2017 SCE HOUSING SURVEY FINDS INCREASED OPTIMISM ABOUT HOME PRICE GROWTH

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The Federal Reserve Bank of New York has released results from its February 2017 SCE Housing Survey, which provides information on consumers’ housing-related experiences and expectations. The survey, which is part of the broader Survey of Consumer Expectations, shows an increase in home price growth expectations, especially for growth during the next year. In addition, the majority of households continue to view housing as a good financial investment; expected changes in mortgage rates have slightly increased since last year’s survey; and renters’ perceived access to mortgage credit has continued to ease.

Here, the key findings from the February 2017 survey:

Home prices/rents

Average home price change expectations at both the one- and five-year horizons increased from 2016. For example, the mean one-year ahead expected change in home prices in 2017 was 5.1 percent, which is 1.8 percentage points higher than last year and the highest level since the inception of the survey in 2014. Five-year growth expectations also increased from last year, but remain at or below the levels in 2014 and 2015.

There was a drop in the perceived downside risk in home prices over both the one- and five-year horizons. At the one-year horizon, the average probability of home prices decreasing declined from 43 percent in 2016 to 37.5 percent.

Rent change expectations increased at both the 1- and 5-year horizons, by 0.8 and 0.5 percentage points, respectively.

Housing outlook

Attitudes toward housing continued to remain positive: 60.4 percent of all respondents think that buying property in their zip code is a very or somewhat good investment, and 12.7 percent think it is a bad investment. Although slightly less optimistic than respondents overall, most renters are also enthusiastic about buying property, with 55.9 percent viewing it as a good investment and 15.6 percent viewing it as a bad investment. Higher-income (annual income of $60,000 or more) and more educated (a bachelor’s degree or more) households continue to have a more optimistic outlook of housing compared to their counterparts.

The average probability of buying a home, conditional on moving within the next three years, was largely unchanged from 2016 at 63.6 percent. The average probability of moving during the next year declined slightly, from 19.2 percent to 17.8 percent.

Mortgage rates

On average, households perceive mortgage rates for themselves and nationally to have increased by about 40-50 basis points from 2016. This change is roughly in line with the increase in actual mortgage rates. Less-educated and lower-income households perceived larger increases.

Average expectations of future mortgage rates similarly increased for both the one- and three-year-ahead horizons. For example, the average year-ahead mortgage rate expectation was 5.6 percent, up from 5.2 percent in 2016. The average probability that mortgage rates will increase over the next year rose from 49.5 percent in 2016 to 52 percent; this is primarily driven by older respondents (ages 50 or older).

Owners

The average probability of mortgage refinancing over the next year declined to 10.2 percent, from 11.3 percent in 2016.

The average probability of investing at least $5,000 in the home over the one- and three-year horizons remained steady. The average probability for the one-year horizon stands at 32.4 percent; the corresponding value for the three-year horizon is at 46 percent.

Renters

Renters continue to perceive obtaining a mortgage (if they want to buy a home) as difficult, with 65 percent stating that it would be somewhat or very difficult to get a mortgage. However, renters are gradually beginning to perceive credit access as becoming easier. For instance, this year 20 percent of renters stated it would be somewhat or very easy for them to obtain a mortgage if they wanted to, compared to fewer than 15 percent in 2014 and 2015. These movements held across demographic groups, although they are less pronounced for older renters.

Renters continue to report a strong preference for owning homes. The share of renters who report preferring or strongly preferring to own instead of rent (if they had the financial resources to do so) stood at 72.3 percent, a slight decrease from 74.1 percent in 2016. Younger and less-educated respondents are particularly likely to express a strong preference for owning.esplanade

FOREIGNERS BUY UP PROPERTY IN SURPRISING U.S. MARKETS

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It’s no secret that foreign investors target real estate in the U.S. Markets like New York City, Los Angeles and Chicago seem to be the most likely recipients of funds from foreign investors, but you may be surprised to learn that this unique set of investors also targets unlikely areas like Watertown, New York and Anchorage, Alaska.
What’s the reason behind these investment decisions? That depends on the location. The popularity of Watertown relates to its proximity to Canada and its appeal to Canadian investors. Cities in the northern portion of Washington state also enjoy popularity among foreign investors for the same reason.
The appeal of locations like Anchorage is harder to identify. Investors from all over the world flock to the Alaskan city. Home prices are on the rise in Anchorage, and the relatively low unemployment rate may make the city more attractive for real estate investors who are hoping to quickly turn a profit on their purchase.
Miami is known to draw investors from Latin America, but market trends show that the entire state of Florida attracts foreign investors. Mexican real estate investors are active in Texas and California, and Indian investors tend to focus on markets in San Jose and New York.
Some investors have largely pulled out of the U.S. real estate market. Japanese investors maintain a minor presence in Hawaii and Seattle, but these investors once purchased real estate across the country. Domestic investors who target quieter markets may be surprised to learn that they have competition from abroad.
Tags: home buyers, home owners, housing market, real estate, u.s. market

Save Energy During the Holidays!

