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New York (CNN) — US stocks rallied powerfully last week after a topsy-turvy start to the month. History indicates that if the market can cling to those gains, that could bode well for the rest of the year. But last week, all three major indexes turned positive for the year as tech stocks led the broader market higher. The January barometer, introduced in the Stock Trader’s Almanac, states that however stocks perform during January, their year-end performance will follow suit. That is good news for the 85 million homeowning households that enjoyed further gains in housing wealth, said Lawrence Yun, chief economist at NAR.
Persons: turvy, bode, Bell, Anna Rathbun, we’re, it’s, we’ve, Bryan Mena, ” Joanne Hsu, Anna Bahney, Lawrence Yun, Read Organizations: CNN Business, Bell, CNN, Dow Jones, Nasdaq, CBIZ Investment Advisory Services, The University of Michigan’s, National Association of Realtors Locations: New York
Washington, DC CNN —The residential real estate market tumbled in 2023, as soaring interest rates steadily slowed sales activity — but home prices still hit a record high. Even with all the disruptions of the onset of the pandemic, sales in 2020 ended at about 5.5 million. The next year, sales soared to over 6 million amid the frenzied market as mortgage rates sank in 2021. As mortgage rates hit 7.79% in October 2023, the highest in 23 years, sales sank again, to about 4 million. If there had been more listings on the market in 2023, we would have had more home sales.”
Persons: Lawrence Yun, , Yun, Lisa Sturtevant Organizations: DC CNN, National Association of Realtors, , , Federal Reserve Locations: Washington, homeownership,
Mortgage rates drop to lowest level since May
  + stars: | 2024-01-18 | by ( Anna Bahney | ) edition.cnn.com   time to read: +2 min
Washington, DC CNN —After moving higher the past two weeks, mortgage rates fell this week, dropping to the their lowest level since May 2023. Mortgage rates remain more than a full percentage point lower than their highest levels of last year: 7.79%. However, he added, as more buyers come in off the sidelines attracted by lower rates, more pressure will be placed on already depleted inventory for sale. “In some markets, however, prices will rise much faster this year.”Still, lower rates can improve affordability by reducing the costs of financing a home. “On a loan to purchase a $400,000 home, a one percentage point decrease in mortgage rates can lead to a $250 drop in the typical monthly payment,” Sturtevant said.
Persons: Freddie Mac, who’ve, , Sam Khater, Freddie Mac’s, Lisa Sturtevant, Sturtevant, ” Sturtevant Organizations: DC CNN, , homebuyers Locations: Washington, DC
New home construction slowed at the end of 2023
  + stars: | 2024-01-18 | by ( Anna Bahney | ) edition.cnn.com   time to read: 1 min
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Washington, DC CNN —Homebuilder confidence surged in January as mortgage rates continued to trend lower, according to the National Association of Home Builders/Wells Fargo Housing Market Index released Wednesday. Builder confidence in the market for newly built single-family homes surpassed market expectations, climbing seven points to 44 on the index. The optimism comes as mortgage rates begin to fall and data points to an improving economy heading into 2024. “Single-family starts are expected to grow in 2024, adding much needed inventory to the market,” Huey said. The monthly builder index looks at current sales, buyer traffic and the outlook for sales of new-construction homes over the next six months.
Persons: Alicia Huey, ” Huey, Freddie Mac Organizations: DC CNN, National Association of Home Builders Locations: Washington, Wells Fargo
As a result, empty-nest Baby Boomers own 28% of large homes — and Milliennials with kids own just 14%, according to a Redfin analysis released Tuesday. Ten years ago young families were just as likely as empty nesters to own large homes. But even then empty nest Baby Boomers had the most large homes. Where Millennials own the most larger homesYoung families take up the smallest share of large homes in coastal areas like California and Florida, where large homes tend to be more expensive. Empty nesters own at least 20% of large homes everywhere in the country.
