Nice piece of garbage reporting Bloomberg. Do National Association of Realtors shills have you on their speed dial? According to the NAR and most real estate agents we are about to experience a massive surge in home sales due to weather related constrained demand.
“There aren’t many people who want to drive around looking for homes in a blizzard, and there aren’t many sellers who can put their homes on the market unless they have some place to move to,” Maki said. “We’ve seen sales take a hit so far, lagging where they usually are, but we think the next few months will make up for it.”
Fact or fiction?
A bunch of nonsense is more like it. I have already pocked a number of holes in their weather related argument in my previous posts, but only time will prove me right. The reality is quite different. The real estate market is now done with it’s dead cat bounce. That was evident in last weeks report where according to the National Association of Realtors, pending home sales index “unexpectedly” fell 0.8% in February and 10.5% from a year ago level. If you would like to get a complete real estate report and learn exactly what will happen over the next few years, please read my comprehensive report. Real Estate Collapse 2.0 Why, How & When
In short, the real estate market will decline over the next 3-4 years in conjunction with the US Economy and financial markets. When it is all said and done, I wouldn’t be surprised to see real estate prices down 30-50% from today’s levels in select markets. If you would be interested in learning when the bear market of 2014 will start (to the day) so you can time the real estate market with more precision, please Click Here.
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Home Sales About To Surge Google
Bloomberg Writes: Home Sales in U.S. Poised to Surge With Spring: Mortgages
Donna Cicerone and her husband Paul want to put their three-bedroom home in Milton, Massachusetts, on the market. First, they have to find a house to buy.
The Cicerones live in the Boston area, where all but three weekends this year have had snow, sleet or rain. Bad weather has forced them to cancel house-hunting plans half a dozen times, they said. When they have found a house they liked amid a limited supply of properties, they’ve been outbid.
“The moment we sign a contract to buy, we’re putting our house on the market,” said Donna Cicerone. “We feel like we’re missing an opportunity because everyone says there are lots of buyers, but there’s nothing we can do.”
Frustrated shoppers and would-be sellers like the Cicerones are setting the pace for the housing market’s spring selling season, the March through June period when more than half of U.S. home sales take place. The market’s getting a late start this year because so much of the country has been in the grips of bad weather, said Dean Maki, chief U.S. economist for Barclays PLC in New York.
“There aren’t many people who want to drive around looking for homes in a blizzard, and there aren’t many sellers who can put their homes on the market unless they have some place to move to,” Maki said. “We’ve seen sales take a hit so far, lagging where they usually are, but we think the next few months will make up for it.”
Potential home buyers view a model home for sale. Home sales declined in February to…Read More
Sales Fell
Home sales declined in February to the lowest level since mid-2012, according to the National Association of Realtors. The number of contracts signed with the intention of purchasing properties fell that month to the lowest since 2011, according to the Realtors’ group. While the numbers are seasonally adjusted, they can be influenced by unexpected events such as unusual weather.
Applications for mortgages to purchase homes dropped in February to the lowest since 1995, according to an index from the Mortgage Bankers Association that also is seasonally adjusted. By mid-March, the gauge regained about 12 percent from that low, while remaining about 17 percent below the level it was during the same week in 2013.
Most of the sales blocked by bad weather will happen in the next few months, Maki said. Housing forecasters Fannie Mae and the Mortgage Bankers Association predict 2014 home sales will be
‘Exaggerated Bounce’
“Because we’ve had a late start to sales, we expect a bit of an exaggerated seasonal bounce,” said Maki.
Sales of existing homes probably will rise to 5.14 million in 2014, up from last year’s 5.07 million, according to the mortgage bankers group. Mortgage lending for purchases probably will total $661 billion, near last year’s $652 billion, the trade group said.
Like many buyers, the Cicerones are eager to purchase a house so they can lock a mortgage rate before borrowing costs rise. The average U.S. rate for a 30-year fixed mortgage was 4.4 percent last week. A year earlier, it was 3.57 percent. By the end of 2014, the average rate probably will be about 4.6 percent, said Fannie Mae.
“We’re ready to pounce when we find the right house,” said Cicerone, 48. “We want to put our home on the market to catch all the buyers nervous about mortgage rates, and we want to find a house as fast as we can so we can lock in a good rate too.”
They may get some cooperation from the weather in April. Below-normal temperatures will give way to more seasonal weather in the eastern U.S. next week, according to Matt Rogers, president of Commodity Weather Group LLC in Bethesda, Maryland. The December through February period was the coldest in four years.
Fed Tapering
Borrowing costs have risen as the Federal Reserve continues tapering stimulus efforts that have kept interest rates low. Policy makers cut monthly bond purchases to $55 billion this month, from $85 billion last year. Fed Chair Janet Yellen said the program could end this fall and that the benchmark interest rate, which has been close to zero since 2008, may rise six months after that.
Tighter lending also is hurting the market, said Michael Hanson, a former Federal Reserve economist now working for Bank of America Corp. in New York. In January, the Fed issued a report showing 1.4 percent of banks had raised mortgage standards, the first increase since April 2012.
“We need more first-time buyers in the market so they can purchase the homes of people who want to move up,” Hanson said. “We won’t see a normal real estate market until they are included, and they are the ones most affected when lenders tighten standards.”
First-time buyers accounted for 28 percent of all purchases in February, up from 26 percent in January that was the lowest in data going back to October 2008, according to the National Association of Realtors.
Supply Differences
The supply of homes for sale is bigger than last year, according to the National Association of Realtors. At the current sales pace, it would take 5.2 months to sell the properties on the marketin February, compared with 4.6 months a year earlier.
The markets in certain areas, such as Boston, Denver, and Houston, are leaner than during the 2013 Spring selling season. In Boston and Boulder, Colorado, the number of homes for sale in February was down about 30 percent from a year ago, according to Zillow Inc. in Seattle. In Houston, Dallas and Denver, the contraction is about 20 percent. The metropolitan New York and Seattle areas were up 1 percent.
That has made extra work for home-loan brokers such as Jonathan Sexton, a vice president at NE Moves Mortgage LLC’s office in Cambridge, Massachusetts. Each time people make an offer on a house, their mortgage broker prepares a letter showing they are pre-qualified for the amount of the bid. When supply shortages cause bidding wars, those letters are in greater demand.
‘Low Success’
“So far this year, I’ve seen an inordinately low success rate for bids because the supply of properties is so limited,” he said. “I wish I got paid in pre-approval letters instead of closed loans.”
Sales in the Boston area and other parts of the country likely will pick up speed as the market goes into April and May, said Bank of America’s Hanson.
“The housing market, like the rest of the economy, is on a gradual rec