Retirees could again lead Florida rebound!

WASHINGTON – Jan. 4, 2012 – While international buyers have been heralded as the leaders of a Florida real estate rebound, a recent Census Bureau report on migration trends indicates that U.S. residents from northern climates are once again heading to Florida for retirement.

Between April 1, 2010, and July 1, 2011, Florida welcomed 256,000 new residents, or roughly 560 new Floridians each day. Texas grew by 529,000 residents, and California came in second with 438,000.

In total population, Florida retained its No. 4 status, but its 19.1 million residents moved closer to bumping New York, with 19.5 million residents, from its No. 3 spot.

Florida ranked No. 3 for attracting new international residents, behind only California and Texas. However, the Sunshine State ranked No. 2 in attracting residents from other U.S. states. During the 15 months of the Census study, 119,000 moved to Florida from other states, a number surpassed only by Texas’ 145,000 new residents.

The state’s growth according to the Census Bureau surpassed earlier estimates by the University of Florida’s Bureau of Economic & Business Research, and Sarasota’s Herald-Tribune dug a little deeper to find out why. They found that the UF study relies mainly on new electric utility hookups to judge population growth, while the Census Bureau relies largely on tax returns and Medicare data.

Since the Census Bureau numbers were roughly twice UF’s figures, the Medicare data may have made a difference – implying greater demand from retirees – said University of Central Florida Economist Sean Snaith. “I think with the recovery of the wealth, at least through the rebound of the stock market, that has helped the flow of retirees resume,” Snaith said.

Source: Herald-Tribune, Dec. 21, 2011, Doug Sword

© 2012 Florida Realtors®

Leading U.S. economists:Florida houseing market bouncing back

ORLANDO, Fla. – Dec. 7, 2011 – Despite national and global headwinds, Florida’s real estate market is entering 2012 on an upward trend, according to three leading U.S. economists.

“Our state is in a mini-recovery,” said Florida Realtors® Chief Economist Dr. John Tuccillo at the state association’s 2012 Real Estate and Economic Forecast Conference in Orlando. “Sales are trending up, listing inventories are falling, the supply of lender-related properties has stabilized, and we are seeing multiple offers on homes in some local markets.”

In fact, Florida homes today may be undervalued, Tuccillo added. “That may seem like a drastic statement,” he said. “But a buyer who plans to own the home for five to seven years can get some great bargains today.”

Mark Vitner, senior economist at Wells Fargo in Charlotte, N.C., said the U.S. economy will continue to face significant challenges, particularly financial concerns related to the European debt crisis. But he expects the U.S. economic recovery will continue next year, making it easier for Midwesterners, for example, to buy Florida homes.

“Florida’s economy is recovering, with tourism and healthcare leading the way,” Vitner said. “International tourism has been particularly strong in Miami and Orlando.”

Looking around the state, Vitner said Jacksonville’s unemployment rate has dropped and home prices are stabilizing. In Orlando, prices have not yet reached bottom, he said, but the winter tourism season should help the regional economy. Tampa and Southwest Florida have seen solid job growth, with little new home construction.

South Florida’s economy is growing thanks to trade relationships with Latin America and the Caribbean, while in the Panhandle, Fort Walton Beach is outperforming Panama City and Pensacola, according to Vitner.

Dr. Lawrence Yun, chief economist for the National Association of Realtors®, said many Florida markets are showing sharp drops in inventories of homes for sale – a sign that demand is picking up and prices are stabilizing. “That’s a major change from just a year ago,” he said. “Buyers have stepped back into the Florida market.”

Noting the state’s powerful appeal to international buyers, Yun said he was particularly optimistic about the outlook for South Florida. “Don’t be surprised to see a gain in home prices in the Miami and Naples markets in the next 18 months,” he said. “From there, the recovery is likely to roll northward to Central Florida and then North Florida.”

Tuccillo noted that foreclosed and distressed properties will remain a significant part of the Florida market in 2012, but lenders are feeding these properties into the market at a gradual pace rather than pushing them out all at once.

