For the latest sales information on single-family homes and condos in Houston, see these three infographics below.
Monthly Archives: December 2017
Age is Just a Number When It Comes to Community Preference
According to a new report from the National Association of Realtors® (NAR), both millennials and those from the silent, or greatest generation, agree – walkable communities are the preferred way of living.
The trend toward smaller homes in neighborhoods with convenient walks to shopping and dining options is no longer something just for the 21-to-35-year-old demographic, but it’s the favored choice of senior citizens aged 73 and up.
The report, based on the 2017 National Community and Transportation Preference survey showed that 62 percent of millennials and 55 percent of respondents over the age of 73 would rather have easy access to restaurants and shops and shorter commutes than a bigger home.
These same respondents would live in a smaller home – such as a townhouse or even an apartment – to have that ease of access.
“Realtors® understand that when people buy a home, they are not just looking at the house, they are looking at the neighborhood and the community,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “While the idea of the ‘perfect neighborhood’ is different for every homeowner, more Americans are expressing a desire to live in communities with access to public transit, shorter commutes and greater walkability.
“Realtors® work tirelessly at improving their communities through smart growth initiatives that help transform public spaces into these walkable community centers.”
An overwhelming number of respondents – 88% – said that having amenities within walking distance increased quality of life, while 70% said walkability, short commutes and proximity to highways are important factors when deciding where to live.
Additionally, the report showed there was a five percent increase over the past two years in the number of Americans, now 53 percent, who prefer to live in communities containing houses with small yards but within easy walking distance of the community’s amenities, as opposed to living in communities with houses that have large yards but they have to drive to all amenities.
But there is the rest of the population – those generations between Millennials and the Silent generation who make up a majority of homeowners. This group still prefer things to be quiet and suburban or rural.
A total of 55 percent of both Gen-Xers and baby boomers say they have no problem with a longer commute and driving to amenities if it means living in a single-family, detached home.
Additionally, those with school-age kids in the home prefer conventional suburban communities. Sixty percent of all responders with kids in school said they prefer larger homes and yards that require driving, and that number jumps to 63 percent for millennials with kids in school.
One reason for this maybe that families place education higher on the priority list than convenience of amenities like shopping and dining – or even access to highways.
The survey also found that gender played a role in community and transportation preferences. Young women in particular are more inclined to prefer places to take walks (54%) or prefer having access to public transit (39%) than young men.
Of note is that nearly half of all millennials preferred living where there are short commutes, regardless of gender.
The survey of 3,000 adult Americans living in the 50 largest metropolitan areas was conducted by American Strategies and Meyers Research in September 2017.
Fewer homes for sale and a growing economy lead to home price growth in New York State, according to a housing report for November released recently by the New York Association of REALTORS® (NYSAR), the median sales price of a home in New York was $254,000, a 5.8% increase over the same time in 2016.
The price increase has been a regular occurrence in New York in 2017, especially given the high demand for housing, the creation of more jobs, a burgeoning stock market and an improved economy over the previous 12 months.
“Sales remain on track to finish slightly ahead of the 2016 record and we project the median sales price [for the entire year] to show growth of 5.5 to six percent,” said Duncan R. MacKenzie, CEO of NYSAR.
Closed sales decreased 2.5% from November 2016, but were still significantly higher than either 2014 (plus 21.2%) or 2015 (plus 10.2%).
Buyer enthusiasm has not waned in the face of fewer homes from which to choose.
The housing stock available for purchase decreased again as the month’s supply of inventory was down 11.1% to 5.6 months. The ongoing decline in number of homes for sale has likely held back overall market growth and is likely to continue into 2018.
Learn more from the New York State Association of REALTORS®: Home sales near record high in November
Don’t blink, or you might miss the sale of another home in New York. In November, homes in New York sold, on average, 12 days faster than they did in November of 2016. Not only that, but the percentage of list price received increased again, ever-so-slightly (0.6%), to 96.9%.
This is all according to a housing report for November released recently by the New York Association of REALTORS® (NYSAR).
The growing economy, stock market gains and growing labor force are all strong supports for housing demand and prices going into 2018.
“With one month left in the year, it is clear 2017 will go in the books as a strong year for housing in New York State,” said Duncan R. MacKenzie, CEO of NYSAR.
The number of homes for sale was down 9 percent from this time last year as the downward trend in the number of homes on the market continued, but there is still a lot of enthusiasm about more homes being available for sale in 2018.
Learn more from the New York State Association of REALTORS®: Home sales near record high in November.
