fbpx

Monthly Archives: January 2022

‘Energy Efficient’ a Selling Point for Older Homes

Sometimes buyers’ general desire for a newer home can be countered by an older home that has been upgraded to be considered “energy efficient.”

NASHVILLE, Tenn. – Today’s homebuyers put energy efficiency high on their “must-have” list, and many also want something that’s no more than 10 years old, yet many homes are at least 30 years old. That means owners should consider adding energy-efficient muscle to their marketing plan.

A recent survey found most homeowners thought they were not using as much energy as they did five years ago. At the same time, a little more than half said their energy bills had gone up. The outlook for 2022 and beyond is for energy costs to continue increasing.

A strong selling point for today’s new homes is dramatic improvements in energy efficiency due to improved materials, better building standards and advances in appliance technology. But there are things owners of older homes can do to mitigate the new vs. old energy use issue.

They can start with an energy audit. There are local firms that offer this service. Another source is power companies. Audits usually offer short-term and long-term options. The short-term is lower-cost improvements for immediate results. The long view typically includes big-ticket items.

Here are a few primary options:

  • Insulating or re-insulating attic spaces. It has a major impact on both heating and cooling costs.
  • New windows and doors score high on the upgrade wish list but can be a big-ticket item.
  • Many older homes can make big energy efficiency gains with new technologies. Digital controls are one example. They make it possible to automatically adjust heating and cooling levels in concert with peak need-and-use times. Another example is the ability to set those digital controls heating a home’s downstairs during the day and the upstairs at night.
  • Hot water heaters and piping are big energy users. While better insulation helps, tank-less water heating units can be good upgrades, but like the energy-efficient windows, there’s an upfront investment. The payback comes over time because the tankless systems heat water only when needed.
  • If an older home also has older appliances, consider newer energy-saving models. Compared to things like replacing windows and doors, this can be a less expensive alternative, resulting in some energy-efficiency eye candy.

As with any home upgrade, it’s important to keep tight control on costs and return on investment expectations. If the project involves contractors, multiple estimates are prudent and be sure to check out the contractors’ references. To expand on your library of tips about saving on energy costs for any season check out the National Association of Realtors®’ House Logic website under “Save on Utilities.”

The 2022 housing market outlook is for a market that will cool from last year’s harried pace. It should continue as a strong sellers’ market, but they’re likely won’t be as many multiple offers, and buyers will also likely begin resisting foregoing contingencies and inspections to seal the deal.

Source: Northeast Tennessee Association of Realtors

https://www.floridarealtors.org/news-media/news-articles/2022/01/energy-efficient-selling-point-older-homes

3 Fla. Markets ‘Hottest’ for 2022 – Tampa No. 1

An analysis of “competitive” markets in 2021 projects that Tampa will be the hottest in the U.S. this year, with Jacksonville and Orlando close behind.

ORLANDO, Fla. – An analysis of the 50 largest U.S. metro areas to determine “the hottest” (most competitive) for 2022 determined that Tampa was No. 1 in the U.S.

To determine hotness, the study released by Zillow looked at home value appreciation from November 2021 to November 2022, anticipated change in home value appreciation from 2021, the flow of for-sale inventory, an estimate of the net new number of home-owning households based on current demographic trends and new jobs per new housing unit permitted.

Of the top 10 hot home markets, two other Florida metro areas also made the list: Jacksonville in the No. 2 spot, and Orlando at No. 9. Last year’s No. 1 hottest market, Austin, Texas, fell to No. 10 this year.

The economists who oversee the yearly ranking say shoppers in the hot markets will likely face strong competition, rising prices and limited inventory that’s snatched off the market quickly. The study finds Tampa, for example, has strong forecasted home value growth, a thriving job market, relatively scarce and fast-moving inventory, and demographics that indicate a good number of potential buyers.

“Homebuyers are attracted to markets in the Sun Belt that offer relative affordability, fast-growing economies and weather that allows them to enjoy the outdoors year-round,” says Zillow Economist Alexandra Lee. “Across the board, sellers will remain in the driver’s seat, but especially so in the hottest markets. Buyers should be ready for strong competition for homes, which means bidding wars and homes flying off the market only days after they are listed.”

