Author Archives: Kelly Leighton

Erie, Scranton, Allentown named top “overlooked dream cities”

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Pennsylvania cities nabbed three of the top five spots on GoodCall’s 2017 Overlooked Dream Cities.

The website analyzed cities with less than 300,00 residents, and rated them based on factors like crime rate, cost of living, amenities and walkability.

Erie landed in first overall, thanks to the low cost of living, which is 18.5 percent below the national average, as well as the city’s walkability. The city, nicknamed the Gem City, came in 71st out of 461 cities on its walk score, which rates cities on how walkable they are. Erie was also applauded for its entertainment and attractions, such as the Erie Zoo, Erie Art Museum, UPMC Park and Presque Isle State Park.

Scranton, also known as the Electric City, came in second place. The city’s affordability helped it land so high on the list, as it is 20 percent below the national average cost of living. Additionally, Scranton scores high on the walkability list, and offers residents many bars and restaurants downtown. The city also hosts the Steamtown Marathon each October.

Allentown rounded out the top five of the list. Its higher population (120,000 making it the third-largest city in the commonwealth) doesn’t take away from what Allentown offers. The city landed in 37th out of 461 cities for walkability, and the cost of living is 13 percent below the national average. With the new Riverfront district, the city offers even more stores, restaurants, offices and residential homes.

Other cities that made the top ten include Parma, Ohio, Appletown, Wis., Grand Rapids, Mich, Cicero, Ill., East Orange, N.J. and Green Bay, Wis.

 

 

Homebuyers still relying on referrals, in-person meetings for mortgage lenders

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Despite technological advances, referrals are still the main way homebuyers choose their mortgage lender.

Ellie Mae’s 2017 Borrower Insights Survey found that 23 percent of homebuyers picked their mortgage lender based on a referral from a friend or family member, 17 percent a referral from a bank and 16 percent a referral from their agent.

The survey also found that homebuyers are still mostly applying for their mortgages completely in person.

Fifty-seven percent of homeowners applied for and completed their mortgage in person, while 28 percent applied for and completed it partially in-person and partially online. Eleven percent reported that they applied for their last mortgage completely online. When asked what factor would have improved the mortgage process, approximately 40 percent of homeowners indicated they would have liked a faster process with fewer delays. Twenty percent indicated that a shorter, easier to understand application would be preferable, while 11 percent asked for more communication with their lender throughout the process.

The half and half solution, doing some of the process online and some in-person, was most popular with millennials (30 percent). Still, 28 percent of Generation X and 20 percent of baby boomers opted to go this route as well.

When going through the mortgage process, homebuyers are looking for speed, security and simplicity. Millennials and women both think security is the most important factor, while Generation X and baby boomers looked for speed. All cited simplicity as a big help.

“There’s no question that technology is playing a larger role in the home buying experience,” said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. “As we expected, many homeowners are seeking a faster and more streamlined experience. And it’s not just a millennial phenomenon; it’s homebuyers of all ages and both genders.”

“But what’s even more telling is that homeowners still want a personal interaction with their lender. They want someone who can answer important questions, and make them feel confident that everything will be handled correctly and on time. While 27 percent of millennials identified the speed of the process as the top area to improve their experience, surprisingly 23 percent cited more face-to-face interaction as the second-greatest opportunity for improvement. By leveraging technology, lenders can provide a more high tech experience to simplify and speed the overall process, while still having the high-touch interactions when and where homebuyers want,” Tyrrell added.

More sellers tried to negotiate agent’s commissions last year

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More than half of sellers in 2016 attempted to lower their listing agent’s commission.

According to a recent survey from SurveyGizmo and Redfin, 57 percent of sellers tried to negotiate, an increase of 5 percent from June. And millennials are the generation most likely asking for a break. Nearly two-thirds report they asked their agent for a lower commission rate. Fifty-eight percent of Generation X members and 39 percent of baby boomers so tried to negotiate.

For buyers, 49 percent reported receiving a refund, a contribution toward closing costs or something else worth at least $100. This is an increase of 3 percent from June.

The survey also found that political opinions continue to be a hot issue these days. Nearly half of respondents (42 percent) reported they would hesitate to buy in an area that had differing political views. Millennials (47 percent) were the highest generation with qualms.

