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Trulia reports Millennials think housing no longer part of American Dream

The homeownership rate remained the same in the fourth quarter as the previous year and the previous quarter, according to today’s report from the U.S. Census Bureau.

The national homeownership rate slipped only slightly to 63.7% in the fourth quarter. This is down from the previous year’s 63.8% and up slightly from the third quarter’s 63.5%.

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Home rate

(Source: U.S. Census Bureau)

One economist explains that the lack of inventory is partially to blame for the low homeownership rate.

“After reaching a 50-year low in mid-2016, the homeownership rate edged up for the second consecutive time in the final quarter,” Capital Economics Property Economist Matthew Pointon said. “A lack of inventory is preventing a faster rebound in homeownership.”

The national vacancy rates for rental housing in the fourth quarter of 2016 dipped slightly from 7% in the fourth quarter of 2015 to 6.9%. This is a slight increase from the third quarter’s 6.8%. Similarly, the homeowner vacancy rate of 1.8% is also slightly down from the fourth quarter of 2015’s 1.9% and the same as the third quarter’s rate.

But this could get even worse in the year ahead. Trulia’s end of the year survey shows the share of Americans who say homeownership is part of the American dream dropped for the first time in five years from 75% last year to 72%.

This drop was even more extreme among Millennials. While in 2015 80% of Millennials said buying a home was part of the American dream, the survey at the end of 2016 showed that number dropped to 72%, now even with everyone else.

“Given millennials make up the largest pool of potential homebuyers in the U.S., this should be at least somewhat disconcerting,” Trulia Chief Economist Ralph McLaughlin said. “If the for-sale housing market is to continue building steam in the years ahead, this demographic will need to transition into homeownership in order to support the resale of homes by their older counterparts.”

“Though home buying among millennials is likely to be volatile in the short-run, the long-run potential for this generation to support housing consumption in the U.S. is large,” McLaughlin said.

However, there is still hope for the future of homeownership. McLaughlin points out that the report shows growth in household formation. Household formation increased 0.5%to 805,000 new households, however the increase was due to the formation of renter households.

“This effectively is why the homeownership rate has dropped: a greater share of new households since 2006 have been renters rather than home owners,” McLaughlin said. “But the margin is slimming: about 46% of new households over the past year were owner occupied.”

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Case-Shiller: Housing market now officially, completely recovered

Home prices increased in November, making the argument the housing market recovered completely from the housing crisis.

According to the latest data released Tuesday by S&P Dow Jones Indices and CoreLogic, the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, increased 5.6% annually, up from 5.5% from the previous month.

The 10-City composite increased by 4.5% from November 2015, up from 4.3% in October. Similarly, the 20-City Composite increased 5.3% year-over-year, up from 5.1% the month before.

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Case-Shiller

(Source: S&P Dow Jones Indices, CoreLogic)

“With the S&P CoreLogic Case-Shiller National Home Price Index rising at about 5.5% annual rate over the last two-and-a-half years and having reached a new all-time high recently, one can argue that housing has recovered from the boom-bust cycle that began a dozen years ago,” said David Blitzer, S&P Dow Jones Indices managing director and chairman of the Index Committee. “The recovery has been supported by a few economic factors: low interest rates, falling unemployment, and consistent gains in per-capita disposable personal income.”

“Thirty-year fixed rate mortgages dropped under 4.5% in 2011 and have only recently shown hints of rising above that level,” Blitzer said. “The unemployment rate at 4.7% is close to the Fed’s full employment target. Inflation adjusted per capita personal disposable income has risen at about a 2.5% annual rate for 30 months.”

Seattle, Portland and Denver reported the highest annual gains among the top 20 cities for each of the past 10 months. In November, Seattle came in first with an increase of 10.4%, followed by Portland at 10.1% and Denver at 8.7%.

Monthly, the National Index increased by 0.2% in November. The 10-City Composite and 20-City Composite also both increased 0.2% for the month. After seasonal adjustment, however, the National index increased 0.8% and the 10-City and 20-City Composites increased 0.9% month-over month. After seasonally adjustment, all top 20 cities saw an increase in home prices.

“The home prices and economic data are from late 2016,” Blitzer said. “The new Administration in Washington is seeking faster economic growth, increased investment in infrastructure, and changes in tax policy which could affect housing and home prices.”

“Mortgage rates have increased since the election and stronger economic growth could push them higher,” he said. “Further gains in personal income and employment may increase the demand for housing and add to price pressures when home prices are already rising about twice as fast as inflation.”

