Timely Real Estate……………………………………………1 March, 2020
Mortgage rates plunged to 8-year low
Here’s some good news: Mortgage rates are falling fast, and they could sink even lower according to Mortgage News Daily, a respected real estate journal. They reported that the 30-year fixed-rate mortgage averaged 3.34% last Monday, a rate last reached in 2012 and briefly in 2016.
It was also noted that long-term mortgage rates loosely follow the 10-year Treasury yield. While the coronavirus fears are hitting financial markets and prompting bond yields to move lower; mortgage rates are following suit.
The report pointed out that when rates fall this quickly, it’s not so much that big banks draw the line on mortgage rates, but rather, the underlying mortgage-backed securities market refuses to improve as quickly as the Treasury market.
Refinance applications surged 165% annually as homeowners rushed to lock in rates, the Mortgage Bankers Association reports. Restrictive lending, however, may block some mortgage shoppers from taking advantage of the low rates.
Health and Wellness lead the global luxury market trends
According to the recent Coldwell Banker Global Luxury Market study done in 2019, three-quarters of people shopping for a home in the U.S. consider housing an essential or extremely important contributor to their health. When asked what constitutes health and well-being, 75% responded “having more energy,” while 65% said “feeling better rested.” More than half mentioned “achieving a happier state of mind” and “increasing mental alertness.”
From custom designed homes and new condominium buildings to planned residential communities, the inclusion of wellness structurally as well as in the design, features and amenities, is becoming the rule rather than the exception, especially for the affluent in their real estate choices in some ways replacing the long standing dictum of “location, location, location”.
Luxury is the trend leader in wellness, but developers are starting to leverage the benefits to create more affordable smart-healthy homes and neighborhoods. There is a sharpening focus on wellness at the center of new home conception, design, and creation.
Advancements in science and technology have produced longer life spans around the world, but also enabled daily human life to become more sedentary, presenting people with the unappealing possibility of living longer but unhealthier lives.
California and LA to experience less growth
Despite a booming economy through the U.S., California and Los Angeles in particular, are headed for a ‘slowed-down’ economy. But it wasn’t so long ago that economic growth in California and Los Angeles far surpassed that of the nation.
Those days are coming to an end, according to the Los Angeles County Economic Development Corp., a nonprofit group that works with local businesses. In 2018, while the U.S. economy expanded by 2.9%, California’s grew by 4.3% and Los Angeles County’s by 3.7%. In 2019, economic growth slowed to 2.3% in the U.S., 2.6% in California and 1.6% in L.A. County.
This year, California’s growth will slow to 2%, and L.A. County’s economy will expand by just 1.8% — close to the nation’s 1.9%, the LAEDC predicted Wednesday in its annual forecast presented to business executives and government officials last week.
The assessment is in line with other forecasts. “Though the pace of real GDP growth has slowed this year, there are few signs that the longest U.S. expansion is on its last legs,” the Federal Reserve Bank of St. Louis reported last November. “The consensus of professional forecasters is that real GDP growth will dip below 2% in 2020.”
Fun Facts about Leap Year!
Leap days are needed to keep our calendar in alignment with the Earth’s revolutions around the Sun. It takes the Earth approximately 365.242189 days – or 365 days, 5 hours, 48 minutes, and 45 seconds – to circle once around the Sun. This is called a tropical year. Without an extra day on February 29 nearly every four years, we would lose almost six hours every year. After only 100 years, our calendar would be off by approximately 24 days.
All the other months in the Julian calendar have 30 or 31 days, but February lost out to the ego of Roman Emperor Caesar Augustus. Under his predecessor Julius Caesar, February had 30 days and the month named after him – July – had 31. August had only 29 days. When Caesar Augustus became Emperor, he added two days to ‘his’ month to make August the same as July. So, February lost out to August in the battle of the extra days.Are you a Leap Year baby? Happy Birthday!
49% Admit strained relations in buying house
This certainly isn’t news to many. Forty-nine % of buyers admit that house hunting with their partner strained their relationship, according to a survey from Porch.com, a home remodeling website. Porch surveyed more than 980 homeowners.
Nearly one in four homeowners say their current home does not have all the features that their partner considers important. Certain home features tended to lead to the most bickering among couples, particularly wood- burning fireplaces and hardwood flooring, the survey found.
Indeed, a separate survey found that 77% of Americans who have purchased a home and 71% of those who have sold a home with a significant other in the last decade admit to arguing during the process, according to a survey conducted by The Harris Poll.
