Cool Tools News Spool

Month: May 2015

  • Fannie housing survey reveals cautious homebuyers

    For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.

    by G. Steven Bray

    Fannie Mae’s Apr National Housing Survey revealed good news and bad news about the housing market. The good news was that the recent slide in consumer sentiment towards housing reversed. The bad news was consumers are becoming more wary of their ability to afford a home.

    Sixty-three percent of respondents said they would prefer to buy a home next time they move. This reverses the recent slide in this index and is up from a survey low of 60% in Mar. An increasing majority expects rental rates to increase in the next year, and the average expected rate of increase is 4.1%, much higher than the survey’s average expected home price increase. This presents a continuing opportunity to convince would-be renters to become homebuyers instead.

    Unfortunately, a declining share believes now is a good time to buy a home. Fannie cites renewed concerns about rising home prices and recent economic weakness as causing the decline. The average expected home price increase ticked up again this month, and an increasing majority believed the economy is on the wrong track. Interestingly, this result is at odds with respondents’ views of their own financial situation, which generally improved. Thus, should the economy improve this summer, this nervousness could pass quickly.

    Click here for a link to the survey results.

  • RealtyTrac says more investors and less cash

    For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.

    by G. Steven Bray

    RealtyTrac released an interesting report recently that showed the share of homes purchased by owner occupants dropped to 63.2% in the first quarter, the lowest level since 2011 when they started tracking the data. This is down from 65.8% last quarter and 68.6% a year ago.

    RealtyTrac considers anyone who has the property tax bill mailed somewhere other than the property address to be a non-owner occupant, so it could include vacation home buyers in addition to investors.

    Among non-owner occupants, a much smaller 44.7% were cash buyers, down from 61% a year ago. Institutional investors represented 3.4% of all buyers, down from 6.1% last year and the lowest share in 4 years.

    This suggests that smaller, more traditional real estate investors are becoming more active in the market. It also suggests that buyers are taking advantage of relatively easier credit requirements to use mortgage money to complete their purchases.

    Three of the top 5 metro areas for investor activity were in FL, and no TX cities made that list, which makes sense given that FL cities led the nation in REO sales. More interesting, I think, is the shifting focus of institutional investors. Memphis and Charlotte topped the list of markets having the most institutional investor activity.

    Click here for the full report.