Sales Surged in January

Home buyers appeared in a rush to lock in mortgage rates ahead of further increases and to take advantage of any housing inventory they could find last month. Existing-home sales climbed 6.7% in January compared to the prior month, led by the strongest gains in the Southern region of the U.S., according to the National Association of REALTORS®’ latest existing-home sales report.

Sales rose even as housing inventories fell to an all-time low and home prices increased at a much swifter pace, NAR reports.

Existing-home sales—completed transactions for single-family homes, townhomes, condos, and co-ops—increased to a seasonally adjusted annual rate of 6.50 million in January. Sales, however, are down 2.3% compared to a year ago, NAR reports.

“Buyers were likely anticipating further rate increases and locking-in at the low rates, and investors added to overall demand with all-cash offers,” says Lawrence Yun, NAR’s chief economist. “Consequently, housing prices continue to move solidly higher.”

Meanwhile, “the inventories of homes on the market remains woefully depleted, and in fact, is currently at an all-time low,” Yun adds. Homes priced at $500,000 and below are vanishing from the market. Supply is rising at the higher price ranges. “There are more listings at the upper end—homes priced above $500,000—compared to a year ago, which should lead to less hurried decisions by some buyers,” Yun adds. “Clearly, more supply is needed at the lower end of the market in order to achieve more equitable distribution of housing wealth.”

5 Key Housing Indicators

Here’s a closer look at how existing-home sales performed in January, according to NAR’s latest report:

• Home prices: The median existing-home sales price increased at a stronger pace in January, climbing 15.4% annually to $350,300.
• Inventories: Total housing inventory at the end of January was 860,000 units, plunging nearly 17% from a year ago. Unsold inventory is at a 1.6-month supply at the current sales pace.
• Days on the market: Seventy-nine percent of homes sold in January were on the market for less than a month. Homes are selling faster than last year. Properties typically stayed on the market for 19 days in January, down from 21 days a year ago.
• First-time home buyers: First-time buyers accounted for 27% of sales in January, down from 33% in January 2021. As home prices increase and mortgage rates rise, first-time buyers could be getting priced out of the market, Yun notes.
• Investors and second-home buyers: Individual investors or second-home buyers purchased 22% of homes last month, up from 15% a year ago. They tend to account for the largest bulk of cash sales, which accounted for 27% of transactions in January.

Regional Breakdown

The South saw the largest uptick in home sales last month, but all four major regions of the U.S. posted gains. The following are how existing-home sales fared in the main regions of the U.S. in January.

• South: home sales climbed 9.3% in January compared to the prior month, reaching an annual rate of 2.94 million. That is an increase of 0.3% from a year ago. Median price: $312,400, an 18.7% increase compared to a year ago
• Midwest: sales increased 4.1% in January compared to the previous month and reached an annual rate of 1.51 million. That is equal to the level a year ago. Median price: $245,900, a 7.8% rise from January 2021
• Northeast: sales increased 6.8% in January, reaching an annual rate of 780,000. That marks an 8.2% decrease from a year ago. Median price: $382,800, up 6% compared to January 2021
• West: home sales rose 4.1% and reached an annual rate of 1.27 million in January, down 6.6% compared to a year ago. Median price: $505,800, up 8.8% from January 2021

Source: National Association of REALTORS®

©National Association of REALTORS®
Reprinted with permission

Disney to Build Themed Housing Development

The Walt Disney Company is bringing “Storyliving by Disney” to those who want to live out the Disney magic beyond the silver screen. It announced it will be building a housing development in Southern California—the first of what they plan to be many across the U.S.

The development, to be built in collaboration with DMB Development, will be located in Rancho Mirage, Calif., and will be constructed on a 24-acre “grand oasis featuring clear turquoise waters with crystal lagoons,” a release announces, adding in that will be built sustainably with low water consumption. The planned neighborhood will be called Cotino. No dates were provided for its opening.

According to the press release, Cotino will welcome homeowners of all ages, with one section of the development tailored to the 55-plus age group. The development will feature estates, single-family homes, and condos.

Disney cast members trained in the company’s guest service will operate the community association. Also, voluntary club memberships will be available to residents for accessing a waterfront clubhouse, club-only beach area, recreational water activities, and Disney programming and entertainment throughout the year, such as live performances, cooking classes, and more.

