My website: www.sandralew.com

Huge new mixed use development breaking ground in early 2018. The entire area around the expo has positive improvements with the dedicated bike lanes and now is getting more user friendly for pedestrians and connecting it to transit—namely, the Expo Line’s Expo/Bundy station a block away

What’s next for West LA’s big new development Martin Expo Town Center?

A new grocery store, offices, restaurants, and more than 500 apartments coming to Olympic and Bundy

By Bianca Barragan Sep 30, 2016, 9:44a

A big Westside project, the Martin Expo Town Center, won unanimous approval from the Los Angeles City Council last week, a decision that will usher in new retail, residential, and a 10-story office tower on the site of a car dealership at the northwest corner of Olympic Boulevard and Bundy Drive.

The project has been tweaked and trimmed since we last saw it at the beginning of the year. The most notable reductions are on the retail and office front. Office space was shaved down from 200,000 square feet down to 150,000, and the grocery store, once 50,000 square feet, has been slimmed down to 35,000 square feet. (The project also includes 18,000 square feet of restaurant space and 46,000 square feet for general retail use.)

The town center has also gained a few significant add-ons, namely an affordable housing component that will set aside 20 percent of the project’s 516 apartments for less-than-market rate rents. (Fifteen percent will be "workforce housing," where occupants median income can't exceed 150 percent of the area median income, and five percent will be for very low-income tenants.)

The project has also acquired a lot of upgrades geared at making it friendly for pedestrians and connecting it to transit—namely, the Expo Line’s Expo/Bundy station a block away. In addition to widened, 15-foot sidewalks, the new complex will have a half-acre pedestrian plaza, as well as a smaller, 4,000-square-foot pedestrian-oriented area at the corner of Olympic and Bundy, acting as a sort of staging area for people heading over to the light rail station, project manager Phil Simmons tells Curbed. There will also be 100 short-term and 600 long-term bike parking spots, as well as bike storage. There are also more than 1,500 underground car parking spaces.

"We think we’ve got as close to a perfect TOD [transit-oriented development] as possible," Simmons said.

The new mixed-user is being developed by the Martin family, which for over 40 years has owned and operated a Cadillac/GMC dealership on the site. (Two dealership-related buildings on the site would be demolished to make way for the new development.) Simmons says the Martin family’s long presence in the neighborhood helped garner support from locals.

But not everyone was swayed. Last month, the West Los Angeles Neighborhood Council told the City Council the project would, "make our community a more dangerous place to live." The letter cited "significant traffic impacts" as the main reason for the neighborhood group’s opposition.

Now that plans are approved, the next step for developers is to prepare "working drawings." Simmons said he expects it will be "close to a year" before they apply for building permits. Developers aim to break ground in early 2018.

Source: http://la.curbed.com/2016/9/30/13118254/martin-expo-development-approved-west-la

Silicon Beach keeps on scaling upward and outward

My website: www.sandralew.com

The very hot silicon beach housing market has resulted from growing high tech firms in the area. Wow! Did you know that 86 percent of the nearly 700 tech firms in LA are located in Silicon Beach according to CBRE? No wonder there has been such a demand in housing. People want quality of life and desire to live close to where they work. Great jobs, coastal breezes, upscale shopping, hip restaurants, gyms, and proximity to the beach lifestyle make here worth every penny.

I've personally experienced so many multiple offers for my buyers. It's the lifestyle and potential upside with more dense conservative ratio of employees to work space that drives greater housing needs as well. Housing supply has not kept up with demand thus driving up prices and rents. 

 

Silicon Beach keeps on scaling upward and outward

Rents soar in hot hoods, but expansion could prove to be a market equalizer

September 22, 2016 10:30AM

From the L.A. print issue: In less than a decade, Silicon Beach has grown from a Silicon Valley outpost in Santa Monica to encompass a stretch of coastline as far south as Playa Vista and as far east as Culver City. Market pros are now closely watching whether the high-tech enclave will continue marching south to El Segundo, eating up real estate along the way.

Fully 86 percent of the nearly 700 tech firms in Los Angeles are located in Silicon Beach, according to CBRE. The roster includes such boldfaced names as Facebook, Google, Hulu and Snapchat, as well as high-tech incubators and startups — such as DogVacay and Scopely — which haven’t (yet) achieved household-name status.

