Friday, July 25, 2014

Mortgage demand rising, Fannie Mae says; Freddie says rates unchanged

My website: www.sandralew.com

Mortgage shoppers continue looking for bargain mortgages as rates have remained at near lows for the year. First half of last year was around 4% while this year they have only slightly risen to 4.5% which is still historically low.

Mortgage demand rising, Fannie Mae says; Freddie says rates unchanged

Townhouses under construction in Glenview, Ill. 

Townhouses under construction in Glenview, Ill., on June 27. (Tim Boyle / Bloomberg)

Consumer demand for home loans has strengthened modestly this year as the economy improved, a trend expected to continue, according to a Fannie Mae survey of senior mortgage lending executives.

The demand was met by a slight easing of credit standards during the second quarter at large lenders, the survey showed, echoing recent remarks by executives at No. 1 home lender Wells Fargo & Co. and a separate survey by a trade association.

The picture was different, though, at smaller lenders, according to Fannie Mae, which said in a report Thursday that they tended to tighten their lending standards during the quarter.

What's more, the report said, the mortgage executives were much more likely than consumers to say it is difficult for a borrower to get a loan these days. And the demand for mortgages, though improved, was far from robust.

"These results are broadly in line with other major indicators released recently, including the pickup in home sales in May," said Fannie Mae chief economist Doug Duncan.

Duncan said the findings "support our expectations of a steady but unspectacular rebound for housing during the second half of this year."

Mortgage shoppers continue to enjoy rates that are near their lows for the year.

Freddie Mac's weekly survey of lenders, also released Thursday, showed that lenders were offering 30-year fixed loans to solid borrowers at an average of 4.13%, unchanged from last week.

The Freddie Mac survey showed the average 30-year rate, which was less than 4% during the first half of last year, had risen to about 4.5% as this year began.

Source: http://www.latimes.com/business/money/la-fi-mortgage-lending-trends-20140724-story.html

Thursday, July 17, 2014

Southern California home prices hit 77-month high, sales fall again

My website: www.sandralew.com

Wow! Sky high housing price again for Southern California. Yet,  it's still 18% below the record high during the spring and summer of 2007. Prices are still increasing but more stable as it's  climbing at a much more reasonable slow pace which helps to sustain prices.  Due to continued low inventory and the decline in affordability sales have slowed. Market indicators (lower foreclosure rates, fewer short sales and less distressed sales) are showing signs of returning to a normal healthy housing market.

Southern California home prices hit 77-month high, sales fall again

Posted:

Southern California’s housing prices hit their highest level in 77 months during June, but signs emerged that appreciation is moderating, a market tracker said Tuesday.

Last month, the median price of new and previously owned houses and condos in the six-county region rose 8 percent to $415,000 — up 1 percent from $410,000 in May, which was the 76-month high, said La Jolla-based DataQuick.

It was the median’s first year-over-year single-digit percentage gain in 22 months, the company said. The median, which has inched up for 27 consecutive months, has generally been in the same range since last May. Its biggest gain since the end of the Great Recession was 28 percent in June 2013.
The median price is now 18 percent below the record high of $505,000, in place through the spring and summer of 2007.

Prices are expected to increase but not outrun the market, which is what led to the last collapse.
“Pent-up demand, job growth and still-low mortgage rates continue to put pressure on home prices,” said DataQuick analyst Andrew LePage. “But they’re climbing at a much slower pace than a year ago. In many markets, price appreciation has slipped into the more sustainable single-digit range, compared with gains exceeding 20 percent this time last year.”

Inventory, while still historically low, is higher this year, and the decline in affordability serves as “gravity” for price gains to narrow, LePage said, adding that there may be increases in the 10 percent range as the summer plays out.

Sales in June remained in a funk.

Last month, 20,654 new and previously owned houses and condos sold, down 4 percent from a year earlier.

Sales have fallen on a year-over-year basis for nine consecutive months, DataQuick said, as perspective buyers continued to struggle with inventory and declining affordability. They rose 6 percent from May.

In Los Angeles County, the median home price rose 6 percent, to $450,000 from $425,000 a year earlier. Sales fell 7.5 percent, to 6,792 properties.

In San Bernardino County, the median jumped 18 percent, to $240,000, and sales were basically flat.
The role distressed properties played in the market continued to diminish.