“For nearly 100 years, Disney has shared stories that have touched the hearts and minds of people all around the world,” Josh D’Amaro, chairman of Disney Parks, Experiences and Products, said in a release announcing the new development. “As we prepare to enter our second century, we are developing new and exciting ways to bring the magic of Disney to people wherever they are, expanding storytelling to storyliving. We can’t wait to welcome residents to these beautiful and unique Disney communities where they can live their lives to the fullest.”

Disney said additional locations for future developments are currently being explored.

Disney has gotten into residential real estate in the past. Disney has sold luxury vacation homes through a 980-acre gated Golden Oak community in Florida. Also, in 1996, Disney developed a 5,000-acre residential community known as Celebration, Fla., about 20 miles outside of Orlando. Disney has since divested most of its interest in the development, The Wall Street Journal reports. Source: The Walt Disney Company and “Disney Adults Never Have to Grow Up With New ‘Storyliving’ Residential Housing,” New York Post (Feb. 16, 2022)

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Reprinted with permission

Best Day for Listing Photo Shoots

Not sure when to plan your next listing photo shoot? The most popular day of the week for real estate photography: Wednesday, according to a new study of real estate photography data from HomeJab, a professional real estate photography and video service. Twenty percent of all listing photos are taken on Wednesday.

Tuesday and Thursday are tied as the second most popular day of the week, at 18% each.

“Most professional real estate photography shoots don’t happen on weekends, even though home sellers are typically more available,” says Joe Jesuele, founder and CEO of HomeJab. “Our research shows that only about one out of 10 listing photo shoots occur on a Saturday and Sunday.”

The study also found that video and 3D shoots of property listings are growing more popular ever since the pandemic began. The share of video and 3D virtual tours ordered by agents jumped to 53% of photo shoots in 2020 and 48% in 2021 (compared to 37% in 2019), according to HomeJab.

However, aerial photography seems to be losing some traction. HomeJab reported that about 15% of real estate listing photo shoots included aerial photography in 2018 and 2019, but that percentage dropped to 12% in 2020 and 14% in 2021.

“Agents typically have a fixed budget for photography so an increase in one service would cause a decrease in the other service,” Jesuele says. He expects video and 3-D tours to continue to remain popular and aerial photography to rebound this year. “Increasing visual content satisfies sellers and helps potential buyers, especially those who still don’t want to tour physically as many houses as they once did,” Jesuele says. Source: “2022 Real Estate Photography Study,” HomeJab (February 2022)

©National Association of REALTORS®
Reprinted with permission

Mortgage Rates Nearing 4%

Borrowing costs are climbing: The 30-year fixed-rate mortgage rose to a 3.92% average this week, Freddie Mac reports.

“Mortgage rates jumped again due to high inflation and stronger than expected consumer spending,” says Sam Khater, Freddie Mac’s chief economist. “The 30-year fixed-rate mortgage is nearing four percent, reaching highs we have not seen since May 2019. As rates and house prices rise, affordability has become a substantial hurdle for potential home buyers, especially as inflation threatens to place a strain on consumer budgets.”

As of now, however, the rising rates are sparking an urgency rather than a pause among house hunters, Nadia Evangelou, National Association of REALTORS®’ senior economist and director of forecasting, writes on the association’s blog. “Buyers are rushing to lock in lower rates as the outlook is for even higher mortgage rates in the following months,” she notes. Mortgage rates are still low by historical standards.

Freddie Mac reports the following national averages for mortgage rates for the week ending Feb. 17:

• 30-year fixed-rate mortgages: averaged 3.92, with an average 0.8 point, rising from last week’s 3.69% average. Last year at this time, 30-year rates averaged 2.81%.
• 15-year fixed-rate mortgages: averaged 3.15%, with an average 0.8 point, increasing from last week’s 2.93% average. A year ago, 15-year rates averaged 2.21%.
• 5-year hybrid adjustable-rate mortgages: averaged 2.98%, with an average 0.3 point, increasing from last week’s 2.80% average. A year ago, 5-year ARMs averaged 2.77%.

Freddie Mac reports average commitment rates along with points to better reflect the total upfront cost of obtaining a mortgage. Source: Freddie Mac and “Instant Reaction: Mortgage Rates, February 17, 2022,” National Association of REALTORS® Economists’ Outlook blog

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Reprinted with permission

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Markets With Highest Mortgage Fraud Risks

Mortgage application fraud rose in the fourth quarter of 2021, according to CoreLogic’s Mortgage Fraud Brief, released Feb. 11. Lenders tracked several areas of risk, including occupancy fraud, employment and income fraud, and property fraud. The report analyzes the metro areas with the highest mortgage fraud risk on a quarterly basis.