10 hottest housing markets of 2022

  1. Tampa
  2. Jacksonville
  3. Raleigh
  4. San Antonio
  5. Charlotte
  6. Nashville
  7. Atlanta
  8. Phoenix
  9. Orlando
  10. Austin

In addition to Austin’s fall from No. 1 to No. 10, Denver dropped off the top 10 list (No. 5 last year, No. 15 this year).

Outside the Sun Belt, the hottest 2022 markets are expected to be in the Midwest. Salt Lake City (No. 13), Kansas City (No. 14), Oklahoma City (No. 16) – which is sometimes considered a Sun Belt city depending on where the border is drawn – Columbus (No. 17) and Indianapolis (No. 18) just missed the top 10 list.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/3-fla-markets-hottest-2022-tampa-no-1

Solar Shingles Could Soon Be Available, Affordable

Energy companies are racing to create shingles that generate solar energy, and one firm says the cost might be only $15K more than a regular roof replacement.

NEW YORK – Tesla first made solar shingles a thing in 2016, when the company unveiled the Tesla Solar Roof. Blending asphalt shingles with the means to generate energy was a new idea – one that other companies have tried to emulate.

Consumers have been hesitant to adopt solar shingles because of the steep cost to manufacture and install them. Also, they’re not yet as efficient as regular solar panels.

GAF Energy is the latest company to join the solar shingle race. One of the largest roofing companies globally, GAF Energy announced its launch of solar shingles with the debut of Timberline Solar, which it says will be a cheaper alternative to Tesla’s Solar Roof. The company already won attention with a Best of Innovation Award for Smart Cities at CES 2022, the annual mega tech show that ran last week in Las Vegas and virtually.

“We’re part of the world’s largest roofing manufacturer,” Martin DeBonon, president of GAF Energy, told CNBC. “We have access to materials that typical solar companies don’t have access to. No one has ever specifically tried to make a solar product that a roofer can install. And we’ve done it, and our product goes on with just a nail gun. It goes on twice as fast as typical solar.”

The shingles are 17 inches tall and 64 inches long, or larger than Tesla’s solar shingles. The company says the larger shingles mean there are fewer parts to manufacture and fewer wiring connections, which will help decrease costs. GAF Energy did not release specific pricing information.

“Let’s say in many parts of the country, you have a $15,000 cost for the roof. Getting a solar system, adding that would be another $15,000,” DeBono said. That would include a new roof and solar panels, which at $30,000 total would be less expensive than other similar products.

Tesla’s projected cost for an average-sized 1,700-square-foot Solar Roof in the Bay Area is about $40,700, prior to solar subsidies, CNBC reports.

Roofing experts believe GAF Energy is in a prime position to shake up the solar shingles race. About one out of every three asphalt shingle roofs in the U.S. is a GAF roof, David Winter, co-CEO of Standard Industries, said.

“So we’re the people that are sitting at the proverbial kitchen table with the homeowner at that moment that they need to replace their roof, where we can introduce the idea of solar,” Winter said. “The natural moment to actually put solar on a roof is that moment when you’re already about to replace your roof. It makes literally no sense to put brand new PV on an old roof that’s well into its warranty.”

Source: “Roofing Giant Takes on Tesla to Make Solar Roof Shingles More Affordable,” CNBC (Jan. 3, 2022)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/solar-shingles-could-soon-be-available-affordable

Too Few Homes ‘Camera Ready’ for Listing Photos

Many times, ink isn’t dry on the listing contract before photographers show up, and sellers told to “get your home ready” aren’t sure what that means.

NEW YORK – Most homebuyers shop for online and judge properties based on photos before deciding whether to visit the properties in person. But many home sellers don’t make much effort to prepare their home for a photo shoot, according to a new study.

More than half of the 310 professional real estate professional photographers surveyed said home sellers haven’t properly prepared their property before the photographers arrive, according to a survey conducted by HomeJab, a photography and visual production service firm for real estate.

“Agents may be assuming their sellers know what they need to do to have their home ready for a photo shoot,” says Joe Jesuele, founder and CEO of HomeJab. “But photography occurs very early in the listing process, and sellers may not realize what professional photographers need to make the right impressions.”