Buyers said they most often fought over the size or style of the home to purchase, the home’s must-have features, the location or neighborhood to buy in, and the budget. As for sellers, they tended to argue over financial decisions involved, such as what price to list the home for, whether to drop the price, and whether to accept an offer.
Other common disagreements involved whether or not to make repairs, strangers walking through the home during an open house, and keeping the house clean for showings.
One of the pieces of advice I give all of my buyer clients is to make two lists for themselves individually, one a “must have list”, and the other the “fantasy list”. Then as a couple, repeat the process, but as a couple. It eliminates a lot of problems, and many times highlights what they are both looking for. They should also be prepared to throw all of that out when they walk into a house that may not have any or most of the items on their list, but “rings all of their respective bells”. I know about that personally as it happened to me.
Nation’s delinquency rate flattens out to 3.9%
In November 2019, 3.9% of home mortgages were in some stage of delinquency, down from 4% a year earlier and the lowest for the month of November in more than 20 years, according to the latest CoreLogic Loan Performance Insights Report
The measure, also known as the overall delinquency rate, includes all home loans 30 days or more past due, including those in foreclosure. For the month of November historically, the share of delinquent mortgages peaked in 2009 at 11.5%. Since March 2018, the overall delinquency rate each month has been lower than during the pre-crisis period of 2000 through 2006, when the rate averaged 4.7%.
The serious delinquency rate – defined as 90 days or more past due, including loans in foreclosure – was 1.3% in November 2019, down from 1.5% in November 2018. The serious delinquency rate has stood at 1.3% since April 2019. The foreclosure inventory rate – the share of mortgages in some stage of the foreclosure process – was 0.4% in November 2019, unchanged from a year earlier.
More couples delay marriage…home first!
Is the declining number of marriages contributing to fewer first-time home buyers? In the 1980s, the number of married couples in the ranks of first-time buyers peaked at 75%. Flash forward to today, when only 53% of first-time buyers are married couples, according to data from the National Association of Realtors (NAR).
So, who are the other buyers making up the housing market today? The share of unmarried couples purchasing their first home is now matching single females at 17%, the largest share recorded by NAR to date.Also increasing is the share of “galentines” buying a home together, notes Jessica Lautz, NAR’s vice president of demographics and behavioral insights, at the association’s Economists’ Outlook blog. Galentines refers to platonic friendships, such as roommates. These buyers have made a notable jump, from 2% to 4% of the market in the last year, Lautz notes.
Unmarried couples and roommate buyers may have an advantage over single buyers helping them to increase their numbers: dual incomes. “Dual incomes allow them to navigate the housing market and perhaps allow them to purchase a home that is at a higher price point where they may face less competition in the buying market,” Lautz writes.
California reopening grants for earthquake help
Putting off an earthquake retrofit of your house? California is reopening applications for grants of up to $3,000 to fund seismic strengthening of older homes that can slide off their foundations.
There are an estimated 1.2 million California homes with a deficiency that can render them unlivable after strong shaking. It involves houses that were built before 1980, but especially before 1940, that are a few steps off the ground and have a crawl space between the living space and the ground the house sits on.
The problem is the homes haven’t been properly braced and bolted to the foundation. Walls and wood beams that keep the house off the ground aren’t fastened tightly to the ground, and the lack of grip can cause the home to be shoved off the foundation — as if the shaking has broken the building’s knees, and a rug has been pulled from underneath the home.
If you think your home needs help, please visit this website: https://www.earthquakebracebolt.com
Speaking of Moving & Shaking
For those of you who enjoy doing cross word puzzles and receive the Schiffer Line via snail mail, starting with the next issue of the Schiffer Line in two weeks, you will be receiving a cross word puzzle linked to articles in the newsletter which you will need to complete and send in via my email address. There will be a prize for the first person who gets the most correct answers.
Please remember all responses will need to be via email ONLY at email@example.com.
Please stop by my open house at my new listing at 2218 Canyonback on the 8th and 15th of March from 2-5PM .
Of course, it can also be seen by appointment any time before then. It is priced at $2,775,000 and will be in the MLS with photos on the 3rd.
It will be a treat to see and priced to sell!
A lot of going on behind the scene with regard to the rapid transit proposals for the Sepulveda Corridor as well as the Berggruen Institute.
I very much look forward to hearing from and seeing you. Please let me know how you like the changes we are making in my marketing and how I can assist you with all of your real estate needs.
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