Wall Street Journal: Sign the housing market has momentum heading into the spring selling season
Photo Wilfredo Lee/Associated Press
By Laura Kusisto and Chris Kirkham
Updated May 31, 2016 7:55 p.m. ET
Home prices are back to near-record highs across the U.S. amid rising demand and supply constraints, a sign that the lopsided housing-market recovery of the past five years is gaining some strength.
The S&P/Case-Shiller national home-price index, released Tuesday, has clawed its way back to within 4% of its 2006 peak, a steep rise from the near 30% decline at the bottom in 2012. U.S. new-home sales, meanwhile, in April posted their strongest month in more than eight years, with a nearly 17% jump from a month earlier, the Commerce Department said last week.
After years of volatility, home prices have grown at a rate around 5% since early 2015. That bodes well for sellers heading into the peak home-selling season in May and June but could pose challenges for buyers, especially first-timers who may be priced out of the market as supply, particularly among starter homes, remains thin. But the rise in prices comes amid lingering weakness in some parts of the market. Overall sales volume and new construction remain well below their pre-crisis peaks. And a broader collection of figures point to an uneven recovery that has seen a flourishing market at the high end, mainly in big U.S. cities, while the lower end lags. “It’s a great market if you have pristine credit and lots of money,” said Sean Becketti, chief economist at Freddie Mac. “The people starting out who are looking for that first home—they’re having a tougher time.
Despite the unbalanced recovery, Federal Reserve officials have seen housing as a bright spot for the U.S. economy in recent years. Residential construction has contributed to overall economic output for eight straight quarters, expanding at a 17% annual rate in a first quarter marked by slow growth in other sectors.
Yet while sales are increasing, they have nonetheless been stymied by a lack of new inventory and first-time home buyers. Sales of existing homes, which account for the bulk of the overall market, clocked in at a 5.45 million seasonally adjusted annual rate in April, the second consecutive monthly increase but below the peak seen during the last decade’s boom. The S&P/Case-Shiller national index rose 5.2% in March. But that is mainly because of a lack of inventory, economists said. When adjusted for inflation the S&P/Case-Shiller index remains about 20% below its peak reached in 2006.
Building activity, meanwhile, remains muted compared with normal markets. April’s single-family housing starts were at a seasonally adjusted annual rate of 778,000 units, down from a more than five-decade average of about 1.03 million, according to Census data.
Still, several markets have surpassed their 2006 price peak, prompting concerns about a bubble. In Dallas, where prices have returned to record levels, first-time buyers have struggled to get into the market. Shriveling inventories of starter homes have driven up prices and led to bidding wars, while wealthier buyers enjoy a better selection of luxury properties to choose from.
That has made it difficult for buyers like Jeremy Ponce and his wife, Lyndel, who started looking to purchase a home in Dallas last spring after living in a rental apartment. They were hoping to find a smaller starter home in the urban center, but quickly realized how competitive the market had become. With inventories at nearly three-decade lows in Dallas, most of the homes in their price range required too many repairs. “The price they wanted just didn’t seem realistic,” said the 31-year-old Mr. Ponce, who works as a project manager for a company that builds rail cars. “Some of them were only a little bit bigger than our apartment.”
The couple widened their search away from downtown, but it still took about six months to find what they were looking for: a 3-bedroom, 3½-bath home that was about a five-minute drive from popular entertainment districts. They put in an offer of $417,000, above the asking price of $399,000. Yet Mr. Ponce said they considered themselves lucky.
Homeownership has been declining since the peak of the housing bubble. The national rate slipped in the first quarter to a near four-decade low of 63.5%, according to the Commerce Department. The homeownership rate for households headed by someone under 35 years old fell to 34% in the first quarter of this year, the lowest level since at least 1994. One main culprit: stricter lending standards since the financial crisis, which have made it tougher for lower earners to qualify for mortgages. That, in turn, has prompted builders to focus their efforts on the higher-end segment of the market. New homes under $200,000 made up 19% of U.S. sales last year, down from 38% four years earlier, according to U.S. Census data.
