Supply & Demand Drives Home Pricing

One of the key factors to success in any kind of business is supply and demand. The National Association of Realtors (NAR) agrees that this principle has boosted home pricing in the current housing market. NAR’s chief economist Lawrence Yun believes the housing market is still going strong because of the lack of inventory even though data shows a modest growth rate reduction.

Yun states,”…with homebuilding activity still failing to keep up with demand and not enough current homeowners2-Lot 91 Maison du Lac Unique Private Entryway putting their home up for sale, prices continued their strong ascent – and in many markets at a rate well above income growth.”

In the second quarter of last year the peak existing single-family home price was $229,400, this year however, the second quarter single-family home price has risen 4.9% with a median single-family home price of $240,700.

According to NAR findings, new construction cannot keep up with the demand for new homes.  In the second quarter this year 40% of the listings sold over their listing price. “Many listings in a majority of markets – and especially those in lower price ranges — had multiple offers and went under contract quickly because of severely inadequate supply,” Yun added.

This coupled with low mortgage rates have many potential home buyers wanting to purchase a new home now.  In the Northeast region there was a 7.6% increase in existing homes sales and the median home price increased to $273,600. The Midwest, though not as high of an increase, was 10.4% in total existing-home sales with a median 1-Lot 207 Front Exteriorprice of $191,300. The West came in next with a 1.4% increase in total existing-home sales with a median home price of $345,500.  The South came in last with a 0.3% increase with a median home price of $214,900.

Whether you are in the market to sell a home or purchase a home, now is the right time.  The housing market is holding strong and is a great investment for your money.  Locally in St. Tammany Parish, Ron Lee Homes, a new home builder in Covington, Louisiana, is building new homes for sale as well as completely custom homes designed completely from your vision of how you would like your new home to be.  We have been keeping a steady pace of new construction for the past 2 years, and we are constantly meeting with new custom home buyers as well as buyers who are looking for homes to buy immediately.  If you are interested in building or buying a new home, Contact Us at 985-626-7619 or E-mail Info@RonLeeHomes.com.

Click Here For the Source of the Information.

NAHB Works with Congress to Help Low-Income Housing Laws

Without the help of the country’s federal government, many Americans could not see homeownership in their future.  The National Association of Home Builders worked with the House of Representatives and the Senate to pass a bill in Congress that would facilitate the chance for low-income Americans to become homeowners.  On July 29, 2016, the President signed The Housing Opportunity Through Modernization Act which consists of several reforms which will increase access to affordable rental housing, provide assistance to low-income renters

 

 

and facilitate homeownership.

There are many facets to the bill which is now a new law.  In the past voucher holders had no chance in competing with market-rate renters.  Because of red tape in the inspection process, voucher holders were not able to move into a multi-family unit such as an apartment or condominium immediately.  Now with the new law inspection requirements in the Housing Choice Voucher Program are more efficient and allow a quicker approval.

The contract terms of HUD’s Section 8 Project Based Housing Choice Voucher program is now 20 years instead of 15 which enables project-based vouchers to be used with the Low Income Housing Tax Credit residences.  Voucher holders will now be protected from economic influences that are out of their control, which means that when the market rental rate goes up, voucher holders will not have to be displaced because their payments are not high enough.  This also allows property owners to preserve respectable renters.

The Rural Housing Service Single-Family Guaranteed Loan Program will also be updated to compete with other government loan programs.  This will allow more low-income renters to actually be able to get a home loan.

FHA regulations that are enforced on existing condominium projects have been reduced.  This means that the purchase of a condo will be less stringent in terms of required owner occupancy for the buyer.  Buyers will now find it easier to purchase multi-family units for rental purposes, creating more rentals in the market.  Also, condo owners who are able to sell will then be able to move up to a single family detached home, if they would like.

 

Click Here for the Source of the Information.

