Register Real Estate Advisors

Finally, we are in the best real estate market since 2007. As the spring flowers begin to bloom in our Houston area, enjoy the open houses. There are some great homes on the market. Maybe over the past couple of years you have wanted to move, but the economy and the housing market just wasn’t right. Now is your time. Interest rates are still low and the housing market, the greatest economic driver, is back in the hot seat. Call Register Real Estate Advisors with all of your housing needs. 281.288.3500

AUSTIN (Austin Business Journal) – The construction industry appears to be on the rebound, according to Associated General Contractors of America (AGC).

Construction employment grew in two-thirds of U.S. states in January, according to the Arlington, Va.-based group. Texas posted the biggest job growth between January 2012 and 2013, adding 28,500 jobs. That is a 5 percent increase over the 571,600 jobs reported last year.

AGC chief economist Ken Simonson stated the rise in employment is finally reflecting the increase in construction activity.

“Construction spending has been rising for two full years, but contractors have been cautious about adding workers until they knew the upturn would last,” Simonson said.

LAS VEGAS (Real Estate Center) – “Cautious optimism” might best describe some experts’ expectations for the U.S. economy and housing market this year.

Speaking at the International Builders’ Show in Las Vegas Tuesday, National Association of Home Builders (NAHB) Chief Economist David Crowe said the economic forecast looks good, and he expects overall economic growth to continue to build this year, but that growth will be modest.

“The momentum is still not quite there,” Crowe said.

In addition, Nationwide Chief Economist David Berson said the United States faces three economic unknowns in the coming months: the debt ceiling, sequester and the continuing resolution to fund the government.

“There’s at least the possibility that if any of them don’t go well, maybe instead of modest economic growth as the year goes on, the economy actually stumbles,” Berson said.

However, Crowe said 2012 offered a couple of indicators of a strong housing market in 2013: home price increases in enough markets to affect the overall national number, and an increase in household formations.

“We were forming households at roughly 1.4 million per year in the boom period,” Crowe said. “That sunk to about a half a million a year additional households coming out of the typically younger population. And that low household rate simply means we don’t need more houses.”

Crowe said an excess of houses in some markets drove construction down, but that’s beginning to change.

“We’re up to 850,000 household creations per year. That’s been a stimulus behind new construction,” he said.

Crowe said that’s especially true of new construction for renters, because renters make up the entire 850,000 average gain.

While demand for rental units is expected to be strong this year, a couple of headwinds could impede demand for single-family homes.

“One of those is the fact that unemployment is still very elevated for this part of the economic recovery,” said Freddie Mac Chief Economist Frank Nothaft. “We have a national unemployment rate of 7.8 percent. And we have consumer confidence that has not rebounded as much as we normally see at this stage of the economic recovery. In other words, consumers are still concerned about their overall financial well-being.”

Editor’s note: Today’s RECON is a special report from the International Builders’ Show in Las Vegas. We will resume our usual twice-weekly publication schedule tomorrow.

COLLEGE STATION (Real Estate Center) – The Texas economy gained 265,500 nonagricultural jobs from December 2011 to December 2012, an annual growth rate of 2.5 percent compared with 1.4 percent for the United States.

The Real Estate Center’s latest Monthly Review of the Texas Economy reports that the state’s nongovernment sector added 258,500 jobs, an annual growth rate of 2.9 percent compared with 1.7 percent for the nation’s private sector.

The state’s seasonally adjusted unemployment rate fell to 6.1 percent in December from 7.4 percent the year before. The nation’s rate decreased from 8.5 to 7.8 percent.

All Texas industries except the information industry had more jobs last month than a year ago. The state’s construction industry ranked first in job creation, followed by the leisure and hospitality industry, professional and business services, and the education and health services industry.

All Texas metro areas except Sherman-Denison, Lubbock and Brownsville-Harlingen had more jobs. Austin-Round Rock-San Marcos ranked first in job creation followed by Wichita Falls, Odessa, Houston-Sugar Land-Baytown and Fort Worth-Arlington.

The state’s actual unemployment rate last month was 6 percent. Midland had the lowest unemployment rate, followed by Odessa, Amarillo and San Angelo.

News Release Issued: December 26, 2012 8:00 AM EST

Economists Expect 2012 Housing Momentum To Carry Into 2013

Panel of 105 Forecasters Predicts Where Case-Shiller Index Will Stand in Five Years; Majority Say Potential Changes to Mortgage Interest Deduction Will Negatively Affect High-End Home Values

SEATTLE, Dec. 26, 2012 /PRNewswire/ — A nationwide panel of more than 100 professional forecasters expects home prices to rise 3.1 percent in 2013 after finishing 2012 up more than 4.6 percent, reflecting growing optimism in the housing market, according to the December 2012 Zillow® Home Price Expectations Survey.

