April 26, 2016

Spending On Something That Isn’t Yours

A report from The Record in New Jersey. “According to the 2015 State of Hispanic Homeownership Report conducted by the Hispanic Wealth Project and National Association of Hispanic Real Estate Professionals, Hispanics were the only major ethnic or racial group to raise its homeownership rate last year. In 2015, Hispanics achieved a net increase of 250,000 owner households, which accounted for 69 percent of the total net growth in U.S. homeownership. Eleonoro Paula, 53, who has lived in the United States for nearly 30 years and works as a contractor at FedEx Ground in South Hackensack, said he has been saving for years to buy his first home. For more than two decades, Paula essentially lived in the U.S. on his own — until four years ago, when his family joined him from the Dominican Republic. ‘We’re buying now because we have the right qualifications to do so,’ Paula said in Spanish.”

“The family of six, which includes three children ages 13, 15 and 16, currently rents an apartment in a two-family home in Saddle Brook for $1,500 per month. The Paulas hope to find a one-family home in the borough, where they enjoy the quiet suburban lifestyle and where the children attend school. They hope to close on a home in the $500,000-$600,000 price range, and anticipate a 30-year mortgage and a $2,600 monthly payment. To Eleonoro Paul, the $1,100 jump is worth it. ‘Realistically, no matter how you look at it, [when you rent] you’re spending on something that isn’t yours,’ Paula said.”

WEAU in Wisconsin. “Business is good when it comes to selling or buying a home in Wisconsin; more houses were sold in the first quarter of 2016 since 2007 in Wisconsin according to the Wisconsin Realtors Association. Joe Germain, President of the Realtor Association of Northwest Wisconsin, knows the number of homes sold in Eau Claire has dropped 10% from the first quarter of 2015 to this year’s first quarter, but he says the numbers can be misleading. ‘One of the reasons it’s down is the lack of inventory,’ Germain said. ‘If we had more inventory, the prices would be up.’”

“With a relatively smaller number of houses on the market, some sellers in the Eau Claire area don’t seem to be having any trouble finding potential buyers. ‘We’ve been on the market for about 30 days now and we’ve had more than 20 viewings,’ Terry Chmielewski of Eau Claire said. ‘We’ve already had one offer that we could turn down because we know that it wasn’t good compared to what we can get. We’re pretty confident; that’s why we turned down the first offer that we got,’ Chmielewski said. ‘We’ve only been on the market 30 days; I only look to it as being very good.’”

The Sun Sentinel in Florida. “South Florida’s home prices increased in March, but sales slowed as the market settles into a steady, less-frenetic pace. ‘Things are good, but listings aren’t selling overnight anymore, unless they’re just incredibly well-priced,’ said Beverly Rothstein, an agent in Palm Beach, Broward and Miami-Dade counties.”

“Zach Finn, broker-owner of Finn Real Estate across South Florida, said he had clients who agreed to sell their three-bedroom Fort Lauderdale home with a pool for $410,000, but the appraisal came back at $400,000. A year or two ago, in a more overheated market, the buyer probably would have paid all or part of the difference out of pocket, Finn said. But this buyer held firm, not willing to pay anything more than appraised value. ‘I think we’ll continue to gain a little bit of strength, but I definitely don’t see the market allowing prices to spike anytime soon,’ he said.”

Maxim on New York. “A high-living Manhattan entrepreneur who inspired a character in The Wolf of Wall Street has once again slashed the price for his lavish 6,500-square-foot townhouse. Alan Wilzig—who introduced penny stock scammer Jordan Belfort to his second wife Nadine, played by Margot Robbie in the movie—chopped the price of his Tribeca pad from $38.5 million to $24.885 million. The opulent man cave was initially listed at $44 million in 2014.”

The Midland Reporter Telegram in Texas. “Low oil and natural gas prices continue to cut deeper into the overall Midland-Odessa economy. The February Midland-Odessa Regional Economic Index has fallen 11.1 percent below February 2015 levels and is now 11.8 percent below its January 2015 peak. The index, prepared by Amarillo economist Karr Ingham for Midland Development Corp. and Security Bank by, has fallen for 13 consecutive months. The two primary pillars of the economy — consumer spending and employment — continued their double-digit declines, according to Ingham.”

“Midland and Odessa issued a total of 67 new housing permits in February, down 38 percent from 108 last February. For the first two months of 2016, the cities have issued 127 permits, down 31 percent from 184 in the first two months of 2015. Ingham said the index’s components were just as impressive when the economy was growing, rising by double digits, as they are now, falling by double digits. ‘They just had a positive instead of a negative in front,’ he said. ‘Spending and employment are doing what’s expected, losing more with each passing month. They reflect a contraction that is entrenched, and there is no light at the end of the tunnel.’”

The Idaho Statesman. “It’s a good time to be a Treasure Valley home builder. New home sales and median home prices are up sharply from a year ago. In Ada County, demand for new homes increased in the first quarter, with February sales up 25 percent from a year earlier, thanks in part to a small increase in listings. Mike Turner, owner of Front Street Brokers in Boise, says he talks to home shoppers who see new construction springing up across the Valley and think there’s an oversupply. But inventory has not grown much, because homes are either presold or are getting snapped up shortly after reaching the market.”

“‘Everything is selling,’ Turner says. ‘Consumers think it’s getting too hot, but inventory is still low, and as long as that’s the case, the market is healthy.’”

“Coleman builds in the $135,000 to $700,000 range. CBH Homes, Idaho’s largest builder, sells mostly under-$300,000 homes. Coleman owner Thomas Coleman says he plans to increase production to 300 homes this year. Owning 4,000 vacant lots in the Treasure Valley — an eight-year supply — protects Coleman Homes from paying more if land prices rise and gives the company chess pieces to move if the market shifts, he says.”

“Coleman says he is wary of an economic recovery that ‘never felt that great,’ as well the Valley’s reliance on out-of-state retirees buying homes. ‘The Valley is a little different than other areas of the country where the entry-level market is strongest and improving,’ he says. ‘Our high-end market is really strong. If you look at our average wage, which is in the mid-$40,000s, and the number of $800,000 homes sold, it doesn’t compute perfectly.’”