National Lot Size Average Helps Builders and Home Buyers

The number of jobs available in the construction sector have become a positive “negative” for the United States’ real estate market.  Employers are reporting more open positions for construction employees and sub-contractors.  This shortage of workers is actually contributing greatly to the slow completion of new homes for16-12 Bedico Creek Rear of Home sale on the market.  However, new home sales for single-family detached homes has increased 13% year-over-year, reporting 592,000 homes completed in June, 2016.  Lot size has also started to play a role in the completion of  new homes for builders in an unexpected way. The lack of developed lots has also slowed down new home builders as they are trying to keep up with the demand from new home buyers in the housing market.

However, there is a “silver lining” to the lack of developed lots.  Builders may find that they don’t have to look as hard for lots on which to build because the Census Bureau’s Survey of Construction (SOC) found that new home buyers preferred lots that were less than 8,600 square feet – approximately 1/5-acre lots.  Since an acre is 43,560 square feet, this means that approximately 5 homes could fit comfortably on a space the size of a football field.  This is also good news for first-time home buyers.  The types and sizes of homes that would fit on a 1/5-acre lot would probably fall within the price range of the first-time home buyers.  Most builders paying attention to 2-229 Bedico Creek Exterior Fronthousing trends build new homes based on buyers’ preferences.  As lot sizes decrease, the availability of affordable housing has the potential to increase.

In Louisiana, the SOC reported that new home buyers buying single-family homes in Louisiana prefer lot sizes that are .16-acre.  This is less than the national trend of 1/5 acre.  Ron Lee Homes in St. Tammany Parish Louisiana can design and build you a completely custom new home either on a lot you already own or on any new lot for sale in the new subdivisions in the West St. Tammany Parish area.  We also have garden home floorplans and smaller square footage floorplans that have been designed and engineered for smaller lots.  New home buyers frequently modify our previously designed floorplans to their specifications in order to have Ron Lee Homes build the home of their dreams.  If you already own your lot or would like to buyer a lot in one of the many neighborhoods throughout the St. Tammany Parish area, Contact Us Today, Call 985-626-7619 or E-mail Info@RonLeeHomes.com.

Click Here and Here for the Sources of the Information.

Cultural Arts District to Move Forward in St. Tammany Parish

St. Tammany Parish will enjoy the benefits of the design and construction of a new arts and education district in 48 acres north of I-12 between the Pinnacle at Nord du Lac shopping center and the Tchefuncte River.  Despite many ups and downs along the way, including the governor’s veto of $11 million in assistance for the construction project, parish president Pat Brister will realize her vision of creating not only a cultural arts district but also an educational facility and program for students on the North Shore, including the Tangipahoa Parish area.

 

The entire property includes plans for the cultural arts district, the center of which would be a performing arts center, a children’s museum, and a privately owned commercial development with possibly a hotel and restaurant.  Donation of land for a theater and amphitheater as well as planned nature trails along the river are also part of the project.

Real estate developer Bruce Wainer of All State Financial owns the 48 acres as well as the 80 acres that are adjacent to it.  He plans on donating the land for the children’s museum and the performing arts center which will help alleviate the costs, now that the state government is currently unable to contribute.  The natural part of the property includes wetlands, a river, and a heavily wooded area which will offset the commercial atmosphere of the entire development.

Design elements are being prepared by a team of architects and planners which include Wilson Butler Architects of Boston headed by Scott Wilson, and Fisher Dachs Associates of New York.  Wilson’s vision of the area is that of constant activity both day and night for “kids of all ages.”

“Most performing arts centers are urban,” he said. “Very few projects of this nature have such a pristine, undamaged, unmolested site. It’s a huge responsibility for us to do it right.

“Clearly the land, the trees, the wetlands are your jewel. For us to not really capture that would be a big mistake.”

Even though the funding did not come through as planned, Brister is undettered. Brister, who invited members of the news media to attend part of Wednesday’s session, said the parish government didn’t embark on the project thinking all of the funding would simply fall into place. She said the parish is fully prepared to move ahead with planning and will talk with Edwards about future funding.  In addition Brister said St. Tammany will look for money from cultural arts grants, economic development districts, naming rights and private sources.

