Mortgage Fraud Index hits 5-year low

DALLAS – April 9, 2013 – The holidays took a toll on mortgage fraud prosecutions as the Q4-2012 Mortgage Fraud Index sank to its lowest level in nearly five years, according to a study by Mortgage Daily. However, the drop appears temporary.

California saw a big improvement, but the dollar volume in Florida spiked.

The fourth quarter had the fewest number of fraud cases tracked since at least 2007, while the total dollar amount wasn’t as low since the first-quarter 2011. The Mortgage Fraud Index nationally – which includes both the number of fraud cases and their dollar value – was 758 in the fourth quarter for its lowest showing since the first-quarter 2008.

In Florida, the state index of 97 tied California, though the latter dropped from No. 1 the quarter before. Just one quarter earlier, Florida wasn’t even in the top five. The total dollar amount of fraud cases in Florida amounted to $246,873,472.

But the decline in activity appears only to be temporary, according to Mortgage Daily Founder and Publisher Sam Garcia. “Preliminary data indicates that mortgage fraud case activity during the first quarter of this year was up around 25 percent from the fourth quarter,” he says.

While other fraud risk measurement reports, focus on fraud that might have happened or could happen, the Mortgage Fraud Index reflects proven cases of fraud.

Other states in the top five for mortgage fraud in the fourth quarter of 2012 include No. 3 Texas (index of 63), New York (43) and Arizona (43).

© 2013 Florida Realtors®

Wells Fargo dominates home loan business

NEW YORK – April 8, 2013 – Wells Fargo & Co. is the largest U.S. mortgage lender, taking an unprecedented 28.8 percent share of all home loans nationwide last year, up from 11.2 percent in 2007.

“They are dominating the retail space because they are huge, and because there is so little competition from other big banks that have pulled back,” says Alan Rosenbaum, chief executive of GuardHill Financial Corp., a New York-based mortgage bank, to The Wall Street Journal.

Wells Fargo’s home loan production topped $524 billion last year – a record for any one lender. What’s more, that number is more than all of the next five lenders home loan production combined, according to the publication Inside Mortgage Finance.

Wells Fargo has been aggressively approaching real estate brokers and developers to expand its home lending business, striking deals to become preferred lenders.

Wells Fargo preferred-lender arrangements give it “first crack at a lot more loans,” says Rosenbaum.

Source: “Real Estate News: Mortgage Gamble Pays Off for Wells,” The Wall Street Journal (April 3, 2013)

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Florida markets tops for home-rental investments

Fla. cities in top 20 for investment return – capitalization rate

4. Ocala – 10.23%
6. Palm Bay – 9.77%
8. Jacksonville – 9.59%
9. Deltona – 9.39%
11. Tampa – 8.86%
12. Port St. Lucie – 8.8%
13. Orlando – 8.78%

OCALA, Fla. – April 5, 2013 – Seven of Florida’s foreclosure-filled housing markets are among the nation’s Top 20 metro areas for single-family rental investments, according to a report.

Ocala was the top-ranked of the Florida metropolitan areas, ranking fourth nationally with a median sales price of $75,357 for a three-bedroom home and an average monthly rent of $1,070 on the same-size house, according to the report by real estate research firm RealtyTrac Inc.

The California-based company predicted cash flow by factoring capitalization rates, rental rates and home prices. Occupancy rates were not factored into the ranking.

The four-county Orlando metro area ranked 13th for best returns, with a median sales price of $108,000 on a three-bedroom home and an average rent of $1,316 on the same-size house.

“Buying single-family homes as rentals that actually generate good monthly cash flow has become more difficult over the past year as institutional investors crowded into the market, snapping up tens of thousands of properties in 2012 alone,” said Daren Blomquist, vice president of RealtyTrac. “But there are still opportunities for the more conservative, individual investor to buy rental homes that generate a healthy return on investment – it often just takes persistence and a willingness to pass on bad deals.”

Other Florida metro areas on the Top 20 list were: Brevard County, Jacksonville, Volusia County, Tampa-St. Petersburg, and Lakeland.

Leading the nationwide list was Memphis, Tenn., with a median price of $72,605 for a three-bedroom home and an average rent of $1,047 for a house of that same size.

Copyright © 2013 The Orlando Sentinel (Orlando, Fla.), Mary Shanklin. Distributed by MCT Information Services.

Real estate agent: 2013’s happiest job

IRVINE, Calif. – April 4, 2013 – CareerBliss, an employment website, released new data ranking the Happiest and Unhappiest Jobs in the U.S. The data from more than sixty-five thousand independent company reviews determined which jobs rank highest in happiness.

This year, Realtors rank at the top for job happiness, followed by quality assurance engineers, sales representatives and controllers who work in a company’s finance department. By contrast, teachers, nurses and attorneys rank as some of the unhappiest jobs in the U.S., with attorneys at the top of the unhappiness list.