Last month, foreclosure resales — homes foreclosed in the prior 12 months — accounted for a 5 percent share of the region’s market, down from 9 percent a year earlier.

Short sales — transactions where the sale price fell short of what was owed on the property — accounted for a 6 percent share, down from 15.5 percent a year earlier.

And all of this is a good sign, LePage said. “Many of the market indicators we track continue to ease toward normalcy.”

Still, conditions are not quite living up to hopes.

“It’s certainly not performing as expected,” said Robert Kleinhenz, chief economist at the Kyser Center for Economic Research in Los Angeles, of 2014’s first quarter. “That may have prompted people to temper (their buying) expectations.”

Source: http://www.dailynews.com/business/20140715/southern-california-home-prices-hit-77-month-high-sales-fall-again

Thursday, July 10, 2014

Rich Chinese Are Top Foreign Buyers of U.S. Real Estate

My website: www.sandralew.com

Cash is still king with overseas buyers. Chinese buyers were the biggest spenders in terms of dollar volume primarily focused on high-end homes in  California, Washington and New York with a mean price of $590,826.

Rich Chinese Are Top Foreign Buyers of U.S. Real Estate

Overseas buyers scooped up $92.2 billion of U.S. real estate last year, driven mainly by wealthy Chinese looking for a safe haven for their families and fortunes. A new report from the National Association of Realtors says sales activity from international buyers surged 35 percent in the 12 months that ended in March. 

While international buyers represent only 7 percent of total existing home sales nationally over the period, their buying is highly focused on high-end homes in Florida, California, Texas and Arizona. Chinese buyers were the largest foreign buyers measured by dollar volume, with sales jumping 72 percent over the 12 month period to $22 billion. 

Chinese buyers now account for 24 percent of all sales made to overseas buyers by dollar volume. Canada was second with $13.8 billion in deals, followed by the United Kingdom and India, each with $5.8 billion. 

Overseas buyers tend to pay all cash and prefer higher-end homes. Chinese buyers were the biggest spenders. The mean price they paid hit $590,826, and more than half of their purchases were in California, Washington and New York. 


Source: http://www.nbcnews.com/business/real-estate/rich-chinese-are-top-foreign-buyers-u-s-real-estate-n150796

Monday, July 7, 2014

Google's $600 million real estate shopping spree in Mountain View

My website: www.sandralew.com

The effects the internet giant "Google" is having a major impact on the community of Mountain View up in "Silicon Valley" in the San Francisco bay area. It's projecting a growth of jobs for an additional 10,000 people and changing the landscape of the area.  There needs to be a balance to support the continuing growth and expansion as more housing, more dense office space and smart transportation will be a necessity. For now, colorful Google multi-colored bikes dominate the streets near the GooglePlex.

Google's $600 million real estate shopping spree in Mountain View

 
By George Avalos  Oakland Tribune  Posted:   07/07/2014 06:13:06 AM PDT


Google employees ride their Google multi-colored bicycles to and from the GooglePlex along Charleston Road in Mountain View, Tuesday, June 24, 2014. Large 


Google employees ride their Google multi-colored bicycles to and from the GooglePlex along Charleston Road in Mountain View, Tuesday, June 24, 2014. Large and small, buildings are being collected in Mountain View by Google, which is on a shopping spree for parcels near -- and sometimes not so near -- its headquarters in Mountain View. (Patrick Tehan/Bay Area News Group) ( Patrick Tehan )

MOUNTAIN VIEW -- Google has quietly spent $600 million over the past several years in a real estate shopping spree centered on this quiet suburban Silicon Valley city that already houses its corporate headquarters -- one that could pay off with huge new expansion opportunities for the Internet giant and reshape the community's skyline. 

Starting in 2011, Google has bought about 24 office buildings in Mountain View, most of them nondescript and low-slung. 

But if city officials change zoning rules in northern Mountain View, the existing buildings likely would be transformed into much taller, much sleeker spaces that would give Google room to house the thousands of workers the tech titan is hiring in close proximity to the Googleplex, the nickname for the company's headquarters on Amphitheater Parkway.

The city says it will issue a final decision by year's end. After that, property owners would have to submit specific proposals.