The survey of 105 economists, real estate experts and investment and market strategists was sponsored by leading real estate information marketplace Zillow, Inc. (NASDAQ: Z) and conducted by Pulsenomics LLC. It is based on the projected path of the S&P/Case-Shiller® U.S. National Home Price Index during the coming five years.

Survey respondents said they expect home prices to increase in full-year 2012 by 4.6 percent, up from their more modest forecast of 2.3 percent in the September 2012 survey. Respondents also indicated they expect home prices to rise 3.1 percent in 2013, up from an expectation of 2.4 percent in September, and by more than 3 percent annually through 2017.

“An organic recovery in the housing market really took hold in the latter half of 2012, and this improvement is echoed in some of the most optimistic price projections we’ve seen in years from this group,” said Zillow Chief Economist Dr. Stan Humphries. “Record levels of affordability and an improving overall economic picture have really helped buoy the market and have us well positioned for continued growth, albeit slightly slower, in 2013 and beyond.”

The most optimistici quartile of panelists predicts a 6.3 percent increase in 2012, on average, while the most pessimisticii predicts an average increase of 3 percent. For 2013, price change projections range from 4.9 percent among the most optimistic quartile to 0.8 percent among the most pessimistic, on average.

Mortgage Interest Deduction Would Negatively Impact High-End Home Prices

Changes to the mortgage interest deduction (MID) may be a key element of a fiscal cliff “grand bargain,” so the panel was asked to gauge how certain proposed MID changes would impact home prices in both the near and long term.

The survey examined three scenarios: Reducing the maximum MID-eligible mortgage amount to $500,000 and eliminating the allowance for second homes; capping all itemized deductions, including the MID, at $25,000 per year; and eliminating the MID over a multi-year period.

There was only one instance in which a majority of respondents indicated prices would not be negatively affected – 55 percent of respondents said the first scenario outlined above would have little to no near-term impact on overall home prices. Eliminating the MID entirely over a period of several years was expected to have the biggest negative impact on high-end home prices over the long-term, with 70 percent of respondents saying they expected such prices to fall moderately or significantly under such a scenario.

“If adopted, any measure to limit or repeal the MID will result in distinct price impacts over time and by market segment, and our survey data are consistent with this view,” said Pulsenomics Founder Terry Loebs. “For example, in the event that the maximum MID-eligible mortgage amount is reduced from $1 million to $500,000 and the deduction allowance for second homes is eliminated – an ingredient of the Simpson-Bowles proposal – the majority of respondents expect high-end home prices to fall while U.S. home prices overall experience little or no price impact.”

Additional details regarding this portion of the survey are available at www.pulsenomics.com.

This is the 15th edition of the Home Price Expectations Survey. It was conducted from Nov. 30, 2012 through Dec. 12, 2012 by Pulsenomics LLC on behalf of Zillow, Inc.

HOUSTON (Houston Chronicle) – Local housing inventory has shrunk to its lowest level in more than ten years, reports the Houston Association of Realtors.

Housing inventory fell to a 4.4-month supply in October, the tightest since December 2001. The lowest inventory on record was logged in December 1999, with only 3.6 months of listings on the market.

Existing single-family home sales were up for the 17th month in a row, marking Houston’s second longest period of positive sales. A previous 37-month run of positive home sales ended in February 2007.

WASHINGTON, D.C. (U.S. News & World Report) – National news sources continue reporting on Texas’ strong housing market, but not everyone is surprised.

In an article in yesterday’s U.S. News & World Report, Real Estate Center Research Economist Dr. Jim Gaines said the state’s recovery wasn’t entirely unexpected, pointing out that Texas didn’t suffer as severe a recession or housing bust as some other states.

“We started [the recession] later, and it didn’t go as deep,” Gaines said, adding that while Texas saw its share of subprime lending, the fact that the unemployment rate here wasn’t as high as in other states helped lessen the housing market damage caused by the collapse of bad mortgages.

“We didn’t have the financial leverage,” Gaines says. “We had subprime lending, but that works as long as people have jobs, so you had these offsetting factors.”

Gaines also attributed the market’s strength to the lower-than-average property values in Texas’ major metro areas.

“We had median prices go up, but we didn’t have a true bubble,” Gaines said. “Even now you can’t find a new single-family home in most major metro areas for under $200,000. That’s not the case in Houston or Dallas.”

WASHINGTON, D.C. (U.S. News & World Report) – National news sources continue reporting on Texas’ strong housing market, but not everyone is surprised.

In an article in yesterday’s U.S. News & World Report, Real Estate Center Research Economist Dr. Jim Gaines said the state’s recovery wasn’t entirely unexpected, pointing out that Texas didn’t suffer as severe a recession or housing bust as some other states.

“We started [the recession] later, and it didn’t go as deep,” Gaines said, adding that while Texas saw its share of subprime lending, the fact that the unemployment rate here wasn’t as high as in other states helped lessen the housing market damage caused by the collapse of bad mortgages.

