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Housing affordability is near its lowest levels in four decades as mortgage rates and home prices have skyrocketed relative to incomes. But according to Point2, an online real-estate marketplace, there are still areas where young buyers are finding deals. In building their ranking model, they considered factors like home price-to-income ratios, the local Gen Z unemployment rates, Gen Z homeownership rates, inventory, days on the market, and more. "Student loans and the rising cost of living means that Gen Z inherited the affordability concern from millennials," the report said. Below, we've listed the top 20 cities on Point2's index, along with their composite scores, local home price-to-income ratios, and Gen Z unemployment rates.
Persons: Gen Z, Z, We've Organizations: Business Locations: Redfin
As people age, they need homes that are more accessible and easier to maintain. Large homes often have multiple floors, yards, and other features that make them trickier to navigate for older people. AdvertisementSchuetz says there's not a dearth of large homes in the US. Instead, there's really just a mismatch between large homes and occupants who don't need them. But many more family-sized apartments and other homes will need to be built to make up for the lack of large homes on the market.
Persons: , Jenny Schuetz, Redfin, Schuetz, Daryl Fairweather, Redfin's, I've, Fairweather, it's, there's Organizations: Service, Business, Brookings Institution
The housing market is flashing signs of life, Compass CEO Robert Reffkin said. AdvertisementThe housing market is flashing a handful of bullish signals for the year ahead, according to Compass CEO Robert Reffkin. The founder of one of the nation's top real estate brokerages said he believed the housing market will be on the path to recovery in 2024. But more owners appear to be moving out of necessity or have warmed up to the idea of selling as mortgage rates head lower. At this rate, buyers are outpacing sellers in the market, Reffkin said, noting that Compass's real estate agents are seeing more business in the new year.
Persons: Robert Reffkin, Reffkin, , brokerages, Freddie Mac, Sam Lafoca, LM Otero, Sellers, Phil Noble, I've, Barbara Corcoran Organizations: Service, National Association of Realtors, CNBC, Community, Getty, Associated, REUTERS, Mortgage, Association, New Locations: lancaster California, USA, Dallas, Kirkham, England
He settled in Overland Park, Kansas, a city near Kansas City with about 200,000 residents. Ty, who asked to use just his first name for privacy reasons, settled on Phoenix, and moved there in 2023. While Kansas has an income tax of 5.7% on income above $30,000, Arizona has an income tax of 2.5%. While Florida has no income tax, he was drawn in more by the Phoenix area. He's noticed many new residents in Phoenix who have moved from neighboring states, which he didn't observe as much in Kansas.
Persons: Ty, Phoenix, Zillow, there's, it's, he's, I'm Organizations: Service, Business, Phoenix Locations: Ohio , Florida , Kentucky, West Virginia, Indiana, Overland Park , Kansas, Kansas City, Kansas, Phoenix, Arizona, California, Ohio, Florida, Kentucky, Indianapolis, Park , Kansas, Nashville, Tampa . Phoenix, While Kansas, Scottsdale, Phoenix —, Flagstaff, He's
He cited relatively affordable homes and a free, clean, high-quality life as two of Texas' draws. Dallas Mayor Eric Johnson told Business Insider at the World Economic Forum in Davos, Switzerland, that two things consistently attract Americans to move to the state. "The housing market in Dallas is very affordable to Californians and New Yorkers," Johnson said. Johnson reminded BI that all housing costs are relative: "When you're talking about 'it's expensive to live in Dallas,' you're comparing Dallas to the Dallas of yesteryear." AdvertisementHe said Dallas residents have benefited from investments in the police department as well as infrastructure including new sidewalks and smooth streets.
Persons: Dallas Mayor Eric Johnson crowed, , Dallas Mayor Eric Johnson, Johnson, They're, Gen Zers, Pengyu Cheng, Cheng, Dallas, Dallas —, it's Organizations: Dallas Mayor, Service, Economic, Democratic, Republican, Community Survey, University of Minnesota's, Dallas Locations: Texas, Davos, Florida, Switzerland, California, New York . Texas, Dallas, San Francisco, Austin, yesteryear
Nyasia Casey has learned the hard way where to spend money during a home renovation — and where to save. Renovating a rental property versus a flipHow to most effectively spend your renovation money depends on the type of property you're working with. Her agent and hard money lender thought otherwise. Courtesy of Nyasia Casey"My agent said, 'maybe 215,' and my hard money lender said, '200,'" recalled Casey. "But it was the cash offer with closing in 13 days, no inspection," she said, adding: "My hard money lender was blown away."
