Lending in the gig economy

Posted by at 12:20 pm

Plans are underway at Fannie Mae and Freddie Mac to make home loan qualification easier for people earning money in the “gig” economy. For those not familiar, the “gig” economy refers to the pursuit of flexible, freelance employment instead of full-time work on a traditional career path. In today’s ever-changing economy, finding stable, salaried positions that cover the bills isn’t always so easy. Other people simply find working as an independent contractor better fits their lifestyle. Workers in the gig economy often make similar income to salaried positions. Arguably, their income is more dependable than that of salaried employees, whose jobs are closely tied to the success of their employer and stability of their field. But in many cases, gig earnings don’t qualify as income under existing mortgage-industry guidelines. Typical mortgages tend to require W-2 forms and IRS information going...
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Accessorize your dwelling with an ADU unit

Posted by at 2:56 pm

As home prices continue to  rise, many folks are left wondering how they can afford a piece of the American dream. Some have broached the idea of sharing, but co-ownership – even among family – is a little too cozy for most. The tenancy approach is probably the easiest. That’s why many buyers today are looking for homes with potential to add “accessory dwelling units,” or ADUs. ADU residences can be build-ons, re-purposed space or even a separate, free-standing unit. The main draw is practicality. ADUs provide a sense of autonomy for the renter at a lower cost, and can provide the homeowners with help paying their mortgage. The majority (62 percent) of U.S. households are made up of one or two people, while most new and existing homes are designed to accommodate three or four. Legacy housing stock is...
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Manufacturing a new real estate market

Posted by at 9:44 am

Like tiny homes, manufactured homes are emerging as a possible solution to the current housing shortage. For those with low-to-moderate incomes, who don’t want to sleep in a tiny home bed that folds out of a closet just above the kitchen sink, the manufactured home might make a more palatable choice. Previously referred to as mobile homes, manufactured houses are built in a factory, and transported to a site on a flatbed truck – not to be confused with pre-fab homes, which are transported in pieces and mostly built on-site. New manufactured homes cost a median of $73,800, or about a quarter the cost of new homes nationally, according to the latest U.S. Census Bureau. That might be just the remedy for first-time home shoppers who are having trouble saving up a down payment. But regulatory restrictions on zoning and...
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Rebuilding black homeownership

Posted by at 12:10 pm

After the Fair Housing Act passed in 1968, black homeownership in the U.S. increased steadily for 30 years, reaching nearly 50 percent in 2004. But those gains have all but disappeared since. The homeownership rate among African-Americans has tumbled below 43 percent in 2018, more than 20 percentage points lower than the national rate of 63.7 percent. While young people of all races are buying homes at lower rates than their parents, this is particularly true of young blacks. Fear and distrust of the system may be a motivating factor. Studies show African-Americans were disproportionately targeted by predatory lending practices in the run-up to the Housing Crisis, resulting in higher percentages of foreclosures and other adverse financial situations affecting credit. Market dynamics have made it difficult for many black households to regain a foothold. Today, only 20 percent of African...
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Shopping heats up for summer home season

Posted by at 12:42 pm

Just when you thought the housing market couldn’t get any hotter, it’s a buying frenzy as the summer season begins. Most buyers are beset with confidence in the job market, and many also carry the ticking biological desire to start families. Even with all the talk about rising prices, rising interest rates and reduced tax benefits in 2018, demand is not cooling. If anything, it appears the potential homebuyer is just becoming more rugged and resilient! According to a March survey, 40 percent of home shoppers have been looking for seven months or more, while 34 percent have been searching for four to six months. The numbers show that there is only enough inventory on the market to last 3.4 months. In a statement, Lawrence Yun, chief economist for the National Association of Realtors, reported: “supply is woefully low, and...
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Concentrate on the Positives

Posted by at 8:51 am

As America heads into the big spring selling season, all signs point to a robust housing market in 2018. Demand is high and homebuilders are upbeat. The National Association of Home Builders (NAHB) confidence gauge is at its highest level in 18 years. Record numbers of home shoppers are packing sales centers and open houses. The pace of annual construction spending soared to a record $1.257 trillion in November, and starts of single-family homes and building applications are the strongest in a decade. But will vigorous construction be enough to offset exceptionally weak inventory? With new and existing home sales skyrocketing, the national inventory is pegged at just 3.4 months, the shortest timeframe since 1999, and far short of the 6-month supply considered necessary for a healthy housing balance. Home builders say they’ll concentrate more on affordable housing in 2018, but...
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Seniors no longer a niche market

Posted by at 1:17 pm

Fueled by the baby-boomer generation, the population of Americans 65 and older is growing exponentially, and will become a major part of the housing and mortgage industries over the next several decades. According to the latest report from the Harvard Joint Center for Housing Studies, one out of three U.S. households in 2035 will be headed by someone over 65. That’s an estimated 79 million people! Real estate agents and mortgage lenders who plan sales strategies with an eye on the aging will doubtlessly see more success. One unexpected backlash of the exodus to the suburbs over the last 40 years is the growing number of retirees realizing their neighborhoods no longer fit their needs. In a recent survey from Freddie Mac, seniors said they need major renovations in order to stay in their current homes as they age –...
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October 26th, 2017

2018 Housing market: A New Frontier?

Posted by at 12:06 pm

Heading into the back stretch of 2017, analysts predict more of the same for the 2018 housing market – moderate economic growth, solid job gains and low mortgage interest rates. Same old, same old – or is it? Could new construction rev up the housing market wrapping up the second decade of the 21st Century? Economists say low supply is driving high prices right now, but homes are selling fast; continuing to average 30 or fewer days on the market. Some potential buyers have acceded to  the sticker shock, but in most markets, they’ve shown a willingness to spend more. Builders report first-time buyers are skipping the traditional starter home and jumping straight to that new, move-up home instead. Waiting longer to buy a first home has increased the median age of a first-time homebuyer, and many are already higher...
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Exploding home values mean refis, remodels

Posted by at 11:25 am

The low supply of houses on the market in the home stretch of 2017 continues to ramp up demand, jolting home prices “through the roof.” Most current homeowners can count on rising values for the foreseeable future! Cash-out refinances and other home equity loans are ways to pay for repairs or remodels that can push home values even higher. Updates and improvements can be used to enhance personal comfort, maintain property value – or even increase the chance of getting top dollar when an owner does decide to sell! Many of today’s first-time home buyers go smaller or older by necessity – just to get a foot in the door. They can build their dreams with the help of home equity! For homes built before 1940, updates to roofing, gutters and HVAC trend high on the list, along with abatement of toxic...
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Buyers explore longer commutes

Posted by at 12:50 pm

  Stopping short of saying it’s a “major” trend, extreme commuting – or at least extended commuting – is becoming an established feature of the American workplace. About 21 percent of workers commute more than 60 minutes each way to their jobs. More than half of these drive the whole distance alone. Extreme commuters – defined as people who spend 90 minutes or longer getting to work each way – are still rare, making up only about 3 percent of the work force. But the numbers are rising. By coincidence, many companies today are bringing telecommuting workers back to the office, demanding more collaboration and contact with customers. U.S. workers who performed all or some of their work at home fell from 24 to 22 percent between 2015 and 2016. With soaring prices, many commuters say they are willing to sacrifice...
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