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You have probably dropped a load of money on Christmas gifts and do not want any extra expenses. To curb energy bills, here are 10 simple tips that will help you conserve energy.
1. Switch to LED LightsRunning LED lights costs a fraction of the money it takes to use standard bulbs. As you decorate your home, it is worth switching your old strands for new LEDs.
2. Turn Out the Lights
Although Christmas lights look beautiful, it is essential to turn them off when you go to bed at night. It is also possible to use automatic timers as well.
3. Shop Around
Electronic devices and appliances are popular gifts. However, it is important to choose “Energy Star” models.
4. Shop Smart
It is wise to finish all your shopping during one mall stop so that you save gas on multiple visits.
5. Kitchen Efficiency
To save energy in the kitchen, it is wise to heat leftovers in the microwave and to take all ingredients out of the refrigerator at once.
6. Cut the Heat
The ideal temperature setting on your thermostat is 68 degrees. With a fire going, this can be lowered.
7. Burn Wood Efficiently
When filling your fireplace, it is wise to use man-made logs, which are natural and inexpensive. They are good for the environment and your wallet.
8. Fireplace Smarts
When you extinguish the fire, make sure to close the flue. This keeps heat from escaping.
9. Junk Mail
Junk mail kills 53 million trees a year. To help the environment, buy online and avoid mailing lists.
10. Change Your Dress
To remain warm indoors, you should wear layers so that you can keep the thermostat turned low. It is important to wear slippers as well.
By following the above tips, you will enjoy lower energy bills and help preserve the environment.
Tags: holidays, home owners, real estate, tips

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It’s always nice to witness first hands the healthy growth of our local real estate market. Certain pocket areas have increased considerably in list price, sales price and location desirability in a short period of time.

East Manhattan is one of those micro areas.

I was happy to see a glorious new listing while out on Broker’s Open today The sun was shining, and life seemed hopeful, serene and calm (if one wore blinders).

Fresh with that new car smell we all love, sat 1304 Lynngrove Drive. 5 beds and 6 baths are the backdrop of this bright, super natural, white light filled single family home on a 5398′ lot.

Creative finishes, glitteringly gorgeous light fixtures are icing on the spacious 3746′ home. The Nano doors open to a petite  yet generous outdoor space with fire pit.

The price tag is as high as the ceilings..so the $3 Million question is indeed that! Will it fetch $2,999,900?

In this market, who knows. It just might.

 

ART AND REAL ESTATE ARE THE NEW GOLD, SAYS BLACKROCK CEO

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alma didn't light me up

Gold has always been considered a safe investment. However, many moguls are replacing this precious metal with art and real estate. Laurence D. Finch, BlackRock CEO, explains as gold has become widely owned, it has lost its appeal. In fact, gold prices have dropped over one-third from their peak values in 2011.
To store value, many investors are turning to contemporary art and property. Obviously, fine paintings and sculptures are nicer to view than blocks of gold. Also, many elite class members find penthouses are more useful shelters than bland safety deposit boxes. Apartments in Vancouver, London, and Manhattan are especially popular.
The most important thing to note is how art and property compare to gold as investments. Results seem to depend on location. Even though gold prices have dropped 7 percent from last year, they are still up 179 percent over the last 10 years. According to the Knight Frank Luxury Investment Index, art value has increased 252 percent over the last 10 years. London real estate has seen an increase of 138 percent over the last decade. Unfortunately, New York real estate has not been as successful. Its value has only increased 67 percent over the same time period.
One thing that has skeptics worried is that art and real estate are less liquid than precious metal. During a market upswing, these new purchases seem to be smart investment choices. However, over the long term, they may be risky during times of crisis. Under most circumstances, individual needs will dictate what investment path is best.

REPORT: RENTER GROWTH TO EXPLODE BY 2030

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Data from the Urban Institute indicates that between 2010 and 2030, the renting population is expected to exceed that of homeowners. The report, titled Headship and Homeownership: What Does the Future Hold?, looks at the year that millennials are to reach peak homebuying age and trends leading up to it. Although the number of homeowners is anticipated to increase during this two decade period, it is believed that in 15 years, renters will number 13 million to nine million homeowners.
The increase in renters over homeowners is due to the number of millennials and the ethnic makeup of the generation. According to the study, it is believed that the new surge of renters will create additional need for rental housing while reducing the demand for owner-occupied homes. Currently, the rental housing market is already at a fairly high occupancy, and rental rates are rising as a result. This is also leading to a number of single-family homes being turned into rental properties.
Nonwhite populations are where most of home ownership is expected to increase. In the next five years, 77 percent of new households are predicted to be nonwhite, and by 2030, that number is to be 88 percent. Additionally, by 2030, it is anticipated that the rate of Hispanic homeowners will reach 48.2 percent, up from 47.3 percent in 2010.
Along with a push from nonwhite households, home ownership is also supposed to increase as a result of growth among senior households, which are owned by individuals who are at least 65 years old.

Let’s Talk Backyard Retreats

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It’s time for summer break, but why make expensive travel plans? Let the crowds have the beaches, and leave theme parks to the throngs. These four vacation retreats beckon just outside your back door.
1. Lounge in Landscaped Gardens – Elevate exterior design with creative gardening. Traditional trellis walls shaded with favorite vines establish natural privacy. Grace your getaway with a butterfly garden, or practice peaceful relaxation with an Oriental theme. Landscape design keeps your backyard retreat beautiful, and it increases property value.
2. Play on a Pretty Patio – This little piece of real estate has so much potential, so think beyond the umbrella table. Brighten up your great outdoors with cool, colorful pavers underfoot. Lay down luxurious natural stone, and install a small fire pit. Finish off your summertime oasis with miniature fountains and lovely container plants.
3. Man the Deck for Fun – Outgrow the backyard grill with an outdoor kitchen that turns the deck into a summer fun center. Add bench seating along the rails for hidden storage space that welcomes extra guests. Built-in tables double down for dining and family game nights. Top it all with a shady pergola, and enjoy your retreat year-round.
4. Splash in Your Own Pool – You don’t need an Olympic-sized layout. An above-ground pool keeps you cool, and a hot tub keeps you relaxed. Take the splash with a traditional water hole, or save space with a slim lap pool. A personal water world in your backyard keeps summertime living easy.

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