Today’s Home Prices in the Current Market

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 There has been a lot of activity in the housing market when it comes to home prices. It seems that there is a trend of home price appreciation but with this same bit of news comes the fact the sellers are still reducing the price of their homes. So what is really happening with today’s home prices?

Industry leaders explain the differences between the terms used by the industry. Appreciation means when the home price increases, depreciation reflects a decrease in the home price and deceleration is when home prices continue to appreciate but at a slower and moderate pace. Today’s housing market industry leaders are seeing a deceleration. The home prices are still appreciating but not at a record-breaking pace as they have been in the past two years.

According to CoreLogic, in 2021 home prices appreciated by an average of 15% nationwide and at the beginning of 2022 appreciation was at 20%. Currently, it is predicted that prices will increase on average10% to 11%. On a year-over-year basis, home prices appreciated between 19% -20% from January to March of this year. The last few months, home prices have decelerated to 18%. They are still climbing but at a slower pace than compared to the same time last year.

“Annual home price growth dropped by nearly two percentage points….- the greatest single-moth slowdown on record since at least the early 1970s… While June’s slowdown was record-breaking, home price growth would need to decelerate at this pace for six more months to drive annual appreciation back to 5%, a rate more in line with long-run averages,” says Black Knight’s Monthly Mortgage Monitor.

So today’s home prices are not falling or depreciating, but decelerating or moderating nationwide. There are some pocket markets that are seeing declines because they are overheated. When looking at the country as a whole, prices will not depreciate or fall but will keep appreciating.

When you are in the market for a home and want to know about what the current market is doing, the best way to go about this is to hire a trusted real estate profession. A real estate professional can help you navigate the current market making sure you make the best decisions when it comes to your home.

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The Four Separate Parts of A Full Bath

The Four Separate Parts of A Full Bath 

 There are several types of bathrooms that can be found in a home which include full, half, and three-quarters. What do these dimensions refer to when it comes to a bathroom? Here is what the professionals say when it comes to how determining the size of a bathroom.

Bathroom Components

When it comes to a full bathroom, there are four main parts, which include a shower, a bathtub and a toilet. If all four of these components are not there, then it cannot be officially called a full bath. When it comes to the description of the size of a bathroom it is not the square footage but the components that are included in the bathroom. Each component is a utility found in the bathroom and if a utility is not included, you would then deduct one-quarter for each utility missing.

If a bathroom has just a sink and toilet it is considered a half bath because it only has two of the four components. A bathroom with a sink, toilet and shower is considered a three-quarter bath because it only has three of the four components. Also, think twice about upgrades vs utility when it comes to the count. A nice rain shower head will not boost the bathroom in the count.

Importance of a Tub

Remember the utility count is what constitutes the description. Some master bathrooms today only have a shower and not a tub so does this mean it is only a three-quarter bath? According to Ginny Ollis, a Realtor with Coldwell Banker, it will not especially be if there is a tub in another bathroom in the home. “Many homebuilders put only a shower in the master now,” she says.

Other Realtors tend to disagree. “There must be a tub in the house,” says Kathryn Bishop of Keller Williams Realty. ” I’ve seen buyers walk away because only showers are available. Where do you wash your kids?”

A Home’s Bathroom Count

“Bathroom count and bathroom size-full, three-quarters or half-are extremely important to all my buyers. More family quarrels occur when the bathroom accommodations don’t fit the family’s needs, and my buyers are very aware of that,” Bishop says.

Sharing a bathroom with someone else, especially teenagers is not the ideal situation. The number of bathrooms in a home is very important to most buyers. In fact, the number of bathrooms are almost as important as the number of bedrooms in a home.

Whether you are planning to remodel or planning to sell your home, the amount and size of your bathroom does matter. If you are in the market to purchase or sell a home, contact your local real estate agent who can help you with the process.

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Is Today’s Current Housing Market A Challenge Or An Opportunity For Homebuyers?