Click Here and Here for the Sources of the Information.

Single-Family Home Sales Increase in 2nd Quarter

Single-family home sales increased by almost 24% compared to new home sales in 2015 in April.  Compared to March, 2016’s home sales, single-family home sales increased by almost 17%.  Finally, sales went up to 619,000, an eight-year high during the month of April as well.

Home buyers are taking advantage of the availability of new homes because the inventory of new homes for sale2-Woodstone, Lot 25 Exterior on the market has decreased to a 4.7 month’s supply – a total of 243,000 new homes for sale with only 56,000 completed, move-in ready homes available. Demand will require that builders increase their production of new homes for sale in order to keep up with the buyers.

Single-Family Home Builders

April’s sales numbers go hand-in-hand with the reported new, single-family home starts which increased by 3.3% at the beginning of April.  Builder confidence held steady for the 4th month in a row since February, 2016, which contributed to new construction starts and inventory on the ground.  Single-family home permits in the beginning of April were already up year-over-year by 8.4%, so construction of new homes should continue to escalate over 3-54 Maison du Lac Exterior 3the next few months.

While first-time home buyers are finding it difficult to find new homes for sale in their price range, the sales of homes priced from $150,000 – $200,000 increased to 10,000 sales in April.  For existing home sales, the first-time home buyer sales accounted for 32% of these sales, opening up the market, once again for homes priced affordably.

Good News for Resale Market

Existing home sale closings increased by 6% year-over-year and by 1.7% compared to March’s sales.  It is definitely a seller’s market right now as existing home inventory also stands at a 4.7 month supply like single-family new homes.

The 2nd quarter of 2016 shows good news for the housing market after a slow 1st quarter start.  New, single-family home starts and permits indicate an increase in new home inventory moving forward in the 3rd quarter.  Sellers should be able to “take their pick” of home buyers as supply currently is lagging behind demand.

Click Here and Here for the Sources of the Information.

Interest Rates to Remain the Same According to the Fed

A unanimous decision by the Federal Reserve the first week of June declared that interest rates would remain the way they were. This decision was made after reports revealed that the labor market is still not showing a strong recovery.  Even though there are still job gains across the board, they are slow and business investment has also not picked up.

Home buyers have enjoyed and even taken for granted interest rates that are historically low for the past 10+ 1-Lot 207 Singing Rivers Front Exterioryears.  For those buyers who have been able to recover and succeed after the Great Recession, it is still one of the best times to buy a new home or buy an existing home in today’s housing market.

Predicted Rise in Interest Rate

Originally, the “Fed” had predicted that there would be two more rate hikes of the interest rate during 2016, but June’s meeting saw 6 members stating that with the slow growth of the economy, they only would really commit to a possibility of one more interest rate increase, citing the normalization of monetary policy taking a longer period of time than expected.

The good news is that the unemployment rate went down by 4.7%, but the gain of jobs in May, 2016, was only 38,000.  Also, the job increases reported in March and April were revised down by 59,000 – a loss of 458,000 in the labor force.

Strong demand still exists for employees and contractors in the residential construction sector.  The BLS JOLTS data shows that builders have approximately 200,000 unfilled positions.  However, during the course of April and May, 9,600 jobs were lost in the residential construction industry, and these jobs are now having to be refilled.

First-Time Home Buyers

Because of the cost of labor and materials to build a new home, first-time home buyers are finding it hard to acquire a new home.  Homes that are priced less than $150,000 account for only 6% of the market according to the National Association of Home Builders.  Currently approximately 31% of the home buyers surveyed expected to be able to pay less than $150,000 for their new home.

New home buyers in the market to purchase a new home will still benefit greatly from the significantly and historically low interest rates.  Any rise in the interest rate in 2016 will still probably keep the interest rate low enough to have affordable house payments.

Click Here for the Source of the Information.