If there were ever a doubt that mortgage interest and property tax deductions influence future housing decisions, there shouldn’t be any longer.
That’s because a new poll shows that 85% of homeowners would deduct both if they were to buy a different home.
Furthermore, if changes to these deductions were made, as is being proposed in tax reform legislation currently being worked on by a joint committee of U.S. Senators and Representatives, nearly half (48%) of these same homeowners would experience financial strain and nearly a third (30%) would be reluctant to move from their current home.
This data comes from the National Association of Realtors® fourth quarter Housing Opportunities and Market Experience (HOME) survey.
The findings clearly indicate the proposed tax reform legislation eliminate key incentives to owning your own home.
“Homeownership is an aspirational goal for millions of Americans, but getting there isn’t always easy,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “Middle-class families count on tax incentives like the mortgage interest deduction and the state and local tax deduction to make homeownership a more affordable prospect.
“Realtors® will continue to advocate for these and other important provisions as the tax reform debate continues.”
Realtors® still have an opportunity to influence Congress to help make the tax reform bill more favorable to homeowners and consumers. Important improvements in the legislation are possible by encouraging Congress maintain the current law for the mortgage interest deduction and capital gains. Congress can also address the State and Local Tax Deductibility issue by expanding the provision to include income taxes, raising the cap and indexing the cap to inflation. These changes and retaining the current law makes the bill more favorable to homeownership.
This article was originally published in The New York Times. You can read the full article here.
December 8, 2017
Efforts to help potential first-time home buyers save for down payments using special tax-favored accounts have been gaining traction in state legislatures. Three states passed legislation this year authorizing the accounts: Iowa, Minnesota and Mississippi. Three other states had previously approved them: Colorado, Montana and Virginia.
While America’s homeownership rate continues to hover around a 50-year low, experts gathered at the National Association of Realtors® in Washington, D.C. said there is a clear path to improving the landscape for homeownership.
Senator Heidi Heitkamp (D-N.D.) opened the event with a full-throated defense of the role that homeownership plays in American society.
“Homeownership is not a loophole,” said Heitkamp. “When there is no hope for owning real property, we are taking a huge step backwards for the future of our country.”
Senator Heitkamp specifically singled out tax reform legislation passed in the U.S. Senate, calling the bill a “systematic dismantling” of the incentive structure for homeownership. Heitkamp also spoke to the need to reform the government-sponsored enterprises, as well as the importance of protecting and preserving the 30-year fixed rate mortgage.
Chairman Jeb Hensarling (R-Texas) of the House Financial Services Committee also addressed attendees, offering reminders of why sustainable homeownership is so important to protecting both taxpayers and the overall economy.
Hensarling cited what he called the “unsustainable housing finance rollercoaster” that caused the Great Recession. He said this “lost decade” represented 10 years of lost economic growth and should guide policymakers looking to improve financial and mortgage systems in the years ahead.
“The lesson is clear: Housing unsustainability doesn’t just create unaffordability,” he said. “It can create economic catastrophe.”
Nobel Prize winning economist Dr. Robert Shiller echoed those reminders as he offered the event’s keynote address. Citing data on public perceptions of home price appreciation, Dr. Shiller noted the measurable rise in exuberance for real estate investment that led up to the 2007 housing crash.
“People saw that they had this opportunity of a lifetime to borrow at 6 percent and invest at 12 percent,” Shiller said. “But where did this expectation come from?”
Dr. Shiller also cited home sales prices as an important market indicator. He noted that when homes are appreciating they tend to sell above the asking price more often than when home values are in decline. But even more interestingly, Shiller said that homes selling above the asking price is a recent phenomenon that offers clues about exuberance in the market.
In addition, Dr. Shiller said that general impressions about the inherent risk of buying a home can indicate the presence of a bubble. He shared data showing that over the past decade, the public sentiment about the inherent risks of buying a home peaked in 2006. Separately, however, Shiller noted the return of what he called the “buyer’s panic,” where potential buyers fear that they will be priced out if they don’t purchase a home soon.
Shiller said he shared this information as a reminder of the complexity of overall housing markets.
“It’s not just interest rates and tax law that drive prices in speculative markets,” Shiller said.
Following Dr. Shiller’s remarks, Politico’s financial reporter Lorraine Woellert moderated a panel of experts. These included Dr. Beth Ann Bovino, chief U.S. economist at S&P Global Ratings; Jessica Lautz, managing director of survey research and communication at NAR; and Layla Zaidane, chief operating officer of the Millennial Action Project. The panel spoke to ongoing concerns that student debt is contributing to the challenges facing young homebuyers.