The event also featured a panel of Florida real estate professionals, who discussed the 2012 outlook for several sectors of the state’s real estate market from a practitioner’s point of view. Panelists were Clark Toole, president and COO, Coldwell Banker Residential Real Estate Inc. in Florida, discussing residential real estate; Cynthia Shelton, 2009 president of Florida Realtors and a director at Colliers International in Orlando, discussing the commercial market; and Dean Saunders, accredited land consultant and broker-owner of Coldwell Banker Commercial Saunders Real Estate in Lakeland, covering the market for land and undeveloped property.

What will new homes look like in 2015?

WASHINGTON – Dec. 6, 2011 – Members of the National Association of Home Builders (NAHB) were asked earlier this year what they anticipate the new home size will be 2015. While the size of new American homes has been shrinking for years, the builders offered some insights into what home features will start to disappear and which will become more popular.

In terms of square footage, the anticipated drop isn’t drastic. Currently, single-family homes measure an average of 2,400 square feet, a slight decrease from an average of around 2,521 square feet five years ago. In 2015, industry professionals believe it will drop to around 2,150 square feet.

To make up for less square footage, many new homes won’t have living rooms. Of the builders surveyed, 52 percent believe traditional living rooms will be combined into other areas of the home, such as family rooms and kitchens, to form “great rooms.” About 30 percent of builders believe the living room will vanish entirely.

Also likely to become less in demand by 2015? Mudrooms, formal dining rooms, skylights, sunrooms, three-season porches, media rooms, butler ‘s pantries, and homes exceeding four bedrooms and three bathrooms.

However, surveyed builders expect to see more ceiling fans, larger laundry rooms, eat-in kitchens, first-floor master suites with walk-in closets, kitchens with double sinks and recessed lighting. And while two-car garages won’t go anywhere, demand will probably sink for three-car garages.

Sixty-eight percent of builders surveyed say that energy-saving technologies and features including low-E windows, energy-efficient appliances and LED lighting will be common, along with other green features, such as engineered wood products, dual-flush toilets and low-flow faucets. Whole-house Energy Star certification is likely to become the norm for new homes in 2015, but LEED certification will not. Green features considered “somewhat likely” to be in new homes include argon windows, tankless water heaters, above-code insulation, and solar photovoltaic and thermal systems.

Says Stephen Melman, director of Economic Services with the NAHB: “Although affordability is driving these decisions, smaller homes are a positive for builders. It allows for more creative design, more amenities, better flow. It’s an opportunity to deliver a better home.”

© 2011 Mother Nature Network, Matt Hickman. Distributed by MCT Information Services.

Revisions on jobs reports offer good news.

WASHINGTON – Dec. 5, 2011 – The Department of Labor’s monthly jobs report landed with a thud three months ago. The economy added no jobs in August. None.

That report turned out to be wrong. More than 100,000 jobs were added in August, later estimates showed. And three months later, a positive trend is clear. More than 500,000 jobs have been added in four months, and talk of a double-dip recession has largely disappeared.

“It was heartening to see that we continued to see private-sector job creation, 21 months in a row,” says Brian Deese, deputy director of the White House National Economic Council. “But at the same time, the pace of job creation isn’t sufficient. We need to increase the pace.”

So is the economy finally out of the woods? Not so fast.

The major hurdle still to be surmounted lies in Europe, where government leaders will meet later this week in an effort to firm up a rescue plan for debt-ridden economies. Vice President Biden is in Greece, the epicenter of the crisis; Treasury Secretary Timothy Geithner travels to Germany, France and Italy midweek.

The fear is that a European recession would have a contagious effect on financial markets.

The other immediate hurdle: extending a payroll tax cut for millions of families and unemployment insurance for many of the 13.3 million people still looking for work. President Obama will visit Osawatomie, Kan., on Tuesday to make his latest pitch where Theodore Roosevelt called for “equality of opportunity” in 1910.