Persons: Baby, Gen, , Sheharyar Bokhari, Zers, Millennials, Gen Xers, , Boomers Organizations: DC CNN, Baby Boomers, Boomers, CNN, ICE Mortgage Technology Locations: Washington, doesn’t, U.S, California, Florida, Midwest, Riverside , California, Salt Lake City, Austin , Texas
Experts in housing, building, and urban planning say it may be difficult to convert office space to livable, likeable residential housing, but there’s an urgent reason they’re trying. More office space is sitting empty in the United States than at any point since 1979, Moody’s Analytics reported earlier this week. By some estimates, only 3% of New York City office buildings and 2% in downtown Denver are suited for residential conversions. Office space and homes are two fundamentally different types of buildings, according to builders and architects. Do you have another building where you can move them?”As result, according to Theodos, office conversions are not a solution to either the empty office glut or the housing supply shortage.
Persons: Biden, , Harold Bordwin, Keen, Brett Theodos, ” Bordwin, , ” Maren Reepmeyer, ” Theodos, , Nathaniel Meyersohn, Donald Judd Organizations: DC CNN, Moody’s, National Association of Realtors, Summit Capital Partners, Metropolitan Housing, Policy Center, Urban Institute, , CBRE, Wacker, Chicago Business Locations: Washington, New York, Boston, Cleveland, United States, Manhattan, , New York City, Denver, Chicago, Theodos
Washington, DC CNN —Renters and homeowners experience inflation differently; and right now, renters are taking a much more painful hit. While shelter inflation has come down over the past few months, in December, the shelter index was still 6.2% higher year over year. Inflation divide between renters and homeownersTwo things are driving the divide between how homeowners and renters experience inflation. And 64% of homeowners have a mortgage rate of 4% or lower — more than two and a half percentage points lower than prevailing rates. Even if the typical mortgage payment is higher than a typical monthly rent payment, renters’ incomes tend to be lower than homeowners.
Persons: , Lisa Sturtevant, Danielle Hale, Realtor.com, , Hale Organizations: DC CNN, Bright MLS, Bank of America Institute, BLS, Locations: Washington
Dividend stocks could see a revival in 2024
  + stars: | 2024-01-12 | by ( Krystal Hur | ) edition.cnn.com   time to read: +6 min
Dividend stocks fell out of favor in 2023, even as all three major US indexes overcame regional banking turmoil, high interest rates and geopolitical tensions to notch double-digit returns. As interest rates rose to a 22-year high, investors favored bonds at attractive yields over riskier stocks offering smaller payouts. Some traders believe that dividend stocks could make a comeback this year. Larry Adam, chief investment officer at Raymond James, favors dividend stocks in sectors like tech and healthcare for their growth qualities, over traditionally defensive categories like utilities. His firm only invests in dividend stocks that have that growth component, he says.
Persons: , Morgan Stanley, Larry Adam, Raymond James, Adam, Elisabeth Buchwald, John Cochrane, Anna Bahney, Freddie Mac, who’ve, Sam Khater, Freddie Mac’s, Read Organizations: CNN Business, Bell, New York CNN, Mastercard, Companies, Hoover Institute, Locations: New York
Washington, DC CNN —Mortgage rates ticked up this week for the second week in a row, but remain more than a full percentage point lower than their high last year. The 30-year fixed-rate mortgage averaged 6.66% in the week ending January 11, up from 6.62% the previous week, according to data from Freddie Mac released Thursday. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. Lower mortgage rates expected to bring new inventoryWhile mortgage rates trending lower is welcome news for homebuyers, those in the market are still dealing with the double whammy of low inventory and high home prices that continue to rise. But, she added, the pace of mortgage rates declining is likely to be slower going forward than the dramatic nine-week drop at the end of 2023.
Persons: Freddie Mac, who’ve, , Sam Khater, Freddie Mac’s, That’s, Jiayi Xu, Xu Organizations: DC CNN —, , Federal, Treasury Locations: Washington
Many thought the internet would eventually kill the 6% real estate commission. Even as the ranks of stockbrokers and travel agents have dropped in recent years as commissions petered out, the number of real estate agents has grown and their typical commissions are bigger than ever as home prices have risen. That is largely because of the power of the National Association of Realtors, an influential lobbying group that represents 1.5 million real estate agents. How real estate commissions workHome sellers are usually on the hook for their real estate agent’s commission as well as for paying the agent that represents the buyer. Real estate agents will tell you commissions are negotiable — and they are.