What mistakes are homeowners making? They may forget to clean up, but they often leave out personal items, such as cellphones, purses and drinking glasses. Some may even think it makes the home looked “lived in,” when it actually pulls buyers’ eyes away from the elements they care about.

“That can detract attention away from what is important,” says Jon Biddle, a professional real estate photographer in Philadelphia. “Agents could do more to make sure they’re ready.”

To help sellers prepare for a professional photographer’s visit, the National Association of Realtors® (NAR) created a list – How to Prepare for the Photo Shoot – that agents can present to sellers before the photographer arrives.

Source: HomeJab

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/too-few-homes-camera-ready-listing-photos

2021 Home Loans Broke Records with 9% Increase

Mortgage bankers say buyers borrowed $1.6T last year for home purchases, topping the 2005 housing bubble’s $1.5T. They expect another new record this year.

LOS ANGELES (AP) – The fierce competition, low mortgage rates and soaring prices that helped raise mortgage borrowing to record heights last year is expected to drive lending even higher this year, experts say.

Banks lent an estimated $1.61 trillion for home purchases last year, up about 9% from 2020, according to the Mortgage Bankers Association (MBA). That tops the $1.51 trillion lent at the peak of the housing bubble in 2005, the highest on records going back to 1990.

Lenders issued 4.74 million loans to borrowers buying a home last year, down from 4.92 million in 2020, according to the MBA. Even so, the dollar value of for-purchase loans increased last year as home prices surged, often as homebuyers agreed to pay well above a seller’s asking price to outbid competing offers.

“Strong housing demand, persistent increase in housing demand, constrained supply, increase in prices – that’s what led to that record purchase level last year,” said Mike Fratantoni, the MBA’s chief economist.

The housing market has strengthened during the pandemic as many Americans transitioned to working at home, which put additional living space at a premium. Steady job growth, a stock market at all-time highs, rising rents and expectations of higher mortgage rates have also spurred homebuyers, even as skyrocketing prices and a historically low level of homes for sale have shut out many others.

Median U.S. home prices in October were nearly 20% higher than a year earlier, according to the most recent S&P CoreLogic Case-Shiller home price index.

The housing market is expected to continue to sizzle this year, which is why the MBA projects that the dollar value of for-purchase home loans will climb to a new high of $1.74 trillion.

While the for-sale inventory may end up being a little better than in 2021 as homebuilders crank out more homes, it still won’t be enough to give the upper hand to buyers, Fratantoni said.

“2022 is still going to be a seller’s market,” he said. “There’s more demand than supply, and that’s why we’re very confident that prices are going to keep going up.”

Meanwhile, homebuyers are likely going to have less buying power this year to cope with rising home prices.

The extraordinarily low mortgage rates that have helped intensify housing market demand are expected to continue creeping higher in 2022 as the Federal Reserve phases out the monthly bond purchases it has been making since the early days of the pandemic. The central bank has already signaled that it expects to start raising interest rates as early as this spring to check sharply rising inflation.

The average rate on the benchmark 30-year fixed-rate mortgage stuck around 3% in 2021. The MBA’s forecast calls for that average rate to rise to 4% this year.

That’s close to other housing economists’ forecasts. The National Association of Realtors projects the average rate will rise to 3.7% by the end of this year. Greg McBride, chief financial analyst at Bankrate, forecasts rates will peak at 4%, but end the year at 3.5%.

“It will be a bit of a roller coaster ride,” McBride said. “The higher rates we expect in 2022 won’t take the winds out of the sails of the housing market, but it will change the refinancing equation significantly.”

Homeowners borrowed some $2.32 trillion in 2021 to refinance their mortgage, down about 12% from 2020, when refinancing hit a record high, according to the MBA. Taken together, mortgage refinancing in 2021 and 2020 amounted to nearly $5 trillion.

The MBA forecasts mortgage refinancing will fall to $870 billion this year, the lowest since 2018′s $467 billion.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.floridarealtors.org/news-media/news-articles/2022/01/2021-home-loans-broke-records-9-increase

Will Omicron Ding the Number of Out-of-State Buyers?

Fla. tourism officials don’t think so, though a panel of state economists slightly lowered their six-month expectations for Canadian and overseas tourists.