But experts say this isn’t a replay of the dot-com bubble in the late 1990s, when startups rushed to get big in order to score an initial public offering while the market was red hot. These days, brokers say, young tech companies aren’t land-banking office space, as they did back then. 

“You don’t see 50 employees taking 20,000 square feet,” said Jaclyn Ward, an associate at JLL’s Los Angeles office. “They’re being pretty conservative.”

This tendency, in turn, has kept the sublease market fairly tight and given landlords pricing power in the core market in Santa Monica. Sublease space is more plentiful on the periphery, in Playa Vista. 

“The challenge in Silicon Beach is a pretty continual lack of space that pushes rental rates up,” said George Pino, the co-founder and CEO of Commercial Brokers International. However, he added, the continued expansion of Silicon Beach into new neighborhoods could become an equalizing force on market prices.

Here’s a look at some of the biggest deals and most notable tenants in the area’s key beachheads.

Santa Monica

In downtown Santa Monica, where tech firms vie fiercely for prime locations, vacancy rates hover in the single digits and asking rents have soared to $7 or $8 a square foot per month, up from an average of $4.61 just a few years ago, according to data from JLL. But in outlying areas, some big-name companies have pulled up stakes. Both Yahoo and The Honest Company have decamped for Playa Vista, leaving tens of thousands of square feet in their wake.

In the second quarter of 2016, Santa Monica overall had a 17 percent office vacancy rate and average asking rents of $5.40 a square foot, according to JLL. Ward said the “massive exodus” for Playa Vista in 2015 and early 2016 led to the higher vacancy rates, although some of that space has already been absorbed.

In early 2016, Oracle inked a deal to expand from 80,000 square feet to approximately 130,000 square feet in The Water Garden, located at 1620 26th Street. The building is currently being renovated to include collaborative work space in its lobby and an outdoor seating area with a fire pit, said Michael Nieman, an attorney in private practice who is also a commercial real estate broker at CBRE, and who represents the building.

In June, AwesomenessTV, a teen-targeted video-streaming company majority owned by DreamWorks Animation, closed on a 90,000-square-foot lease for its headquarters at Pen Factory, a Clarion Partners property at 2701 Olympic Boulevard.

Venice

Venice Beach has some of the highest asking rents in Silicon Beach, with prime space renting for upward of $8 a square foot. Google is a large tenant, with a 100,000-square-foot campus environment in three buildings, including the historic Binoculars Building designed by Frank Gehry. In front of the building is a giant binocular-shaped sculpture by Claes Oldenburg and Coosje van Bruggen.

Snapchat is another key tech player in the area. In 2015, the company doubled the size of its Venice Beach lease at the intersection of Venice and Abbot Kinney boulevards to 40,000 square feet. In 2016, it leased 80,000 square feet in city-owned structures at the Santa Monica Airport, including two buildings and eight hangars. Snapchat has agreed to make $1.4 million in improvements to the buildings for a rent credit of five months. 

“Snapchat is always a hot topic,” Ward said. Founded in a beachfront bungalow on Ocean Front Walk in Venice Beach in 2011, the company later moved into roomier quarters at 63 Market Street, also in Venice Beach. It continued to expand by inking more leases around Venice Boulevard. 

Playa Vista

Playa Vista certainly isn’t playing Kmart to Santa Monica’s Target, but many market pros do see it as a veritable bargain. With average asking rents below $5 a square foot and a wealth of new creative space, Playa Vista — just minutes south of Santa Monica — has attracted new and established tech companies alike. At least 80 percent of Playa Vista’s commercial space is occupied by technology, entertainment and media companies, including many industry heavyweights, such as Facebook, Microsoft, YouTube, IMAX and Sony Playstation.

The Silicon Beach stronghold has even been immortalized on TV. Scenes for ABC’s “Revenge” were filmed at the Water’s Edge office complex, located at 5510 Lincoln Boulevard, which includes a reflection pool and recreation areas. Electronic Arts leases nearly 150,000 square feet in two buildings, and sublets space for filming at Water’s Edge.