Persons: Nyasia Casey, , she's, Casey, Casey Casey, She's, it's, Casey's Organizations: Business, Yorker, Housing Authority, Depot Locations: Baltimore, Baltimore City, New York
Read previewThe housing market is about to exit its slowdown and take off in a new growth period, according to National Association of Home Builders CEO Jim Tobin. AdvertisementThat's partly because mortgage rates have continued their steady decline in recent months. At the same time, prospective buyers are likely warming up to the new norm of 6% mortgage rates, and could be readying themselves to jump back into the housing market, he said. "I think that the world is getting ready to realize that we're no longer going back to those 3%-4% mortgage rates. Improving affordability conditions could cause home sales to jump 5% while home prices decline 1% in 2024, according to Redfin.
Persons: , Jim Tobin, Tobin, Freddie Mac Organizations: Service, National Association of Home Builders, Business, Yahoo Finance, Mortgage, Association . Housing
A higher percentage of 24-year-olds own a home than when Gen X and millennials were the same age. Gen Z still had the lowest overall homeownership rate of adults in 2023, Redfin reports. At that age, only 24.5% of millennials and 23.5% of Gen X owned a home, according to Redfin. But, Gen Z is primed to come out on top in the years to come. AdvertisementAs boomers die or move into assisted living facilities, a market shift will coincide with older Gen Z's best buying years.
Persons: Gen X, Gen Z, Millennials, , Gen, didn't, Xers, X, Redfin, millennials, boomers, Z's, GoDaddy Organizations: Service Locations: homeownership
Selling a house in this market can be tricky with high mortgage interest rates and steep prices. AdvertisementSelling a home for a good price in this housing market can be challenging but not impossible. What's more, mortgage interest rates remain high compared to several years ago but have dropped slightly recently. Buyers can still beat current interest ratesMeanwhile, some potential buyers are finding creative ways to avoid high interest rates and purchase homes. While nothing is guaranteed with interest rates, this is exactly what the Fed is projected to do, holding interest rates steady in the first part of 2024 before starting to lower rates later in the year.
Persons: , Cork, there's, Gary Miller, Austin Organizations: Austin, Service, Cork Gaines, Brigade, National Association of Realtors Locations: Austin
Too said groceries, gas, and even movie tickets are less pricey in Las Vegas. Katz, a big sports fan, said some of his favorite things to do in the city are watching the Las Vegas Knights and the Las Vegas Aviators, a Minor League baseball team (an affiliate of Major League Oakland Athletics, who are moving to Las Vegas in the near future ). With the 2024 Super Bowl taking place in Las Vegas, Hamrick argued that the city has recently become a sports "mecca." AdvertisementTo receive that kind of hospitality, you don't have to venture far from the bustling parts of Las Vegas. Too said he lives only three miles from the Strip but feels worlds away from the flashy Las Vegas people envision.
Persons: , Richard Katz, Katz, Vegas , Nevada Allan Baxter, Andrew Arevalo, Bob Hamrick, Michael Too, Arevalo, that's, I've, Paolo Becarelli, Hamrick, Strip Katz, He's, It's Organizations: Service, Business, Sin City —, Las Vegas, Census, Coldwell Banker, Las Vegas Knights, Las Vegas Aviators, Minor League baseball, Major League Oakland Athletics, Strip Locations: Virginia, West, Sacramento, Seattle, Florida, Texas, . Colorado, Reno, California, Las Vegas, Vegas , Nevada, Sin, Vegas, Nevada, Sin City, Texas , Arizona, Washington, Utah, San Francisco, Bay, Redfin, Mount Charleston, Fire, Summerlin, Indiana, Western, it's
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailRates must fall more for home builders and buyers to be confident again, says Redfin's FairweatherDaryl Fairweather, Redfin chief economist, joins 'Money Movers' to discuss whether January's homebuilder sentiment moves the needle for affordability, how the home supply dynamic may shift during the year, and more.
Persons: Redfin's Fairweather Daryl Fairweather, Redfin
After all their economic misfortune, they'll still face a turbulent housing market and potentially tens of thousands of dollars' worth of necessary updates to boomers' aging houses. In his 2022 paper, "Who will buy the baby boomers' homes when they leave them? ", Engelhardt argued that mass aging would send ripples through the housing market but fail to push down prices significantly. After that point, demand for home purchases will once again outpace supply as millennials buy more homes and younger generations, like Gen Z and Gen Alpha, file in behind them. The timing of boomers' exit will mostly benefit younger generations, like Gen Z and Gen Alpha, who should find themselves on steadier footing than their predecessors.
