home, nearly all say buying their home was worth all the sacrifice to save for it (90%). If they had to do it over again, they say they still would choose to buy their home rather than rent (93%). In fact, nearly all homeowners (95%) say that, in the long run, owning a home provides more “bang for your buck” than renting.

Millennials share this commitment: 95% of millennial homeowners say it was worth the sacrifice, and 86% of millennials as a whole say the benefits of homeownership outweigh the drawbacks.

Downpayment is the big thing

The No. 1 hurdle to buying for Americans is saving for the downpayment. More than one in four (27%) say it’s the biggest barrier, and it’s even more pronounced for millennials at 38%.

Americans also have misperceptions about what it takes to increase their opportunity to get financing for a home, citing “perfect” credit (71%), being debt-free (65%), “having a lot of money in the bank” (59%) and having no student debt (38%). In fact, 31% of homeowners say they never thought they would be able to purchase their own home, and that number was even higher (54%) for millennial homeowners.

© 2019 Florida Realtors®

30-Year Mortgage Rate Unchanged this Week at 3.75%

30-year FRM still at nearly 3-year lows; a year ago, it was 4.53%. Freddie Mac Chief Economist Khater says recent stabilization reflects Fed’s “accommodative tone.”

MCLEAN, Va. – After declining for most of the year, this week’s mortgage report from Freddie Mac found that mortgage rates remained mostly unchanged this week.

“While rates have moderated, we’re still at nearly three-year lows, which is good news for buyers looking to purchase a home before school starts,” says Sam Khater, Freddie Mac’s chief economist.

“The recent stabilization in mortgage rates reflects modestly improving U.S. economic data and a more accommodative tone from the Federal Reserve to respond to the rising downside economic risk from trade tensions and soft global economic data,” Khater says. “On the housing front, the latest weekly purchase application data suggests homebuyer demand continues to rise, which is consistent with the slowly improving real estate data from the last two months.”

Rates for the week of July 11

• 30-year fixed-rate mortgages (FRM) averaged 3.75% with an average 0.5 point for the week – unchanged from last week. A year ago at this time, the 30-year FRM averaged 4.53%. 

• 15-year FRM averaged 3.22% with an average 0.5 point, up from last week when it averaged 3.18%. A year ago at this time, the 15-year FRM averaged 4.02%. 

• 5-year Treasury-indexed hybrid adjustable-rate mortgages (ARM) averaged 3.46% with an average 0.4 point, up from last week when it averaged 3.45%. A year ago, the 5-year ARM averaged 3.86%.

© 2019 Florida Realtors®

48% of Homeowners Plan to Remodel Within 2 Years

Of those who plan to remodel, 1 in 4 hope to finance it via a home equity line of credit, but most say they’ll dip into savings (48%) or checking accounts (34%).

CHERRY HILL, N.J. – Nearly half of homeowners (48%) plan to renovate their homes in the next two years, and a third of those homeowners expect to spend more than $50,000 on their renovations, according to recent research from TD Bank.

The national survey of more than 1,800 homeowners examines trends in home equity usage and home renovations. According to findings, many homeowners are dipping into their savings (48%) and checking accounts (34%) to fund renovations, many are establishing substantial budgets and seeking financing options. A quarter (25%) say they will borrow through a home equity line of credit (HELOC), and a similar portion will utilize a personal credit card (24%) or a personal loan (18%).

“While there are many viable options for funding a renovation, a home equity line of credit is one of the most affordable ways to borrow,” says Jon Giles, head of Home Equity Lending at TD Bank. “During a HELOC’s 10-year draw period, it functions much like a credit card, whereby you can draw funds when you need them. But while credit cards typically carry interest rates around 17 percent, a well-positioned borrower seeking a HELOC can secure rates close to the Federal Reserve’s prime rate, which is currently around 5.5%.”

The survey uncovered several gaps in understanding home equity:

• Nearly a quarter (23%) of homeowners said they could not define a HELOC.

• Almost a third (32%) of homeowners did not know the current equity in their home.

• One in six (16%) homeowners did not understand the impact of fixed versus variable rates on monthly payments.

DIY or buy? A generational divide

While the desire to renovate spanned all audience segments, key generational differences were observed in respondents’ priorities and strategies for renovating.