National Association of Home Builders Announces Positive Housing Recovery

According to the National Association of Home Builders’ (NAHB) Leading Markets Index (LMI), the national housing market is within a 5% range of complete housing recovery compared to what is considered a “normal” housing market which the United States last saw in 2006.  Out of a score of one, the latest LMI scored a .95 nationwide in housing recovery.

How is the LMI Calculated?

The way that the LMI makes a numeric determination is taking statistics of single-family housing permits, 5-Lot 91 Maison du Lac Rustic Kitchen Design with Graniteemployment, and home prices calculated for the entire country and specifically 337 local markets.  Single-family home permits rose from .48 to .49, new home prices increased from 1.38 to 1.40, and employment rose from .96 to .97.  The really good news is that approximately 35% of the 337 markets have a score that exactly equaled 1 or is greater than 1.

The number of markets which increased overall in single-family home permits in a year-over-year comparison rose by almost 65%. Employment numbers increased 71%.  Three hundred twenty-four markets out of the 337 are now showing new home pricing that is considered normal according to the last data recorded in a normal real estate market in 2006.

For communities located in Louisiana, almost all counties accounted for were located in the top 20% of housing rankings.  Approximately 4 areas were in the top 60% – 80% rankings relative to normal housing numbers for new home permits, employment and new home pricing.  Louisiana overall experienced a far softer impact of the slowdown in housing market numbers of the Recession than other states in the United States.  Baton Rouge consistently ranks in the top 10 cities in the United States with the best recovery numbers to date.

Click Here for the Source of the Information. 

Real Estate Market Celebrates Statistics Which Indicate a Buyer’s Market

Real Estate Showing Buyer’s Market

In general, the real estate market seems to be turning more into a buyer’s market than a seller’s market – an indicator that the housing market continues its steady, slow rebound since the Recession.  New home buyers have cause for optimism with the increase in standing new home inventory which was upwardly revised for the month1-Lot 21 Tchefuncta Bluff Front Exterior of March from 205,000 in March, 2015, to 246,000 new homes this year.  Currently, new home inventory stands at a 5.8 month’s supply.

Competitive Home Pricing

With the increase of available homes, new home pricing and existing home pricing are now competitively arranged in the housing market, making builders’ new homes for sale just as attractive price-wise as existing home pricing.  This trend of available new homes for sale is expected to continue as in the month of Market, there are approximately 149,000 new homes under constructions and 41,000 single-family homes that will be constructed according to the record of building permits throughout the country.  The building industry reported 56,000 move-in ready homes on the market ready to be closed.

New home pricing has also stabilized compared to new homes for sale in March, 2015.  The current new home 4-Lot 859 Beau Chene View to Kitchenmedian sales price is $288,000 where it was around $293,400 in 2015.  Overall, new home pricing gained in a year-over-year comparison, with homes in the $200,000 – $300,000 price range rising by 20% in comparison.

As new home inventory exponentially increases, and a high number of new homes “flood” the real estate market, new home sales are expected to increase in the months ahead as home buyers can expect to see a large variety of different floorplans, features, and upgrades available to them in making a choice of buying their new home for sale. Some buyers may choose to build their new home from scratch with a custom home builder such as Ron Lee Homes in St. Tammany Parish.  If you are interested in building your new, custom home, Contact Us at 985-626-7619 or E-mail Info@RonLeeHomes.com.

Click Here for the Source of the Information.

Louisiana in Top Tier of States Leading Housing Recovery

NAHB Spring Construction Webinar Forecasts Strong Housing Growth

When comparing statistics in housing trends, the National Association of Home Builders place Louisiana in the top tier of states leading housing recovery nationwide.  The top states include Montana, North Dakota, and Utah, and the 2nd tier of states include Texas, Oklahoma, Louisiana, and Alaska.  There are several factors that contribute to Louisiana’s (and other states’) housing recovery.  Some states, such as the top 3 states of Montana,2-Woodstone, Lot 25 Exterior North Dakota, and Utah did not have as big of housing bubbles as other states.  Therefore, their “fall” during the Recession was not as great, so their housing recovery was faster and better.  States like Texas and Louisiana are mainly energy sector states, so the Recession did not cut as deeply into employment and statewide income as other states.  Baton Rouge, Louisiana, has consistently held one of the highest rankings in housing recovery since the beginning of 2015 which helps with Louisiana’s housing statistics.