Persons: Xers, they've, Zers, they'll, Odeta Kushi, Kushi, Gary Engelhardt, Engelhardt, Issi Romem, Meredith Whitney, Boomers, Gen Zers —, Gen, who've, millennials, boomers, Jessica Lautz, Nicole Bachaud, They've, Redfin, Alpha, they're, Lautz, savvier, Zoomers, James Rodriguez Organizations: millennials, Syracuse University, Boomers, Federal Reserve, Alpha, National Association of Realtors Locations: granny, New York, Los Angeles, Chicago, Dallas
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
The housing market could be breaking free from the "rate lock" phenomenon that froze activity in 2023. That's because owners appear less deterred by high mortgage rates when considering whether to sell their homes, Zillow said. 21% of owners are considering selling their homes in the next three years, a Zillow survey shows. Currently, mortgage rates look to be less of a determining factor when considering a sale." Prices and mortgage rates are expected to continue easing slightly this year, Redfin economists predicted.
Persons: Zillow, , That's, Sylar Olsen, Freddie Mac Organizations: Service
Many wealthy buyers say they were driven out by a so-called mansion tax in Los Angeles, among other tax-related issues. Los Angeles topped Redfin's list of US metropolitan areas that homeowners are most looking to leave, based on their user data of home searches. Wealthier Americans — those making more than $200,000 per year — are moving out of high-cost cities like New York and Los Angeles, according to personal finance site SmartAsset. San Diego real-estate agent Jennifer Janzen says she's recently had Los Angeles clients head south to trade up in style. Another client of Janzen's was a young family who grew tired of the city life in Los Angeles.
Persons: , Gus Lira, Lira, Lira's, Summerlin, she's, Jennifer Janzen, Janzen, Sotheby's, grâce, Jade Mills, Rob Desantis, Mary Fitzgerald Organizations: Service, Getty, Hollywood, Las, Golden, LA, Bloomberg, Los, Netflix Locations: Los Angeles, Malibu, California, Orange County, Las Vegas, Nevada, Vegas, Red, Vegas from California, Seattle, Florida , Texas, Tennessee, New York, Diego, Angeles, Rancho Santa Fe, San Diego, LA, Santa Fe, Manhattan
Fg Trade | E+ | Getty ImagesRising inventory is helping push rent prices down. Many Gen Zers are still living with their parentsWhile some older Gen Zers were able to become homeowners during the Covid-19 pandemic, most did not. Gen Z includes those born between 1996 and 2012, according to Pew Research Center's definition, and the youngest members of that cohort are still teens and tweens. Of the Gen Z adults who currently rent, 27% say they can no longer afford the cost, the firm found. In the meantime, there are ways Gen Z adults can prepare, especially those at home saving on expenses.
Persons: Gen, Daryl Fairweather, Jacob Channel, It's, Zers, Intuit Credit Karma, Melissa Lambarena Organizations: Pew Research, Intuit Credit, Finance Locations: U.S
Wealthy people are moving to states including Florida, Texas, North Carolina, and Tennessee. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . Florida, Texas, and North Carolina are popular destinations for more than just the wealthy. The reshuffling of wealth is making historically cheaper states more expensiveIn Miami, in particular, this reshuffling of wealth has ushered in an era of unaffordability. "Miami and most of Southeast Florida have rebranded into more luxury markets," housing expert Jonathan Miller told BI in September.
Persons: They've, , SmartAsset, Ken Griffin, Jeff Bezos, Alexander Tamargo, Indxx, AllianceBernstein, Charlotte, Goldman Sachs, Griffin, plunked, Jeffrey Greenberg, Jared Kushner, Ivanka Trump, Carl Icahn, Elon Musk, he's, Jonathan Miller, Bezos, Kushner, Trump, Dina Goldentayer, Dina Goldentayer Dina Goldentayer, Zillow Organizations: Service, Bloomberg, Austin, Citadel, Amazon, Allspring Global Investments, Oracle, Tesla, Dallas ., Company, Universal, Getty, Miami Locations: Florida , Texas, North Carolina, Tennessee, Miami, Florida, New York, California, Florida , Tennessee, New Jersey , Massachusetts, Dallas, Nashville, Charlotte, New York City, Texas, Miami Beach, Chicago, San Francisco, Austin, Coconut Grove, Southeast Florida
The state of the US housing market in 5 charts
  + stars: | 2024-01-05 | by ( Phil Rosen | ) www.businessinsider.com   time to read: +4 min
Read previewThe US housing market is facing historic unaffordability and it's kept countless Americans sidelined or forced to face hefty monthly home payments. This lock-in effect has created a tale of two markets: those who have been crushed by high mortgage rates and those who have mostly gotten by unaffected. Many Americans secured lower mortgage rates during the pandemic. AdvertisementBut in 2023, that dearth of supply for existing homes was a boon for homebuilders — and Wall Street took notice. William BlairFreddie Mac Multi-family Home Serious Delinquency Rate William Blair, Freddie MacUltimately, in 2024 William Blair forecasts supply to improve, mortgage rates to fall, and existing homeowners to return to the market out of necessity.