TALLAHASSEE, Fla. – A top Florida tourism official called the future of travel to the state “bright” and said there are no plans to slow marketing efforts, even with the rapid spread of the omicron variant of the coronavirus. Visit Florida President and CEO Dana Young said Wednesday the agency continues to expand its winter marketing campaign in the United States and isn’t slowing international efforts.

“This has been a tough road for our international folks, but we have not stopped for one second working in those markets to make sure that Florida stays top of mind,” Young said during a conference call with members of the Visit Florida Executive Committee.

Last month, a panel of state economists slightly lowered expectations through the middle of 2022 for Canadian and overseas travelers, anticipating the omicron variant would slow, at least temporarily, Florida’s resurging tourism.

Amy Baker, coordinator of the Legislature’s Office of Economic & Demographic Research, said during a Dec. 20 meeting the highly contagious variant likely would affect people’s decisions to travel to and from Florida.

“I think omicron kind of changed the environment,” Baker said. “I know of two people who were planning to travel internationally. They canceled their trips because of omicron, not knowing what additional lockdown restrictions (would be) if they got some place. Would their country be open? What’s happening in the United States? What would be the requirements on them going?”

Florida’s tourism industry exceeded expectations in the third quarter of 2021, drawing 32.6 million visitors, which was 2 million more than forecast earlier this year and 0.3% above the overall number of visitors in the third quarter of 2019 – before the pandemic began. The 2021 third-quarter totals followed 31.7 million visitors in the second quarter, which was 2.2% below the second quarter of 2019.

Almost 90% of visitors in 2021 had come from other states, though Visit Florida officials expected a resurgence in Canadian and overseas visitors after the White House eased travel restrictions in November.

Visit Florida Chief Marketing Officer Staci Mellman on Wednesday said it’s too early to make projections on fourth-quarter numbers.

“Most recently, I think we saw some rise in travel, especially from Latin America, but that’s always been pretty consistent over the last year and a half during the pandemic,” Mellman said. “I think the numbers were less than what we anticipated from Europe.”

Members of the committee said they’ve seen many license plates from New York, New Jersey and the Carolinas on Interstate 95, but there hasn’t been the normal crop from Quebec and other parts of Canada.

With the start of 2022, Visit Florida launched a new winter marketing campaign aimed at the West Coast and is pinpointing tourists from numerous cities, including New York; Atlanta; Birmingham, Ala.; Houston; Boise, Idaho; Salt Lake City; Chicago; Detroit; Philadelphia; Indianapolis; Minneapolis; Cleveland; Boston; St. Louis; Nashville, Tenn.; Macon, Ga.; Louisville, Ky.; Cincinnati and Milwaukee.

Executive Committee member Dan Rowe, president and CEO of the Panama City Beach Convention and Visitors Bureau, said the local organization has seen winter tourism numbers already 25% to 40% higher than a year ago.

“I think you will see across the state that there will be an uptick in business from our friends from Canada, and also the Northeast and upper Midwest,” Rowe said.

Young also expressed optimism.

“My common sense tells me that if the border was open, which it was or is, they are in their Suburbans and RVs, and if they aren’t already here, they’re on their way,” Young said. “And we should be getting those numbers … but common sense just tells me that they’re not hanging out in Canada.”

Young’s update came as Visit Florida hopes to draw support from lawmakers for extending the agency’s scheduled expiration date beyond Oct. 1, 2023. A proposal in the Senate (SB 434) would keep the agency operating until Oct. 1, 2031. A similar House measure (HB 489) offers an extension to Oct. 1, 2028.

The agency also hopes to maintain $50 million in state funding next fiscal year, an amount requested by Gov. Ron DeSantis.

Visit Florida received $80 million from the Legislature for the current fiscal year, including $30 million from federal stimulus programs.

Source: News Service of Florida

https://www.floridarealtors.org/news-media/news-articles/2022/01/will-omicron-ding-number-out-state-buyers

Credit Report Errors: The Top Consumer Complaints

Many buyers focus on their credit scores for the first time and find errors, which aren’t always easy to fix. A CFPB report shows top credit score repair issues.