More than half (54%) of baby boomers – those over age 55 – said appearance/quality of the final product was their top renovation priority, while 18-34 year-olds were more likely to prioritize cost first (43%). And while 27% of the youngest respondents said that renovation speed was their first priority, it was 0% for boomers.

When it comes to tackling the renovations, 64% of respondents in the 18 to 34 age group said they would do some or all of the work themselves, indicating they are likely looking to save on labor costs. Meanwhile, 60% of boomers said they would hire professionals to carry out all of the work.

Across the board, homeowners said they are planning to renovate their bathroom (26%) and their kitchen (25%) more than any other area of their home. Nearly half (48%) said improving the quality of their outdoor space was a top reason to renovate.

© 2019 Florida Realtors®

April’s Delinquency Rate Hits Lowest Point in 20 Years

CoreLogic: 3.6% of the nation’s mortgages were in some stage of delinquency – a 0.7 percentage point decline from a year earlier when it was 4.3%.

IRVINE, Calif. – CoreLogic’s monthly Loan Performance Insights Report for April found that 3.6% of the nation’s mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure) in April 2019 – a 0.7 percentage point decline in the overall delinquency rate compared with April 2018, when it was 4.3%.

It’s the lowest delinquency rate for any month in more than 20 years.

The foreclosure inventory rate measures only the share of homes in the foreclosure process and doesn’t include those that are late on a mortgage payment but not yet in foreclosure. This share of mortgages was 0.4%, down 0.1 percentage points from April 2018. The April 2019 foreclosure inventory rate tied the prior five months as the lowest for any month since at least January 1999.

Measuring early-stage delinquency rates is important for analyzing the health of the mortgage market. To monitor mortgage performance comprehensively, CoreLogic examines all stages of delinquency, as well as transition rates, which indicate the percentage of mortgages moving from one stage of delinquency to the next.

The rate for early-stage delinquencies (30 to 59 days past due) was 1.7% in April 2019, down from 1.8% in April 2018. The share of mortgages 60 to 89 days past due in April 2019 was 0.6%, unchanged from April 2018.

The serious delinquency rate – defined as 90 days or more past due, including loans in foreclosure – was 1.3% in April 2019, down from 1.9% in April 2018. April’s serious delinquency rate of 1.3% was the lowest for any month since August 2005 when it was also 1.3%.

The nation’s overall delinquency rate has fallen on a year-over-year basis for the past 16 consecutive months. In April, Nebraska’s overall delinquency rate was unchanged from a year earlier and all other states posted at least a small annual decline.

“Thanks to a 50-year low in unemployment, rising home prices and responsible underwriting, the U.S. overall delinquency rate is the lowest in more than 20 years,” says Dr. Frank Nothaft, chief economist at CoreLogic. “However, a number of metros that suffered a natural disaster or economic decline contradict this national trend. For example, in the wake of the 2018 California Camp Fire, the serious delinquency rate in the Chico, California metro area this April was 21% higher than one year ago.”

In April 2019, 10 metropolitan areas logged an increase in the serious delinquency rate. The highest gains continue to plague the hurricane-ravaged parts of the Southeast (in Florida, Georgia and North Carolina), and in Northern California where the Camp Fire devastated communities in 2018.

“The U.S. has experienced 16 consecutive months of falling overall delinquency rates, but it has not been a steady decline across all areas of the country,” says Frank Martell, president and CEO of CoreLogic. “Recent flooding in the Midwest could elevate delinquency rates in hard-hit areas, similar to what we see after a hurricane.”

© 2019 Florida Realtors®

Gov. DeSantis signs property rights bill

The new law, effective July 1, requires property appraisers to publish new info on their websites and includes additional property rights for homeowners.

TALLAHASSEE, Fla. – Florida Governor Ron DeSantis signed HB 1159 into law yesterday, a property rights bill that includes new measures to protect and promote the rights of the state’s private property owners.

Among other things, HB 1159 requires county property appraisers to publish a list of constitutionally protected property rights on their websites.

The bill also allows property owners to trim or remove trees on their property without consequence, as long as they have a letter from a certified arborist or landscape architect stating the tree is a danger.

The measures included in the bill become effective on July 1, 2019.