In 2014, Google spent $120 million to buy 12 acres next to Howard Hughes’ famed “Spruce Goose” airplane hangar, which is zoned for nearly 900,000 square feet of commercial space. Then, in 2016, the company acquired a long-term lease for the hangar as well. 

YouTube, a Google subsidiary, has occupied space next door since 2012, when it became one of the first tenants in the newly opened Hercules office campus, which also occupies land formerly owned by the Hughes Aircraft Company. Dubbed “YouTube Space LA,” it’s a spot where YouTube video creators — either employees or people from outside the company — can collaborate. 

In April 2016, Facebook scooped up a long-term lease to a three-story, 55,000-square-foot building being developed by Vantage Property at the east end of the Playa Jefferson office campus. The project is slated for completion in late 2017, and Facebook will occupy 35,000 square feet of the building, said Jonathan Larsen, a principal and managing director of Avison Young in Los Angeles.

In the summer of 2016, Yahoo was also preparing to move from space it has long occupied in Santa Monica, into a 130,000-square-foot space in the new
Collective campus on Playa Vista’s West Bluff Creek Drive.

The Honest Company, an organic personal-care products retailer founded by actress Jessica Alba, moved its headquarters here in 2016, taking an 83,000-square-foot spread across the top three floors of the i|o building, which is located at 12130 Millennium Drive. The fast-growing startup had revenue growth of more than $150 million in 2014 — the most recent year for which the private company has released data.

Culver City and El Segundo

Unlike other areas in Silicon Beach, Culver City’s asking rents are holding the line. The average rate for Class A office space remained flat, at $3.33 a square foot, during the first half of 2016. This makes rents here substantially lower than in other areas of Silicon Beach, where year-over-year increases of 50 to 75 percent are not uncommon.

Culver City has around 800,000 square feet of vacant office space, according to JLL. But brokers say that soaring prices in popular coastal neighborhoods such as Venice Beach have spurred bargain hunting here that might absorb some of the inventory.

WeWork, which operates co-working office space in markets from Los Angeles to New York, signed a long-term lease for 75,400 square feet at 5782 Jefferson Boulevard in Culver City in April 2016. The company plans to move in by late 2016, despite slashing its profit forecast by nearly 80 percent in July.

Farther to the south, El Segundo is being eyed as the next expansion area for Silicon Beach. The neighborhood already has multi-family buildings and office space, albeit much of it is in need of renovation. 

“In Silicon Beach, some companies start with one person and some start with five, but they exponentially grow and add space,” Larsen said. “The next Honest Company is out there, growing, below the radar.”

Source: http://therealdeal.com/la/2016/09/22/silicon-beach-keeps-on-scaling-upward-and-outward/

 

My website:www.sandralew.com

Real estate is getting it's own sector in the S&P 500. Very important impact on real estate investment trusts as they move into a different category and out of the financial sector. Huge impacts on the financials as it had included them. Good time to re-balance and take a look at your investments.

Investors moving billions into real estate ahead of a big market change

September 8, 2016 - CNBC

Real estate stocks are getting a place of their own in the market this week, and investors are taking notice.

As of the close of trading Friday, the industry will become its own sector in the S&P 500 (^GSPC), bringing the broad market index up to 11 divisions . The move primarily affects real estate investment trusts (REITs), moving 28 issues with nearly $600 billion in market cap out of the financial sector and into the new real estate heading.

The decision came primarily because officials at S&P Dow Jones Indices believe the industry has become large enough that it should be split from the broader financials that include commercial and investment banks, insurers, brokerages and exchanges.

Practically speaking, there's an important impact on investors.

Portfolios that track the S&P 500 will have to be readjusted to accommodate the new sector, which is expected to account for just over 3 percent of the total index. Financials, which currently account for about 13.1 percent of the S&P 500, likely will drop below 12 percent.

That means investors looking to achieve balance in their portfolios will have to adjust their allocations accordingly.

Ahead of the move, investors have been piling money into real estate funds. In fact, the sector has generated the largest inflows to exchange-traded funds this year of any of its peers, pulling in $1.08 billion in August alone and $7.6 billion for 2016, according to figures released Thursday by State Street Global Advisors.