Online statistics continue to increase in popularity. Ninety-five percent of sellers checked their home estimates online, while 72 percent of sellers said they checked the estimates of their home value, on sites like realtor.com®, at least once a week before they put their home on the market. Twenty-two percent checked daily, or close to. Not surprisingly, millennials were the most likely to check the most often, as 78 percent checked at least once a week, and 28 percent checked daily or close to.

Home estimates impacted buyers too, as 84 percent checked estimates online, and said it affected their buying plans.

However, Americans are more worried about the income gap, as well as affordable housing in the country. Forty-two percent reported that the income gap is their biggest concern, while 41 percent said they are concerned about affordable housing. Thirty-five percent are worried about the federal budget deficit.

Homebuying, mortgage process stressful for many consumers

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Forty-two percent of homebuyers reported that the homebuying process was stressful, according to NerdWallet’s Home Buyer Reality Report.

Nearly one-third said it was complicated, while 21 percent reported it was intimidating. However, 30 percent described the experience as rewarding, while 41 percent it was manageable. Yet, 49 percent reported they would do something differently if they were homebuying again.

Mortgage applications are still confusing many homebuyers, as 58 percent of homebuyers applied for one. Forty-one percent of homebuyers who did apply said they were not sure of all the options available to them. And 28 percent said they did not feel like a priority to their mortgage professional during the loan process. Overall, 89 percent of applicants were approved for a loan to buy their house.

Among generations, 27 percent of millennials believed their mortgage rate was affordable when they purchased, and 39 percent said the mortgage process was positive. Eighty-nine percent of millennials who applied were approved. However, 11 percent of millennials said that after purchasing their home, they didn’t feel financially secure anymore. More than half (57 percent) said they had regrets in their homebuying experience.

Only a quarter of Generation X members reported a positive experience with the mortgage process, but 91 percent of Gen Xers were approved for one. Twelve percent reported not feeling financially secure after homebuying. Sixty-one percent reported that they would do something differently when homebuying again.

As for baby boomers, 25 percent found the mortgage process stressful, but 42 percent said it was manageable. Sixty-five percent said they believed they were aware of all their options for mortgages during the process. Only 6 percent said they did not feel financially secure after they bought their house, but 38 percent of baby boomers would act differently when homebuying again.

Home prices continue to rise, but growth expected to slow

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Home prices rose 6.9 percent year-to-year in January, per CoreLogic’s January U.S. Home Price Insight Report.

Excluding distressed sales, home prices increased 5.8 percent from year-to-year. From December to January, home prices saw an increase of 0.7 percent, including distressed sales, 0.5 percent excluding them.

CoreLogic predicts home prices will see just a 0.1 percent increase from January to February. Year-to-year, home prices are predicted to rise 4.8 percent by January 2018.

“With lean for-sale inventories and low rental vacancy rates, many markets have seen housing prices outpace inflation. Over the 12 months through January of this year, the CoreLogic Home Price Index recorded a 6.9 percent rise in home prices nationally and the CoreLogic Single-Family Rental Index was up 2.7 percent – both rising faster than inflation,” said Dr. Frank Nothaft, the chief economist for CoreLogic.

In January, 13 states, as well as Washington, D.C. hit new home price peaks. Only Maine saw negative home price appreciation.

In Pennsylvania, home prices decreased 0.2 percent from December to January. Year-to-year, the commonwealth only saw an increase of 2.9 percent. CoreLogic predicts that prices will increase 0.1 percent in February, and 3.9 percent by January 2018 in Pennsylvania.

“Home prices continue to climb across the nation, and the spring home buying season is shaping up to be one of the strongest in recent memory,” said Frank Martell, president and CEO of CoreLogic. “A potent mix of progressive economic recovery, demographics, tight housing stocks and continued low mortgage rates are expected to support this robust market outlook for the foreseeable future. We expect the CoreLogic Home Price Index to rise 4.8 percent nationally over the next 12 months, buoyed by lack of supply and continued high demand.”

Consumers more confident about housing than ever

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Now is a “good time” to buy or a sell a home, according to more Americans.

The Fannie Mae Home Purchase Sentiment Index® rose to 88.3 percentage points in February, an all-time high and an increase of 5.6 percentage points since February. The HPSI also increased 5.6 percentage points year-to-year.

