Monthly Archives: June 2016

Pending home sales slumped in May amid supply shortage

In this video, NAR’s Danielle Hale and Adam DeSanctis talk about the drop in contract signings and the potential impact of Brexit on the US real estate market.

After steadily increasing for three straight months, pending home sales let up in May and declined year-over-year for the first time in almost two years, according to the National Association of Realtors®. All four major regions experienced a cutback in contract activity last month.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, slid 3.7 percent to 110.8.

Lawrence Yun, NAR chief economist, says pending sales slumped in May across most of the country. “With demand holding firm this spring and homes selling even faster than a year ago, the notable increase in closings in recent months took a dent out of what was available for sale in May and ultimately dragged down contract activity,” he said.

“Realtors® are acknowledging with increasing frequency lately that buyers continue to be frustrated by the tense competition and lack of affordable homes for sale in their market.”

Impact of Brexit

Looking ahead to the second half of the year, Yun says the fallout from the U.K.’s decision to leave the European Union breeds both immediate opportunity as well as potential headwinds for the U.S. housing market.

“In the short term, volatility in the financial markets could very likely lead to even lower mortgage rates and increased demand from foreign buyers looking for a safer place to invest their cash,” he said. “On the other hand, any prolonged market angst and further economic uncertainty overseas could negatively impact our economy and end up tempering the overall appetite for homebuying.”

In spite of last month’s step back in contract signings, existing-home sales this year are still expected to be around 5.44 million, a 3.7 percent boost from 2015. After accelerating to 6.8 percent a year ago, national median existing-home price growth is forecast to slightly moderate to between 4 and 5 percent.

Student Debt Is Preventing Graduates From Leaving Home


A recent survey revealed that four out of ten student loan recipients are unable to move out of their family homes after graduating college. Survey respondents who graduated six to 10 years ago had the longest delay, with 33% saying it took more than two years to move out of a family home.

The survey was conducted by The National Association of REALTORS®.

(NAR) and SALT, a consumer literacy program provided by the nonprofit American Student Assistance. The survey findings show that higher education debt is preventing many Americans from moving towards the next step in their lives. With many graduates unable to rent or purchase a home due to burdensome education debt.

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The survey also revealed that 71% of non-homeowners believe that their student loan debt is hindering their ability to purchase a home. And slightly more than half of all borrowers say that they expect this delay to continue for another five or more years. Lawrence Yun, NAR chief economist shares that, “Nearly three-quarters of older millennials, many of whom graduated at the peak or immediately after the downturn, said their ability to purchase a home is affected by student debt.”

“It is imperative to the nation’s economy that we find immediate and practical solutions to financially empower the 43 million Americans with student debt,” said SALT® President John Zurick. “SALT® is committed to demystifying the college financing process by giving consumers information, instruction and individualized advice. No one should fail to realize the full potential of their formal education simply because of finances. We invite the higher education community, the U.S. government, the private sector and others to join with us in this movement.”

Existing-Home Sales Grow 1.8% in May

Existing-home sales sprang ahead in May to their highest pace in almost a decade, with the uptick in demand pushing the median sales price to an all-time high, according to the National Association of Realtors®. All major regions except for the Midwest saw strong sales increases last month.

Existing Home Sales 2016

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Lawrence Yun, NAR chief economist, says existing sales continue to hum along, rising in May for the third consecutive month. “This spring’s sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more homeowners realizing the equity they’ve accumulated in recent years and finally deciding to trade-up or downsize.”

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Adds Yun, “Barring further deceleration in job growth that could ultimately temper demand from these repeat buyers, sales have the potential to mostly maintain their current pace through the summer.”

Should Your Home Be Tested for Lead or Radon Health Hazards?

Fast Fact: Your home is your sanctuary. But it also runs the risk of lead and radon hazards. That’s why your community’s REALTORS® work hard to inform and protect you against these dangers.

Does the news out of Flint, Michigan, about lead in its water make you nervous about the water in your own home?

Unfortunately, it isn’t an uncommon problem. Lead is one of two leading home-traced health hazards in our country today. The second? That’s radon, a naturally occurring radioactive gas.

It doesn’t matter if you rent or own. People all across across our country, from New Jersey to Mississippi, and South Carolina to Washington D.C., have been hurt by these invisible dangers.

How Did Lead Become Such a Problem?

Before we knew lead was a danger, it was used in a ton of products. Not until the 1970s was it mandated that lead could not be used, first in gas, then in paint, and later in household plumbing fixtures.

It was a good move, but not soon enough to stop lead from contaminating soil in locations where it was used. Homes near busy roadways and manufacturing facilities may still have lead in the soil around them (not good for kids playing outside!).

Any home built before the 1978 legislation runs the risk of lead in paint. Loose paint chips can look like candy to kids because of the color. And, although the installation of lead water pipes was outlawed, many older homes still have them lead in pipes or soldering leading up to the home, pipes inside the home itself, or lead in interior brass plumbing fixtures. And some water districts stuggle with excessive lead and other contaminants in the water source itself.

Lead Is a National Problem

Millions of homes have higher than acceptable levels of lead in the water. In fact, it may surprise you to learn that as many as 274 water utilities serving 11.5 million consumers exceed EPA lead standards!

And, get this: More than a half-million U.S. kids under the age of six are suffering right now from lead poisoning.

Lead poisoning can cause permanent brain damage — damage that sometimes doesn’t show up until later in life, often in the form of learning disabilities and behavioral issues, including criminal behavior that impacts us all.

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What About Radon?