WASHINGTON – A new analysis by the U.S. Consumer Financial Protection Bureau (CFPB) focuses on the big three consumer credit reporting companies – Equifax, Experian and TransUnion – and analyzes how well they’re responding to consumers who find errors in their credit scores.

Overall, CFPB says the credit agencies in 2021 “reported relief in response to less than 2% of covered complaints, down from nearly 25% of covered complaints in 2019.”

“America’s credit reporting oligopoly has little incentive to treat consumers fairly when their credit reports have errors,” says CFPB Director Rohit Chopra. “Today’s report is further evidence of the serious harms stemming from their faulty financial surveillance business model.”

Credit reporting plays a critical role in consumers’ lives, and has an oversized impact on homebuyers. In some cases, a buyer with a credit score problem can’t qualify for a mortgage at all; in other cases, they can qualify for a mortgage, but it comes with an interest rate higher than they deserve.

In addition to home buying, credit reports impact may aspects of a consumer’s life. It can also impact decisions about employment, insurance and even essential utilities. For consumers, inaccuracies drive up the cost of credit and severely limit opportunities, such as starting a small business or buying that new home.

From January 2020 through September 2021, consumers submitted more than 700,000 complaints to CFPB regarding Equifax, Experian and TransUnion – 50% of all CFPB complaints for that period. The top complaint topic: Inaccurate information. In most cases, the complaint claims that the inaccurate info on their report belongs to someone else, and many says they’re victims of identity theft.

According to CFPB, it generally found that the three credit reporting agencies didn’t provide “substantive responses,” and they usually alleged that the complaints about credit score problems were “sent in by third parties.” However, CFPB says consumers can authorize third-party representatives to submit complaints on their behalf, suggesting that the excuse isn’t valid.

Equifax, Experian and TransUnion’s statutory obligations

The Fair Credit Reporting Act (FCRA) requires Equifax, Experian and TransUnion to review complaints sent to them through CFPB when consumers say there is incomplete or inaccurate information, and the consumer has already tried to fix the problem directly with the company. After review, the credit-score firms must then report back to CFPB.

Under the latest report, CFPB says it found the following problems:

  • Equifax most often promised to open investigations and send the results to the consumers later, but it failed to provide the CFPB with the outcomes of the investigations.
  • TransUnion made similar promises and frequently failed to provide the outcomes of investigations to CFPB. It often stated it would take no action on complaints because it believed the complaints were submitted by third parties.
  • Experian frequently stated it would take no action because it believed the complaints were submitted by third parties; however, it did respond to the remaining complaints with substantive responses.

Medical billing mistakes make up a large share of CFPB’s credit score complaints. It says that “opaque pricing, the complex system of insurance coverage and frequent delays in consumers finally receiving bills create an unnavigable quagmire.”

In many cases, CFPB claims, consumers often struggle to even determine whether the debt belongs to them – and, if it does, whether the amount is accurate.

Key report findings

Overall, consumers describe a consumer reporting system that is not working for them. Other key report details on problems:

  • Equifax, Experian and TransUnion relied heavily on template complaint responses instead of providing meaningful and thorough responses to consumers, despite having up to 60 calendar days to respond.
  • Beginning in early 2020, Experian and TransUnion stopped providing substantive responses to consumers’ complaints if they suspected a third-party was involved in submitting the complaint.
  • In many instances, Equifax and TransUnion promised to investigate but then failed to provide the outcomes of their investigations to CFPB, instead saying they’d forward the complaints to their “dispute channel.”

Overall, CFPB says more than 50% of consumers’ complaints didn’t receive the review required under federal law, often with credit reporting agencies saying that they suspected it was submitted by third parties.

“Overall, consumers describe feeling frustrated and stressed when the nationwide consumer reporting companies’ automated processes for correcting inaccuracies do not work or when they do not get responses to their concerns,” CFPB says in its release.

Credit score resources

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/credit-report-errors-top-consumer-complaints

Fannie, Freddie Increasing Fee on Second-Home Loans

FHFA is increasing the “G-fee” on most high-balance and second-home mortgages. Translation: After April 1, buyers seeking these loans will pay a bit more.

WASHINGTON – On Wednesday, the Federal Housing Finance Agency (FHFA) announced an increase in Fannie Mae and Freddie Mac’s upfront fees for some high-balance and second-home loans. The increase in the so-called “G-fees” begins on April 1, 2022, according to FHFA’s announcement.