An influx of high-earning workers to big U.S. cities is magnifying the imbalances by driving up rents and setting off a scramble among developers to build luxury condominiums and apartment buildings. The S&P/Case-Shiller index covering the 20 largest U.S. cities rose 5.4% in the 12 months ended in March, outpacing the overall market.
In the hottest regions in the country, primarily on the West Coast, prices rose at a double-digit pace in March, with Portland, Ore., reporting a 12.3% year-over-year gain, Seattle showing a 10.8% gain and Denver logging a 10% increase. Portland has been one of the nation’s most robust real estate markets over the last few years as its growing technology sector attracts workers. That has created strong demand for available parcels of land, driving up the individual lot prices—and thus the asking price for a new home.
Jim Chapman, president of Legend Homes, said lenders often are only willing to finance surefire projects at the higher end of the price spectrum. “Even if you have a lender who will loan you money to operate with, you have to show that that project is actually going to make a profit,” Mr. Chapman said.
Mr. Chapman said he is spending between $250,000 and $350,000 just to acquire and develop the land, before even starting to build the home. “You can’t build a house that’s going to sell for $299,000 to an entry-level market if you spent more than that for the land,” he said.
Posted at 12:59:50 PM
The City of Fort Lauderdale has recently begun using distinct green street markings in select areas of the city. These pavement markings known as “sharrows” or “shared arrows” indicate that the street is being navigated and shared by both bicyclists and motorists. Sharrows are not the same as bike lanes, which reserve a section of the street for bicyclists only. Instead, the green paint with white bicycle and arrows indicate that bicyclists may ride on the street using the full lane by following the middle of the arrow on the markings on the street. They also alert motorists to expect bicycles on the street.
Sharrows are now part of the Florida Department of Transportation (FDOT) improvement project for US1, and can be found throughout a new bike route found to both the north and south of Sunrise Boulevard between Searstown and the Gateway intersection. They have been installed along various roads in the Lake Ridge and Victoria Park neighborhoods to safely direct bicyclists around the construction for the improvement of US1.
Because “bikeability” and bike safety are important to the residents of Fort Lauderdale, the City has been able to work with FDOT to successfully negotiate the installation of the new bike amenities into the US1 project, making the streets safer for everyone.
See the map below to view the new “sharrow” or “shared arrow” routes found throughout central Fort Lauderdale, north and south of Sunrise Boulevard (routes in red).
Posted at 12:41:05 PM
A study conducted by the Institute for Business and Home Safety identified 9 areas in your home where water damage is most likely to occur. Stop the damage before it begins. By following a regular maintenance and inspection plan, you can easily avoid costly, devastating damage to your home.
Homes more than 30 years old are 3 times as likely to have a plumbing supply or drainage problem.
Your plan for prevention:
Inspect pipes annually for condensation, leaks and corrosion. Call a plumber at the first sign of rust-colored water, backed-up toilets or sinks and cracked or warped floors.
Roofs are the most frequent source of water damage, especially in regions prone to freezing and strong wind and hail.
Your plan for prevention:
Schedule a professional roof inspection annually. Request a detailed inspection report that includes the condition of the flashing, roof covering, parapets and drainage system. Make repairs if 1) there are cracked, loose or missing shingles and granules, 2) the flashing has deteriorated, particularly around the chimneys and vents and 3) if pooling water is present.
(In wind prone areas, consider an impact resistant roof that has passed the FM 4473 or UL 2218 standard.)
#3: Sump Pump
Sump pumps can fail because of power outages, a clogged inlet screen or a faulty float switch.
Your plan for prevention:
Inspect the sump pump. Open the lid and remove any debris blocking the water inlet screen. Pour 5 gallons of water into the pump. As the float valve rises, the pump should turn on, discharging water through the outlet pipe. Inspect the outside outlet pipe to ensure water is flowing away from the home.
Prepare for power outages. Install a battery backup system, preferably one with a battery replacement warning. Replace batteries every 2-3 years.