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Black Knight: Home prices so close to a new national peak

The Data & Analytics division of Black Knight Financial Services released its latest Home Price Index  report, based on November 2016 residential real estate transactions.

The company finds that after rising 5.7% from the start of 2016, U.S. home prices are now within just 0.3% of a “new national peak.”

[Need more proof? Infographic here.]

The Black Knight HPI reports five price levels, along with REO discount rates, for 18,000+ U.S. ZIP codes. 

According to the index, home prices hit new peaks in six of the nation’s 20 largest states and eight of the 40 largest metros.

New York led all states in monthly home price appreciation, seeing 1.1% growth from October 2016.

Florida and Tennessee dominated the rest of the Top 10 list, together accounting for eight of the 10 best-performing metros.

Full report is availabe here.

Click below to enlarge HPIs:

BKFS HPI

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Realtors pick their top 10 hottest housing markets for 2017

January, typically the slowest month of the year for real estate, is anything but at the start of 2017.

With inventory at record lows, the median age of property listings on realtor.com is expected to decrease four days from last year to 96 days.

The median home price increased 10% from last January to $250,000. Normally, median home prices hit their lowest level in January.

“We saw evidence of a stronger than normal off-season starting last September and October due to pent-up demand and surging interest from first-time buyers,” realtor.com Chief Economist Jonathan Smoke said. “Since the election demand seems to have intensified – potentially as a reaction to mortgage rates rapidly moving higher.”

“The threat of rates approaching multi-year highs in the months ahead is creating a sense of urgency,” Smoke said. “The downside to this strong off-season is that we have started 2017 with a new low volume of available homes for sale and a new high for prices.”

In fact, realtor.com put together a list of what Realtors say are the hottest markets for January. The listings receive 1.5 to 2.6 times the number of views per listing compared to the national average. The hottest markets are also seeing inventory movement stay constant instead of slowing down that you would typically see in January.

Note that the median age of inventory is only one measure being accounted for, based on Realtor impressions of what makes their market hot.

Here are the top 10 housing markets so far for 2017:

10. Fresno, California

Median age of inventory: 69 days

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9. Stockton-Lodi, California

Median age of inventory: 62 days

8. Denver-Aurora-Lakewood, Colorado

Median age of inventory: 67 days

Colorado

7. Yuba City, California

Median age of inventory: 62 days

6. Sacramento-Roseville-Arden-Arcade, California

Median age of inventory: 67 days

California

5. San Diego-Carlsbad, California

Median age of inventory: 56 days

Calif small

4. Dallas-Fort Worth-Arlington, Texas

Median age of inventory: 63 days

Fort Worth skyline

3. Vallejo-Fairfield, California

Median age of inventory: 59 days

2. San Jose-Sunnyvale-Santa Clara, California

Median age of inventory: 45 days

San Jose

1. San Francisco-Oakland-Hayward, California

Median age of inventory: 47 days

san francisco houses

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Meet the latest hotbed for housing: Dallas, Texas

Housing is heating up all around the country as affordability decreases and inventory of homes for sale sink to their lowest level ever.

This year, Dallas appeared consistently in top-10 lists talking about high home prices and hottest markets such as this, this, and this. In fact, home prices in Texas are projected to increase 31% by 2020, according to an article by Samantha Sarf for Forbes

“Texas in general is a hotbed for business,” Movement Mortgage Market Leader Dana Allen said in an interview with HousingWire. “Many mortgage companies are trying to come in and capture some of that.”

Allen, who leads the Dallas and East Texas market, said that Movement Mortgage saw a solid year in 2016, and looks to expand even further in the years to come. Coming from a company whose goal is to hold 10% of all purchases by 2025 and is expanding significantly, perhaps more expansion isn’t shocking, however it isn’t the only company that sees a boom coming in Texas.

This Dallas private equity firm even bet on a home building boom. In fact, the economy in Texas is so great that the U.S. Department of Transportation even chose Texas as its testing ground for autos.

“With five of the nation’s 15 fastest-growing cities in Texas and our population expected to potentially double by the year 2050, Texas must be a leader in new technology that addresses transportation challenges,” said Marc Williams, Texas Department of Transportation deputy executive director.

Allen agreed that builders could bring a building boom to Dallas, adding that the soaring prices are causing first-time homebuyers to struggle.

“I think that the good part is we have plenty of room for expansion and the builders notice that, so they’ll adjust accordingly,” he said. “First time homebuyers I think do struggle a bit to find a property.”

