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Pending and Settled Sales Spring into Action

Courtesy of REIN

Spring is in the air and Hampton Roads is feeling it! The Hampton Road real estate market saw a significant year-over-year upswing in both pending and settled sales for March 2015. “Pending and settled sales rose significantly year-over-year for March 2015. Pending sales are up about 25%, and even more encouraging, settled sales are up almost 30% when compared to last year. No single event can be attributed to this boost in activity, but some contributing factors include the improved weather, rates staying low, and increased consumer confidence.” – says Art Zachary, REIN’s President and Chief Operating Officer of Rose and Womble Realty Company.

Residential active listings did not receive as much of a jolt, but still experienced a 1.83% increase when compared to March 2014. While the overall growth of active listings is to be noted, only three of the region’s seven major cities (Chesapeake, Hampton, Newport News, Norfolk, Portsmouth, Suffolk, and Virginia Beach) experienced increases in the number of homes for sale when compared to March of last year. Chesapeake led the pack with a 12.64% rise, while Hampton and Virginia Beach were runners-up with increases of 9.06% and 4.89% respectively.

The region’s months’ supply of inventory for residential homes for sale is holding steady at 6.31 months. This is only a 1.6% rise from the previous month, February 2015, and an even slighter rise of 0.16% from March 2014 when months’ supply was 6.30 months. For the sixth successive month, Virginia Beach maintains the lowest months’ supply of inventory of the seven major cities at 4.88 months. Suffolk breaks Hampton’s five month streak by having the highest months’ supply of inventory at 7.42 months in March. Days on market for “Solds” has been on the decline for the past three years, settling at 95 days this March as compared to 101 days in 2014.

Residential pending sales for the month of March rose a considerable 24.73% as compared to the prior year. All seven of the region’s major cities saw improvement, some more than others. Norfolk and Portsmouth blazed the trail with the greatest growths of 39.90% and 39.60% respectively. Chesapeake and Hampton were not far behind, both experiencing year-over-year rises of more than 30%. Suffolk lagged behind with the lowest increase of 0.66%. This consistent increase in pending sales suggests continued escalating settled sales in the months to come, assuming all transactions conclude satisfactorily.

March’s residential settled sales rose 29.76% when compared to March 2014. Of the region’s seven major cities, Hampton surged with the most growth, with a year-over-year increase of 58.95%. All of the other major cities showed progress as well, ranging from 5.93% (Suffolk) to 41.36% (Virginia Beach). The region’s median sales price for March 2015 is $209,000, up 5.29% from the previous year when it was $198,500.

While the number of distressed homes, those that are either short sales or foreclosures, have significantly decreased since the peak in 2012, their influence is still considerable, most notably in how they impact the region’s median sales price. During March 2015, distressed homes accounted for just 17.85% of all residential active listings, down 1.65% from the same period of time last year. March’s distressed homes accounted for 22.70% of all residential settled sales, a decrease of 1.84% from March.

Real Estate Trends to Watch in 2015

Courtesy of Yahoo Finance

 

Along with green shoots and chirping birds, one sure sign of spring is popping up in neighborhoods across the country: For Sale signs.

As the weather warms up, so does the housing market, and experts say this year’s spring selling season is shaping up to be an active one. Whether you’re buying or selling, here are the trends you need to know about.

1: Home prices are rising, even hitting record levels in some places. Home prices nationwide rose by 5.7 percent in January, compared to a year ago, with prices hitting record highs in Colorado, Texas, Wyoming, and New York.

Prices are so high in certain areas that some economists are starting to worry about localized bubbles. In most markets across the country, however, gains of around 5 percent are seen as stable, sustainable growth, a welcome change after years of roller coaster changes.

2: Mortgage rates are still low … for now. At less than 3.7 percent, mortgage rates are haven’t been this favorable to consumers since 2013. “Even though rates are expected to rise as the year progresses, for now these rates are really at very low levels,” says Greg McBride, chief financial analyst at Bankrate.com.

To be safe, once you’ve got a closing date, consider locking in your mortgage at today’s rock-bottom rates.

3: It’s still a seller’s market. Total housing inventory at the end of February increased 1.6 percent to 1.89 million existing homes for sale, but that’s still 0.5 percent less than a year ago. Unsold inventory is at a 4.6-month supply, giving sellers a slight advantage in today’s market. (A six-month supply is considered a healthy market.)

4: Buyers want turnkey properties. Even with tight inventory, buyers are looking for properties that are move-in ready and won’t require much more than a coat of paint. “Buyers don’t want to assume any risk with properties that need work, particularly first-time buyers with limited cash resources,” says Budge Huskey, chief executive officer at Coldwell Banker Real Estate.

5: Foreclosures are no longer a factor. After peaking in August 2006 just before the housing bubble burst, foreclosures are on pace to return to historic norms this year. Foreclosure filings fells 4 percent in February to their lowest level since 2006.