Among individual funds, the biggest gainer by far has been the $35.7 billion Vanguard REIT Index Fund (NYSE Arca: VNQ), which has pulled in $4.57 billion this year. The $2.87 billion Schwab U.S. REIT (NYSE Arca: SCHH) ETF has collected $706.2 million, while the $4.3 billion iShares Cohen & Steers REIT (NYSE Arca: ICF) fund has had inflows of $355.2 million. (All numbers according to FactSet.)

Investors in the sector have been rewarded. The Vanguard fund is up 12.6 percent year to date, nearly doubling the 6.7 percent that the S&P 500 has returned.

S&P chose Friday to introduce the real estate sector because the day also marks a "triple witching" in the market. The term refers to the expiration of contracts for stock index options, index futures and options during the final hour of trading. 

That will give market participants time to reallocate on a day where conditions are conducive to making changes.

"It's a day with a huge amount of liquidity in the market, trading is faster and more efficient than usual, and it's a good day for people to rebalance their portfolios," said
David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.

"There will be some people who will be rebalancing their portfolios to make sure their weight in real estate is the right weight."

The sector is part of the Global Industry Classification Standard implemented in 1999 to help investors make sure they could see what was moving the market and make decisions accordingly.

Source: https://www.yahoo.com/news/investors-moving-billions-real-estate-174005934.html

My website: www.sandralew.com

In a nutshell these 6 charts help to visualize the major impact housing has on our economy.

These 6 Charts Tell You Everything You Need to Know About the Real Estate Market

By Chris Matthews July 14, 2016, 5:16 PM EDT
 

The housing market has done a lot of healing, but it also has a long way to go.

There’s likely no sector as important to the U.S. economy as housing.

In the first quarter of 2016, residential investment accounted for roughly half of the 1.1% increase in real GDP. Historically, this is on the high side, but when you count spending on housing services as well as spending on various kinds of housing construction, the home construction industry can account for as much as one fifth of overall output in the U.S. economy.

That’s why housing has traditionally powered the American economy out of recessions, and that’s why housing’s role as the trigger of the Great Recession was so damning to the subsequent recovery.

While housing prices have improved—with home values in some markets higher than before the crisis—there’s evidence that the housing bust has inflicted long-term damage on the home building industry and therefore the American economy. Here are 6 charts from Torsten Slok, Deutsche Bank’s Chief International Economist, that show the state of the housing market and how it’s powering, and holding back, the rest of the economy.

People Really Want to Buy Homes

There’s evidence that the millennial generation has been slow to warm to the idea of homeownership, as they are generally delaying decisions like marriage and child rearing. But as this chart shows, overall, Americans are still in the market for new homes.

But Homebuilders Have Been Slow to Respond to Demand

The rate at which homebuilders are constructing new single family homes remains quite depressed, despite steadily increasing demand. Those in the business have argued that supply-side factors, like increased regulation and a short supply of skilled labor as reasons they have been slow to meet demand.

The Homes Being Built are Mostly for the High End of the Market

There are many metrics that one can use to show that homebuilders have decided that it makes sense for them to target wealthier buyers, but the above chart is striking. During an otherwise sluggish economic recovery, the increase in the size of new homes for sale has actually accelerated.

Because Middle-Class Homebuyers Can’t Get Financing

Home builders aren’t the only business that has been turning it’s back on the American middle, for the simple reason that middle class incomes have been on the decline for years now. Furthermore, the mortgage finance industry is still leery of lending to all but the most creditworthy borrowers.

Rental Markets are Tighter Than They’ve Been in Generations

The lack of credit available for new homebuyers has forced more and more homeowners into the rental market, driving up rents and put further pressure on already strained middle-class budgets.


Hope springs eternal.


Despite what appears to be a negative feedback loop of stagnating middle-class incomes, tight credit, and a homebuilding industry that can’t profitably cater to most of the country, demographics have analysts hopeful that things will turn around in the future. The modal age in America is 26, and this echo-boom generation has yet to settle down and seriously consider homeownership. Analysts hope that this new demographic wave will jolt the housing sector back into pre-bubble normalcy. And we’re moving in the right direction.

Time heals all wounds, even in the real estate market.