Forty percent of Americans said it a good time to buy, an increase of 11 percent from February. Additionally, the percentage of those who think it is a good time to sell rose to 22 percent, a survey high and an increase of 7 percent from the last HPSI.

More than half (55 percent) believe mortgage rates will decline over the year, consistent with the past two months. Forty-five percent believe home prices will continue to rise, an increase of 3 percent.

“The latest post-election surge in optimism puts the HPSI at its highest level since its starting point in 2011. Millennials showed especially strong increases in job confidence and income gains, a necessary precursor for increased housing demand from first-time homebuyers,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Preliminary research results from our team find that millennials are accelerating the rate at which they move out of their parents’ homes and form new households. However, continued slow supply growth implies continued strong price appreciation and affordability constraints facing millennials and first-time buyers in many markets.”

Americans are also more confident with their lives outside of housing. Seventy-eight percent reported they are not concerned about losing their job, an all-time survey high and an increase of 9 percent. Additionally, 19 percent of respondents said their household income is “significantly higher” than it was a year ago, an increase of 4 percent, and a new survey high.

Outdoor spaces: What homebuyers are looking for

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Sustainable and tech-friendly are what homebuyers want in outdoor living spaces, according to the American Society of Landscape Architects’ 2017 Residential Landscape Architecture Trends Survey.

The survey included responses from 817 landscape architects. Overall, the projects that attracted most demand are native or adapted drought-tolerant plants, according to 82 percent of those surveyed. Low-maintenance landscapes were also a big winner, according to 79.3 percent.

Other popular projects include food and vegetable gardens, including orchards and vineyards (76.5 percent), permeable paving (76.3 percent), reduced lawn area (72.7 percent), fire pits and fireplaces (71.5 percent) and drip/water irrigation (71.1 percent).

The outdoor design elements expected to be the most popular this year include fire pits and fireplaces, wireless/internet connectivity, lighting, outdoor furniture and seating/dining areas.

“The fact that more consumers want outdoor wireless access shows that they want expanded options for remaining connected to their devices,” said Nancy C. Somerville, Hon. ASLA, executive vice president and CEO of ASLA.

The outdoor structures anticipated to be the most-wanted for this year include pergolas, decks, fencing, arbors and ADA-accessible strictures, such as ramps, bars and shelving.

The most popular outdoor recreation amenities for 2017 most likely will be sports courts, spa features and swimming pools (39.2 percent).

“Well-designed residential landscapes provide social interaction, enjoyment of nature, and physical activity, while also reducing water use and stormwater runoff,” added Somerville. “Landscape architects are pros at creating sustainable outdoor spaces that reflect their clients’ dreams for relaxation and meaningful activity.”

More millennials having children and moving to the suburbs

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As the millennial generation ages, their preferences are evolving.

According to the National Association of Realtors® 2017 Homebuyer and Seller Generational Trends study, 49 percent of millennial homebuyers have at least one child, up 4 percent from last year and 6 percent from 2015. Approximately two-thirds are married, comparable to previous years.

With a growing family, less millennials are choosing city life when buying. Only 15 percent choose to buy in the city, down 2 percent from 2016 and 6 percent from two years ago.  Two-thirds of millennials who purchased in the past year are first-time homebuyers.

Eighty-five percent said homes are a good investment.

“Millennial buyers, at 85 percent, were the most likely generation to view their home purchase as a good financial investment,” said NAR Chief Economist Lawrence Yun. “These strong feelings bode well for even greater demand in the future as more millennials settle down and begin raising families. A significant boost in new and existing inventory will go a long way to ensuring the opportunity is there for more of them to reach the market.”

However, the survey also found that younger baby boomers are more apt to consider their millennial children when they are purchasing a home, with 20 percent purchasing a multi-generational home, and 30 percent reporting it was because their adult children had never left or were moving back home.

Millennials have made up the largest generation of homebuyers since the report’s inception in 2013. More than 90 percent of millennials searched for a home online, and 90 percent reported they purchased a home using an agent.

“Online and mobile technology is increasingly giving consumers a glut of real estate data at their disposal,” said NAR President William E. Brown. “However, at the end of the day, buyers and sellers of all ages — but especially younger and often DIY-minded consumers — seek and value a Realtors®’ ability to dissect this information and use their expertise and market insights to coach buyers and sellers through the complexities of a real estate transaction.”