Radon naturally occurs when elements, such as uranium in soil and rock, break down. It’s harmless…until it isn’t. Low levels pose no danger, but when those levels rise, radon becomes a carcinogen, and is the second leading cause of lung cancer.

Levels are most likely to become dangerous in poorly circulated home basements located in geographic regions where radon is more likely to form.

How Can You Protect Yourself?

There’s several things you can easily do, and your local REALTORS® are here to help:

  • Run the tap before using water and remember, boiling water is not goint ot eliminate lead. In fact, it can actually increase lead concentration.
  • If you’re concerned that your children may have been exposed to lead, you can ask to have them tested at your peditricans.
  • Learn more about your local water source and any contaminents that may be present by looking up your Water District’s “Right to Know” report online.
  • Hire an EPA approved inspector to test your home for lead in paint, the water, and for radon.
  • Replace any lead pipes and fixtures, and install a water filtration system designed specifically for lead.
  • Install fans and ventilation systems if radon is found.

And last, but not least, when you’re shopping for a home, you can rely on a local REALTOR® to help you find one that will be safe from these dangers. That’s because REALTORS® require sellers and landlords to provide both lead paint and radon disclosures containing valuable information. Ask your REALTOR® about other ways to protect yourself and your loved ones from the risks of lead and radon.

It’s one of many ways REALTORS® are helping to protect you, your home, and the American Dream!

More on this topic

Student Debt Delays Home Ownership

Student loans
The most common student debt amount owed by borrowers is $20,000 to $30,000.

“Paying a few hundred dollars every month on a student loan equates to thousands of dollars over several years that could otherwise go towards saving for a home purchase.” – Lawrence Yun, NAR chief economist

A new study by the National Association of Realtors® shows that 71% of non-homeowners repaying their student loans on time believe their debt is stymieing their ability to purchase a home, and slightly over half of all borrowers say they expect to be delayed from buying by more than five years.

The study’s results also revealed that student debt postponed four in 10 borrowers from moving out of a family member’s household after graduating college.

Forty-three percent of those polled for the survey had between $10,001 and $40,000 in student debt, while 38 percent had $50,000 or more. The most common debt amount was $20,000 to $30,000.

Lawrence Yun, NAR chief economist, says the survey findings bring to light the magnitude student debt is having on the housing market and the budget of even those financially able to make on-time payments. While obtaining a college degree increases the likelihood of stable employment and earning enough to buy a home, many graduating with this debt are putting home ownership on the backburner in part because of the multiple years it takes to pay off their student loans at an interest rate that’s oftentimes nearly double current mortgage rates.

“Realtors® work closely with our clients and consumers everyday; we understand the severity of the problem. This is not an abstract issue for us. This is why Realtors® are leading the real estate industry in the discussion of student loan debt and its impact on housing by generating the most encompassing research on this topic,” said NAR Vice President Sherri Meadows, a Realtor® from Ocala, Florida.

Read more about the study.

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Handling Problems During The Home Loan Process

If you experience problems or discrimination while going through the home loan process it’s important that you know what recourse you have. The following excerpt from the Consumer Financial Protection Bureau’s Home Loan Toolkit can help to understand how to resolve problems that may occur when working with a lender.

The complete toolkit, including financial worksheets and valuable tips, is available as a download (in PDF).

I have experienced a problem with my loan application or how my loan officer is treating me.

Ask to talk to a supervisor. It may be a good idea to talk to the loan officer first, and if you are not satisfied, ask to speak with a supervisor.

I think I was unlawfully discriminated against when I applied for a loan or when I tried to buy a home.

The Fair Housing Act and Equal Credit Opportunity Act prohibits housing and credit discrimination. If you think you have been discriminated against during any part of the mortgage process, you can submit a complaint and describe what happened. To do so, you can call the Consumer Financial Protection Bureau at (855) 411-2372 or visit

You can also submit a complaint to the U.S. Department of Housing and Urban Development (HUD) by calling (800) 669-9777, TTY (800) 927-9275. Or, file a complaint online at

You can find more information about your rights, and how to submit a complaint, with the CFPB at

I have a general complaint.

Submit a complaint to the Consumer Financial Protection Bureau if you have problems at any stage of the mortgage application or closing process, or later if you have problems making payments or become unable to pay. You can call (855) 411-2372 or

I think I may have been the victim of a predatory lender or a loan fraud.

Don’t believe anyone who tells you they are your “only chance to get a loan,” or that you must “act fast.” Learn the warning signs of predatory lending and protect yourself. Find more information at You can also earn more about your loan officer at

The Consumer Financial Protection Bureau is a federal agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.  Have a question about a common consumer financial product or problem? You can find answers by visiting


Pending Home Sales Lift Off in April to Over 10-Year High

Pending home sales rose for the third consecutive month in April and reached their highest level in over a decade, according to the National Association of Realtors® (NAR). All major regions saw gains in contract activity last month except for the Midwest, which saw a meager decline.

“The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers into the market,” says Lawrence Yun, NAR chief economist.

On the topic of mortgage rates, which have remained below 4 percent in 16 of the past 17 months, Yun says it remains to be seen how long they will stay this low. Along with rent growth, rising gas prices — and the fading effects of last year’s cheap oil on consumer prices — could edge up inflation and push rates higher. For now, he foresees mortgage rates continuing to hover around 4 percent in coming months, but inflation could potentially surprise the market and cause rates to increase suddenly.

Why is this important?

Low mortgage rates mean lower mortgage payments and more affordable homes, which encourages home buying. Higher rates have the opposite effect and can discourage home buying or require that buyers shop for smaller, less expensive homes.

Learn more about mortgage rates: Will Rising Interest Rates Threaten Your Home Value?

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An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

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