COVID-19 caused havoc on the housing market, especially due to health scares and stay-at-home orders.  During the pandemic home buyers were up against low home inventory which caused bidding wars.  Even though we are still seeing these challenges, many professionals in the industry say they are now a buyer’s opportunity.  In today’s current the inventory is still low but buyers are not as eager due to the higher mortgage rates. 

The low inventory is still a challenge because of underbuilding since the market crash in 2008. The current moderating of demand is slowing the pace of home sales which is starting to even out so builders are able to catch back up. For the buyer, this means there are more options to choose from.  Good news, as this will also lead to fewer and fewer bidding wars as home buyers have more options.  According to the National Association of Realtors (NAR) Realtors Confidence Index bidding wars are letting up month-over-month.   The average number of homes sold between April 2022 – June 2022 are as follows: April 5.5, May 4.2 and June 3.4.   Those that have been outbid for the past two years can see the light at the end of the tunnel.

If you are in the market for a new home, it is still a good idea to consult with a local sales agent who can guide you through the process.  With an agent, you will definitely make the strongest and best offer upfront.  Partnering with a real estate agent will just ramp up your home buying experience.

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More Homes Are Going on the Market

 July 2022 saw the third consecutive month of home sale growth. This is just a sign that the housing market is starting to slow down due to rising rates.

It is reported that the number of active listings is up 30.7% from July 2021. This was part of the Monthly Housing Trends report from Realtor.com. The average rate on a 30-year fixed mortgage rate rose 6% this summer but has dipped some this fall.

“The U.S. housing market continues to move oward more evenly balanced supply and demand compared to the 2021 frenzy,” said Danielle Hale, the chief economist at Realtor.com. “Our July data shows elevated mortgage rates left many buyers tightening their budgets and sellers responding with price reductions, while home shoppers who kept searching saw more available options.”

The Federal Reserve is moving at the fastest pace seen in thirty years to tighted policy. The reason is to cool consumer demand and bring the housing market back under control. The policymakers are approving two back-to-back 75 basis point rates hikes. There will be another big increase depending on the upcoming economic data.

If you are looking to buy a home, choose a local Realtor who can help you with the rise in borrowing costs and home prices. Redfin has reported that the share of sale agreements on existing homes canceled was around 15% of the homes that went under contract. This has been the highest since we have seen pre-pandemic.

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The Existing Home Market Is Down Still From the Pandemic

Reports show that the market for potential existing home sales were down still from the pandemic. June 2022 showed an estimate of 5.47 million at a seasonably adjusted annualized rate of 13.1% which was lower than just one year ago and 2.5% lower than just last month. The housing market is still strong, however still down compated to before the pandemic.

The factors that drive the existing home sales market have changed. The housing market is still trying to adjust to a post-pandemic norm coupled with higher mortgage rates and high home prices. The current rise in home prices is not the norm. June 2022 saw sales decreased by 823,000 compared to June of 2021. There are many fundmentals that are causing the slow down. Declining House-Buying Power is one which is basically how much home a buyer can afford. Factors that are looked at include household income and the current 30-year fixed mortgage rate. Another is tighter credit standards which means when lending standards are tight, then it is harder for a potential buyer to become qualified. When it is harder for a buyer to get a loan, then homes are not going to sell. The last catalyst is increasing tenure. This year it is reported that tenure length has increase from 10.4 years to 10.6 years. This has been driven by low mortgage rates and potential sellers staying put.

On the otherhand there are several fundamentals that are boosting the housing market potential. The biggest we have seen is rising house prices. When home prices rise, the home owner’s equity becomes stronger. Another factor is rising household formation which means the more households formed, the higher the demand for home inventory. Lastly, there is more new home supply. Seller will not want to sell if there is nothing for them to buy.

The housing market potential for existing-home sales is down compared to last year because of the factors mentioned above but it is still a good time to purchase a home. If you are in the market for a home, find a local sales agent who can help you navigate the current housing market.