Two Pa. Realtors® named finalists in Realtor® Magazine’s 30 Under 30

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Kara Chen, a Realtor® with Keller Williams of Central PA East in Hummelstown, and Melissa Shipley, a Realtor® with Berkshire Hathaway HomeService in Pittsburgh, are two of the 50 finalists for Realtor® Magazine’s 30 Under 30 class of 2017.

For Shipley, this is the last year she is eligible, so she figured why not apply? The Realtor® described herself as “very involved” in the industry. She is on the Board of Directors for the Realtors® Association of Metropolitan Pittsburgh and she is also involved with the local Young Professionals Network.

“I am very active besides selling homes,” said Shipley. “I help new agents in our office get started, and I try to guide them in ways to be successful,” she said.

Shipley has been a licensed agent for about seven years, and has been practicing for five. Upon graduating from Duquesne University in 2009, she found job prospects bleak. She struggled to find a job, and was working in a hotel, which she hated.

“I knew I needed a new challenge,” she said. “I saw advertisements to become a real estate agent, so I took an interview with a manager and she told me I would be great at it. I didn’t like what I was doing, so it couldn’t hurt. I went to school at night and got my license in about two months. I wanted a new challenge,” she said.

Shipley has accomplished much in the industry. In 2016 alone, she received 18 top sales awards from Berkshire Hathaway HomeService.

Chen is another agent in the commonwealth that made the list. She has only been an agent for two years, but has seen much success in that period of time, having sold over $20 million of real estate. She also serves in her company’s Board of Directors and was nominated by her peers and Harrisburg Magazine as a Local Real Estate Leader in South Central Pennsylvania.

“I feel blessed to have had a huge trajectory in a short amount of time.” said Chen. “I was in medical school at Penn State in Hershey and had some health issues, so I decided to take a break from academia and start a family. While I was at home taking care of my son full time, I felt a pressing need to start paying off my medical school loans. Through prayer, I decided to go into real estate.” she said.

Since then, Chen’s career has taken off, and she recently gave birth to her second son. She hasn’t taken any time off though. She showed a house the day after she gave birth and had two settlements the same week.

“I don’t want my family life to hinder my work life, and I don’t want my work life to break into my family life. I love being a mom, and I love being a Realtor®. I am grateful to my supportive husband and friends who encourage me to do both, and do them well,” says Chen.

Judges will pick 29 of the finalists, while one finalist, the Web Choice Award winner, will be chosen by readers. Voting will open today at 1 p.m. and go until Friday, March 24 at 1 p.m. You can vote once every 24 hours.

Baby boomers expected to lead remodeling over next decade

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For the past two decades, baby boomers have been the leaders in renovation spending.

According to the Demographic Change and the Remodeling Outlook, it looks like they aren’t backing down any time soon. Renovations by homeowners 55 and older are expected to increase by nearly one-third in the next decade (by 2025), representing more than 75 percent of total gains.

In 2025, baby boomers are expected to represent 56 percent of all renovation spending, up from 31 percent in 2005. Generation X members are expected to finally do the remodeling they have put off, due to the economy, and millennials are also expected to pour some money into renovations in their newly-purchased homes. Remodeling is expected to grow about 2 percent each year until 2025, the report found. In 2015, homeowner remodeling hit $340 billion, a new high.

“With national house prices rising sufficiently to help owners rebuild home equity lost during the downturn, and with both household incomes and existing home sales on the rise, we expect to see continued growth in the home improvement market,” says Kermit Baker, director of the Remodeling Futures Program at the Joint Center for Housing Studies.

The study said that rising home prices are leading owners to update their homes, but this could be making these homes even pricier when they do hit the market. Baby boomers are most likely to update their homes to be more accessible, while millennials are updating for energy efficiency and automation.

“The remodeling industry should see numerous growth opportunities over the next decade,” says Chris Herbert, managing director of the Joint Center for Housing Studies. “Strong demand for rental housing has opened up that segment to a new wave of capital investment, and the shortage of affordable housing in much of the country makes the stock of older homes an attractive option for buyers willing to in invest in upgrades.”