Buy it or rent it, shelter is getting more expensive

One consequence of the housing crash has been the spectacular rise in residential rent. With fewer people able or willing to buy a home, demand for rental property surged.

for-sale-for-rentEven with investors buying up distressed homes and converting them to rentals the supply still couldn’t quite keep up with the demand. According to real estate website Zillow, that trend isn’t likely to change anytime soon.

In its latest Home Price Expectations Survey 52% of the industry analysts with an opinion said the rental market will eventually correct, but that won’t happen for a while. Zillow Chief Economist Dr. Stan Humphries says, when it does happen, it will happen naturally.

“Solving the rental affordability crisis in this country will require a lot of innovative thinking and hard work, and that has to start at the local level, not the federal level,” he said. “Housing markets in general and rental dynamics in particular are uniquely local and demand local, market-driven policies.”

Home prices rise

While rents continue to rise, so do home sale prices. The National Association of Realtors (NAR) reports most U.S. metro areas saw slightly stronger growth in home prices during the fourth quarter of last year. NAR says prices were boosted by fewer homes for sale, a slight increase in demand and a stronger job market.

Lawrence Yun, NAR chief economist, says the long housing recovery is showing legs.

“Home prices in metro areas throughout the country continue to show solid price growth, up 25 percent over the past three years on average,” he said. “This is good news for current homeowners but remains a challenge for buyers who are seeing home prices continue to out-pace their wages. Low interest rates helped preserve affordability last quarter, but it’ll take stronger income gains and more housing supply to help meet the pent-up demand for buying.”

The national median existing single-family home price in the fourth quarter was $208,700. That’s up 6.0% from the fourth quarter of 2013.

For all of 2014, the median price increased 4.8% in the third quarter from a year earlier; 4.2% in the second quarter from a year earlier; and 8.3% in the first quarter from a year earlier.

International buyers remain active

Rising prices and a strong dollar are doing nothing to discourage foreign investors from buying U.S. homes, particularly homes in California. The California Association of Realtors (CAR) ssays that 14% of its members closed a 2014 transaction with a buyer from another country.

More than a third of foreign buyers were from China and two thirds of all foreign buyers came to closing with all cash.

Foreclosures, which triggered the housing crash, haven’t completely disappeared as a factor in the housing market. In its most recent report on foreclosures, RealtyTrac found foreclosure filings rose in January from December, including a 55% jump in bank repossessions.

Still, the 58,000 foreclosure filings were down considerably from the peak of the crisis, when there were 158,000 foreclosure filings in March 2010.

This article originally appeared on ConsumerAffairs.com

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Last Quarter of 2014 Sees Solid House Price Growth in US

housing-increase-rate-chart-imageDuring the last quarter of 2014, the United States saw solid price growth for homes, with most metro areas seeing a slightly stronger rate of growth.

According to the article in Propertywire, this growth was due to lower levels of housing supplies combined with low interest rates and an improving jobs market, with these facts being gleaned from the National Association of Realtors. During the fourth quarter, the median price for an existing single family home was $208,700, an increase of 6% year-on-year and the median price rose in 150 out the 175 metro areas tracked, equating to 86% overall. This is a much stronger rate of price growth than the third quarter when 73% of metro areas saw increases. The latest figures also show that 14% or 24 areas saw double digit price increases during the fourth quarter.

These price increases are certainly good for those people who already own their own homes, but do mean that anyone looking to buy in the near future will face more of a challenge because house price growth is continuing to outpace wages growth. Experts point out that low interest rates have helped to preserve housing affordability, but that greater increases in wages combined with an increased housing supply are needed to help meet the pent-up demand for housing.

Sales of existing homes which includes single family homes and condominiums, fell by 1% during the last quarter of last year to reach a seasonally adjusted rate of 5.07 million, but overall existing home sales are 2.6% higher year-on-year.  At the end of last year there were 1.85 million existing homes for sale, slightly less than the 2.01 homes for sale during the last quarter of 2013. There was a 4.9 month supply of homes during the fourth quarter of last year, whereas a supply of six to seven months is considered to indicate a healthy market.

Overall most of the country had affordable housing, but upward pressure on house prices is still persisting in certain metro areas, particularly in the west where there is an insufficient supply of homes available to meet demand. Real estate experts are concerned that unless builders are able to boost construction levels this spring, there will be house shortages that will apply additional pressure on house prices. The most expensive area for homes during the last quarter of 2014 was in San Jose, California, where the median price for an existing family home was $855,000.

This article originally appeared on RealtyBizNews.com

Experts: Unaffordable rents here to stay

Rising RentsUnaffordable rents are making it hard for people to save for down payments, and they aren’t likely to ease up for at least two years, according to the latest Zillow Home Price Expectations Survey sponsored by Zillow and conducted quarterly by Pulsenomics.

More than half (52%) of the respondents with an opinion on this issue said the market will correct the nation’s soaring rents over time, and no government intervention is required. About one-third (35%) of respondents said rising rents are not a problem.

“Solving the rental affordability crisis in this country will require a lot of innovative thinking and hard work, and that has to start at the local level, not the federal level,” said Zillow Chief Economist Dr. Stan Humphries. “Housing markets in general and rental dynamics in particular are uniquely local and demand local, market-driven policies. Uncle Sam can certainly do a lot, but I worry we’ve become too accustomed to automatically seeking federal assistance for housing issues big and small, instead of trusting markets to correct themselves and without waiting to see the impact of decisions made at a local level. Broader federal efforts aimed at increasing real wages and job opportunities will go a long way toward helping renters, but real, lasting solutions to rising rents need to be found locally.”

The survey also asked panelists about President Obama’s announcement last month aimed at helping middle-class homebuyers through a reduction in FHA mortgage insurance premiums.