More than half of all mortgages, once originated by a lender, are sold to either Fannie Mae or Freddie Mac. The system provides liquidity to the U.S. mortgage market and allows local lenders to finance even more loans. FHFA uses money generated by the G-fees – essentially a surcharge to loans they purchase – to support affordable housing through programs such as HomeReady, Home Possible, HFA Preferred and HFA Advantage.

FHFA says the increase will help it meet objectives outlined in its 2022 Scorecard for Fannie Mae, Freddie Mac and Common Securitization Solutions to “increase support for core mission borrowers, while fostering capital accumulation, achieving viable returns and ensuring a level playing field for small and large sellers.”

Starting in April, G-fees for the affected high-balance home loans will increase between 0.25% and 0.75%, tiered by loan-to-value ratio. Fannie Mae calls these high-balance loans; Freddie Mac calls them super-conforming loans. However, loans to first-time homebuyers in high cost areas with incomes at or below 100% of area median income won’t have specific high balance upfront fees.

For second-home loans, upfront fees will increase between 1.125% and 3.875%, tiered by loan-to-value ratio.

The National Association of Realtors® (NAR) opposes G-fee increases but says the latest change has a positive side if it helps Fannie and Freddie maintain broad liquidity as the federal government pulls back unprecedented support during the pandemic. Still, it expects an undue impact in higher-cost metro areas and areas with a high level of second-home purchases.

“Fannie Mae and Freddie Mac will face greater risks as the market is weaned off of the extraordinary federal support during the pandemic, and these changes may help them to support the maximum access and affordability possible for the market in a sound manner,” says NAR President Leslie Rouda Smith. “However, we are concerned that any fee increases that exceed necessary levels in the current environment will harm affordability and access for consumers. Realtors® believe any excess revenues gleaned from the fee increases must be used to support homeownership opportunities in underserved communities, expanding affordability and access in a safe manner.”

“Today’s action represents another step FHFA is taking to strengthen (Fannie Mae and Freddie Mac’s) safety and soundness, and to ensure access to credit for first-time homebuyers and low- and moderate-income borrowers,” says FHFA Acting Director Sandra L. Thompson.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/fannie-freddie-increasing-fee-second-home-loans

High Prices for Lumber? It’s Back

After a summer dip, lumber prices almost tripled over the past four months. Builders say the increase adds more than $18.6K to the price of a new home.

CHICAGO – Following a price dip last spring and summer, lumber costs have nearly tripled over the past four months.

The National Association of Home Builders (NAHB) says the increase pushed the price of an average new single-family home more than $18,600 higher. It also added nearly $7,300 to the price of an average new multifamily home, which would translate into $67 more per month in rent for a new apartment.

Lumber’s price volatility started in April 2020 when the pandemic prompted a reduction in production at sawmills, followed by an unexpected surge in demand as new-home construction and remodeling sparked shortages. Lumber prices reached a record of $1,500 per thousand board feet in May 2021.

However, recent challenges have once again hurt the lumber supply: Ongoing supply chain disruptions, the doubling of tariffs on Canadian lumber imports, and the wildfire season in the western United States and British Columbia. On Dec. 19, the price of framing lumber was $1,000 per thousand board feet – a 167% increase since late August.

Builders use lumber throughout the building process, for structural framing, sheathing, flooring, interior walls and ceiling finishes, cabinets, doors, siding, garages, porches, railing, fences and more.

Source: “Latest Wave of Rising Lumber Prices Adds More Than $18,600 to the Price of a New Home,” National Association of Home Builders (Jan. 4, 2022)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/high-prices-lumber-its-back

Class-Action Surfside-Collapse Lawsuit Pushed to 2023

The judge says he’s disappointed a late-summer trial won’t work, but lawyers argued it wasn’t a realistic timeline given the pace of the investigation.

MIAMI – Victims of the Surfside condominium collapse will have to wait more than a year – until at least March 2023 – for a trial on their class-action lawsuit, the judge overseeing the case has ruled.