Friday’s jobs report indicating the nation’s jobless rate dropped from 9 percent in October to 8.6 percent in November was a welcome sign. Combined with revisions to earlier monthly reports, it showed a gain of 534,000 jobs in four months and 2.5 million since hitting a low point February 2010, and marked 21 months in a row of private-sector job growth.

Perhaps as significant as November’s 120,000-job gain are the recent revisions for earlier months: August from zero to 104,000 new jobs, September from 103,000 to 210,000, and October from 80,000 to 100,000, with one more revision still to come.

“That usually shows there’s a little momentum,” says Jared Bernstein, until recently Biden’s top economic adviser. “And that’s why you worry so much about anything that could block that momentum.”

The jobs report wasn’t all rosy. State and local governments continued to shed jobs, totaling 600,000 since the second half of 2008.

The mismatch between jobs created and the jobless rate decline indicated that some 315,000 people stopped looking for work. If they return, the jobless rate could rise.

Still, Republican economic adviser Douglas Holtz-Eakin sees a silver lining: More people are quitting the workforce than getting laid off.

“That’s a good-news story: People are confident enough to quit,” he says. “I think the only way we get a double dip is a real serious European meltdown.”

© Copyright 2011 USA TODAY, a division of Gannett Co. Inc., Richard Wolf

Pending home sales jump in October!

 WASHINGTON – Nov. 30, 2011 – Pending home sales rose strongly in October and remain above year-ago levels, according to the National Association of Realtors® (NAR).

The Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, surged 10.4 percent to 93.3 in October from 84.5 in September and is 9.2 percent above October 2010 when it stood at 85.5. The data reflects contracts but not closings.

“Home sales have been plodding along at a sub-par level while interest rates are hovering at record lows, and there is a pent-up demand from buyers who normally would have entered the market in recent years,” says Lawrence Yun, NAR chief economist. “We hope this is indicates more buyers are taking advantage of the excellent affordability conditions. Many consumers recognize that homebuyers in the past two years have had one of the lowest default rates in history. Moreover, continued inventory declines are another healthy sign for the housing market.”

The PHSI in the Northeast surged 17.7 percent to 71.3 in October and is 3.4 percent above October 2010. In the Midwest the index jumped 24.1 percent to 88.7 in October and remains 13.2 percent above a year ago. Pending home sales in the South rose 8.6 percent in October to an index of 99.5 and are 9.7 percent higher than October 2010. In the West, the index slipped 0.3 percent to 105.5 in October but is 8.1 percent above a year ago.

“Although contract signings are up, not all contracts lead to closings,” Yun says. “Many potential homebuyers inadvertently hurt their credit scores and chances of getting a mortgage through easily averted actions, such as cancelling an old credit line while taking on a new one. Such actions could unwittingly prevent buyers from obtaining a mortgage if their credit score is close the margins of qualifying – or they might get a loan but with less favorable terms.”

Aging in place: a little help can go a long way…

Nov. 22, 2011– Retirement communities may have their perks, but Beryl O’Connor says it would be tough to match the birthday surprise she got in her own backyard when she turned 80 this year.

She was tending her garden when two little girls from next door — “my buddies,” she calls them — brought her a strawberry shortcake. It underscored why she wants to stay put in the house that she and her husband, who died 18 years ago, purchased in the late 1970s.

“I couldn’t just be around old people — that’s not my lifestyle,” she said. “I’d go out of my mind.”

Physically spry and socially active, O’Connor in many respects is the embodiment of “aging in place,” growing old in one’s own longtime home and remaining engaged in the community rather than moving to a retirement facility.

According to surveys, aging in place is the overwhelming preference of Americans over 50. But doing it successfully requires both good fortune and support services — things that O’Connor’s pleasant hometown of Verona has become increasingly capable of providing.

About 10 miles northwest of Newark, Verona has roughly 13,300 residents nestled into less than 3 square miles. There’s a transportation network that takes older people on shopping trips and to medical appointments, and the town is benefiting from a $100,000 federal grant to put in place an aging-in-place program called Verona LIVE.