Persons: Sellers, , Jordan Barry, , Tiffany Hagler, won’t, Babiracki Barlow, “ we’ve, Vasi Organizations: DC CNN, Kansas City, Brookings Institution, stockbrokers, National Association of Realtors, University of Southern, National Association of Real, Exchanges, NAR, Association, Geard, Bloomberg, Getty, realtors, Agents, MLS, Department of Justice, DOJ, California Association of Realtors, New, Real, Board Locations: Washington, New York City, University of Southern California, Larchmont , New York, Boston, New York, New York —, York
Mortgage rates drop for fifth straight week
  + stars: | 2023-11-30 | by ( Anna Bahney | ) edition.cnn.com   time to read: +5 min
It’s the fifth straight week rates have moved lower. The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. According to a forecast from Realtor.com, the average mortgage rate is projected to be 6.8% in the next year. “As mortgage rates are expected to remain elevated, current homeowners with low mortgage rates are expected to stay put, leading to a decline in for-sale inventory,” said Xu.
Persons: Freddie Mac, , Sam Khater, Freddie Mac’s, , Khater, Jiayi Xu, Xu, ” Xu, Joel Kan, ” Kan Organizations: DC CNN —, Inflation, Federal, Realtor.com, Treasury, Mortgage, Association Locations: Washington
Washington, DC CNN —US pending home sales fell to their lowest level in 20 years in October as mortgage rates surged to their highest levels of the year, according to a report released Thursday. Pending home sales dropped 1.5% last month from September, monthly data from the National Association of Realtors showed. The pending home sales index — a forward-looking indicator based on contract signings rather than closings — was down 8.5% from a year ago. Completed sales of existing homes and sales of new construction homes, which are also based on contract signings, also fell in October. In October, existing home sales fell to the lowest level in 13 years, remaining below 4 million for the first time since October 2010.
Persons: , , Lawrence Yun, Yun, Hannah Jones, October’s, Jones, — Jones, ” Jones, Organizations: DC CNN, National Association of Realtors, Northeast, NAR, Realtor.com, Locations: Washington, Midwest, South, West
Washington, DC CNN —US home prices continued to rise in September, hitting a new record high and marking the eighth consecutive month of increases, according to data released Tuesday. Even as mortgage rates lingered above 7% in September, historically low inventory continued to push up the price of a home. Prices rose 0.7% in September from the month before, according to seasonally adjusted data from the S&P CoreLogic Case-Shiller US National Home Price Index. Compared to a year ago, the national composite index also rose, with prices up 3.9% from September 2022, the data shows. Higher prices and higher mortgage rates led to crushing affordability challenges for homebuyers in September, bringing existing home sales to 13-year lows.
Persons: , Craig Lazzara, Dow, Charlotte ,, Hannah Jones, Jones Organizations: DC CNN, Dow Jones, Las, Realtor.com, homebuyers Locations: Washington, Atlanta, Boston, Charlotte, Charlotte , North Carolina, Chicago, Cleveland, Detroit, Miami ; New York, Tampa , Florida, San Diego, New York, Las Vegas, Portland , Oregon, Northeast, Midwest
Washington, DC CNN —New home sales in the United States fell in October as typical mortgage rates reached their highest levels this year. This was below analysts’ expectations of an annualized sales pace of 723,000. The average mortgage rate for that loan has been lower recently, dropping down to 7.29% last week, according to Freddie Mac. New home builders often offer more financing options for homebuyers, she said, and are able to “buy down” mortgage rates to make their offerings more attractive than the resale market. With [mortgage] interest rates anticipated to drop in the coming year, more resale homes may go on the market – however there remains significant pent-up demand from buyers,” Mangold said.
Persons: Freddie Mac, , Kelly Mangold, ” Mangold, Organizations: DC CNN, US Department of Housing, Urban Development, Census, Federal Reserve, Real Estate Consulting, homebuyers Locations: Washington, United States
Mortgage rates fall for fourth week but stay above 7%
  + stars: | 2023-11-22 | by ( Anna Bahney | ) edition.cnn.com   time to read: +2 min
Washington, DC CNN —Mortgage rates fell again in the most recent week, as inflation showed signs of slowing. It’s the fourth consecutive week of tumbling rates after rising for seven straight weeks. The average rate rose above 7% in mid-August and since then reached as high as 7.79% at the end of October. “In a few short weeks, mortgage rates have largely erased the sharp climb traversed in October,” said Danielle Hale, Realtor.com’s chief economist. Meanwhile, she added, existing home sales slid to their worst reading since 2010 as home prices rose and mortgage rates pushed the cost of buying even higher.
