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The Real Blogger
Real estate Blog for Boise and Southwest Idaho
REALTORS® Release Mid-Year Housing Reports for Ada, Elmore, and Gem Counties

The reports looked at the factors driving home prices and purchase demand, the impact of the pandemic on listing and sales activity, and the differences between today’s market and the conditions prior to the Great Recession, among other things.

 

Download 2020-Mid-Year-Residential-Real-Estate-Update-for-Ada-County.pdf

Download 2020-Mid-Year-Residential-Real-Estate-Update-for-Elmore-County.pdf

Download 2020-Mid-Year-Residential-Real-Estate-Update-for-Gem-County.pdf

Asking Prices Surge to a Record High
July 31, 2020

While the pandemic continues, home prices are accelerating and, in some markets, began to edge into previously uncharted territory this month. The national median listing price in July was $349,000—a record high, realtor.com® reports in its latest Monthly Housing Trends report.

 

Further, homes are selling just as fast as they were last year. Buyers are in a rush for fewer homes for sale. Nationally, the housing inventory has declined to nearly one-third of what it was last summer, realtor.com® reports.

 

National listing prices grew 8.5% in July year over year. Homes are selling six days faster than a year ago. Homes are selling the fastest compared to a year ago in markets like Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md.; Boston-Cambridge-Newton, Mass.-N.H.; and Hartford-West Hartford-East Hartford, Conn., realtor.com® reports.

 

When the COVID-19 outbreak first struck the U.S. in March, home prices tumbled. But, since April, home prices have reversed course and accelerated each month. July’s listing price increase of 8.5% marks the largest jump in median listing prices in one month since November 2018, realtor.com® notes, equating to a $27,000 increase from a year ago.

 

The Northeast is now leading the nation’s housing recovery, realtor.com® reports. “After being particularly hard-hit in March and April, new coronavirus cases remain stable in the Northeast and we’re seeing buyers return to the market in force,” says Danielle Hale, realtor.com®’s chief economist. “If this same trend follows in the South and Midwest—where outbreaks continue to rise—we could see a flurry of activity well into the fall, especially as schools delay their openings.”

 

Indeed, Hale notes that “the U.S. housing market performance is closely mirroring COVID’s path, which is providing clues into what we can expect for various housing markets in the months to come.”

 

Housing inventories remain tight across the country. Inventories of new listings are down 34.8% compared to a year ago, according to realtor.com®. The metros that have seen the largest declines in inventory are Riverside-San Bernardino-Ontario, Calif. (down 50.4% annually); Baltimore-Columbia-Towson, Md. (down 48.7%); and Providence-Warwick, R.I.-Mass. (down 47.4%).

 

table showing price data from realtor.com. Visit source link at the end of this article for more information.

© realtor.com

 

 

Fed to Keep Rates Near Zero
July 30, 2020

The Federal Reserve voted Wednesday to keep its benchmark interest rate near zero. This will keep the cost of loans down until the economy starts to recover from the COVID-19 pandemic. The Fed also announced Wednesday it would be extending its lending and credit initiatives until the end of the year to help make it easier for Americans to get a loan.

 

The Fed’s key benchmark rate is not directly tied to mortgage rates, but it often indirectly influences them.

 

The federal funds rate is what banks charge one another for short-term borrowing. That does not reflect the exact rate that consumers pay.

 

Interest rates are currently low, but “the challenge is that lending standards have gotten much stricter,” Tendayi Kapfidze, chief economist at LendingTree, told CNBC. “Banks are tightening standards pretty aggressively because they are concerned that the damage to the economy is going to be long lasting.”

 

Greg McBride, Bankrate’s chief financial analyst, says consumers with a credit score of 700 or above are likely to get the best rates. For lower credit scores, “the availability of credit starts to dry up,” he says

 

The Federal Reserve is closely monitoring the economic impact of the pandemic.

 

“The coronavirus outbreak is causing tremendous human and economic hardship,” the Fed said in a statement. “The path of the economy will depend significantly on the course of the virus.”

 

The U.S. recovery is “extraordinarily uncertain,” Fed Chairman Jerome Powell said in a video press conference on Wednesday. The Fed is “not even thinking about raising rates,” Powell said. “We’re stepping in to provide credit at a time when the market has stopped functioning.”

 

The Fed has vowed to use “its full range of tools to support the economy in this challenging time.”

 

In mid-March, the Fed started buying Treasuries and mortgage-backed securities. MBS yields track Treasuries, so both types of purchases are putting downward pressure on mortgage rates, HousingWire reports. Mortgage rates have reached all-time lows in recent weeks. The 30-year fixed-rate mortgage dipped below a 3% average in mid-July.

 

The Fed reportedly may also adjust its purchases of Treasury bonds and mortgage-backed securities that could nudge already low long-term rates even lower.

 

The central bank expects to keep its federal funds rate near zero “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals,” its statement read.

June 2020 Housing Sale Statistics

Ada County June 2020 home sales

 

Coronavirus May Spark More Moves
June 24, 2020

The economic fallout from the coronavirus outbreak is having a continuing effect on mobility, encouraging some to find cheaper housing while persuading others to stay put a little longer.

In its latest survey, some 46% of Americans say the coronavirus outbreak has influenced their moving plans in some way, according to a new survey from ApartmentList.

Over a recent series of surveys by the site, reflecting 10,000 responses over the past three months, the population segments most likely to move are renters (25%), those who live in dense urban areas (29%), and those who have been laid off (32%).

“Many low-income Americans will be moving out of necessity, and for them, affordable housing options will be difficult to find,” the newest survey notes.

The U.S. mobility rate has actually been falling for the past 35 years, but the coronavirus may change that, economists say.

More employers may embrace remote working for the long haul, which could untether more Americans and let them move anywhere they wish. Also, following months of sheltering in place, urban dwellers may desire more space to spread out. Further, millions of Americans have lost their jobs and may need to move to a more affordable living situation.

In particular, households who earn less than $50,000 annually are the most likely to say they need to move. The majority say they need to find cheaper housing or to pursue better economic opportunity elsewhere.

Nearly 30% of respondents living in a high-density urban area say that the pandemic is prompting them to want to move by the end of the year, the survey shows. “This is more than double the rate of those living in rural parts of the country, where residents are much more likely to stay put rather than to relocate,” according to the report.

 

Inforgraphic on virus impact on moving plans. Visit source link at the end of this article for more information.
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