The market is so hot, in fact, that some even starting throwing around the dreaded B-word (bubble, that is) when referencing the city’s market.

Earlier this year, a study from Nationwide Mutual Insurance Company ranked Dallas-Plano-Irving, Texas in its bottom 10 unhealthy markets, in terms of housing affordability. 

However one of HousingWire’s readers, Matt Maison, Arbor Commercial Mortgage director of research and analysis, insisted that there was a significant difference between Dallas, and the city used for comparison, San Francisco.

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disquis

Allen agreed that while the high home prices might be beginning to price first-time homebuyers out of the market, Dallas is still seeing a healthy expansion.

“Builders are going to start countering by building some more first-time homebuyer, maybe something at a lower price point, which’ll balance that equation out,” he said.

In fact, the entire state is seeing expansion with new highs in its housing market. San Antonio, Texas saw a record-setting year for its housing market in 2016.

“Between the economy and the state laws, it’s been very good for the housing market,” Allen said. “The Dallas market is just blowing up in general.”

“The relocation and number of people moving from across the united states, either to join a company or even relocate their entire company, has just been phenomenal,” he said.

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CoreLogic: Cash sales increase yet again in October

Following the trend of previous months, October saw an increase in cash sales, according to a report from CoreLogic.

Cash sales slipped to 31.8% of total home sales in October, down 2.7 percentage points from the year before. However, it is a slight increase from September’s 31.7%, marking the fourth consecutive monthly increase.

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cash sales

(Source: CoreLogic)

Before the housing crisis, cash sales made up about 25% of total home sales, a mark that could be hit by mid-2018 is the share continues to fall at the same annual rate it did in October.

Real estate owned sales held the largest cash sales share in October at 59.2%, followed by resales at 31.7%, short sales at 30.2% and newly constructed homes at 15.9%.

While cash sales make up many of the sales in the REO category, its share in the market continues to decrease. Within the distressed sales category, REOs made up 5% of the market sales and short sales made up 2.6% of sales in October. The total share of distressed sales came in at 7.7%, the lowest share for any month since October 2007.

The pre-crisis share of distressed sales held steady around 2%. At the current rate of annual decreases, distressed sales could hit that mark by mid-2018.

While distressed sales continue to decrease, some states are still struggling more than others. Maryland had the largest share of distressed sales with 18.6%, followed by Connecticut with 18.3%, Michigan with 17%, New Jersey with 15.8% and Illinois with 14.7%.

On the other end of the spectrum, North Dakota held the smallest share of distressed sales at 2.7%, and, along with the District of Columbia, is within one percentage point of its pre-crisis level.

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cash sales

(Source: CoreLogic)

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FHFA: Home prices barely increase in November

Home prices increased slightly in November, but at a slightly higher pace than the previous month, according to the Federal Housing Finance Agency’s monthly Housing Price Index report.

Home prices increased a seasonally adjusted 0.5% in November, slightly higher than October’s downwardly-revised 0.3% increase. Home prices increased 6.1% from November 2015, the report shows.

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FHFA

(Source: FHFA)

The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. Because of this, the selection excludes high-end homes bought with jumbo loans or cash sales.

Home price changes varied for the month from the decrease of 0.2% in the South Atlantic division to the increase of 1.5% in the Pacific division. Annually, all home prices increased from 4.7% in the Middle Atlantic division to 7.7% in the Pacific division.

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FHFA

(Source: FHFA)

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Six factors driving the cost of your new HVAC system

(BPT) – More than half of homes in the U.S were built before 1980, according to U.S. Census figures. With most home heating and ventilation systems lasting around 20 years, millions of American homeowners will be looking at replacing their HVAC systems this year. If you’ll be among them, understanding the factors that influence the cost of a system could help save you money in the long run.

“The cost of HVAC systems can vary widely, and most people who face replacing a system have never gone through the process before,” says Steve Hoffins, director of marketing, Luxaire, a heating and cooling systems manufacturer. “Sorting through your options can be challenging. However, finding the right system for your home can greatly influence energy efficiency, your home’s comfort and its resale value.”

Here are six factors that affect the cost of installing a new heating and cooling system, and what you should know about each:

The size of your home

You can probably guess that the larger the home, the bigger the system you’ll need to adequately heat and cool it. If a system is too small for the home, it will work harder, be less energy efficient and possibly wear out sooner.

However, too big isn’t better, either. In fact, says Hoffins, “Most homes have heating and cooling systems larger than they actually need.” A system that’s too large for a home can create uneven temperatures, poor humidity control, maintenance problems and a loss of efficiency.

