San Diego Real Estate and Community News

Sept. 24, 2021

New Home Construction Up 17% Over Last Year

If you're a prospective home buyer, the pace of new home construction should matter to you. Today's hot market and rapidly rising prices are largely due to the fact that there are fewer homes for sale these days. Combined with a high level of buyer demand, the lack of inventory has caused a competitive market where homes sell quickly and well over the seller's asking price. So what's the answer to this problem? Well, adding to the supply of available homes would help alleviate some of the pressure home buyers are currently feeling. And that's why the latest New Residential Construction report from the U.S. Census Bureau and the Department of Housing and Urban Development is encouraging news. The report found that the number of new homes that began construction in August was 3.9 percent higher than the month before and 17.4 percent higher than last year at the same time. Additionally, the number of permits to build new homes was also up, rising 6 percent from July. The gains mean more homes for sale and, potentially, less stress for home shoppers

Sept. 22, 2021

Affordability Conditions Key To Market's Future

Each month, Fannie Mae's Economic and Strategic Research Group releases a forecast detailing their outlook for the economy and housing market. According to their most recent release, the group sees some potential challenges ahead that may affect home buyers. Specifically, they believe buyer demand could begin to slow if affordability conditions worsen. Doug Duncan, Fannie Mae's senior vice president and chief economist, says there are a few factors that will determine whether or not that happens. “Affordability remains a challenge, even with mortgage rates near historic lows; if the pace of income growth doesn't keep up with inflation and interest rates rise more than expected, we'd expect housing activity to slow from our current projections,” Duncan said. But while their outlook is cautious, they're still projecting a significant increase in demand next year. In fact, they forecast a 6.3 percent jump in demand for loans to buy homes in 2022.

Sept. 20, 2021

How Many Bathrooms Do Buyers Want In A House?

The number of rooms a house has – and how they're distributed – is even more important than the overall size of the home. A huge home that packs all the bedrooms and bathrooms into one cramped corner of the house may not serve its owners as well as a smaller house with a better layout. But while determining the number of bedrooms you need is a fairly simple calculation, how many bathrooms you need can be less clear. An analysis of data from the Census Bureau's latest Survey of Construction offers some insight into what most home shoppers want. The numbers show – based on new homes that began construction in 2020 – the vast majority of newly built single-family homes had two bathrooms. In fact, 65 percent of homes built last year had two full bathrooms. Twenty-five percent of homes had three bathrooms, while 7 percent had four or more. Less than 3 percent had one bathroom. Based on those numbers, it's pretty clear that most home buyers want, at least, two bathrooms in their house.

Sept. 17, 2021

Mortgage Lenders See Calmer Days Ahead

Your mortgage lender is the first person you should talk to once you've decided to buy a home. After a preliminary review of your finances, they can tell you, not only whether you're qualified to borrow, but also what your potential price range will be. In short, they're your first step toward buying a house. That's why Fannie Mae conducts their quarterly Mortgage Lender Sentiment Survey. Positioned at the start of the buying process, lenders are able to get a good read on the market and where it may be headed. So what do they expect in the months ahead? Well, according to the most recent survey, lenders expect buyer demand to continue to grow, though at a slower pace than before. “More lenders than not reported expectations that purchase mortgage demand will continue to grow, though the total share expecting such growth fell substantially compared to the previous quarter,” Mark Palim, Fannie Mae's deputy chief economist said. In other words, while buyer demand will remain high, the market should be a bit calmer than it's been in recent months.

Sept. 15, 2021

Early Fall May Be The Best Time To Buy

The best time to buy a house is when you're ready. But, once you're ready, picking the right time of year to start the process could be beneficial. It could even save you money. How? Well, when the market slows down and there are fewer active home buyers, price increases, bidding wars, and competition also slow down. That means, buying at the right time of year may mean better deals and less stress. And, according to a recent analysis from the National Association of Realtors' consumer website, the right time of year may be right now. “Home prices peaked in the summer, and new listings continue to come on the market helping slow the pace of sales – which is good news for homebuyers,” Danielle Hale, the site's chief economist, said. “As families across the county focus on getting back into school routines, there are fewer buyers in the market, creating a great opportunity especially for first-time home buyers to make a purchase with somewhat less competition.” The analysis found that, between September 12 and October 17, buyers could see prices $10,000 below their seasonal high.

