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Archive for the ‘Real Estate General News’ Category

Every homeowner wants to make sure they maximize their financial reward when selling their home. But how do you guarantee that you receive the maximum value for your house?

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Home Prices the difference

CoreLogic recently released their Home Price Index ReportOne of the key indicators used in the report to determine the health of the housing market was home price (more…)

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NAR report shows

We all realize that the best time to sell anything is when the demand for that item is high and the supply of that item is limited. The last two major reports issued by the National Association of Realtors (NAR) revealed information that suggests that right now continues to be a great time to sell your house. (more…)

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what does the future hold for home prices

Home prices are at the top of everyone’s minds. Can they maintain their current pace of appreciation? Will rising mortgage rates negatively impact home values? Will the next (more…)

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Homeownership is like

There are many things that factor into the decision to buy a home. New research from the Urban Institute suggests that one of those things may be inherited from your parents. (more…)

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The latest Existing Home Sales Report issued by the National Association of Realtors (NAR) revealed that home sales have decreased for four consecutive months (more…)

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Top 3 housing no 2 myths

There are many conflicting headlines when it comes to describing today’s real estate market. Some are making comparisons to the market we experienced 10 years ago and are starting to believe that we may be doomed to repeat ourselves. Others are just plain wrong when it comes to what it takes to qualify for a mortgage.

Today, we want to try and clear the air by shedding some light on what’s causing some of these headlines, as well as what’s truly going on.

Myth #1: We Are Headed for Another Housing Bubble

Home prices have appreciated year-over-year for the last 76 straight months. Many areas of the country are at or near their peak prices achieved before the last housing bubble burst. This has many worried that we are headed towards another housing bubble.

Reality: The biggest challenge facing today’s real estate market is a lack of homes for sale! Demand is strong, as many renters have come off the fence and are searching for their dream homes.

Historically, a normal market requires a 6-month supply of inventory in order for prices to rise with the rate of inflation. According to the National Association of Realtors (NAR) there is currently a 4.3-month supply of inventory.

The US housing market hasn’t had 6-months inventory since August 2012! The concept of supply and demand is what had been driving home prices up!  Now they are leveling off and in fact have gone down slightly.

Myth #2: The Rumored Recession Will Lead to Another Housing Market Crash

Economists and analysts know that the country has experienced economic growth for almost a decade. When this happens, they also know that a recession can’t be too far off. But what is a recession?

Merriam-Webster defines a recession as “a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two consecutive quarters.”

Reality: Recession DOES NOT equal housing crisis. Many people associate these two terms with one another because the last time we had a recession it was caused by a housing crisis. According to the Federal Reserve, over the last 40 years, there have been six recessions. In each of the previous five recessions, home values appreciated (on a national basis).  Of course the old adage location , location, location still holds true.

I do expect real estate, especially residential real estate, to outperform securities in the next recession.

The big overarching issue with hosing at this time is that interest rates for 30 year fixed mortgages are up a little over 0.7% year-over-year (YoY) basis and prices have also increased on a YoY basis and that trend can’t continue.

Interest rates YOY 9 18 2018

John Paul Ledesma, GRI | Broker Associate | HomeSmart Evergreen Realty| DRE 01810644 | 949-616-2988

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