CoreLogic’s fraud risk showed that its mortgage application fraud risk index rose 10.4% in the fourth quarter compared to the third. The index was up nearly 27% over the fourth quarter of 2020.

These are the metros where fraud risk was highest in the fourth quarter of 2021:

1. Las Vegas-Henderson-Paradise, Nev.
2. Poughkeepsie-Newburgh-Middletown, N.Y.
3. San Jose-Sunnyvale-Santa Clara, Calif.
4. Miami-Fort Lauderdale-Pompano Beach, Fla.
5. Los Angeles-Long Beach-Anaheim, Calif.
6. New York-Newark-Jersey City, N.Y.-N.J.-Pa.
7. McAllen-Edinburg-Mission, Texas
8. San Francisco-Oakland-Berkeley, Calif.
9. New Orleans-Metairie, La.
10. San Diego-Chula Vista-Carlsbad, Calif.
11. Austin-Round Rock-Georgetown, Texas
12. Tampa-St. Petersburg-Clearwater, Fla.
13. Orlando-Kissimmee-Sanford, Fla.
14. Stockton, Calif.
15. New Haven-Milford, Conn.

Source: “Q4 2021 Mortgage Fraud,” CoreLogic (Feb. 11, 2021)

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Reprinted with permission

‘Real Estate Agent’ Most Googled Job Search Term

The pandemic-fueled trend of the “Great Resignation” has prompted a lot of people to leave their current jobs in search of new roles. For many people, that very well may be real estate, according to research findings from Google.

Google revealed the search trends of the jobs attracting the most attention on its search engine. The list identifies the top jobs people searched for in the U.S.

The industry has seen a rising number drawn to a real estate career since the pandemic began. The National Association of REALTORS® has seen its membership climb from about 1.4 million in 2019 to about 1.52 million in January 2022, according to the latest member data.

The top 10 jobs that are the most searched-for online in the U.S. (ranked in order), according to the Google study, are:

1. Real estate agent
2. Flight attendant
3. Notary
4. Therapist
5. Pilot
6. Firefighter
7. Personal trainer
8. Psychiatrist
9. Physical therapist
10. Electrician

The 15 states where searches for real estate careers dominated were California, Washington, Wyoming, North Dakota, Nebraska, Minnesota, Kentucky, Tennessee, West Virginia, Virginia, Pennsylvania, New York, New Jersey, and Vermont. Source: “The Jobs People Want, According to Search Trends,” Blog.Google (Feb. 9, 2022)

©National Association of REALTORS®
Reprinted with permission

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Thirty-one percent of all Americans and 41% of 18-to-34-year-olds say they’ve purchased a primary residence with someone they aren’t married to, according to a survey by realtor.com®. Further, 55% of Americans and 68% of 18-to-34-year-olds say they would consider it.

“With home prices skyrocketing in recent years, it’s become even more challenging to break into the housing market for first-time buyers,” says Clare Trepasso, deputy news editor at realtor.com®. “Many buyers have needed more than one income to afford a home, especially as rising rents may be eating into their down payment savings. However, the pandemic delayed many weddings. And rising prices forced some couples to choose between saving to become homeowners versus having the big day. This has resulted in many unmarried couples, as well as extended families and friends, pooling their resources so they can afford to become homeowners.”

The most common co-buyers are romantic partners who are not engaged or married (15%). But Americans are also open to buying with extended family members or roommates.

Here’s the breakdown:

• Romantic partner, not engaged or married (15%)
• Parent, grandparent, or older relative (6%)
• Child, niece or nephew, or other younger relative (5%)
• Sibling, cousin, or relative of a similar age (4%)
• Roommate (4%)
• Friend (4%)

Also, here’s who they would consider buying a home with, according to the realtor.com® survey:

• Romantic partner, not engaged or married (27%)
• Child, niece or nephew, or other younger relative (20%)
• Parent, grandparent, or older relative (17%)
• Sibling, cousin, or relative of a similar age (16%)
• Friend (10%)
• Roommate (7%)

Source: realtor.com®

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Reprinted with permission