Two-thirds (66%) of survey respondents with an opinion said they think the changes will be “somewhat effective in making homeownership more accessible and affordable,” but almost half (49%) said the new initiatives are unwise, unnecessary and potentially risky for taxpayers.

The panelists predicted U.S. home values will rise 4.4% in 2015, to a median value of $187,040. The most optimistic forecasted a 5.5% increase, while the least optimistic projected a 3.1% increase. On average, panelists said they expect median U.S. home values to exceed their pre-recession peak of $196,400 by May 2017.

“During the past year, expectations for annual home value appreciation over the long run have remained flat, despite lower mortgage rates,” said Terry Loebs, Founder of Pulsenomics. “Regarding the near-term outlook, there is a clear consensus among the experts that the positive momentum in U.S. home prices will continue to slow this year.  At 4.4%, overall expectations for nationwide home value growth in 2015 are one-third lower than the actual 6.6% appreciation rate recorded last year.”

This article originally appeared on HousingWire, the nation’s most influential source of news and information on U.S. housing finance, covering lending, servicing, investments and real estate. © 2015 HW Publishing, LLC

The Top 14 Tips Landlords Wish Their Tenants Knew

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Sometimes the landlord/tenant relationship can be a difficult one. But it does not have to be that way, and it certainly does not have to start out that way. As landlords, we try to get this relationship off to a good start and keep it that way by taking care of our properties and tenant concerns.

But some tenants, perhaps due to past experiences, prepare for the worst and thus approach the relationship ready for a fight. Maybe they have never had a decent landlord. Maybe some just do not know how to act. Whatever the reason, here are 14 tips from our 12 years as landlords to tenants everywhere for a decent landlord/tenant relationship.

The Top 14 Tips Landlords Wish Their Tenants Knew

1. Pay your bills on time.

Seems fairly obvious, I know, but many tenants believe they can pay every other bill before they pay the rent. Want to stay on our good side? Please pay your rent on time.

2. Always try to be polite.

I will, too. Being polite and calm really does go a long way. You would not like it if I left you snarky or angry screaming messages on your voicemail. I know sometimes issues can seem to linger on and on, but we really are doing our best to get things resolved.

3. Listen to our instructions.

We tell you things for a reason. If we show you how to trip a breaker or turn a gas valve off, listen. It may just save your butt. If we tell you there will be a hard freeze tonight and to please let your faucet drip, don’t call us the next day and complain that your pipes have frozen and you need to do laundry. I can’t control the weather, so you will just have to wait until it warms up.

4. Help us.

We try to take care of our properties, but we can’t be everywhere all the time. Is there something we need to know about? Tell us. Is something broken? Let us know. Help us by being our eyes and ears.

Related: How to Find a Tenant in Any Market: A Comprehensive Guide

5. Tell the truth.

Did you or your kid flush something down the toilet and stop it up? Then tell us the truth so we can get the problem resolved as quickly as possible. After a dozen years in this business, we can almost always determine the culprit anyway.

6. Please just leave me a message.

If we do not answer your call, do not hang up and call over and over again. There are times we simply cannot take your call. How do you think we are going to feel when we finally answer you after you have called five times in a row? It had better be a matter of life or death.

7. Understand that we have a lot going on.

Sometimes other tenant’s issues may take priority. We know about your issue, and we will get to it just as soon as we can. We might for example need to make sure everyone has heat before taking care of your dripping bathroom sink.

8. If you get in a bind, talk to us.

Communication is key! Tell us what is going on. Did you lose your job? Has your roommate gone off the deep end? We have been there before, and we know what it is like. But if you do not talk to us, there is no way we can help you. Please do not put your head in the sand and hope whatever problem you are having will go away. It will not, and things will only get worse.

9. Treat my property and the people who do work for me with respect.

You would not believe how many people are just plain rude to the people we send over to try and fix their problems. Plus, how do you think we are going to react if we see that your place is a mess or that you are causing damage? Disrespecting our properties or our help is a sure way to create an adversarial relationship.

10. Work with me.

We know you have a busy schedule. So do we, and trust us, we want your issue resolved as quickly as possible too because we have a dozen or so more to deal with. It all goes much easier if you work with us on times and arrangements. You might have to put up your dog for a day or allow us into your apartment on your day off. We hate to disturb you, but we will be done and out of your hair just as soon as we can.

11. Trust me.

We are not going to steal your stuff or try and stiff you. Yes, we know some landlords might, but not us. If we say we need to get into your home, it is for a legitimate reason.

Related: Here is the Best Indicator of Tenant Quality… Hands Down.

12. Follow the rules.

They are there for a reason. They were explained to you when you moved in, and you agreed to follow them. It just makes life harder for all of us if you choose to ignore them. If you could not live with the rules, then you should not have moved in.

13. Respect your neighbors.

Would you appreciate a loud party the night before you need to make a major presentation at work or before your final exams? No, you would not. Remember that you live in an apartment building, and you have neighbors — sometimes very close neighbors. Think about how your actions might affect them. I’m not saying do not have any fun; just try to be considerate.

14. Hide your weed.

Just please do this. It is technically against your lease, and you really never know when there will be an emergency and who will need to access your place.

A lot of the above is just common courtesy and common sense. But for those few — and you know who you are — please review and follow the above and let’s make your stay with us as pleasant as possible.

This article originally appeared on BiggerPockets, the real estate investing social network. © 2015 BiggerPockets Inc.

Cary, Raleigh, Apex, Fuquay, Morrisville, Holly Springs, Durham, Chapel Hill, Garner, Wake Forest. Residential rentals Wake County, RTP, RDU.  http://www.RobertsRentals.net. Triangle area rental homes and property management.  Bev Roberts Rentals