Asked if the low rates of homeownership among young adults will solve itself, Bovino said “eventually, time will start to soften the impact of those high student loans. Jobs are coming around, wages are picking up.” But for now, the experts agreed that the issue is having a real impact on the market.
“When we look at the spectrum of those who have student loan debt, only 55 percent of them are making their payments on time,” Lautz said. For many of these individuals, she said, homeownership is simply not an option. But even among those who are currently making their payments, Lautz said homeownership is still largely out of reach.
“Among millennial student loan borrowers who are current on their payments, 80 percent are not homeowners,” said Lautz. When they are buying, she added, they tend to buy in the suburbs where homes are most affordable.
In a separate panel, Dr. Lawrence Yun of NAR, Alex Nowrasteh of the Cato Institute, and Boyd Campbell of Century 21 addressed affordability concerns in a discussion on supply and demand issues facing the current housing market.
Noting a 4-month supply of homes nationwide, Yun said, “Prices have risen roughly 40 percent in the past five years, while people’s income has risen at a much slower rate. This rise in prices forces an affordability concern.”
Yun said that puts homeownership out of reach for many buyers, and added that this isn’t simply a real estate concern, but also a labor market concern as college-educated workers leave areas where the job market is strong but home prices are relatively high.
Earlier this year, at the 2017 Realtors® Conference & Expo, Yun forecasted that single-family housing starts will jump 9.4 percent to 950,000 in 2018, well below the 50-year average of around 1.2 million starts.
“Prospective homebuyers face headwinds from the market, in the halls of Congress and in their own family’s budgets,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “We can’t solve them all, but we know more can be done to smooth the way for creditworthy borrowers who want to own a home. I’m pleased we could assemble such a diverse pool of experts to offer their insights as we chart a path to improving America’s homeownership landscape.”
At the beginning of December, the U.S. Senate passed their tax bill. This followed the U.S. House passing theirs. There are differences between the two and they need to be ironed out in a conference committee.
But, it’s a good bet they will be, and that a newly polished bill will be sent to the White House for the President’s approval.
It seems inevitable.
But, ultimately it depends on several of the issues that need to get ironed out between House and Senate legislators. If homeowners don’t speak out now and convince their Members of Congress to address certain concerns, – especially those in New York – they are going to bear the brunt of this tax bill’s impact.
“We have concerns about the plan and its impact on New York state as a whole, New York taxpayers and New York homeowners – and frankly future homeowners as well,” said Mike Kelly, Government Affairs Director at the New York State Association of REALTORS® (NYSAR). “We see it as a tax break for corporations that are making record profits that are going to be paid for on the backs of New Yorkers and homeowners.”
The conference committee will be under a lot of pressure – both in time and from special interest lobbyists – to make last minute changes. And when that happens, there are always deals to be cut, usually with both sides giving in a little bit.
For example, the House bill would slash the mortgage interest deduction in half for all new mortgages, and eliminate it completely for those who own second homes. The Senate Bill would only eliminate it for home equity loans.
It sounds like there is a middle ground to be reached there, none of which will be beneficial to homeowners.
“As soon as you eliminate or reduce real estate-related tax provisions, such as the deductibility of mortgage interest or the deductibility of property taxes, there are going to be fewer people with the ability to purchase a home,” Kelly said. “This will drive demand down and when that happens, property values may decline.”
The National Association of REALTORS® (NAR) commissioned a study to see how the House bill would impact housing prices in New York state, and depending on where a home was located, values would decrease from anywhere between $10,810 and $83,840.
“New York State has higher-cost housing stock than in most places in the country,” Kelly said. “For example, the average sales price for a home in New York City (cooperatives, condos and one to three family dwellings) in the first quarter of 2017 was over $1 million – and that’s often for a first-time purchase. This is not a three-bedroom condo or co-op on the Upper West Side looking at Central Park. This is often the starting point for a first-time buyer in New York City.”
It appears that the House and Senate are ready to come to an agreement on tax reform before the end of the year.
After House Republicans warned that a Senate bid to end a long-standing deduction for state and local taxes (SALT) was a nonstarter, the Senate adopted the House plan to put a limit on that tax break to $10,000 in property taxes.
“Any reduction in the ability to deduct state and local taxes, including property taxes, will negatively impact many New Yorkers’ net income.” Kelly said. “The result for many New Yorkers will be an increase in their taxes, which will reduce their income and their ability to purchase a home.