Judge Michael Hanzman, who has been trying to keep the case on a fast track, said he was disappointed that his original plan to schedule a trial for late summer would have to be delayed. Lawyers argued that was not a realistic timeline given the pace of investigating the cause of the June 24 collapse that killed 98 people at Champlain Towers South, and complications in collecting evidence and depositions.

“That is six months later than I’d hoped for, and justice delayed is justice denied, for both victims and defendants,” Hanzman said during a Zoom status hearing on Wednesday. “So you better get your experts going. This court is not working under any leisurely schedule. You schedule your depositions and you take your discovery.”

On another matter, a date of Feb. 4 was set for an in-person mediation session to discuss how funds should be allocated to surviving property owners, the relatives of those who died, renters and visitors who were in the 136-unit building when it partially collapsed at 1:22 a.m.

Hanzman is counting on court-appointed mediator Bruce Greer to make progress in a dispute over how money should be divided. At stake is at least $120 million for the sale of the property, $50 million in insurance coverage and millions more in negligence claims against various defendants. Design defects, construction shortcuts, poor maintenance and deferred refurbishment by the condo association board and the building of a luxury condo next door are among the factors cited by engineers and lawyers who have examined how the 13-story tower fell.

“Let’s understand there is no perfect solution,” Hanzman said. “It’s a limited-funds case. The last thing the court wants to do is adjudicate a dispute between victims who lost units and those who lost lives.”

Everyone involved in mediation is being asked to fill out a claims questionnaire, including tenants with content claims. He reiterated his goal of settling economic loss claims quickly so that those victims can be compensated, exit the class-action lawsuit and “get on with their lives” when the focus shifts to wrongful death claims.

“Most people have insurance for contents,” Hanzman said, making a reference to “pots and pans” destroyed in the rubble.

His comments touched a nerve with some survivors.

“I resent what you said very much,” said Sharon Schechter, who was a renter. “I didn’t just lose utensils. I lost everything I owned for my entire life. I had insurance for a few thousand dollars to secure my lease. I never thought this would happen in a million years. That was everything I had – not just knives and forks.”

Hanzman responded by saying, “I didn’t mean to offend you. But let me give you a dose of reality. We have to prioritize. It’s a limited pot of money. You have to understand where your claim may end up in the pecking order between 98 people who perished and 136 owners who lost homes.”

© 2022 Miami Herald. Distributed by Tribune Content Agency, LLC.

https://www.floridarealtors.org/news-media/news-articles/2022/01/class-action-surfside-collapse-lawsuit-pushed-2023

Mortgage Rates Hit 3.22%, Highest Level in 20 Months

The 30-year, fixed-rate loan rose from last week’s average 3.11%. A year ago, the FRM was 2.65%, though this week’s average remains low by historical standards.

WASHINGTON (AP) – Average long-term U.S. mortgage rates rose in the past week to start the new year. They reached their highest level since May 2020, at the height of the coronavirus pandemic, yet remained historically low.

Mortgage buyer Freddie Mac reported Thursday that the average rate on the benchmark 30-year home loan increased to 3.22% this week from 3.11% last week. A year ago, the 30-year rate stood at 2.65%.

The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, rose to 2.43% from 2.33% last week.

Many economists expect mortgage rates to rise this year after the Federal Reserve announced last month that it would begin dialing back its monthly bond purchases – which are intended to lower long-term rates – to tamp down accelerating inflation. But even with the expected three rate increases in 2022, the Fed’s benchmark rate would still sit below 1%.

In addition to stronger inflation, experts expect robust economic growth and a tight labor market to continue to push rates higher.

The government reported Thursday that the number of Americans applying for unemployment benefits rose last week but remained at historically low levels, suggesting that the job market remains strong. U.S. jobless claims rose by 7,000 last week to 207,000.

The highly transmissible omicron variant so far does not appear to have triggered significant layoffs.

Employers are reluctant to let workers go at a time when it’s so tough to find replacements. The U.S. posted 10.6 million job openings in November, the fifth-highest monthly total in records reaching back to 2000. A record 4.5 million Americans quit their jobs in the “Great Resignation” in November – a sign that they are confident enough in their prospects to seek something better.

