Strong Economy Boosts Home Sales – Industry Outlook

By November 25, 2019Industry Outlook

Strong Economy Boosts Home Sales – According to the National Association of REALTORS® report, low mortgage rates and a strengthening economy propelled home sales in October. Total existing-home sales, which include completed transactions of single-family homes, townhomes, condos, and co-ops, rose 1.9% month over month to a seasonally adjusted annual rate of 5.46 million. Sales are up 4.6% from a year ago. “Historically low interest rates, continuing job expansion, and higher weekly earnings are undoubtedly contributing to these higher numbers,” says NAR Chief Economist Lawrence Yun. “We will likely continue to see sales climb as long as potential buyers are presented with an adequate supply of inventory.”

Source and link to the full article:  https://magazine.realtor/daily-news/2019/11/21/strong-economy-boosts-home-sales-upward-trend-to-hold

Why Lenders Might Be Favoring Gen Z – Based on a new study from LendingPoint, Generation Z, those born after 1996, may only have started building their credit profiles, but they’re already outshining their older counterparts. Gen Z consumers have an average FICO score that’s higher than those of both millennials and Gen X, of more than 5 million near-prime loan applications. “This is especially interesting when you consider that how long you’ve had credit is a key factor when it comes to credit scoring,” LendingPoint notes in its analysis. “Even with duration of credit use playing a role in FICO scores, Gen Z is off to a strong start in building their credit profile.” Gen Z has an average FICO score of 637 compared to 629 of millennials and 632 of Gen X. Gen Z consumers are showing caution with personal finances. “As children, their formative years were dominated by the Great Recession, and they watched as their parents dealt with financial uncertainty and job insecurity”. “As a result, they don’t borrow less, just differently.”

Source and link to the full article:  “Gen Z Is Turning Around Credit: Survey of NearPrime Borrowers Find Gen Z FICO Scores Higher Than Millennials, Gen X,” LendingPoint (Nov. 14, 2019)

Retirees Are Looking for Larger Homes – According to a new article by Elizabeth Alterman, a growing number of retirees are bucking the downsizing trend and are opting to upsize instead. They may be motivated to find a larger home to accommodate a live-in parent or visiting family members or because a larger home is simply what they prefer. “People who choose to upsize in retirement often do so when relocating to a more climate-friendly area, such as Florida or Arizona,” Cara Ameer, a real estate professional with Coldwell Banker Vanguard Realty in Jacksonville, Fla., told Next Avenue, a digital publication produced by PBS that is geared to baby boomers. “Many times, they want to find their ‘dream home’ and feel it is time to make that happen. They don’t want to sacrifice on location, finishes, and most importantly, a view.” Susan Landau Abrams of Warburg Realty told Next Avenue that she has been part of several transactions where empty-nest clients moved from a three-bedroom apartment to a four- or five-bedroom one. “They are at the pinnacle of their success and want to enjoy life and live graciously,” she says. “They want spacious master bedrooms, his and her master bathrooms, an office/library, and a chef’s kitchen.”

Source and link to the full article:  “Upsizing in Retirement: Going Against the Grain,” NextAvenue.org (Nov. 7, 2019)

Mortgage Rates Rise Again as Recession Fears Recede – Based on Freddie Mac reports, mortgage rates climbed again and economists say the trend may well continue as the economy sees some improvement. The 30-year fixed-rate mortgage averaged 3.75% recently. “The modest uptick in mortgage rates over the last two months reflects declining recession fears and a more sanguine outlook for the global economy,” says Sam Khater, Freddie Mac’s chief economist. “Due to the improved economic outlook, purchase mortgage applications rose fifteen percent over the same week a year ago, the second highest weekly increase in the last two years. Given the important role residential real estate plays in the economy, the steady improvement of the housing market is a reassuring sign that the economy is on solid ground heading into next year.”

Source and link to the full article:  Freddie Mac

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