Source: http://fortune.com/2016/07/14/real-estate-charts/

My website: www.sandralew.com

Why home prices in Southern California keep climbing 

Real estate is a hot commodity these days especially in Southern California. It boils down to the pent up demand and lack of inventory, scarcity of land to build, continued low mortgage interest rates and improving job outlook. All these factors play into the surging home prices with no let up in sight especially as markets reach or even surpass their previous historical peaks.

The Southern California housing market is red-hot again.

By James F Peltz - July 14, 2016

Home prices in the region have been climbing steadily, as they have nationwide, toward record levels not seen since the 2008 housing crisis plunged the country into a severe recession.

The S&P/Case-Shiller home price index, a widely followed gauge of the market, showed that prices in the Los Angeles market in April stood at their highest point since October 2007.

The median home price in Orange County in May was $651,500, surpassing its bubble-era peak reached in 2007, according to the real estate data firm CoreLogic.

Interest rates of about 3.5% or less for 30-year, fixed-rate mortgages — not far off the all-time low of 3.31% in November 2012 — have helped fuel the gains.

Dana Kuhn is a lecturer at the Corky McMillin Center for Real Estate at San Diego State University, and we asked him to summarize the market and what it means for would-be buyers and sellers. Here’s an edited excerpt:

Has the Southern California housing market completely recovered from the recession?
In the most desirable markets, that’s essentially true. That would be West Coast large-metro areas. The San Francisco Bay Area is now priced above its peak numbers of the last decade. Orange County, too, and Los Angeles and San Diego are getting very close to their former peaks. Seattle is doing really well. Portland is doing well.

One of the worst-hit areas in the housing crisis was the Inland Empire. How is that region faring?
That was the real subprime [mortgage] disaster area. Those markets have been slower to recover. There are areas like the Inland Empire that are probably only between 80% and 85% of [their pre-bubble] peak.

Is it surprising that it’s taken this long?
Yes and no. Given how severe the recession was, there was so little production [of new housing] in that time. There was a four-year period between September 2008 and September 2012 when the nation’s housing starts were below all previous troughs going back some 40 years. And in those previous troughs, what you typically had was one year at that nadir, and then you’d climb back up fairly quickly. But we had four years below all of those troughs, and so production obviously fell behind demand.

So there was a huge pent-up demand when people started getting jobs and believing in housing again. The industry has struggled to keep up with it in the more desirable markets.

Is that driving the surge in prices?
Yes. Like most things, it’s a supply/demand situation. The number of [housing] starts hasn’t been able to take care of that pent-up demand. The pricing has gone up accordingly, and that has been accommodated by low [mortgage] interest rates. Continued low interest rates have in essence subsidized a rapid ascent in pricing.

Why is it tough to add more housing to the supply in Southern California?
Land is increasingly scarce, and that’s forcing people to build up rather than out. And those higher-density projects are more sensitive politically, more difficult to get approved and take longer to get through the pipeline. You can have agreement about needing more housing in a given market, but when it actually comes down to [building] those 300 units on that corner in that neighborhood, you get resistance. So it can take years in Southern California coastal areas to get [those] projects approved. That’s true whether it’s a for-sale product or a rental market.

This all sounds good for sellers, but is it a tough time to be a buyer?
Yes. Unfortunately real [inflation-adjusted] wage growth hasn’t kept up with that surge in pricing. It’s significantly harder to buy something now than it was a few years ago because people’s wages just haven’t kept up, even though interest rates are still the same.

The median price of a house in Los Angeles County is above a half-million dollars. How does a first-time buyer afford that?
They don’t buy that house. That’s the middle of a statistical group. Your first-time buyer is pretty much forced to buy a [less-expensive] attached product, not detached.

Like a condominium?
Yes. And they’re probably not going to be able to afford to buy that unit in the same neighborhood in which they would rent if they were renters. So they have to make a lifestyle concession in order to become homeowners.

Meaning they would build up equity in that house, then later sell it in hopes of buying one in the neighborhood they desire?

Right. Also, the millennial generation [18 to 34 years old] has eschewed the concept of home ownership because they saw their parents and others get burned in the last downturn and because they prefer lifestyle over ownership.

But as they get older and have kids they’ll have a different outlook. And as their wages increase, they’re also going to realize the importance of the mortgage deduction — the tax benefits that come from home ownership — and there will be move back toward home ownership.