Persons: Freddie Mac, , , Sam Khater, Freddie Mac’s, Danielle Hale, Hale, homebuyers, ” Hale Organizations: DC CNN — Locations: Washington
Sales slumped in October and prices continued to climb, as mortgage rates surged last month and inventory remained extraordinarily low. Home sales remained at 13-year lows as buyers competed for the few available homes on the market and continued to push up prices. Elevated prices, together with the average rate for a 30-year fixed rate mortgage nearing 8% in October, have created the least affordable market in several decades. Home sales were down in lower priced categories – under $750,000 – due to lack of inventory and sales grew in higher price categories where there was more inventory. “The lack of inventory and higher interest rates really hitting the home sales market,” said Yun.
Persons: , , Lawrence Yun, Yun, Organizations: DC CNN —, National Association of Realtors, West, NAR, Locations: Washington, Northeast, Midwest, South
Washington, DC CNN —The annual pace of new home construction increased again last month amid a historic shortage of housing inventory and crushing mortgage rates. Housing starts, a measure of new home construction, jumped by 1.9% in October, compared to the previous month. Starts rose to a seasonally adjusted annual rate of 1.372 million last month, rising above expectations of 1.35 million, according to data released Wednesday by the Census Bureau. Building permits also ticked up in October, climbing 1.1% from August’s revised number to a seasonally adjusted annual rate of 1.487 million. “The new construction housing market is poised to ensure that inventory is available to meet pent-up demand of households who have been waiting for a reprieve in rates before purchasing.”
Persons: , Kelly Mangold, Mangold Organizations: DC CNN, Housing, Census, Real Estate Consulting Locations: Washington
Mortgage rates have cooled in recent weeks as markets absorbed the latest economic indicators, including an improving inflation picture. “For the third straight week, mortgage rates trended down, as new data indicates that inflationary pressures are receding,” said Sam Khater, Freddie Mac’s chief economist. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. “The gap between the 10-year Treasury yield and the 30-year fixed rate mortgage rate is historically around 180 basis points,” she said. “While the gap has narrowed somewhat, the 30-year mortgage rate remains 280 basis points higher than the bond yield.”By historical norms, she said, mortgage rates should be under 6.5%.
Persons: Freddie Mac, , Sam Khater, Freddie Mac’s, Price, Jiayi Xu, Jerome, Powell, ” Xu, Bob Broeksmit, Lawrence Yun, ” Yun, , Lisa Sturtevant, ” Sturtevant Organizations: DC CNN —, Mortgage, Association, Federal Reserve, Treasury, Consumer, , National Association of Realtors, Bright MLS Locations: Washington
Courtesy National Association of RealtorsKasper echoed those sentiments in a keynote address to agents at the convention on Tuesday, telling agents: “We will continue to listen closely to your feedback. Real estate agents generate about $100 billion in commissions a year, according to the Department of Justice. And about half of that, plaintiffs in the recent case argue, goes to buyers’ agents. Visitors at the National Association of Realtors convention on November 14 in Anaheim, California. She said that buyers’ agreements may have to have wording that says that if a seller doesn’t agree to pay the buyer’s agent commission, the buyer is on the hook for that money.
Persons: Keller Williams, Tracy Kasper, Berkshire Hathaway, Silverhawk, , ” Tracy Kasper, National Association of Realtors Kasper, Renée Roqué, Alexis McGee, , Liu Guanguan, John Natale, Natale isn’t, Lynn Madison, Madison, Chuck Simons, “ It’s, Matt Troiani, Troiani, it’s, ” Troiani, ” ‘, Jim Flanagan, Flanagan, isn’t, Nate Johnson, haven’t, Johnson Organizations: California CNN, National Association of Realtors, NAR, of Justice, NXT, Department of Justice, China News Service, Social Media, Realtors, Coldwell, RedKey Realty Locations: Anaheim, California, Missouri, America, Texas, Berkshire, Boise , Idaho, Stevenson Ranch , California, San Mateo County , California, New Jersey, Anaheim , California, Illinois, Valencia , California, Ocean County , New Jersey, Flanagan’s, St, Louis , Missouri
Washington, DC CNN —Homebuilder confidence dropped for the fourth month in a row in November as mortgage rates neared 8%. But recent economic data suggests housing conditions may improve in coming months. Builder confidence in the market for newly built single-family homes in November fell six points to 34, according to the National Association of Home Builders / Wells Fargo Housing Market Index released Thursday morning. Specificially, Dietz said, the 10-year Treasury rate moved back to the 4.5% range for the first time since late September, which will help bring mortgage rates down closer to or below 7.5%. In November, 60% of builders provided sales incentives of all forms, down slightly from 62% in October.