Administrated by United Jewish Communities of MetroWest New Jersey, the program strives to educate older people about available services to help them address problems and stay active in the community. Its partners include the health and police departments, the rescue squad, the public and public schools, and religious groups.

Among the support services are a home maintenance program with free safety checks and minor home repairs, access to a social worker and job counselor, a walking club and other social activities. In one program, a group of middle-school girls provided one-on-one computer training to about 20 older adults.

Social worker Connie Pifher, Verona’s health coordinator, said a crucial part of the overall initiative is educating older people to plan ahead realistically and constantly reassess their prospects for successfully aging in place.

“There are some people who just can do it, especially if they have family support,” said Pifher, “And then you run into people who think they can do it, yet really can’t. You need to start educating people before a crisis hits.”

There’s no question that aging in place has broad appeal. According to an Associated Press-LifeGoesStrong.com poll conducted in October, 52 percent of baby boomers said they were unlikely to move someplace new in retirement. In a 2005 survey by AARP, 89 percent of people age 50 and older said they would prefer to remain in their home indefinitely as they age.

That yearning, coupled with a widespread dread of going to a nursing home, has led to a nationwide surge of programs aimed at helping people stay in their neighborhoods longer.

Verona LIVE is a version of one such concept: the Naturally Occurring Retirement Community, or NORC. That can be either a specific housing complex or a larger neighborhood in which many of the residents have aged in place over a long period of time and need a range of support services in order to continue living in their homes.
Verona is an apt setting. Roughly 20 percent of its residents are over 65, compared with 13 percent for New Jersey as a whole.

Another notable initiative is the “village” concept. Members of these nonprofit entities can access specialized programs and services, such as transportation to stores, home health care, or help with household chores, as well as a network of social activities with other members.

About 65 village organizations have formed in the U.S. in recent years, offering varying services and charging membership fees that generally range between $500 and $700 a year.

One of the potential problems for people hoping to age in place is that their homes may not be senior-friendly.

“It becomes a challenge because we live in Peter Pan houses, designed for people who never grow old,” said Susan Bosak, a social scientist who is overseeing a program to boost intergenerational engagement in Tulsa, Okla.

Many older people live in homes that are 40 or more years old, abounding with narrow interior doorways, hard-to-reach kitchen cupboards and potentially hazardous bathroom fixtures.

“If you’re a boomer person, with money to remodel, think about making your house more user-friendly, not just more beautiful, for when you have your knee replacement or a chronic condition,” said Nancy Thompson of AARP. “We’re talking smart, convenient. It doesn’t have to look institutional or utilitarian.”

To promote this outlook, AARP has teamed up with the National Association of Home Builders to create a designation for certified aging in place specialists trained in designing and modifying residences for the elderly. Several thousand builders, contractors, remodelers and architects have been certified. Building or remodeling homes can include such details as touchless faucets, trim kitchen drawers instead of cupboards, grab bars and nonslip floors in the bathrooms.

Arizona’s Pima County, along with a few other local governments, has gone a step further, passing an ordinance requiring that all new homes in the unincorporated areas around Tucson offer a basic level of accessibility. They must have at least one entrance with no steps. Minimum heights and widths are set so that light switches can be easily reached and doorways are passable in a wheelchair.

For now, Beryl O’Connor’s two-story, four-bedroom Cape Cod house, built in the 1940s, poses no physical challenges for her. Her own bedroom is on the ground floor, and she recently had a safety bar installed in her bathtub, so she thinks prospects are good for staying put over the long term.

Plus, she’s got company at home — a 26-year-old granddaughter lives upstairs and commutes to a job in New York — and many friends around town, where she has a busy schedule of club meetings, group lunches, card games and occasional bus trips to casinos.

“You’ve got to socialize,” she says. “There are things out there to do — you’ve got to look for them.”

Ira and Roseanne Bornstein, who live a few blocks from O’Connor, also think their longtime home can accommodate them suitably for many years to come. There’s a room on the ground floor they could convert to a bedroom, and space upstairs to house a live-in aide if one were needed.

