New Home Sales at 6 Year High

Even though the housing recovery remains fragile, the good news is that single family home sales have reached a six-year high. Sales of new homes rose slightly in September, making it the highest since 2008. The Commerce Department announced that sales increased 0.2%. One reason for the increase in sales may be that the median price of a new home fell four percent from the previous year. This is the lowest it’s been since August 2013. The median price for a new home is currently $259,000.

The sales of new homes has fluctuated throughout the country, with the highest jump in the Midwest. Sales rose 12.3% in this area. They rose two percent in the South, were stagnant in the Northeast, and actually fell in the West. The trend also seems to be toward smaller homes once the cooler seasons start. Homes under $199,999 increased while the sale of properties from $300,000 to $499,999 decreased. New home sales account for a small portion of the overall home sales, with approximately 8% of the total housing market. With sales rising, however, this in turn has been a boost to the stock market. Stock for new houses went up 1.5%, the highest level since July 2010.

Since new home sales tend to be volatile, it helps to look at the big picture to get an idea where the market is heading. In the third quarter of this year new home sales were up by 15% from the same time period in 2013. While we’re still a long way from the pre-recession peak of 1.3 million new home sales, there is reason for optimism. Builder confidence continues to rise and credit is beginning to flow again.

When you're ready to purchase a home, please contact me at barkerloans@gmail.com or 708.473.7688.

Don't Wait - Now is the Time to Buy

With interest rates still at historically low levels now is a great time to purchase a home.  But, with employment increasing, rising home prices, and projected interest rate increases in the near future, waiting could cost you.

The National Association of Realtors (NAR) and the National Association of Home Builders (NAHB) are two organization that measure and track home affordability over time.  Both the NAR's Home Affordability Index and NAHB's Housing Opportunity Index are showing the cost of purchasing a home is starting to rise, affecting affordability negatively.

According to NAHB’s Chief Economist David Crowe,  “The second quarter HOI reflects the slow but steady march toward the historic levels of price appreciation and interest rates that result in affordability levels we experienced before the mid-2000s boom.”

And, Michael Hyman, Research Assistant at NAR said,  “At the national level, housing affordability is down for the month of June due to higher prices and qualifying income levels despite the lowest mortgage rates of the year.”

So, even though you missed the very bottom of the real estate market, interest rates are still remarkably low and home prices in most areas are still below the levels they were seven years ago.  It is still a great time to purchase a home.

Contact me to find out how much home you can afford and what it will cost you at BarkerLoans@gmail.com or 708.473.7688.

Warmer Weather Brings In The Buyers, Is There Inventory?

After three consecutive months of decline, the S&P Case-Shiller 20-City Composite Index

remained nearly unchanged in February. Year-over-year home prices rose by 12.90 percent in February as compared to 13.20 percent in January.

20 Percent Below Their 2006 Pre-recession Peak
Analysts note that in spite of recent slowdowns in home prices, the year-over-year rates of home price growth remain close to peak price growth attained in 2006. National home prices remain approximately 20 percent below their 2006 pre-recession peak. 13 cities posted lower rates of price gains in February. The Case-Shiller 10 and 20 city indices showed year-over-year price gains of 13.10 and 12.90 percent respectively. Only five cities posted year-over-year gains in price appreciation. Las Vegas, Nevada continues to lead home price growth but its year-over-year rate of home price growth slowed from January’s reading of 24.9 percent to February’s reading of 23.10 percent. Washington, D.C. posted its eighth consecutive month of home price gains with a year-over-year reading of 9.10 percent, its highest rate of price increases since May 2006. Dallas, Texas posted a year-over-year rate of 10.10 percent and a month-to-month increase of 0.20 percent, which continues the city’s record home price growth.

Home Price Gains Expected To Slow In Coming Months
Analysts said that more homes are expected to come on the market and also noted that the rapid increase in home prices for some areas likely sidelined some buyers. As inventories of homes increase, home prices are expected to rise at more modest rates. Job markets continue to experience ups and downs and incomes are relatively flat. These factors can cause would-be homeowners to take a “wait-and-see” stance. Price increases in other sectors can also impact home prices, as buyers adjust their home purchase plans to what they can afford to spend.

Pending Home Sales Rise In March
The NAR reported that its pending home sales index rose by 3.40 percent in March as compared to a decrease of -0.80 percent for February. The March reading showed the first increase in pending home sales in nine months, and was the highest reading since November. Warmer weather allowed more buyers shop for homes, but remains 7.90 percent lower than in March 2013. Higher home prices and low inventories of available homes were cited as reasons for the lower reading. Pending home sales by region showed mixed results, and suggested the impact of severe winter weather on potential home buyers.
Northeast: +1.40 percent
Midwest:    -0.80 percent
South:       +5.60 percent
West:        +5.70 percent
Based on a slow start during the first quarter of 2014, the NAR forecasts 2014 sales of existing homes at 4.9 million as compared to 5.1 million existing homes sold in 2013.

If you are thinking of buying or selling a home, please contact me at BarkerLoans@gmail.com or 708.473.7688.

4 Tips for Real Estate Investing

Invest In Real Estate Like A Pro With These Quick Tips

Real estate investments are still going strong and will probably continue to be a popular method of financial gain into the future.

Real estate is solid. It is a tangible product that is attractive to both beginning investors and experienced pros. The most important part of getting started in real estate investing is knowing what you’re getting into and what to watch out for.

Here are 4 top tips from real estate investment professionals:

Understand The Realities

Real estate investment, like any form of investment, is risky. Do not use money you cannot afford to lose. Careful study, understanding the market, and practice help alleviate a lot of the risks but things happen in the best of situations so don’t play with what you can’t afford to lose.

Research Is A Constant

Research in real estate investment isn’t something you do once. Research is constant. It is a daily part of your efforts and should always be at the forefront of your mind. From changing banking methods to market changes, researching and learning must be ongoing to be a successful real estate investor.

Know The Property

Research isn’t limited to financing and the real estate market. You need to thoroughly investigate each property before you buy. Fill out an investment worksheet to see if all the costs associated with the purchase will allow a satisfying profit.

Learn About Personal Protection

Taking risks with the money you have set aside for investment is one thing. Taking risks with your family’s savings, property, and other assets is another. Consider starting an LLC. You can choose from a single LLC to cover all of your real estate holdings, or having a separate LLC for each property purchased.

Please contact me at BarkerLoans@gmail.com or 708.473.7688 if you have any questions about investing in real estate.