“Real estate agents have definitely weathered quite a financial storm over the past few years,” says Heidi Golledge, CEO and co-founder of CareerBliss. “But right now, rates are between 2 to 3 percent and inventory is low, making it a real estate agent’s dream as new homes hit the market and (they get) multiple offers in the first week. Realtors say that the way they work, and the rewards they are seeing with a growing market, has helped boost overall happiness for those in this career.”

The presence of real estate and construction jobs in the CareerBliss happiest jobs list is a new trend this year.

Happiest jobs rank based on 1-5 point score
1. Real Estate Agent – 4.26
2. Senior Quality Assurance Engineer – 4.23
3. Senior Sales Representative – 4.19
4. Construction Superintendent – 4.10
5. Senior Application Developer – 4.08
6. Logistics Manager – 4.07
7. Construction Manager – 4.06
8. Executive Administrative Assistant – 4.04
9. Network Engineer – 4.02
10. Assistant Controller – 4.02

Unhappiest jobs based on 1-5 point score
1. Associate Attorney – 2.89
2. Customer Service Associate – 3.16
3. Clerk – 3.18
4. Registered Nurse – 3.22
5. Teacher – 3.22
6. Marketing Coordinator – 3.31
7. Legal Assistant – 3.38
8. Pharmacy Technician – 3.39
9. Technical Support Specialist – 3.41
10. Case Manager – 3.44

Data was derived from more than 65,000 independent employee reviews from 2011-2012.

© 2013 Florida Realtors®

Housing – a new senior moment

NEW YORK – April 3, 2013 – Single-family home sales in retirement communities jumped 21 percent last year and are poised for nearly 25 percent growth this year, projects the National Association of Home Builders (NAHB).

With 55-and-older households expected to climb to 46.6 percent of all U.S. households by 2020 – up from 42 percent in 2012 – developers see an opportunity. They continue to break ground and expand the number of units and new communities targeting the demographic.

Many older adult developments offer upscale amenities, from hydromassage rooms and private theaters, to professionally decorated interiors and top-notch chefs. They cater to retirees with active lifestyles by offering full-size gyms, personal trainers, and Zumba and belly-dancing classes, among other options. Some also consider pets as members of the family.

However, rents at upscale communities can run as high as $10,000 per month for a two-bedroom unit, which can be difficult for retirees to manage as they deal with healthcare and prescription costs. Still, many seniors prefer active-adult communities because they don’t require upfront payments to cover living and healthcare expenses for the rest of the resident’s life, a practice common in continuing-care retirement communities.

Active-adult communities provide traditional dwellings, often with first-floor master suites, and landscaping and maintenance covered by a monthly fee. However, residents must pay for advanced medical services on their own.

Some experts believe the success of the community depends on the clubhouse, with buyers drawn to its amenities, which can include everything from arts and crafts rooms to industrial kitchens that can cater parties.

Source: Wall Street Journal (03/29/13) P. M1; Wotapka, Dawn

© Copyright 2013 INFORMATION, INC. Bethesda, MD (301) 215-4688

Millennials want to buy – boomers want to sell

ORLANDO, Fla. – April 2, 2013 – Is it the perfect real estate storm? A survey released yesterday by PulteGroup Inc. finds strong demand soon from buyers 18 to 34. Meanwhile, Arthur C. Nelson, a professor of urban planning at the University of Utah, worries that the nation’s supply for for-sale inventory will expand fast as more baby boomers turn 65 and decide to rent or downsize.

Millennials

According to the PulteGroup Home Index Survey (PGHI), 65 percent of renters age 18-34 with an income of more than $50,000 intend to buy, and that percentage grew in the past year.

Most millennials aren’t moving on their own, with 76 percent saying they’ll live with a spouse or significant other, according to the survey. Of those not moving in with a significant other, 22 percent expect to have a roommate, including a friend, parent, in-law, grandparent or sibling.

“Millennials have witnessed the housing boom and bust, but still believe homeownership is a good investment,” says Fred Ehle, vice president for PulteGroup. “Consistent with other third-party research that shows more than 90 percent of millennials plan to buy a home someday, we see a lot of young adults who are making financial sacrifices to afford a place of their own. With the combination of incredibly low mortgage rates, rising rental rates and very low inventory levels, millennials realize now is a good time to purchase a home.”

PulteGroup says 30 percent of its 2012 home sales went to first-time homebuyers, many of whom are millennials. In internal buyer surveys, more than 50 percent of millennials say a desire to own/build equity is the primary reason for purchasing a home. The second largest reason, at 12 percent, was that millennials were tired of apartment living.

“Millennials today want a lot of value in their home that makes efficient use of every space,” says Ehle. “In fact, the single most important home feature to a millennial buyer today is the floor plan layout.”