“The basic principle remains the same,” said NAHB Senior Economist Robert Denk. “A strong economy – whether helped, hindered or unaffected by the energy economy – will be a key factor driving housing recoveries going forward.”

Economists predict that by the end of 2017, the top tier states will have a housing recovery of 102% of normal (based on statistics pulled of the housing numbers during the last “normal” housing market pre-Recession).  The bottom tier states will have recovered to just 65% of where they were before the Recession.  The reason for the predicted recovery numbers in 2017 is based on the underlying housing market fundamentals of population and insulation-1job growth which are typical in driving supply and demand in real estate.  The cycles of “boom and bust” are mostly over according to Denk.

“A common theme has emerged,” said Denk. “The progress of market recovery is no longer a function of the boom-and-bust cycle marked by price bubbles, excess supply and foreclosures. The key driver of the housing recovery is now back to the underlying housing market fundamentals of population and job growth.”

Factors that will help builders and sellers to sell their new homes for sale and homes for sale are a predicted increase in household formation by home buyers that were previously unable to secure a mortgage, stabilized home pricing that now offers tiers of homes for sale available and affordable to purchase, less foreclosures, rising employment and the first increase in wages in over 8 years, and home prices that are in line with incomes and rents making it an easier transition from renting to owning.

If you are a new home buyer who is interested in building your own custom, dream home in West St. Tammany Parish, Ron Lee Homes in Covington, Louisiana, offers full-service home building strategies such as custom home design, engineered floorplans, complete “end-to-end” home construction supervised by Ron Lee, financing and insurance assistance, and a hands-on approach to building new, custom homes in the Greater New Orleans area.  For More Information, Call 985-626-7619 or E-mail Info@RonLeeHomes.com.

Click Here for the Source of the Information.

Real Estate Trends in April Showing Growth and Good News

With the 22.6% increase of single-family home construction starts compared to the previous month and year of March, 2015, real estate nationwide has taken a very positive step forward.  In addition to a substantial increase in new home starts, there is good and bad news when it comes to new homes being built and put up for sale in the real estate market.  The bad news is that builders are finding it difficult to procure land to build new homes, as1-Lot 34 Autumn Creek Front Exterior well as the labor required to start and complete a new home project in a timely manner.  On the flip side, that is also good news in that there are now a tremendous amount of construction jobs available for those trained and experienced in the construction industry.

The lack of land and lots to build also increases the new home buyers’ demand across the entire United States, making it so that builders are building new homes “on demand” for prospective homeowners.  Now home buyers are waiting on builders to supply new homes to buy whereas just a few years ago, it was builders waiting on home buyers to be able to buy a 1.5 years’ supply of new homes.

Existing home inventory currently in the market is also really tight according to the National Association of 17-Lot 207 Fully Bricked Back PatioRealtors.  Right now, existing home inventory is at just a 4.5 month supply – really good news for sellers and Realtors, but not such good news for home buyers.  However, existing home sales increased 5.1% in March, despite the dearth of homes available to buy.

If home buyers are in the market for a new home and can afford to wait to be able to build their dream home, they may consider buying a new custom home from local builder Ron Lee Homes in St. Tammany Parish.  Custom homes built by this award winning builder are “worth the wait,” and by using Ron Lee Homes, buyers get full-service attention on the new custom home building process.  Ron Lee Homes designs floorplans, builds new custom homes, assists with financing, and literally walks home buyers through the home building process from start to finish.  So, if you would like to Consult with a Custom Home Builders in West St. Tammany Parish, Call 985-626-7619 or E-mail Info@RonLeeHomes.com.

 

Click Here and Here for the Sources of the Information.