“It’s a modest home, but it’s always worked for us,” said Rosanne Bornstein, 63, who was a school counselor and teacher for 25 years. “We’re very strong in wanting to stay here.”

Her 69-year-old husband, a retired pharmacist, said they worry that the economics of relocating might result in a smaller residence, and crimp their ability to entertain and host out-of-town guests.

“People are younger and healthier when they retire,” he said. “If you plan right, you can have a lot of time to enjoy it.”

Connie Pifher, the town social worker, engages with aging-in-place issues as part of her job, and also on a personal level as she nears retirement at 64.

Divorced, with two grown sons, she used to be determined to stay on in her four-bedroom house as a retiree. Now she’s planning to move out, to a co-op or townhouse. She said the ordeal of a recent three-day power outage after a surprise snowstorm hammered home the point that “it’s time to move out of Dodge.”

“Do I want to worry about the sump pump or getting the car out of the garage when the door doesn’t work?” she asked.

One former option, moving to an upscale retirement community, is off the table for financial reasons. She said the value of her house has dropped too far for her to afford that switch.

That’s a relatively common problem, with many continuing-care retirement communities charging entry fees of several hundred thousand dollars, followed by ongoing monthly fees.

In several states, there’s debate about whether to promote aging in place by shifting more Medicaid dollars to community-based programs and away from traditional nursing facilities. But budget problems may complicate such efforts as some financially struggling states cut back on home health services that help keep some elderly people out of nursing homes.

Susan Bosak, the social scientist who is advising Tulsa on its Across the Generations initiative, says building positive intergenerational relations throughout a community is vital to enhancing life for its elderly.

“Aging in place fosters the illusion we can do it by ourselves, but we can’t,” she said. “A high quality of life requires support from the entire community.”

It’s worth the effort, she says, if it means that more older people are aging where they feel most comfortable.

“Home is more than just meeting our need for shelter,” she said. “It’s in our memories. It’s where we can be ourselves.”
Copyright © 2011 The Associated Press, David Crary, AP national writer.

Survey: 5 homebuying myths

SEATTLE – Oct. 31, 2011 – Overall, today’s homebuyers tend to be fairly knowledgeable about the real estate market, but there are still a few points of confusion in the process, especially for buyers just entering the market. Here are the five main areas of confusion found in a survey by Zillow:

• Appreciation: About 42 percent of homebuyers believe home values will appreciate by 7 percent a year. Reality: Historically, home values in a normal market appreciate by 2 to 5 percent in a year.

• Appraisals: 56 percent of the buyers said the purpose of the appraisal was to determine if a home was in good condition. Reality: That’s the purpose of a home inspection; an appraisal estimates fair market value.

• Homeowner’s insurance: 37 percent of homebuyers think that buying homeowner’s insurance is optional. Reality: Lenders require homebuyers to purchase homeowner’s insurance if they carry a mortgage.

• Ownership: 47 percent of homebuyers said a prospective buyer owns a home after the purchase contract is signed by the seller – when the two parties reach agreement. Reality: The purchase and sales agreement is the beginning of the closing phase, but it can be a long process until they finally take ownership.

• Mortgage insurance: 41 percent of buyers think they must purchase private mortgage insurance, regardless of the amount of their downpayment. Reality: Buyers only need to purchase PMI if their downpayment is less than 20 percent of the home’s purchase price.

Source: Zillow Inc.

© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688

Bargains abound: What are buyers waiting for?

NEW YORK – Oct. 28, 2011 – With low home prices and ultra-low interest rates, the housing market now offers “perhaps the best deals of a generation,” notes a recent article by Bloomberg Businessweek.

Since the housing boom of 2006, home prices have fallen about 31 percent. Also, mortgage rates have been hovering at record lows for the past few weeks – in the 4 percent range or even lower on 30-year fixed-rate mortgages, according to Freddie Mac’s mortgage market survey.

“It’s hard to see the possibility of losing on a home purchase right now, with these mortgage rates,” says economist Dean Baker. “Prices may go lower, but not by much.”