PulteGroup’s internal buyer surveys showed that millennials listed the following aspects in a new home as extremely important/very important:

• 84 percent – ample storage for daily items
• 76 percent – space for TV, movies, sports watching
• 73 percent – the entry to the home
• 69 percent – an open/layout space in kitchen and family rooms for entertaining
• 63 percent – outdoor living/deck
• 36 percent – the ability to conduct business from home

More than 90 percent of millennials research a home purchase through the Internet. The PGHI survey found that they’ll also go online to reach out to real estate professionals and even their own parents.

Baby boomers

Arthur C. Nelson, professor of urban planning at the University of Utah, predicts that roughly 1.5 to 2 million adults age 65 or older will put their home on the market in the next seven years. Nelson says he sees a growing momentum to downsize.

“This is the decade of the shakeout, where the boomers will begin turning 65 and we’ll begin to see how they influence the housing market,” Nelson told The Chicago Tribune. Nelson cites other research that shows people tend to sell at a faster rate once they hit age 60. Baby boomers began turning 65 in 2011 and the last will hit that age in 2029.

It could represent a lot of homes. About 80 percent of adults own a home when they turn 65.

The news could also benefit commercial developers. Nelson says that about 4 percent of older-adult home sellers opt for a rental once they sell the family home. He predicts a surge in construction of apartments for more affluent renters.

© 2013 Florida Realtors®

U.S. homeowners think it’s a good time to renovate

PALO ALTO, Calif. – April 1, 2013 – Significantly more U.S. homeowners are moving forward with renovation projects compared to this time last year, according to the second annual Houzz & Home survey.

A majority of the homeowners surveyed believe now is a good time to remodel (53 percent), and 58 percent of those planning projects in the next two years will hire professional help. The study also found that three-quarters of homeowners believe that now is a good time to buy a home.

Together with the recent U.S. Commerce Department report showing the rate of single-family home construction is at its highest level in four and a half years, the results of this study point to a strengthening economy, housing and renovation market.

The 2013 Houzz & Home survey garnered more than 100,000 responses from the Houzz community of 14 million monthly unique users. The study yielded detailed data at the national, regional and metropolitan area level.

The number of homeowners who say they will delay projects because of the economy has dropped to 45 percent from 52 percent last year, and homeowners are more likely to cut back in other areas, such as vacations and other big ticket purchases, rather than delay or decrease budgets for their home plans. While improving the look and feel of the space is still the key driver for recently completed projects (83 percent), the number of homeowners who remodeled to increase their home value has increased to 54 percent from 47 percent in 2012.

“We’ve collected an unprecedented volume of data from the community, and we are pleased to share the findings with everyone looking to renovate or decorate their home,” said Liza Hausman, vice president of community for Houzz.

Bathrooms and kitchens top America’s renovation project list again this year, with 28 percent of respondents planning a bathroom remodel or addition, and 23 percent planning a kitchen remodel or addition in the next two years.

In terms of dollars spent, kitchens command the lion’s share. Over the last five years, nearly four in ten home improvement dollars have gone into kitchens and survey data indicates future spending is likely to follow the same trend.

Over the last five years, homeowners on average spent $28,030 to remodel their kitchens; however spending varies widely at different budget levels. Homeowners spent an average of $54,942 nationwide for a high-end kitchen, $22,390 for a mid-range kitchen and $7,133 for a lower-budget kitchen.

The study also found that homeowners renovating at the higher-end were more likely to go over budget than those doing more modest renovations, though a significant number reported going over budget at all project levels. Fifty-six percent of those doing a high-end renovation, 42 percent of those who did a mid-range renovation and 31 percent of those whose renovation was lower budget also spent more than expected on their projects.

Other key U.S. findings

• Spending more time in a room does not necessarily correlate with decorating dollars. Homeowners report spending the most time in their family/TV rooms, but not the most money there.

• Nobody was willing to admit to spending significant time in their bathroom – but apparently the time we do spend there is worth significant investment. The percentage of money spent on kitchens and bathrooms far exceeds the percentage of time spent in these spaces.

• A majority of the homeowners surveyed who are planning to complete a project in the next two years will hire a general contractor (58 percent), and a third a kitchen/bath (36 percent) or carpet/flooring professional (34 percent). Twenty-three percent plan to hire architects and 22 percent interior designers.

• When it comes to hiring a professional for their project, 67 percent of homeowners surveyed rated a “personality I can work with” as a 5 (very important) on a 5-point scale.

• Thirty-four percent of U.S. homeowners cited making their home more energy efficient as a key driver for completing their most recent project.

The Houzz & Home Survey was emailed to registered users of the Houzz website between January and February 2013. Edge Research conducted the survey. To download the full report, go to the Houzz website.

Source: Houzz.com

© 2013 Florida Realtors®