Sept. 13, 2021

Mortgage Credit Availability Improves In August

If you want to be approved for a mortgage, you have to qualify. Which means, if you have too much debt, too little income, or bad credit, you may not be able to get a loan. Put simply, you have to have your finances in order, if you hope to borrow hundreds of thousands of dollars. But the standards lenders use to determine whether or not you're qualified aren't fixed. Sometimes they're more lenient than others. That's why the Mortgage Bankers Association tracks mortgage credit availability. Their monthly index determines whether access to credit is loosening or tightening. Any increase means potential borrowers will have an easier time getting approved for a mortgage, while a decline means standards have gotten stricter. In August, the index increased 3.9 percent. Joel Kan, MBA's associate vice president of economic and industry forecasting, says availability increased across the board. “Credit availability increased in August, driven by significant activity across all indexes,” Kan said. “Of note, jumbo credit availability increased 9 percent to its highest level since March 2020.” Conforming credit availability was up 5.1 percent. 


Sept. 10, 2021

Homeowners See Big 2nd Quarter Equity Gains

Equity is the difference between what you owe on your house and what it's worth. So, when home prices are growing, equity is too. And with the recent spike in home prices, equity has surged. In fact, according to Black Knight's most recent Mortgage Monitor Report, tappable equity – the amount available for homeowners to borrow against while still retaining at least 20 percent equity in their homes – grew 37 percent over year-before levels during the second quarter of this year. Ben Graboske, Black Knight's president, says homeowners have made big gains. “This is by far the strongest growth we've ever seen and equates to some $173,000 in equity available to the average mortgage holder, a $20,000 increase in just three months,” Graboske said. According to the report, tappable equity hit a record high at the end of the first quarter, reaching $8.1 trillion. During the second quarter, it added an additional $1 trillion to that total.

Sept. 8, 2021

More Americans Say It's A Good Time To Buy

Fannie Mae's Home Purchase Sentiment Index is based on a monthly survey gauging Americans' feelings about the housing market and overall economy. It asks respondents for their opinions about buying and selling a home, mortgage rates, home prices, their jobs and financial situation. In August, the index was largely unchanged from the month before. However, the share of participants who said they felt it was a good time to buy a home was up 7 percent. It was the first increase in buying optimism since March. Mark Palim, Fannie Mae's vice president and deputy chief economist, says buyers expect conditions to improve in the months ahead. “The 'good time to buy' component, while still near a survey low, did tick up for the first time since March, perhaps owing in part to the favorable mortgage rate environment and growing expectations that home price growth will begin to moderate over the next twelve months,” Palim said. Overall, 32 percent of respondents said they thought it was a good time to buy, while 73 percent said it was a good time to sell.

Sept. 7, 2021

How Building Material Costs Affect Home Buyers

The typical home buyer doesn't spend much time considering the price of gypsum products or ready-mix concrete. But the prices builders pay for building materials has an effect on buyers – even if they aren't shopping for a new home. That's because new home construction is the fastest way to boost inventory. And, when there are more homes for sale, home prices moderate. So, when more new homes are being built, it benefits all buyers because it helps keep prices in check. That's part of the reason prices have been rising so rapidly over the past year. Building material costs have been increasing at a fast pace. In fact, according to new numbers from the National Association of Home Builders, material costs have increased almost 20 percent over the past 12 months. That's made it more difficult for home builders to build the affordable homes needed to bring balance to the market and more choices to buyers

Sept. 3, 2021

Home Prices Increase Almost Everywhere

There are many gauges of U.S. home prices but the S&P Case-Shiller Indices is among the most closely followed. The index is constructed to accurately track the price path of a typical single-family home in each of the nine U.S. Census divisions. According to the most recent release, home prices are still increasing and the gains can be seen almost everywhere. In fact, Craig J. Lazzara, managing director and global head of index investment strategy at S&P, says prices have hit all-time highs everywhere but Chicago. “The last several months have been extraordinary not only in the level of price gains, but in the consistency of gains across the country,” Lazzara said. “Home prices in 19 of our 20 cities (all but Chicago) now stand at all-time highs, as do the National Composite and both the 10-and 20-City indices.” Fortunately for home buyers, the number of homes for sale has begun to improve and should help slow the rate of price increases in coming months.