Also, we are a high tax state and in many parts of New York State, property taxes far exceed $10,000 for what is a middle-class home.”
“Housing is a primary economic driver and anything that affects that has the potential to hurt the overall economy,” Kelly said.
Prospective residents in the Los Angeles area are finding it increasingly difficult to purchase, or rent a home for their family. No one is more aware of the increasingly sparse housing conditions than local REALTORS®. “Production of affordable housing for our Los Angeles workforce is at crisis level. Residents are being priced out of the rental housing market by the increased demand created by a lack of supply of affordable housing” shares Aaron Leider, President of the Beverly Hills/Greater Los Angeles Association of REALTORS® (BH/GLAAR).
BH/GLAAR represents over 9,000 REALTOR® and AFFILIATE Members in the cities of Beverly Hills, Culver City, Los Angeles, Santa Monica, West Hollywood, and unincorporated areas of Los Angeles County. A big part of the organization’s mission is to advocate for homeowners by protecting property rights and supporting relevant legislation.
BH/GLAAR has taken an active role in addressing the area’s housing affordability crisis. Most recently, they endorsed the successful Proposition JJJ. “Proposition JJJ was important because it ensured that affordable housing construction, both rental and purchase, would be an integral part of the area’s planning approval process” explains Leider. “Prop. JJJ will be able to accomplish this without increasing taxes or fees on the already tax-burdened residents of Los Angeles.”
Proposition JJJ also helps homeowners who depend on public transportation by incentivizing builders. Developers who construct the required number of affordable housing units within 750 feet of a busy Metro rail stop will be eligible for financial incentives. This motivates builders to increase affordable housing in the areas that commuters need it to be.
The Los Angeles County Democratic Party was also an endorser of Proposition JJJ. Eric C. Bauman, Chair of the Los Angeles County Democratic Party shares why, “Too many hardworking families are getting pushed out of the City of LA by rent that they cannot afford.”
Rusty Hicks, Executive Secretary-Treasurer of the Los Angeles County Federation of Labor, AFL-CIO and convener of the Build Better LA Coalition, spoke about how important it was to have the backing of two powerful organizations in the fight to pass Proposition JJJ. “The Los Angeles County Democratic Party has always been our partner in the fight for economic and social justice, and having the support from the Beverly Hills/Greater Los Angeles Association of REALTORS® creates a real pathway to more housing options that Angelenos could actually afford.”
The November 7 election was a great example of the many ways Texas REALTORS® engage at the state and local level.
Communities across Texas had several huge wins on Election Day, thanks to the support of TAR’s Issues Mobilization Committee, which provides resources when a local association identifies a local issue that could affect Texas REALTORS® or property owners.
3 local issues victories
Issues that arise locally can have larger implications if they aren’t addressed effectively. Here are three ways Texas REALTORS® fought for real estate in their communities.
- In the city of Bryan, voters successfully passed 12 out of 13 of the city’s proposed charter amendments, thanks to the efforts of the Bryan-College Station Regional Association of REALTORS®. Earlier this year, BCS REALTORS® defeated a petition of proposed charter amendments that would have significantly harmed the community.
- The Paris City Council sought to abolish the city’s Economic Development Corporation, which would have limited the city’s ability to attract employers and maintain economic viability. Thanks to the efforts of the Paris Board of REALTORS®, the ballot measure failed 75%-25%.
- The Nolan County Association of REALTORS® successfully supported a ballot measure in the city of Sweetwater to transition the city’s Economic Development Corporation into a Municipal Development District. The MDD will allow the city to fund a wider variety of projects than the existing EDC.
Prop 2 overwhelmingly approved
Thanks to the efforts of Texas REALTORS® across the state, Proposition 2 passed with 68.6% voter approval!
The new law will update the home equity lending provisions in the Texas Constitution, allowing more homeowners to access smaller loans.
This amendment will take effect Jan. 1, 2018 and will apply to new home equity loans made on or after the effective date and to existing home equity loans that are refinanced on or after the effective date.
Texas REALTORS® fought hard for this constitutional amendment from beginning to end. The Public Policy Subcommittees discussed the issue last year before the legislative session, and TAR’s Executive Board agreed to make it one of TAR’s priorities for the 85th Texas Legislature.
Then, Texas REALTORS® were strong advocates for the legislation during session, extolling its virtues one-on-one with lawmakers during REALTOR® Day at the Texas Capitol. Finally, Texas REALTORS® worked tirelessly getting the word out to support Prop 2 on the ballot.
All of these efforts lead to another great win on behalf of Texas homeowners!