#4: Water Heaters
75% of water heaters fail before they are 12 years old. The chance a water heater will leak or burst increases dramatically at 5 years old
Your plan for prevention:
Schedule a professional plumbing inspection of the anode rod annually once the warranty has expired. The rod will eventually corrode and leave the tank vulnerable to damage.
Remove sediment by flushing the tank every 6 months. Sediment will build up faster in areas with hard water.
Over half of shower stall damage involves a faulty shower pan.
Your plan for prevention:
Test the shower pan annually. Block the floor drain. Fill the shower stall with 1 inch of water and mark the water line. After 8 hours, if the water level drops, contact a plumbing professional.
Inspect your shower every 6 months. Check for loose or cracked tiles or crumbling grout lines. Repair as needed.
78% of water damage from toilets is caused by faulty supply lines, toilet flanges, fill valve assemblies or toilets that back-up & overflow.
Your plan for prevention:
Inspect the flushing mechanism every 6 months. The fill valve should shut off when the float reaches the proper level. Replace the flapper or fill valve assembly if you notice constant tank refilling when the toilet is not in use.
Inspect the supply line every 6 months. Ensure the connection to the valve is secure. Operate the valve to make sure the water supply will shut off. Replace if needed.
Nearly half of all water damage caused by sinks is due to a faulty plumbing line and can cost approximately $7,000 per incident.
Your plan for prevention:
Inspect sink plumbing every 6 months. Ensure connections are secure and there is no corrosion or kinking of pipes, which could lead to pinhole leaks over time.
Know where the water shut-off valve is. Inspect the valve every 6 months to make sure the water supply will shut off.
#8: Washing Machine
Half of all washing machine water damage incidents are caused from a burst water supply line. Repair costs about $6,000 per incident.
Your plan for prevention:
Inspect water supply line hoses every 6 months to ensure the connection to the valve is secure. If loose, hand-tighten first, then tighten an additional 2/3 of a turn using pliers. Leave a 3-4 inch gap between the washing machine and wall to avoid kinking. Check hoses for kinks, cracks, or blisters commonly found near the hose connection. Replace hoses every 5 years and consider braided stainless steel hoses.
#9: Ice Maker
73% of losses involving icemakers were caused by a supply line hose failure.
Your plan for prevention:
Make sure the icemaker supply line hose is properly installed. Tightly connect the hose to the valve, but avoid over-tightening. Leave a 3-4 inch gap between the refrigerator and wall to prevent the hose from crimping. Inspect hose every 6 months.
Information has been provided by the Insurance Institute for Business and Home Safety. This brochure is not an insurance policy. It highlights safety precautions you can consider to help protect you and your property. Suggested precautions may not be effective in every circumstance. Please use good judgment on what's appropriate. Insurance terms, definitions and explanations are intended for informational purposes only and do not in any way replace or modify the definitions and information contained in individual insurance contracts, policies or declaration pages, which control coverage determinations. Such terms may vary by state or area, and exclusions may apply.
Posted at 11:06:47 AM
(Original posted on RISMedia.com) When it comes to home improvement, the options are endless. While many homeowners have their sights set on a huge overhaul (hello five-star kitchen complete with the latest and greatest appliances and gadgets), simple home updates that can be completed in a timely manner—without breaking the bank—typically offer the best return on your investment.
If you’re itching to upgrade your home this season, whether with your own two hands or by bringing in a certified contractor, consider the following ideas:
Change the Hardware. If a complete kitchen or bathroom overhaul is out of the budget, don’t write these rooms off your list just yet. By simply replacing the hardware (drawer pulls, knobs) and faucets, you can create an entirely different look. If you’re feeling really adventurous, and in the mood for a more drastic effect, you can even paint the cabinets. Or, dress up the kitchen with a decorative backsplash that ties the whole room together.