Do you see prices continuing to climb?
The peak value in any given cycle has always exceeded the peak value in the previous cycle. So there was no question in my mind — even during the depths of the downturn — that we would get back to peak [price levels] because we always have. It’s only a question of how long it takes to get there. Of course it took quite a long time this time because [the recession] was so bad.
The only question is how many more years of increases beyond that peak can you expect? I don’t know anyone who can tell us that.

Source: http://www.latimes.com/business/la-fi-qa-home-prices-20160713-snap-story.html

My website: www.sandralew.com

While the dollar volume of sales decreased, number of homes purchased actually increased most likely due to the changing demand for locations of homes.While previous international buyers have mainly purchased in expensive locales they are now expanding to less expensive areas as well. Chinese buyers still rank the highest investors followed by Canadian buyers. Given today's volatility in global financial markets, real estate is still one of the safest investments available.

Foreign buyers flood US real estate, but buy cheaper homes

Diana Olick - 7 hours ago

 

Chinese investors negotiate at the US-China Real Estate summit & trade fair in Beijing. (File photo).

The appetite for U.S. real estate continues to flourish, but international buyers are shifting their sights from luxury to less-pricey properties. This may be due to overall higher home prices, along with a stronger U.S. dollar, which both cost foreign buyers more at the negotiating table. There are also fewer nonresident foreigners investing in the market.

"Weaker economic growth throughout the world, devalued foreign currencies and financial market turbulence combined to present significant challenges for foreign buyers over the past year," said Lawrence Yun, chief economist of the National Association of Realtors (NAR). "While these obstacles led to a cool down in sales from nonresident foreign buyers, the purchases by recent immigrant foreigners rose, resulting in the overall sales dollar volume still being the second highest since 2009."

Foreign buyers purchased $102.6 billion of residential property in the U.S. between April 2015 and March 2016, according to NAR's annual report on international activity in U.S. real estate. That is a 1.3 percent decline in dollar volume from the previous survey. The number of properties purchased, however, rose 2.8 percent to 214,885. The value of homes bought by foreigners was typically higher than the median price of all U.S. homes.


"The slight drop in dollar volume can probably be accounted for based on the types of properties purchased, and the locations of many of those properties. We've seen at least some evidence that foreign buyers — both investors and people just looking for a home — have begun looking beyond expensive markets like San Francisco, New York City and Washington D.C., and buying properties in smaller, less-expensive cities in the Southeast and Midwest," said Rick Sharga, executive vice president at Ten-X (formerly Auction.com), an online real estate marketplace .


Another major shift was in the makeup of international buyers. Chinese purchasers continued to outpace all others, with their dollar volume exceeding the total of the next four ranked countries combined. Their dollar volume of sales, at $27.3 billion, was a slight decrease from last year's survey but was still three times as much as Canadian buyers, who were ranked second. Chinese buyers also bought the most expensive homes at a median price of $542,084.


"Although China's currency modestly weakened versus the U.S. dollar in the past year, it's much stronger than it was five to 10 years ago, thereby making U.S. properties still appear reasonably affordable over a longer time span," wrote Yun in the report.


Given today's volatility in global financial markets, real estate is one of the safest investments available. U.S. real estate in particular is relatively inexpensive compared to properties in Asia.

"The explosive growth of the Chinese economy created a very large number of very wealthy people.

As that country's economy has slowed down, those individuals are looking for better investment alternatives, and many have concluded that U.S. real estate is a smart bet," added Sharga.


London had been a favorite of foreign investors, but the impact of the Brexit vote is already hitting the housing market there. Buyers from the United Kingdom were the fourth-largest consumer of U.S. real estate in the data that was gathered before the Brexit vote.

"Sales activity from U.K. buyers could very well subside over the next year depending on how severe the economic fallout is from Britain's decision to leave the European Union," added Yun. "However, with economic instability and political turmoil outside of the U.S. likely to persist, the world view of American real estate as a safe investment should keep demand firm even as pressures from a stronger dollar continue to weigh down on affordability."