The article notes the following scenario: Buying a $300,000 home with a 4 percent mortgage rate and a 20 percent down payment would mean a $1,145 monthly payment. The Mortgage Bankers Association recently predicted that home prices may fall another 3.5 percent by mid-2012, but mortgage rates will increase by a half-point. Under that same loan scenario, a home would sell for $289,000 while the monthly mortgage bill would be $1,171 – only a $26 difference.

For those who can qualify for a mortgage, “playing the waiting game” won’t result in much gain, Nariman Behravesh, chief economist at IHS in Englewood, Colo., told Bloomberg Businessweek.

Source: “Crazy Home Deals Await the Creditworthy,” Bloomberg Businessweek (Oct. 24, 2011)

© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688

Baby Boomers: Home is where the grandkids are

NEW YORK – Oct. 27, 2011 – According to a new poll from the Associated Press (AP) and LifeGoesStrong.com, 73 percent of baby boomers would rather live close to children or family rather than “friends of your own age,” and 50 percent ranked nearby family as “deeply important.”

However 27 percent prefer to live near peers, a huge potential market niche.

About a quarter (23 percent) of boomers say it’s very likely they’ll move out of their current area or community in retirement. However, that doesn’t mean boomers imagine that their retirement home will be their last purchase. Only 40 percent of boomers expect to stay in the home permanently.

“It’s easy to understand why mid-lifers are interested in being near family and staying close to home during retirement,” said Barbara Corcoran, a prominent real estate entrepreneur. “It’s also important to note that most boomers currently live in a suburb, and that group is more likely to have lost money on real estate since the economic downturn began. But whether or not someone was directly impacted, the recession makes all of us more aware of the importance and comfort of a close family circle, and the value of strong home roots.”

Even so, three in 10 boomers say that there is at least somewhat of a chance that they will purchase a new home for their retirement years. While 67 percent consider it unlikely that they’ll leave their home state if they do, 13 percent say there is a good chance they’ll move across state lines.

In addition to family, 39 percent of boomers rated “being close to medical offices or hospitals” as very important, and a similar number, 38 percent, want to be “close to shops and services.”

Boomers who plan to move noted the following preferences:

• smaller home (43%)
• area with a different climate (30%)
• more affordable home (25%)
• closer to family (15%)
• in a retirement community (12%)

When marketing to boomers, it’s worth noting that three out of the top five reasons given have nothing to do with the home itself and more to do with weather, family proximity, and community elements.

Housing types

The survey asked boomers what they did with the empty bedrooms vacated by children to gauge their housing desires. While 51 percent did not change the bedrooms, those who did created:

• guest bedrooms (58%)
• home offices (39%)
• craft rooms (28%)
• entertainment rooms (15%)

Younger boomer parents are more likely to have repurposed their children’s rooms. Among those boomer parents born from 1955 to 1964, 57 percent say they converted the room to other uses; just 40 percent of boomer parents born in 1954 or earlier say the same.

© 2011 Florida Realtors®

Foreigner’s sweetner: Buy house, get visa!

WASHINGTON – Oct. 21, 2011 – Sens. Charles Schumer (D-N.Y.) and Mike Lee (R-Utah) have proposed a new type of resident visa for foreigners who spend at least $500,000 to purchase real estate in the United States. The proposal calls for at least $250,000 to be spent on a residence, while the other $250,000 could be invested in other real estate. However, the entire amount must be a cash investment.

The provision, part of a larger package of immigration measures, would complement existing visa programs that permit foreigners to enter the country if they invest in new businesses that create jobs.

Supporters believe the initiative would help absorb a glut of housing supply – especially in markets like Arizona and South Florida, where foreign buyers have represented a rising share of home buying activity. According to National Association of Realtors® (NAR) research, 5.5 percent of Miami homes sell to international buyers.

International buyers snapped up $82 billion in U.S. residential property in the year ended in March, surging from $66 billion during the prior 12 months, reports NAR.

Source: Wall Street Journal (10/20/11) P. A7; Timiraos, Nick

© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688