In order to find out the potential home sales, existing-home sales are measured which include single-family, townhomes, condos and co-ops. These are taken on a seasonally adjusted annualized rate that is factored by looking at the historical relationship between existing home sales and the country’s population, demographics, homeowner tenure, and pricing trends. This is all done through The Potential Home Sales model which is published by the National Association of Realtors.

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Housing Market Is Making A Turn for The Best for Buyers

 According to Realtor.com, inventory rose to 31% in July making it a peak in three straight months.  This means there are tons more homes for buyers to pick from.

“The U.S. housing market continues to move toward more evenly balanced supply and demand compared to the 2021 frenzy,” Danielle Hale, Realtor.com’s chief economist said.

She goes on to explain that the rise in mortgage rates caused buyers to tighten their spending budget.  It has caused sellers to reduce their listing price.  Although there are more options, the rise in inventory is because most home buyers cannot afford what is out there.  As of August 4^th, the 30-year fixed rate averaged 4.99%.  Freddie Mac said this was down from the prior week but still up .77% from the same week a year ago.

Realtor.com also reported a decline in new listings in July showing a shift in many sellers’ plans to list.  Sellers are still in a good position as homes that are priced right are selling very quickly. The recent spike in home prices has also cushioned my homeowner’s equity so they can be a bit more flexible with their listing price.  According to the New York Federal Reserve Bank, the median expected increase in home prices dropped to 3.5% from 4.4% in June and 6% in January.

Bad news Fannie Mae’s Home Purchasing Sentiment Index dropped 2 point to 62.8 which is the lowest level since 2011.  The survey point out that only 1 of every 6 consumers (17%) surveyed said that it’s a good time to buy a home and for sellers, 67% believe it is a good time to sell.

“The Sentiment Index has declined steadily for much of the year, as higher mortgage rates continue to take a toll on housing affordability,” Doug Duncan, Fannie Mae’s chief economist, said in a statement.

To be sure, “with home-price growth slowing, and projected to slow further, we believe consumer reaction to current housing conditions is likely to be increasingly mixed,” Duncan said.

“Some homeowners may opt to list their homes sooner to take advantage of perceived high prices, while some potential homebuyers may choose to postpone their purchase decision, believing that home prices may drop.”

 

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A Change in the St. Tammany Schools’ Budget

 What will the new budget for St. Tammany public schools be for 2022-2023 school year?

The new proposed budget for the 2022-2023 school year is $488 million.

The St. Tammany public school has announced a new budget for 2022-2023 which amounts to $488 million. The larger budget is in part of the recent salary hikes, 40 new school buses and expanded mental health services for students and staff and increase funding for school security.

The salary hikes are $20.8 million on staff salaries and benefits. The parish teachers union and the school system finally agreed to the pay boost. The money will come from the district’s general operating fund. Supplementing the general fund is the district’s special revenue budget, which includes federal aid schools received to make up for losses sustained during the coronavirus pandemic.   The district has until September 2023 to spend the $114 million in federal allotment and so far have already spent $37 million.

Along with putting funds toward professional development for health providers, they will also be putting it towards starting a new positive behavior intiative. The program is called “Leader in Me.” This is a social-emotional learning initiative that seeks to help students manage their emotions and maintain relationships.

As for ramping up security, the district will spend 4% over last year which will total a school security fund of $8.9 million. This will cover salaries and benefits for security employees which include secuirty officers, law enforcment officers who work at schools and mental health profiders.

The 40 new school buses will be delivered in Decemeber of this year. With the new buses, the number of district-owned buses will double. Revenue from FEMA-administered community disaster fund grants will cover the costs. In the past, independent bus owners and operators have been used. The school district will be able to cut back on hiring indpendent buses and drivers.

“Last year we had over 300 drivers. This year, the number of bus owners/operators is between 240-250,” said Wichers.

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