Persons: , Alicia Huey, ” Huey, NAHB, Robert Dietz, NAHB’s, Specificially, Dietz, ” Dietz, Freddie Mac Organizations: DC CNN, National Association of Home Builders, Federal Reserve, Treasury Locations: Washington, Wells Fargo
“First-time buyers tiptoed back into the market this year with less competition and fewer multiple-offer scenarios,” said Lautz. The age of the typical repeat buyer also dropped slightly to 58 from an all-time high of 59 last year. In comparison, the typical downpayment for repeat buyers was 19%, which is the highest share since 2005, when the typical downpayment was 21%. First-time buyers increased their reliance on financial assets this year, which grew to 24% from 20% last year. Of recent homebuyers, 7% were Latino, 7% were Black, 6% were Asian or Pacific Islander and 6% identified as some other race.
Persons: , Jessica Lautz, today’s, homebuyers, downpayment, Homebuyers, Organizations: DC CNN, National Association of Realtors, Census Locations: Washington, United, United States
Washington, DC CNN —Mortgage rates tumbled this week in the biggest one-week drop since last November. “Many consumers are feeling strained by the high cost of living, so unless mortgage rates decrease significantly, the housing market will remain stagnant.”The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. But while mortgage rates remain relatively high, the difference between rates now and what they were a year ago has narrowed, said Lisa Sturtevant, chief economist at Bright Multiple Listing Service. “We are in a new era for mortgage rates, where prospective homebuyers can expect rates to settle above 6%,” said Sturtevant.
Persons: It’s, Freddie Mac, , Sam Khater, Freddie Mac’s, Joel Kan, Jiayi Xu, Xu, Realtor.com, Lisa Sturtevant, Sturtevant Organizations: DC CNN —, , Treasury, Mortgage, Association Locations: Washington
Farmers Insurance deemed it too risky to continue insuring homes in Florida and pulled out of the market there entirely. The average cost for homeowners’ insurance in the United States is about $1,820, according to an analysis by NerdWallet, but there are many variables. As climate risks continue, a standoff has developed over who should pay the cost of insuring homes against ever-growing risks. And for many of the properties that are on the market you can’t obtain insurance? “We’ll have to see some creative solutions in the near term to create that competitive marketplace for insurance,” she said.
Persons: Michael Monaghan, Sellers, , ’ ” Monaghan, , Monaghan, Will, Amy Bach, United, Hurricane Andrew, ” Bach, mitigations, Bach, Jennifer Branchini, Branchini Organizations: DC CNN, Coldwell, Allstate, . Farmers Insurance, National Oceanic, Atmospheric Administration, NOAA, Hurricane, FAIR, California Department of Insurance, California Association of Realtors, State Farm, Farm, Locations: Washington, California, Bayside, , Florida, Monaghan, United States, , San Francisco, “ Florida, Louisiana, WUI, Pleasanton
It’s easy to forget how much we used to rely on real, physical paper and, like, other people to buy basic things. It wasn’t all that long ago that you’d call a travel agent to book a flight. But the sellers argued that in a competitive market, the buyers should pay their own agent’s commission, and negotiate that fee separately. Because even though the NAR says fees are negotiable, the industry has made 5%-6% commissions so standard that most people wouldn’t question it. According to Bloomberg, Realtor commissions are high by global standards.
Persons: CNN Business ’, Anna Bahney, Keller Williams, Bob Goldberg, , you’re, you’ll Organizations: New, New York CNN, CNN Business, National Association of Realtors, Homeservices, Keller, Keller Williams Realty, NAR, MLS, Bloomberg, Department of Justice Locations: New York, Missouri, America, Australia
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