Research can help you identify the size HVAC system that’s just right for your home. You can also ask your product dealer to provide a load calculation and energy analysis for your home.

Energy efficiency

Replacing an HVAC system affords you the chance to improve your home’s energy efficiency and save money over the long term. A quality, energy-efficient HVAC system may cost more than a less efficient one, but you can anticipate recouping the expense, plus additional savings over the lifetime of the system.

System type

From gas furnaces and split system air conditioners to heat pumps and packaged heating and cooling units, there are multiple ways to heat and cool your home. Most people replacing all or part of an HVAC system will opt to stick with the same type of system they’re replacing. However, you may find a different option will work better.

Different types of systems come with different product and installation costs. Before deciding what’s right for your home, research your options and talk to a qualified dealer about benefits and costs of each.

Ductwork

When you’re installing a new HVAC system, it’s important the ductwork in your home works with the type of system you’ve chosen, and that it’s been properly installed and maintained. Improper ductwork can create hot or cold spots in a home, reduce system efficiency and even allow the growth of mold from condensation. An HVAC professional can help you assess if your ductwork is in good shape before you invest in a new heating and cooling system.

Accessories

Certain types of accessories can make your new HVAC function more efficiently and provide you with greater ease of use. If your furnace is 20 years old, chances are good your thermostat is the same age, so you’ll want to replace that, too. Programmable thermostats can be reasonably priced and help enhance the energy efficiency of your HVAC system. Other accessories such as an electronic air cleaner can help enhance the air quality inside your home. You’ll want to carefully consider the accessories you’ll be adding, and factor them into the total anticipated cost of your new HVAC system.

How you’ll pay for it

Replacing an HVAC system costs thousands of dollars. If you don’t have enough cash saved to cover the cost, you may choose to finance all or part of the expense. You could use a credit card, but high interest rates mean you could end up paying thousands more in interest for your HVAC system. Manufacturer or dealer financing may be a lower-cost option. For example, select participating Luxaire contractors offer financing with appealing terms such as deferred interest, no interest with equal monthly payments and convenient monthly payment options.

To learn more about Luxaire home comfort systems, visit www.luxaire.com or follow @LuxaireHVAC on Twitter.

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Where to find rebates, tax credits and rewards for energy-efficient home improvements

(BPT) – If you’re planning to make some home improvements this year, you’re probably thinking about energy-efficient options, knowing they can save you money in the long run. However, many eco-friendly home improvements that help lower your energy bills can also pay off right away in the form of rebates and tax credits.

Whether you’re considering installing an energy-efficient tankless water heater, putting solar panels on your house, or adding a skylight, chances are you can find a program that will put cash back in your pocket for improving your home’s energy efficiency. Here is where to look for rebates, tax credits and rewards for your energy-efficient home improvements:

Qualifying improvements

When you think of energy efficiency, insulation and appliances probably come to mind. But a number of improvements can help reduce your home’s energy consumption, and many of them qualify for tax credits, rebates and incentives from a variety of sources. The kind of improvements that can make your home more efficient and get you some cash back typically include:

* Solar energy systems (such as solar panels)

* Tankless water heaters

* Solar-powered appliances

* Energy-efficient windows and doors

* Skylights and solar-powered blinds

* Wood or wood-pellet stoves

* Home wind turbines

Manufacturer rebates and incentives

Makers of energy-efficient products and appliances often offer their own rebates to homeowners for making eco-friendly upgrades. If you’re considering an energy-efficient upgrade such as installing new windows, HVAC system or tankless water heater, be sure to ask the retailer or installer about any available manufacturer’s rebates.

For example, now through at least Feb. 15, 2017, you can get up to a $650 rebate on select tankless water heaters from Noritz. The average American household spends nearly 18 percent of its energy use on heating water, at a cost of $200-$600 per year, according to the U.S. Energy Information Administration. Tankless water heaters are more energy-efficient because they only heat water when you need it, rather than constantly consuming fuel to keep water hot in a tank. To learn more about tankless water heaters and the rebate, visit www.noritz.com.

Federal tax credits

Although many tax credits for energy-efficient home improvements expired at the end of 2016, some are still available. The federal government offers a tax credit of up to 30 percent for home solar energy systems through Dec. 31, 2019, and there’s no upper limit on the credit, according to EnergyStar.gov.

If you’ll be making energy-efficient home improvements, be sure to talk to your professional tax preparer about any credits or deductions that may be available to you from the federal government.

