by Keeping Current MattersFor a while now baby boomers have been blamed for a portion of the housing market’s current lack of housing inventory, but should they really be getting the blame?Here’s what some of the experts have to say on the subject:Aaron Terrazas, Senior Economist at Zillow, says that “Boomers are healthier and working longer than previous generations, which means they aren’t yet ready to sell their homes.”According to a study by Realtor.com, 85% of baby boomers indicated they were not planning to sell their homes.It is true that baby boomers are healthier and are thus working and living longer, but are they also refusing to sell their homes? Last month, Trulia looked at the housing situation of seniors (aged 65+) today compared to that of a decade ago. Trulia’s study revealed that:“Although seniors appear to be delaying downsizing until . . .

by Keeping Current Matters
Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for the entirety of America’s existence.Realtor.com reported that:“Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option…as people get more savings in their pockets, buying becomes the better option.”What proof exists that owning is financially better than renting?1. In a previous blog, we highlighted the top 5 financial benefits of homeownership:Homeownership is a form of forced savings.Homeownership provides tax savings.Homeownership allows you to lock in your monthly housing cost.Buying a home . . .

by Keeping Current Matters
The price of any item is determined by the supply of that item, as well as the market’s demand for it. The National Association of REALTORS (NAR) surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions” for their monthly REALTORS Confidence Index.Their latest edition sheds some light on the relationship between seller traffic (supply) and buyer traffic (demand).Buyer DemandThe map below was created after asking the question: “How would you rate buyer traffic in your area?”The darker the blue, the stronger the demand for homes is in that area. The survey showed that in 38 out of 50 states buyer demand was slightly lower than this time last year but remains strong. Only six states had a ‘stable’ demand level.Seller Supply The index . . .

by Keeping Current Matters
Home values have risen dramatically over the last twelve months. In CoreLogic’s most recent Home Price Index Report, they revealed that national home prices have increased by 6.2% year-over-year.CoreLogic broke down appreciation even further into four price ranges, giving us a more detailed view than if we had simply looked at the year-over-year increases in national median home price.The chart below shows the four price ranges from the report, as well as each one’s year-over-year growth from July 2017 to July 2018 (the latest data available). It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor which determines how much your home has appreciated over the course of the last year.Lower-priced homes have appreciated at . . .

by Keeping Current Matters
If you thought about selling your house this year, now more than ever may be the time to do it! The inventory of homes for sale is well below historic norms and buyer demand is skyrocketing. We were still in high school when we learned about the concept of supply and demand, so we understand that the best time to sell something is when the supply of that item is low and demand for that item is high. That defines today’s real estate market.Lawrence Yun, Chief Economist at the National Association of Realtors, recently commented:“Contract signings inched backward once again last month, as declines in the South and West weighed down on overall activity.”Yun goes on to say:“The reason sales are falling off last year’s pace is that multiple years of inadequate supply in markets with strong job growth . . .

by Keeping Current Matters
Here are four great reasons to consider buying a home today instead of waiting.1. Prices Will Continue to RiseCoreLogic’s latest Home Price Insights report reveals that home prices have appreciated by 6.2% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 5.1% over the next year.Home values will continue to appreciate for years. Waiting no longer makes sense.2. Mortgage Interest Rates Are Projected to IncreaseFreddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have already increased by half of a percentage point, to around 4.5% in 2018. Most experts predict that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in . . .

by Keeping Current Matters
There are many things that factor into the decision to buy a home. New research from the Urban Institute suggests that one of those things may be inherited from your parents.Children are More Likely to Own a Home if Their Parents DidAccording to an analysis of millennial homeowners, the homeownership rate of those whose parents rent their homes is 14.4%, while the rate amongst millennials whose parents are homeowners is 31.7%! “A young adult’s odds of homeownership are highly correlated with their parent’s homeownership. Without controlling for such factors as age, income, education, marital status, and race or ethnicity, there is a 17 percentage-point gap between the homeownership rate for young adults whose parents are renters and young adults whose parents are homeowners.”The study also revealed that as a parent’s net worth . . .

by Keeping Current Matters
There are many things that factor into the decision to buy a home. New research from the Urban Institute suggests that one of those things may be inherited from your parents.Children are More Likely to Own a Home if Their Parents DidAccording to an analysis of millennial homeowners, the homeownership rate of those whose parents rent their homes is 14.4%, while the rate amongst millennials whose parents are homeowners is 31.7%! “A young adult’s odds of homeownership are highly correlated with their parent’s homeownership. Without controlling for such factors as age, income, education, marital status, and race or ethnicity, there is a 17 percentage-point gap between the homeownership rate for young adults whose parents are renters and young adults whose parents are homeowners.”The study also revealed that as a parent’s net worth . . .

by Keeping Current MattersSome are attempting to compare the current housing market to the market leading up to the “boom and bust” that we experienced a decade ago. They look at price appreciation and conclude that we are on a similar trajectory, speeding toward another housing crisis.However, there is a major difference between the two markets. Last decade, while demand was being artificially created by extremely loose lending standards, a tremendous amount of inventory was coming to the market to satisfy that demand. Below is a graph of the inventory of homes available for sale leading up to the 2008 crash.A normal market should have approximately 6 months supply of housing inventory. As we can see, that number jumped to over 11 months supply leading up to the housing crisis. When questionable mortgage practices ceased, and demand dried up, there was a . . .

by Keeping Current Matters
Every three years, the Federal Reserve conducts their Survey of Consumer Finances in which they collect data across all economic and social groups. Their latest survey data, covering 2013-2016 was recently released.The study revealed that the median net worth of a homeowner was $231,400 – a 15% increase since 2013. At the same time, the median net worth of renters decreased by 5% ($5,200 today compared to $5,500 in 2013).These numbers reveal that the net worth of a homeowner is over 44 times greater than that of a renter.Owning a home is a great way to build family wealthAs we’ve said before, simply put, homeownership is a form of ‘forced savings.’ Every time you pay your mortgage, you are contributing to your net worth by increasing the equity in your home.That is why, for the fifth year in a row, Gallup reported that Americans . . .