Life is good for U.S. home sellers

It's good to be a home seller right now ... really good.

That's because it's the most profitable time to sell a home in almost 10 years.

Homeowners who sold in the first three months of this year saw an average price gain of $44,000 from purchase, according to a report from Attom Data Solutions released Thursday. That's the highest gain since 2007.

"I am guessing we will see it get even better before it gets worse," said Daren Blomquist, senior vice president at Attom. "If you are considering moving this spring, it could be a really good time to sell."
Cities with robust local economies have seen strong price growth during the housing market's recovery. Low housing supply has helped push up prices to create competitive markets where bidding wars and above-asking price sales are common.

Nationwide, the median home price was $225,000 during the first quarter of 2017, the report stated, up 13% from a year ago.

Homes in more expensive markets have seen the highest average price gains so far this year, the report found. Sellers in San Jose, California, saw an average price gain of $356,500, followed by those in San Francisco with a gain of $276,750.

Even in a seller's market, homeowners aren't necessarily in a hurry to list their homes. Sellers in the first quarter of this year had lived in their home for an average of almost eight years. From 2000-2007, the average homeownership tenure was around 4.26 years.

After the housing crisis, many homeowners were underwater and had to stay put until they could rebuild their equity. Now, tight inventory levels have made some owners hesitant to sell because they fear they won't be able to find a home to move into.

Other homeowners are simply relishing the home price appreciation and expect it to keep going.
"I've talked to agents and brokers in the Bay Area, and one of the mantras there is actually 'never sell,'" said Blomquist. The idea is to leverage the wealth to purchase additional properties or pass the home along to future generations. In fact, San Francisco has a nearly 10-year homeownership tenure, which is among the longest in the country.

While strong price gains are good news for homeowners, it means buyers really have to step up their game in order to compete.

Not only are home prices rising, they're moving fast. On a national level, homes sat on the market for an average of 45 days in the first quarter, down from 84 during the same time period in 2011, according to data from Clear Capital.

In the five fastest-moving markets, homes are on the market for less than 21 days.
But not all homeowners are swimming in equity and have buyers lining up around the block. While home prices have exceeded pre-recession levels in more than half of U.S. housing markets, 46% still haven't returned to their peaks, noted Blomquist.

In Las Vegas, home prices are 26% below their pre-recession high and in Miami and Baltimore, they are 22% below.

"There are many individual homeowners who have been left behind by this housing recovery," Blomquist said.

Here are the markets with the highest average percent return on the previous purchase price, according to Attom:

San Jose: 71%
San Francisco: 65%
Seattle: 56%
Portland, Oregon: 52%
Modesto, California: 51%
Stockton, California: 51%
Los Angeles, California: 50%
Denver: 50%
Vallejo, California: 47%
Salem, Oregon: 46%

Original Article from CNN Real Estate

Ken Keegan Real Estate Broker
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St. James Plantation

The Struggle is real for Millennial Homebuyers

It's going to be an intense house-hunting season -- especially for young buyers.

After years of many experts lamenting how Millennials weren't interested in becoming homeowners, it turns out many are actually diving in. But they're facing a lot of competition.

Millennials are the largest group of homebuyers, according to Ellie Mae, a software company that analyzes mortgage data. In January, Millennials represented around 45% of all purchase loans, up from 42% the same month in 2016.

And many expect more Millennial house hunters to jump into the market this spring buying season.

But their path to homeownership won't be easy.

"Millennials are mostly first-time buyers and they are competing against repeat buyers who have more buying leverage and experience," said Javier Vivas, manager of economic research for Realtor.com. He added that Millennials recently became the dominant group of users searching for homes on the website.

New buyers this spring will also be up against buyers who started looking last year, but still haven't bought a home.

A shortage of available homes has driven up prices -- particularly among starter homes that tend to fall within first-time buyers' budgets.

There were 3% fewer homes on the market in February compared to a year ago, according to a recent report from Zillow, and home values are up nearly 7%.

That's led to bidding wars and fierce competition, especially in the lower end of the market.

When Andy Greene and his wife Jenna began looking for their first home together near Columbus, Ohio, they found themselves in a super competitive market.

"We would get a notification that a house went on the market. You had to go see it that night ... you had to go the same day it was out," said Greene.

They thought they found their perfect home early in their search and put in an offer. But they weren't the only ones. The seller received 13 bids.

Despite going $10,000 above the asking price, the Greenes were not the winning bidders.

"It was a little defeating," said Greene. "It made us wonder if we were actually going to be able to make it work and second guessing if we could find something we could afford."

Rising home and rent prices can make it difficult for many first-time buyers and young people still establishing their careers to save for a down payment.

The Greenes, who both work full-time, saved $30,000 for a down payment, mainly by living off one income and banking the other.

They were tempted to increase their budget as they continued their search, but they stuck to their pre-determined limit. Finally, after three months of hunting, they found a house and had their bid accepted. They're scheduled to close this month.

"We didn't want to be in a house we couldn't afford," he said. "And we didn't want to have to buy a house and dump money into it."

For first-time buyers looking to become homeowners this year, experts say do your homework: determine your budget, prioritize your requirements and get pre-approved for a loan.

"Be first in line," advised Vivas. "Start your search early, figure out your budget early on."

Millennials are also facing a tighter lending environment compared to a decade ago as banks stiffen up on credit requirements.

But despite the obstacles they face, Millennial buyers do have a major advantage: low interest rates.

"If you compare their access to credit and ability to get into a home, it's far easier for Millennials than previous generations," noted Joe Tyrrell, executive vice president of Ellie Mae. "Back when Millennials' parents were buying homes, they had higher interest rates and there weren't down payment assistance programs."

Original Article

Ken Keegan Real Estate Broker

(910) 523-0903 mobileEmail Mewww.KenKeegan.com Click here for more information on Brunswick, County Real Estate St. James Plantation