The stakes for all this are considerable. Mountain View feels pressure to allow higher densities for offices to continue to grow as a city. Some residents are alarmed enough about growth that they make seek a referendum on one or more proposals and are making this year's City Council elections a barometer on growth issues.

Google won't say if it will seek approval for big buildings on the sites it is buying. However, commercial real estate industry experts say the company is focusing its purchases in areas where the city is considering high-density development that would yield taller offices, expected to be five to 10 stories high.

And were Google able to redevelop just 20 of its sites with modern offices of 100,000 square feet each, that would be 2 million square feet of new space with room for 10,000 employees. That would be one-fourth of the estimated 39,000 people who work in downtown San Jose.

Mountain View is the hub of an extraordinary burst of real estate activity by Google, which is busy buying or leasing sites in a swath that stretches about 10 miles along Highway 101 and encompasses three cities.

At the northern edge of this stretch is a cluster of nine Palo Alto office buildings. Then come two more clusters of buildings close to the Googleplex. Also near the Googleplex is a proposed 1 million-square-foot campus at NASA Ames. Adjacent is Moffett Field, where Google will preserve and redevelop Hangar One and other facilities. At the southern terminus are several big office buildings Google leased in Sunnyvale.

The tech titan says it wants sites that form natural clusters.


"Google is a growing company, and our real estate needs are re-evaluated on an ongoing basis to make sure we're ready for what the future holds," said Meghan Casserly, a Google spokeswoman. "That's why we often look for proximity. When multiple pieces of property become available nearby, it's helpful to accommodate for natural growth."

The possibility of high-density office spaces in Mountain View -- and the resulting traffic -- have alarmed some community leaders, including Lenny Siegel, executive director of the Center for Public Environmental Oversight.

"The projected growth in employment is tens of thousands of people, and the anticipated growth in residential construction is on the order of thousands of units," Siegel said. Expensive housing and clogged streets will result, he warned.

If the city doesn't meet their wishes for balance in new jobs, homes and traffic, the Campaign for a Balanced Mountain View, a group that includes Siegel, said it may pursue a referendum to reverse the looser development rules.


What's more, a City Council election is scheduled for November, keeping the issue on the front burner.

Google has previously collected offices in Mountain View. In 2007, the company grabbed space up and down Shorebird Way. Now, Google signs and workers riding colorful Google bikes dominate the street.

When Google launched the current buying binge in 2011, observers were puzzled. The decades-old structures didn't fit the mold of the modern offices Google was leasing. Yet seen in the context of Mountain View's lack of sites for large new office buildings, the purchases leave Google poised for a major expansion of its operations, depending on the city's density decision.

"Mountain View is running out of land," said Phil Mahoney, an executive vice president with Cornish & Carey, a realty firm.
Some analysts argue that Mountain View must increase density or be hobbled by feeble growth.

"We want to ensure that Mountain View retains its economic vitality, that it remains a place where businesses and people can still grow and locate," said Randy Tsuda, city community development director.

In 2012, Google used a letter about Mountain View's general plan to publicly back the concept of higher densities, coupled with smart transportation.

Transportation efficiency and land use are "inextricably linked," David Radcliffe, Google vice president for real estate and workplace services, wrote in a letter to city officials.

"The office park development model has played itself out," he wrote. Sprawling business parks in north Mountain View would yield to higher-density offices, more housing and an improved transportation system that would serve the taller buildings and additional workers, Google said in supporting the city's general plan.

Google's quest for space has caught the eye of developers who are betting on a boom in Mountain View underpinned by robust rents.
"It's like you're developing on Boardwalk or Park Place," said David Vanoncini, a managing partner with Kidder Mathews, a commercial realty firm.

Sobrato is building a big office building in Mountain View on parcels the developer collected, said Chase Lyman, Sobrato's director of commercial real estate.
Experts think Google is in good shape for expansion, despite the tech industry's boom and bust cycles.

"Technology does ebb and flow, you had Atari and Worlds of Wonder, and we've seen Apple go from boom to bust to boom again," said Jim Beeger, a senior vice president with Colliers International, a commercial realty firm.

"Google has been different. The most they do is take their foot off the accelerator a bit. We've never seen Google hit the brakes."


Source: http://www.mercurynews.com/business/ci_26102102/googles-600-million-real-estate-shopping-spree-mountain