Persons: , it's, William Blair, Richard de Chazal, homebuilders, William Blair's, de Chazal, William Blair Freddie Mac, Freddie Mac Organizations: Service, Industry, Business, National Association of Realtors, Federal, Wall, Bloomberg
There's finally a glimmer of hope for the housing market, according to Redfin. AdvertisementThere are signs the frozen housing market is starting to thaw after a year where higher mortgage rates drove potential buyers away, according to Redfin. Still, the flare-up fueled a slowdown in housing market activity, with potential buyers disenchanted by higher rates and would-be sellers opting to stay put to take advantage of being locked in at a lower mortgage rate. Mortgage rates still look high compared to historic levels despite the recent pick-up in demand, according to real-estate agents. "There have been more tours and more offers on my listings since mortgage rates started declining," said Shay Stein, who works for Redfin in Las Vegas.
Persons: There's, , Freddie Mac, Redfin, Shay Stein Organizations: Service, Federal Reserve, Redfin Locations: Las Vegas
Remote workers may also seek out cities with cultures they enjoy more, those that are walkable, and those that are well-connected via a major airport, she said. All of them have median home prices relatively close to, or below, the national median of $408,573, according to Redfin data. And they are all significantly less expensive than median prices in New York or Boston, which hover near $800,000, or San Francisco and Los Angeles, which both have median prices over $1 million. The eight cities also have below-average costs of living, according to the Council for Community and Economic Research's Cost of Living Index. We've listed the eight cities below, their median home prices, populations, cost of living index scores, and major airports.
Persons: Nicole Beauchamp, we've, Beauchamp Organizations: Sotheby's, Business, Council for Community Locations: New York, Boston, San Francisco, Los Angeles
"We are in a high interest rate environment, and we're going to be in a high interest rate environment a year from now," he said. Prediction: Mortgage rates decline to 5.75%Thanks to higher mortgage rates, 2023 was the least affordable homebuying year in at least 11 years, according to a report from real estate company Redfin. McBride also expects mortgage rates to continue to ease in 2024 but not return to their pandemic-era lows. Prediction: Auto loan rates edge down to 7%When it comes to their cars, more consumers are facing monthly payments that they can barely afford, thanks to higher vehicle prices and elevated interest rates on new loans. "It will still be a banner year for savers when those returns are measured against a lower inflation rate," McBride said.
Persons: Tim Quinlan, Greg McBride, McBride, Bankrate Organizations: Finance, Fed, CNBC PRO, CNBC, YouTube Locations: Wells Fargo
A six-floor duplex home in San Francisco had its price slashed by $10 million in just three years. It was bought for $20 million in 2020, but then sold for only half that value in November. Home values in San Francisco have been sinking in the last year after reaching a peak in April 2022. AdvertisementA 10,000-square-foot duplex apartment in San Francisco was just sold for only half of its $20 million value from three years ago, as the city's housing market suffers a recent slump. Home prices have been slashed across the US over the last year, but San Francisco is often a poster child for the decline because property there is notoriously expensive.
Persons: , Rohin Dhar, Leslie Stretch, Zillow, Business Insider's James Faris Organizations: Service, Bay, Business Locations: San Francisco, Calcutta, Francisco
Lower mortgage rates have prompted mortgage applications to pick up. Even the recent decline in mortgage rates may not provide incentive for homeowners to move. watch now"The story for 2023 has been one of homeowners staying put," said Daryl Fairweather, chief economist at Redfin. Monthly payments are falling as mortgage rates come down from their peak. The weekly average 30-year mortgage rate fell to 7.29% in late November, down from a 7.79% high in October, according to Redfin.
Persons: Daryl Fairweather Organizations: Bank of, Redfin, Redfin's
San Francisco, Los Angeles, and San Diego residents are looking to move to Las Vegas and Seattle, Redfin found. Some parts of California are losing residents due to the high cost of living, politics, and crime. Bob Giramma, a 63-year-old business owner, moved away from San Diego and landed in Murfreesboro, Tennessee , a town 30 miles southeast of Nashville. Now residents of some of the most populous cities in California — Los Angeles, San Diego, and San Francisco — are eyeing other cities, according to home-listings site Redfin, which tracks where its users are house-hunting. Allan BaxterPeople looking to move out of San Francisco, Los Angeles, and San Diego, Redfin additionally found, are most often searching for homes in Las Vegas and Seattle.
Persons: Redfin, , Bob Giramma, Giramma, Francisco —, Allan Baxter, relocators, Andrew Arevalo, he's, Arevalo Organizations: Service, Census Bureau, Business, California —, Las, Los, Denver Locations: California, San Francisco , Los Angeles, San Diego, Las Vegas, Seattle, Murfreesboro , Tennessee, Nashville, Tennessee, Texas, Arizona, Florida, Oregon, Colorado, California — Los Angeles, Francisco , Los Angeles, , Vegas , Nevada, San, Los Angeles, Washington, Nevada, Millennials, Las, Vegas
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
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