6: Investors are backing off. Ordinary buyers in recent years often found themselves competing with investors. “Today’s houses are getting less desirable for investors because price points are going higher, so it doesn’t pencil out as much,” says Daren Blomquist, RealtyTrac vice president. The share of homes going to institutional investors or all-cash buyers dropped in 2014 to the lowest level in four years.

7: In most places it’s much cheaper to buy than to rent. Soaring rents in recent years have made buying a home much more affordable for those who want to stay put than renting one. Nationally, U.S. renters spend an average of 30 percent of their income on rent, versus just 15 percent of income on mortgage payments.

8: Credit is getting looser. Fannie Mae and Freddie Mac have introduced new lending programs that allow borrowers to put just 3.5 percent down on a home – although this comes with risk, of course. The Federal Housing Finance Agency recently reduced the cost of mortgage insurance by half a percentage point, which will save home buyers an average of $900 per year. All of this makes it a little bit easier for first-time buyers to qualify for a home loan. “It’s still not easy to get a mortgage, but it’s not as hard as it was a couple of years ago,” says Bob Denk, an economist with the National Association of Home Builders.

9: New homes are smaller and greener. The average new home in 2015 was expected to be about 2,200 square feet, or 10 percent smaller than the average new home five years ago. Millennial buyers and downsizing boomers want a smaller carbon footprint and a more eco-friendly home with energy-efficient windows and plumbing.

 

Residential Listings in Hampton Roads Continue to Rise

Spring is here and the housing market is continuing to show growth.

Residential active listings rose 3.35% when compared to February 2014. This is the 19th consecutive month that active listings have risen year-over-year, with increases that have ranged from less than 1% to as high as 12%. Of the region’s seven major cities (Chesapeake, Hampton, Newport News, Norfolk, Portsmouth, Suffolk, and Virginia Beach) all but Newport News experienced a year-over- year increase in the number of homes for sale. Chesapeake and Hampton saw the largest spikes at 14.67% and 13.90%, while Newport News declined by 2.24%.

Hampton Roads’ residential pending sales for the month of February rose substantially year-over- year, up 17.97% as compared to the prior year. All seven of the region’s major cities fostered year-over- year increases, with Hampton and Virginia Beach experiencing the largest gains of 36.08% and 30.07% respectively. February marks the 9th consecutive month that residential pending sales have risen year- over-year. A significant and steady increase in pending sales should result in higher settled sales over the next few months, assuming all transactions conclude satisfactorily.

Real Estate Market Proving Strong in 2015

Courtesy of the Virginia Pilot

The Hampton Roads real estate market started 2015 on a positive note.

The number of existing homes sold and the median price grew year-over-year in January, as did the number of active listings across the region, according to a report released recently by the Real Estate Information Network, the Virginia Beach-based multiple listing service for Hampton Roads.

Pending sales rose significantly, according to the service, which suggests that “consumer confidence is up and buyers are jumping into the market.”

Residential active listings rose 7.6 percent over January 2014 to 10,994 last month. All seven of the region’s biggest cities experienced a year-over-year increase in the number of homes for sale, according to the report.

In South Hampton Roads, the number of existing homes sold increased to 707 in January – a 4.9 percent bump over the 674 sold the same month in 2013.

The median price grew 3.9 percent in South Hampton Roads to $185,000 in January from $178,000 the year prior.

Distressed sales decreased year-over-year in January, but they accounted for more than a quarter of all sales in the region.

January’s distressed homes accounted for 27.7 percent of all residential settled sales, a 1.8 percent drop from the prior year. But it was also the highest percentage since February 2014 when it was 30.7 percent, according to the report.

Home sales picked up steam toward the end of 2014, but for the year, the market lost the forward momentum that had been building slowly since 2012.

Why Today’s Market is Good for Both Buyers and Sellers

After a slight increase at the end of last month, mortgage rates have once again fallen for all home loan types. According to the Mortgage Reports, loan rates are at their lowest levels in nearly two years and very close to all-time low rates set in May 2013. For homeowners who have been looking to refinance to save money each month or get rid of their MIP payments, now is the time to act.

The average 30-year fixed mortgage rate is now at 3.59 percent, nearly a full percent lower than rates were a year ago. FHA, USDA and VA loan rates are even lower and 15-year mortgage rates can be found well under 3 percent for prime borrowers.

The housing market right now is good for both buyers and sellers, as home values continue to rise, while mortgage rates are staying low. The demand for homes has been strong in the U.S., with a third of homes selling in less than 30 days. The Pending Home Sales Index from the National Association of Realtors shows that supply of homes is at 4.4 months, which is defined as a seller’s market.

Fortunately buyers can get home loans at low rates without having to put a ton of money down. Mortgage loans have down payments as low as 5 percent for fixed rate loans and 3.5 percent for FHA loans. For those who qualify for a VA loans, no down payment loans are available as well.

For current homeowners looking to lower their monthly payments, refinancing at today’s low rates is a smart idea. For those who have some equity in their homes, refinancing from an FHA to a conventional loan can save you money on your monthly payments, and get rid of MIP. If you owe more than your home is worth, you may qualify for a HARP refinance, which Freddie Mac shows can save homeowners over 30 percent annually.