The National Association of Realtors (NAR) offered up its predictions on housing as the market deals with the effects of low inventory. At the Realtors Midyear Legislative Meetings & Trade Expo, NAR’s chief economist Lawrence Yun projected further increases in existing-home sales. According to a release, Yun expects existing-home sales to increase to nearly 5 million this year, then grow to an annual rate of 5.3 million sales in 2014, and rise up to 5.7 million in 2015. Dramatic price increases are also expected to continue this year. “Double digit price gains are within reach in 2013 because inventory is bouncing near 13-year lows, but some relief to inventory will occur later in the year,” Yun said. NAR projects the median existing-home price will increase to about 8 percent this year from 6.4 percent in 2012, and then slow to 5 percent in 2014. Yun also estimates 51 percent of renters are financially qualified to purchase a home. This is a drastic increase from 24 percent in 2005. [Read this article]

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Mortgage rates have never been lower – but they most certainly have been higher!
 This latest infographic takes mortgage loan rates back in time from the last decade, to the 90s and even back to the 80s! It turns out, you could have spent a lot more on your mortgage loan payments in the past than you could or would today. In September of 2002, 30-year home loan interest rates averaged 6.09 percent. This means that after 30 years, you would have paid a total of $653,776.93 on a $300,000 mortgage loan. On August 6, 1991, interest rates stood at 9.25 percent. Your monthly payment would have $2,468.03 on a $300,000 mortgage loan. On June 11, 1982, interest rates were a whopping 16.70 percent. Your monthly payment would have been $3,503.36. Let’s come back to the future though, where mortgage rate trends continue to hover near historic low levels. [Read this article]

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The Bureau of Labor Statistics recently ranked Phoenix 9^th among all metropolises nationwide for job creation. Phoenix had only recovered 44% of the 250,000 jobs it lost during the last recession, so there’s plenty of room for the desert metro to expand. That’s good news for the area’s home builders, whose 11,000-plus starts in 2012, while up by two-thirds over the previous year, were a far cry from the 65,000 homes per year started during the last housing boom here, or even the 30,000 to 35,000 starts experts now predict will be this market’s leveling-off point. Ben Sage, director of Metrostudy’s regional office in Mesa, Ariz., shared details about Phoenix’s recovery during Builder’s Housing Leadership Summit last week. He noted that Phoenix “is not all the way back yet.” But Sage sees encouraging signs of sustainable growth. For one thing, Phoenix’s resale market, whose annualized sales rate rose to more than 80,000 in April, is “extremely strong.” [Read this article]

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This past Sunday, Lennar’s Next Gen – The Home Within A Home – was featured on the CBS “Sunday Morning” program in a segment highlighting the benefits of multi-generational living. According to the program, fifty million Americans live in multi-generational homes, and many more want homes that fit their expanded families. The CBS “Sunday Morning” segment was partially filmed at Dove Mountain, a community near Tucson where Lennar offers its Next Gen homes. The segment features Alan Jones, President of Lennar’s Arizona Division, discussing the advantages of Lennar’s unique Next Gen floorplans and the connected – yet separate – Next Gen suite. Also featured in the segment are Tom Moser and his father Lee, who live in a Lennar Next Gen home, along with Tom’s sister Diane – who moved into a Lennar Next Gen home in the same community with her in-laws. [View the video]

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Buying a home is more affordable than renting in nearly two-thirds of metros after three years of paying for a mortgage, according to Zillow. For its calculation, Zillow considered costs associated with buying and renting, such as upfront payments, closing costs, insurance, utilities, and maintenance. Then, the online marketplace looked at historic and anticipated home value appreciation rates, rental prices, and rental appreciation rates to determine how many years would need to pass before buying becomes less expensive than renting. According to Zillow, in 64 percent of U.S. metros, buying is more affordable than renting if homebuyers plan to stay in their home for at least three years. “Locally high home value appreciation in many areas, combined with historically low mortgage rates and low home prices relative to recent peaks, has made buying a home a more advantageous financial decision than renting for many would-be buyers,” said Dr. Stan Humphries, Zillow’s chief economist. [Read this article]