State-level programs

In addition to federal programs, a number of states offer their own incentives to encourage homeowners to make energy-efficient improvements. For example, Alabama allows homeowners to deduct 100 percent of the purchase price and installation costs of a wood-burning heating system. In Minnesota, homeowners can borrow up to $20,000 at 4.99 percent interest to make energy-efficient improvements such as water heaters, lighting, furnaces, air conditioners, insulation, windows, tankless water heaters and more.

You can find a searchable Database of State Incentives for Renewables & Efficiency at www.dsireusa.org.

Utility company incentives

Many utility companies also offer programs designed to help homeowners reduce energy consumption and save money. Typical programs include free LED or CFL bulbs to replace incandescent bulbs in a home, and rebates or discounts for installing energy-efficient HVAC equipment or programmable thermostats.

The best way to find out what programs your local utility offers is to check out their website or give them a call. You can also find state-specific lists of programs at www.dsireusa.org.

Energy-efficient home improvements pay off over the long-term by reducing your home’s energy consumption and utility bills. With a little bit of planning and legwork, you can also find rebates, tax credits and incentive programs that will also repay your eco-friendly investment right away. To learn more, visit Noritz.com, www.direusa.org, energy.gov, energystar.gov and irs.gov.

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Death-row inmate facing final months for murder of Texas real estate agent

[Correction: The original version of this article stated the execution date was January 25th. This was the prior execution date, which was changed to July 19th]

Death-row inmate Kosoul Chanthakoummane [pictured below] faces his final hours this week before his execution, which will take place on Wednesday July 19 at 6 p.m. CST.

While the date was previously scheduled for Wednesday, however has since been changed to July because Chanthakoummane is “litigating various charges,” according to his attorney. 

Chanthakoummane

Back in 2006, Chanthakoummane was sentenced to death after stabbing a Dallas real estate agent to death. He stabbed the agent, Sarah Anne Walker, in the face and neck in a model home in what his defense attorney called a robbery gone-wrong.

But went wrong is an understatement. A medical examiner testified at Chanthakoummane’s trial that Walker was beaten, bitten and stabbed, according to an article by Tom Steele for The Dallas Morning News. Of her 33 stab wounds, 10 were deemed fatal wounds. The jewelry she had been wearing was stolen.

The murder occurred on July 8, 2006, and Chanthakoummane was received on death row on October 18, 2007.

Now, 10 years later, he will face lethal injection. But what has he done with his life the past decade? Alex Hannaford wrote an article titled Letters from Death Row: Books Behind Bars for the Texas Observer. In it, he questions death-row inmates about their taste in books.

Chanthakoummane wrote a letter to Hannaford answering his questions and stating that most of the books he wanted to read have been censored by the TDCJ Director’s Review Committee—the body tasked with hearing appeals related to rejected correspondence and publications.

From the article:

Death Row Inmate Kosoul Chanthakoummane courtesy TDCJ Kosoul Chanthakoummane. Chanthakoummane wrote that he “will likely receive 60 – 70% of my magazine subscriptions,” and said that among the titles periodically censored were GQ, Vogue and Popular Mechanics. He wrote that censorship was “limited to a handful of reasons, which are conservative in their nature.”

Chanthakoummane also claimed that publications and periodicals “targeting African Americans are more closely and often censored [including] King, Jet [and] Diva magazines … it’s blatant racism / sexism at the root of censorship.”

However, TDCJ Spokesman Jason Clark clarified that publications are rejected because of sexually explicit images, the break-down or manufacture of weapons, depictions of drugs, alcohol and information deemed a security threat.

After being convicted of murder, Chanthakoummane even tried to file in the court of appeals, however he was unsuccessful. Here was the United States Court of Appeals for the Fifth Circuit’s response:

Petitioner now seeks a COA to appeal the district court’s dismissal of his federal petition on two grounds: (1) his trial counsel was ineffective for failing to sufficiently investigate, develop, and present mitigating evidence and (2) his trial counsel was ineffective for failing to challenge whether the murder was United States Court of Appeals Fifth Circuit committed during the commission of a robbery. After careful consideration of his arguments and the record, we deny his application for a COA.

To read full details about the case from the court of appeals, click here.

Realtor safety is a growing concern in recent years. Early in 2016, Arron Lewis was found guilty of abducting and killing Arkansas Realtor Beverly Carter in 2014.

Later, Carter’s son made it his mission to educate Realtors and real estate agents just how critical taking precautions is to their safety.