Tuesday, November 22, 2016

California ranks 49th in the nation in homeownership rate and last in affordability

California will become a state where renters are the majority instead of homeowners.

Key factors causing the affordability crisis are job growth and a housing imbalance, population growth and demographic shifts in cities, climate change challenges, and stagnant incomes in the face of rising costs of living were some of the causes.

Among solutions possible are expanding the supply and lowering the cost of housing by streamlining the development approvals process and addressing regulatory barriers to housing production. 

Also, Expanding access by giving renters a tax credit and developing new mortgage products to increase access to homeownership.

Source:  Center for California Real Estate Summit: Housing Affordability and California’s Future.

Monday, March 17, 2014

Profile of Buyers and Sellers

NAR Report:

A recent National Association of REALTORS® (NAR) report, from data collected in 2013, revealed many insights into current buyer and seller habits. Highlights of the report include:
  • 38% of homebuyers were first-time buyers, a little lower than the historical average of 40%.
  • 14% of homebuyers purchased multigenerational homes. The primary reasons given were children over the age of 18 moving back home, cost savings and caretaking of aging parents.
  • The average homebuyer is 42 years old, while the typical first-time homebuyer was 31 and the average repeat buyer was 52. Buyers over the age of 50 accounted for 49% of recent buyers.
  • New home purchases accounted for 16% of all recent home purchases.
  • The size of the average home purchased was 1,900 square feet and had two bathrooms and three bedrooms.
  • On average, the homebuyer searched for 12 weeks and viewed 10 homes before making a purchase. More than 50% of homebuyers said finding the right home was the most difficult step in the homebuying process.
  • 42% said the first step in the homebuying process was searching online for properties. 12% of buyers said they used online recommendations to search for an agent.
  • 63% of recent buyers said they interviewed one agent before they found the agent they worked with and 88% said they would use their agent again.
  • 42% of buyers found their agent through a referral from a friend or family member and 12% used an agent they had used before to buy or sell a home.
The report concluded that typical sellers had lived in their home for nine years, up from six years in 2007. And 36% of sellers had offered incentives, such as assistance with home warranty policies and closing costs to attract buyers.

Tuesday, February 4, 2014

Home Prices Boost Renovation Business

Increasing home prices and an improving economy are positive signs for those planning to renovate their homes.

A Houzz report revealed a significant drop in the percentage of homeowners who said they are postponing renovation. Compared to a year ago, those planning to delay remodeling dropped by eight percentage points. And only 11% said they would need to take out a line of credit to finance their home renovations.

Over the next two years, in a “select all that apply” questionnaire, 10% of those surveyed were planning to build a custom home; 40% were planning to remodel or build an addition to their house; and 84% were planning to decorate or redecorate.

The top-five renovation projects planned in the next two years were bathroom renovation/addition (28%); kitchen renovation/addition (23%); flooring/paneling/ceiling replacement (18%); patio or landscape addition/replacement (18%) and windows/doors addition/replacement (15%).

In terms of dollars spent, over the last five years, those surveyed spent an average of $28,030 on kitchen renovations and $10,422 remodeling bathrooms. 

Nearly four in 10 home improvement dollars have gone into kitchens in the last five years. The cost of kitchen renovations varied from a high of $54,942, a mid-range of $22,390, and a low of $7,133.

The cost of bathroom renovations varied from a high of $25,018, a mid-range of $10,422, and a low of $2,896.

The top factors driving the desire to renovate were to improve the look, feel and layout of the home (83%); increase home value (54%); improve storage and efficiency (42%); increase energy efficiency (34%); and incorporate new technologies for the home (18%).