Add a Little Paint. Do all the rooms in your home blend together because they’re painted the same color? Painting an accent wall is a great way to help a room ‘pop.’ Whether it’s in the kitchen, living room, dining room (or any other room in the home), an accent wall is a simple way to incorporate a color you love into the space without going overboard. If you’re content with the walls just the way they are, another popular alternative is to paint the ceiling.
Update the Entryway. An inviting entryway is just as important for creating a good first impression among visitors as it is among prospective buyers. Wow your guests—and even your family—with an updated facade. From (re)painting the front door to incorporating vinyl door decals to welcome visitors in style, updating the front of your home is a surefire way to create a welcoming environment.
Install Hardwood Floors. Hardwood floors are a popular choice among homeowners looking to update their space, and with a little elbow grease and know-how, avid do-it-yourselfers can complete the look with their own two hands. Tongue-and-groove flooring that fits together like a puzzle is a safe bet for anyone looking to get their hands dirty in home improvement projects this season.
Add a Porch/Patio. Whether they’re semi-enclosed, attached to the home’s front entrance or built at ground level, the addition of a porch/patio extends a home’s living space. From adding value to your home to upping its curb appeal, if you have the space, this is one project you should move to the top of your to-do list.
No matter what type of home improvement project you choose to undertake, it’s important to remember that it’s okay to call in reinforcement, especially when it comes to projects you might not be able to tackle on your own.
“When considering completing any home improvement project, you should consider the value of hiring a general contractor,” says Lance Malcolm, chief operating officer of Contractor Connection. “An experienced contractor can be the difference between keeping the project moving forward smoothly or being delayed.”
Paige Tepping is RISMedia’s managing editor.
Posted at 1:50:14 PM
Employment rates are up and housing demand is growing.
Fort Lauderdale ranked fourth in a list of the top 49 hottest single-family housing markets in the US, according to Auction.com.
Home prices and housing demand in the city are closing in on pre-downturn levels, according to the report. The market has seen a 7.8 percent gain in home prices and a 2.3 percent increase in volume of sales year-over-year.
In addition, population numbers were up 1.3 percent in 2014, and employment is up, as well, as the report shows that the estimated 100,000 jobs lost during the recession have been recovered.
The top spot on the list belonged to Denver, CO, which enjoyed a 9.2 percent increase in home prices and a 4.6 percent increase in sales volume, year-over-year. Fort Lauderdale was followed by Dallas and Fort Worth in Texas; Seattle, WA; San Francisco, CA; and Phoenix, AZ.
"As the US housing market has continued to recover from the "Great Recession", we've seen significant regional variances in terms of both price appreciation and sales volume," said Auction.com executive Vice President Rick Sharga in a statement. "Earlier in the recovery, most of the growth came from markets that had suffered the biggest declines during the housing bust, but what we're seeing today is more in line with fundamental economic trends: markets with the bext job growth and population growth are recovering most quickly."
- Sean Stewart-Muniz, The Real Deal
Posted at 2:10:43 PM
The Gayle Borden Real Estate Group is pleased to share the exciting news that Realogy Corporation, Coldwell Banker's parent company, has been named among the 2015 World's Most Ethical Companies for the fourth year in a row outperforming its industry peers for ethical conduct.
(Coldwell Banker Residential Real Estate is a part of NRT LLC, which is a subsidiary of Realogy.) This designation was awarded by the Ethisphere® Institute, a leading international business ethics think-tank.
Realogy earned this prestigious honor by implementing and maintaining upright business practices and initiatives that are instrumental to the company's success, benefit the community, and raise the bar for ethical standards within the real estate industry.
We are proud to be affiliated with a company that shares its parent company's deeply instilled commitment to demonstrating the highest ethics and integrity in all business practices. The honor is no surprise to the sales associates and employees at Coldwell Banker Residential Real Estate, as the Coldwell Banker® brand was founded 108 years ago on the principles of trust, honesty and integrity. Today, the organization, and those of us within it, continue to demonstrate an unwavering commitment to the highest ethical standards, and your complete satisfaction is our top priority.