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Consumer sentiment rebounded in early May to the highest level in nearly six years, an encouraging sign after recent data that has suggested economic growth is cooling. A gauge of future economic activity released on Friday also suggested the expected slowdown would be temporary, with the index rising to a near five-year high in April. Economists expect growth will likely slow in the second quarter from the 2.5 percent pace at the beginning of the year as tighter fiscal policy starts to bite. But recent stronger than expected improvement in several areas, including the labor market and retail sales, has suggested the recovery remains resilient. “We’re still definitely on the recovery path. We expect that this is going to be a very long and gradual recovery,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida. “Most economists are looking for stronger growth in the second half of the year and into next year.” [Read this article]

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The index of U.S. leading indicators climbed in April, a rebound from March that suggests the world’s largest economy will accelerate later this year. The Conference Board’s gauge of the outlook for the next three to six months climbed 0.6 percent in April after falling a revised 0.2 percent in March that was steeper than previously reported. Advancing stock prices and a recovering housing market may be propping up household spending, which accounts for about 70 percent of the economy. “We’re still definitely on the recovery path, but we anticipated all along that this is going to be a very gradual recovery,” said Scott Brown, chief economist at Raymond James & Associates Inc. He said multiple factors could drive economic improvement going forward. “It’s typically a lot of little things getting better at the same time. You get a little more job growth, a little more consumer spending, bank credit eases up a little more,” according to Brown. [Read this article]

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Solid hiring helped lower unemployment rates in 40 U.S. states last month, the most since November. The declines show the job market is improving throughout most of the country. The Labor Department said that unemployment rates increased in only three states: Louisiana, Tennessee and North Dakota. Rates were unchanged in seven states. California, New York and South Carolina all reported the largest unemployment rate declines in April. Each state’s rate fell by 0.4 percentage points. The report said 30 states added jobs in April, while 18 reported fewer jobs. Nationwide, employers added 165,000 jobs in April and the unemployment rate fell to a four-year low of 7.5 percent. The economy has added an average of 208,000 jobs a month since November. The housing recovery is creating jobs in many states. Texas has created 41,500 construction jobs in the past year. That’s helped the state be the nation’s leader in job growth over the past year and in April. The state added 33,100 jobs last month and 326,100 jobs over the past 12 months. [Read this article]

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The down payment is often the toughest hurdle to clear when buying a home. Whether your goal is $5,000 or $50,000, consider these 10 simple ways to save for your down payment. For example, try to negotiate your rent. With rent likely near the top of your list of expenses, cutting its cost can help you sock away serious savings. If you’re a good tenant, approach your landlord about lowering your rent. If that doesn’t work, consider downsizing to a smaller, cheaper apartment, and put the money you save on rent directly into savings. Also, shop around to reduce major monthly expenses. If it’s been a while since you checked rates for your car insurance, renter’s insurance, health insurance, cable, Internet or cell phone plan, now is the time to look into those costs. You may be able to save hundreds or even thousands of dollars by making alterations to some of these contracts. [Read this article]

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The “juice” that will fuel the economic recovery is housing, or more specifically, new home sales, Freddie Mac stated in its economic and housing market outlook report for May. Although the unemployment rate has been decreasing, falling to 6.5 percent in April, the GSE explained the reduction is due to a decline in the labor force participation rate, not an increase in employment. According to Freddie Mac, the labor force participation rate, which remained at 63 percent in April, was at the lowest level since 1980. However, as the building of new homes adds to the availability of jobs, the unemployment rate should inch down. “Based on historical correlations, every additional 100 thousand housing units started brings down the unemployment rate for construction workers by about three-fourths of a percentage point,” the report stated. For 2013, Freddie Mac forecasts housing starts will increase by 200,000 units, which would support over 100,000 new jobs in construction. Adding to this are the additional households that will form. [Read this article]

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