“We didn’t have the financial leverage,” Gaines says. “We had subprime lending, but that works as long as people have jobs, so you had these offsetting factors.”

Gaines also attributed the market’s strength to the lower-than-average property values in Texas’ major metro areas.

“We had median prices go up, but we didn’t have a true bubble,” Gaines said. “Even now you can’t find a new single-family home in most major metro areas for under $200,000. That’s not the case in Houston or Dallas.”

In this month’s Greater Houston Home Builders e-newsletter they published a Metrostudy Reports: Houston Housing Market Achieves Balance and Sustained Growth.  This is what was written:

Supply and demand fundamentals have returned to every facet of the Houston housing market, building confidence in the successes of the first nine months of 2012, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Greater Houston continues to rank among the top job growth markets in the country, adding another 89,500 jobs in the trailing twelve months ending in August 2012.”Though Houston was outpaced in terms of total job growth by New York City and Los Angeles, the consistency of its job growth remained as the market has grown, annually, over 3% for much of the last twelve months,” said David Jarvis, director of Metrostudy’s Houston division. The unemployment rate in August was 7%, which is 1.4 percentage points better than a year ago.

Houston’s resulting annual starts pace in 3Q12 was 22,371, surpassing the activity spurred by the federal home buyer tax credit two years ago. “Much of the growth in new home activity has occurred in the upper price points over the last five quarters, though recently the lower price points have shown signs of growing demand,” said Jarvis. In 3Q12, Houston builders started 17% more home under $175,000 than they did in 3Q11, proving that despite the restrictive mortgage qualifying process, consumers are willing to go through the process for a new home. Houston home builders closed 6,014 new homes in3Q12, an 11% increase from 3Q11, when the Houston market began its recovery. The annual closings count rests 15% higher in 3Q12 with builders closing 20,867 homes since October 2011.

This article was first posted on RisMedia and can also be read at rismedia.com.

Rising home values have brought homeowner equity to its highest level since the third quarter of 2008 and helped lift 1.3 million families above water. Homeowner equity jumped $406 billion, or 5.9 percent, to $7,275 billion in the second quarter of 2012, according to the Obama Administration’s September Housing Scorecard.

After a sharp first quarter rise, total equity has grown to $863 billion, or 13.5 percent, since the end of 2011. The number of underwater borrowers has declined by 11 percent since the end of last year, from 12.1 million in the 4th quarter of 2011 to 10.8 million in the second quarter of 2012.

Nearly 1.3 million homeowner assistance actions have taken place through the Making Home Affordable Program, while the Federal Housing Administration (FHA) has offered more than 1.4 million loss mitigation and early delinquency interventions. The Administration’s programs continue to encourage improved standards and processes in the industry, with HOPE Now lenders offering families and individuals more than three million proprietary mortgage modifications through July.

As of August, more than one million homeowners have received a permanent HAMP modification, saving approximately $539 apiece on their mortgage payments each month, and an estimated $15 billion to date. In August, 81 percent of homeowners with eligible non-GSE mortgages benefitted from principal reduction with their HAMP modification. Eighty-seven percent of homeowners entering the program in the last two years have received a permanent modification.

“As the September housing scorecard indicates, our housing market is showing important signs of recovery – with homeowner equity at a four-year high and summer sales of existing homes at the strongest pace in two years,” says HUD Acting Assistant Secretary Erika Poethig. “The Administration’s efforts to keep housing affordable and refinances strong are critical with so many households still struggling to make ends meet. That is why we continue to ask Congress to approve the President’s refinancing proposal so that more homeowners can secure the help they need.”

Rising home values have brought homeowner equity to its highest level since the third quarter of 2008 and helped lift 1.3 million families above water. Homeowner equity jumped $406 billion, or 5.9 percent, to $7,275 billion in the second quarter of 2012. After a sharp first quarter rise, total equity has grown to $863 billion, or 13.5 percent, since the end of 2011. The number of underwater borrowers has declined by 11 percent since the end of last year, from 12.1 million in the 4th quarter of 2011 to 10.8 million in the second quarter of 2012.

The Administration’s foreclosure programs are providing relief for millions of homeowners as we continue to recover from an unprecedented housing crisis. Nearly 1.3 million homeowner assistance actions have taken place through the Making Home Affordable Program, while the Federal Housing Administration (FHA) has offered more than 1.4 million loss mitigation and early delinquency interventions. The Administration’s programs continue to encourage improved standards and processes in the industry, with HOPE Now lenders offering families and individuals more than three million proprietary mortgage modifications through July.

Homeowners entering HAMP continue to benefit from deep and sustainable assistance. As of August, more than one million homeowners have received a permanent HAMP modification, saving approximately $539 on their mortgage payments each month, and an estimated $15 billion to date. In August, 81 percent of homeowners with eligible non-GSE mortgages benefitted from principal reduction with their HAMP modification. Eighty-seven percent of homeowners entering the program in the last two years have received a permanent modification.