For over 30 years, The Gayle Borden Group has been providing our customers with the highest level of service along with those principles, and we hope that you continue to remember us for all of your Fort Lauderdale Real Estate needs.
Posted at 2:53:26 PM
By Doreen Hemlock
Sun Sentinel 3/22/15
A parking spot for $3 million? That's what you'll pay for the largest superyacht dock at Harbour Twenty-Six in Fort Lauderdale, where 26 covered boat storage units are being sold like condominiums, each with a property title.
Prices start at $1.8 million for smaller docks, which can handle yachts starting at 80 feet long. Add several thousand dollars more every month to cover the cost of a clubhouse, swimming pool, security and other perks at the marina set for the Shady Banks neighborhood on the New River.
Developers call the project "the only fully covered dockominium megayacht marina in South Florida." They're counting on owners of multimillion-dollar yachts to pay the price to ensure a parking spot in the "Yachting Capital of the World." Finding a space to fit their super-long boats in peak season can be as tough as parking your car in South Beach on a festival weekend. And forget about parking in the shade. "Covered spaces for megayachts are coveted because they're few and far between in South Florida," said marine consultant Jim Bronstien of North Palm Beach, who is helping to manage the venture.
Shade matters, because sun, dust and the elements degrade a boat's paint, wood surfaces and exterior furnishings. And just painting a megayacht can cost hundreds of thousands of dollars. "The sun can be vicious on a paint job, just like on your car," said Kitty McGowan, who runs the U.S. Superyacht Association based in Fort Lauderdale. Plus, a covered dock makes it cooler for the live-aboard crew — sometimes a dozen or two people — to do daily maintenance and other work. The Harbour Twenty-Six project will include a clubhouse, swimming pool, security and other perks.
A different megayacht project was planned on the same site before the recession, but it was shelved with the crisis. The nearly 6-acre property went into foreclosure. An investor group bought it and then sold it for $6 million to the current developers, Battle Plan Capital led by Nathan Cox. Cox mostly builds single-family homes in his home state of Alabama. He had come to Fort Lauderdale to see a colleague and heard about the property. He asked all of the people he could about the direction of the yacht industry and the need for parking — and received so many positive comments that he jumped in.
"Either I was the biggest laughing stock of South Florida and everyone was in on the joke, or this was a pretty good opportunity," Cox said in a phone interview from Alabama.
Cox's group aims to break ground this summer on the site of the former Summerfield Boat Works. Construction should take just under a year, with sales of all 26 docks fetching about $50 million. The group unveiled the project at the Miami International Boat Show in February and has five reservations for the slips so far, each secured with a $25,000 nonbinding deposit, Cox said.
The big crunch for parking superyachts around Fort Lauderdale tends to come in the fall. The boats stop off between summer cruising in the U.S. northeast or Europe and winter cruising in the Caribbean. In hurricane season, the big boats prefer spaces in protected coves or upriver — away from the coastline.
New docks upriver can offer other benefits for buyers, brokers say. Megayacht owners can save money on insurance because the facilities meet new hurricane codes. Plus, owners, generally corporations, get tax advantages from buying, and they can make some of their money back by renting out the space when they're not using it.
"Harbour Twenty-Six is the first new marina project in Broward in a long time," said Kit Denison, a marine industry veteran who is helping to sell docks up to 170 feet long at the venture. But don't look for many more projects like it. Waterfront property for marinas remains limited in South Florida, and some spots have piers over submerged lands that are leased from the state and not owned outright. Developers prefer not to sell docks over rented lands, partly because of extra fees involved.
And really, how many buyers can afford $1.8 million or $3 million docks, plus monthly maintenance?
firstname.lastname@example.org, 305-810-5009, @dhemlock on Twitter
Posted at 11:22:19 AM
September 08, 2015
The City of Fort Lauderdale has recently begun using distinct green street markings in select areas...
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July 29, 2015
A study conducted by the Institute for Business and Home Safety identified 9 areas in your home where water damage is most likely to occur. Stop the damage before...
> Full Story