© 2019 Florida Realtors®

May Pending Home Sales Bounce Back, Up 1.1%

The number of homes under contract rose everywhere except the Northeast. NAR economist says confidence is up, and he expects pending-sales growth to continue.

WASHINGTON – U.S. pending home sales increased in May, a positive variation from a minor sales dip the previous month, according to the National Association of Realtors® (NAR). Three of major U.S. regions saw growth in contract activity, with the West experiencing a slight sales decline.

NAR’s Pending Home Sales Index (PHSI) – a forward-looking indicator based on contract signings – climbed 1.1% to 105.4 in May, up from 104.3 in April. Year-over-year contract signings declined 0.7%, marking the 17th straight month of annual decreases.

Lawrence Yun, NAR chief economist, said lower-than-usual mortgage rates led to the increase in pending sales for May. “Rates of 4% and, in some cases even lower, create extremely attractive conditions for consumers. Buyers, for good reason, are anxious to purchase and lock in at these rates.”

Yun said consumer confidence about home buying has risen, and he expects more activity in the coming months.

“The Federal Reserve may cut interest rates one more time this year, but there is no guarantee mortgage rates will fall from these already historically low points,” he says. “Job creation and a rise in inventory will nonetheless drive more buyers to enter the market.”

While contract signings and mortgage applications have increased, Yun says there’s still a great need for more inventory, noting, “Home builders have not ramped up construction to the extent that is needed. Homes are selling swiftly, and more construction will help keep home prices manageable and thereby allow more middle-class families to attain ownership opportunities.”

May regional breakdown
The PHSI in the Northeast rose 3.5% to 92.0 in May and is now 0.5% below a year ago. In the Midwest, the index grew 3.6% to 100.3 in May, 1.2% lower than May 2018.

Pending home sales in the South inched up 0.1% to an index of 124.1 in May, which is 0.7% higher than last May. The index in the West dropped 1.8% in May to 91.8 and decreased 3.1% below a year ago.

© 2019 Florida Realtors®

Consumer Confidence Down After 3 Months of Increases

By Florida Realtors

The Consumer Confidence Index dropped from May’s 131.3 to 121.5 in June, with attitudes about both current conditions and future expectations taking a hit.

BOSTON – The Conference Board Consumer Confidence Index declined in June following increases in the three prior months. The Index now stands at 121.5 down from 131.3 in May.

The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – decreased from 170.7 to 162.6. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – decreased from 105.0 last month to 94.1 this month.

“After three consecutive months of improvement, Consumer Confidence declined in June to its lowest level since September 2017,” says Lynn Franco, senior director of economic indicators at The Conference Board. “The decrease in the Present Situation Index was driven by a less favorable assessment of business and labor market conditions.”

In talking about the decline in expectations over the next six months, Franco says, “The escalation in trade and tariff tensions earlier this month appears to have shaken consumers’ confidence. Although the Index remains at a high level, continued uncertainty could result in further volatility in the Index and, at some point, could even begin to diminish consumers’ confidence in the expansion.”

Current conditions

Consumers claiming business conditions are “good” decreased from 38.4% to 36.7%; however, those saying business conditions are “bad” also decreased, from 11.7% to 10.9%.

Consumers’ assessment of the labor market was also somewhat less upbeat. Those saying jobs are “plentiful” decreased from 45.3% to 44.0%, while those claiming jobs are “hard to get” rose from 11.8% to 16.4%.

Short-term outlook

The percentage of consumers expecting business conditions to be better six months from now decreased from 21.4% to 18.1%, while those expecting business conditions will worsen rose from 8.8% to 13.1%.

Consumers’ outlook for the labor market was also less favorable. The proportion expecting more jobs in the months ahead decreased from 18.4% to 17.3%, while those anticipating fewer jobs increased from 13.0% to 14.8%.

Regarding their short-term income prospects, the percentage of consumers expecting an improvement decreased from 22.2% to 19.1%, while the proportion expecting a decrease inched up from 7.8% to 8.0%.

The monthly Consumer Confidence Survey is based on a probability-design random sample and conducted for The Conference Board by Nielsen. The cutoff date for the preliminary results was June 14.

© 2019 Florida Realtors®