As for U.S. destinations, five states accounted for half of foreign buyer purchases: Florida, (22 percent), California (15 percent), Texas (10 percent), Arizona and New York (each at 4 percent). Latin Americans, Europeans and Canadians, who historically favor warmer climates, were most prevalent in Florida and Arizona. Asian buyers flocked to California and New York. Texas was more a mix of buyers from Latin American, the Caribbean and Asia. Texas may be more of an investment play, as demand for single-family rentals there remains strong.


Sales to nonresident foreign buyers fell to the lowest dollar volume since 2013. Shares to foreign residents increased. The shares had been evenly split, but higher home prices and the depreciating value of foreign currencies likely played into that dynamic.


"Led by Venezuela (45 percent) and Brazil (24 percent), at least eight countries, including China and Canada, saw double-digit percent increases in the median sales price of a U.S. existing home when measured in their country's currency," added Yun.

Source: http://www.cnbc.com/2016/07/06/foreign-buyers-flood-us-real-estate-but-buy-cheaper-homes.html

 

My website: www.sandralew.com

The Brexit vote has directly impacted interest rates in the United States. This summer is a good time to shop for a home mortgage as analysts are predicting rates may drop even further. Good opportunity for those who are home shopping, looking at real estate as an investment or looking to refinance their existing home loans.

Brexit could prove advantageous for borrowers in real estate market

Posted: Friday, July 1, 2016 12:00 am By RHETT MORGAN World Staff Writer

Married and a father of four children, including a newborn, Tulsa’s Mike Guillen was seeking ways to save money.
A refinancing opportunity gave him one.

Guillen this week secured a 15-year, fixed-rate of 2.87 percent on his home near 101st Street and South Memorial Drive, a drop of more than one point from his previous rate.

“It was just too good of a deal to pass up,” said Guillen, who works for a local heat-and-air company. “I was floored.”

He purchased his family’s 3,300-square-foot home about seven months ago.

“After looking at the math — because I was going to do the house pay-down account — I’m going to come out more ahead by having a low interest rate than I would have by putting the money in the bank and trying to earn on it,” Guillen said.

In the wake of the United Kingdom’s decision to leave the European Union, stories such as Guillen’s could become increasingly more common.

The move, also known as Brexit, has some analysts predicting that rates could drop even further.

“The latest statistic I saw is that we are in a three-year low of interest rates again,” said Ed Adams, who leads the retail mortgage channel for Tulsa-based BOK Financial Mortgage.

“We continue to be in a place where there are historically low interest rates, which presents a real good opportunity for buyers who are thinking about home ownership or refinancing or move-up opportunities or real estate as an investment.”

Thirty-year, fixed-rate mortgages have been hovering in the 3.5-percent range, he said.

“People still believe you need a 20-percent down payment to buy a home when you look at national surveys,” Adams said. “The truth is, there is a lot more opportunity. There’s a lot more product available to help with low down payment-type loans and options to get into home ownership.

“The continued pressure to keep interest rates down and what recently happened with Brexit is certainly providing opportunity for people to think about real estate as an asset and a part of their total net worth.”

Bankrate.com, which puts out a weekly mortgage rate trend index, found that almost half of the experts it surveyed believe rates will remain relatively unchanged in the coming week while a third believe they will fall further.

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average plunged to 3.48 percent with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.56 percent a week ago and 4.08 percent a year ago.

Since the beginning of the year, the 30-year fixed rate has plummeted nearly 50 basis points. (A basis point is 0.01 percentage point.) It has fallen 18 basis points in the past month alone.

The 15-year fixed-rate average sank to 2.78 percent with an average 0.4 point. It was 2.83 percent a week ago and 3.24 percent a year ago.

The five-year adjustable rate average dropped to 2.70 percent with an average 0.5 point. It was 2.74 percent a week ago and 2.99 percent a year ago.

“In the wake of the Brexit vote, the yield on the 10-year U.S. Treasury bond plummeted 24 basis points,” Sean Becketti, Freddie Mac chief economist, said in a statement. “This week’s survey rate is the lowest since May 2013 and only 17 basis points above the all-time low recorded in November 2012. This extremely low mortgage rate should support solid home sales and refinancing volume this summer.”

Source: http://www.tulsaworld.com/business/realestate/brexit-could-be-prove-advantageous-for-borrowers-in-real-estate/article_60e96d62-4312-5e49-a494-1774f9e7326e.html