The job market has bounced back from last year’s brief but intense coronavirus recession. When COVID hit, governments ordered lockdowns, consumers hunkered down at home and many businesses closed or cut back hours. Employers slashed more than 22 million jobs in March and April 2020, and the unemployment rate rocketed to 14.8%.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.floridarealtors.org/news-media/news-articles/2022/01/mortgage-rates-hit-322-highest-level-20-months

Beware Smishers: Not All Texts Are Good Texts

Many texts from scammers get blocked by security software, but sophisticated ones from professional scammers can still get through.

NEW YORK – “Smishing” is the latest phishing cybersecurity attack, and it strikes through your phone. When hackers try to steal data – or money – through a text message, it’s called “smishing.” The text message attempts to dupe you into following a link, reveal personal details or disclose your login information.

Through smishing hackers can try to gain access to your bank account or social media accounts.

Security experts say you should keep a phone’s software and web browser updated. It helps protect against smishing attacks because it also updates security features built into a phone or computer’s software, according toWired.com.

Common smishing attacks

  • Beware of links that come via an SMS text message. They often look like they’re from a company website or social media network. Once clicked, you’ll be asked to enter your username and password, but they’ll log you into a fake website instead.
  • An SMS text message may also try to get you to download an app or run it on your web browser. Many phones block malware apps automatically, but not all. You should still watch out for such messages.
  • A text message may even ask you directly for personal or financial information. The message might, perhaps, ask that you reply to the text with your bank details or login information to a website.

Source: “How to Guard Against Smishing Attacks on Your Phone,” Wired.com (Dec. 12, 2021)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/beware-smishers-not-all-texts-are-good-texts

Fed: Expect an Interest Rate Hike Sooner than Later

Notes released Wed. suggest a shift in Fed officials’ attitudes, and policy changes could soon induce interest rates, including mortgages, to move higher.

WASHINGTON (AP) – The U.S. job market is nearly healthy enough that the central bank’s low-interest rate policies are no longer needed, Federal Reserve officials concluded last month.

Fed officials also expressed concerns in minutes from its December meeting, released Wednesday, that surging inflation was spreading into more areas of the economy and would last longer than they previously expected.

“Many (policymakers) saw the U.S. economy making rapid progress” toward the Fed’s goal of “maximum employment,” the minutes said. “Several” officials said they felt the goal had already been reached. The economy is still roughly four million jobs short of its pre-pandemic level, though some Fed policymakers increasingly believe that all those jobs may not be recovered, at least not anytime soon, as older Americans retire and some former workers stay home to take care of children.

The minutes underscored the Fed’s sharp pivot from what had been its policy through most of the pandemic, as it shifts from keeping interest rates very low to encourage more hiring, to moving quickly towards raising rates to rein in inflation, which has surged to four-decade highs.

Officials also voiced rising concerns about inflation, saying that faster rate hikes may be needed, and signaling that they could start reducing the Fed’s huge portfolio of bonds more quickly than expected. Those moves pushed down stock prices after the minutes were released, with the Dow Jones Industrial Average falling almost 400 points at the close of trading. Bond yields also rose in response. The yield on the 10-year Treasury note, a benchmark for setting rates on mortgages and many other kinds of loans, increased to 1.7% soon after the minutes were released, from 1.68% just before.

“Inflation readings had been higher and were more persistent and widespread than previously anticipated,” the minutes said. “Some participants noted that … the percentage of product categories with substantial price increases continued to climb.”

“The minutes … reflected policymakers’ rising discomfort with elevated inflation and stronger confidence in the recovery of the economy and the labor market despite the downside risks due to the Omicron variant,” Kathy Bostjancic, chief U.S. financial economist at Oxford Economics, said in a research note.

With inflation worsening and unemployment falling more quickly than many economists expected, Fed Chair Jerome Powell said after the Dec. 14-15 meeting that the central bank was accelerating the reduction of its ultra-low interest rate policies.

The Fed said last month that it would reduce the monthly bond purchases it has made since the spring of 2020 – which are intended to lower long-term rates – at twice the pace it had previously set and will likely end those purchases in March. The accelerated timetable puts the Fed on a path to start hiking its benchmark short-term interest rate as early as this June.

Fed policymakers in December also suggested they could hike the Fed’s short-term benchmark interest rate three times this year. That signaled a significant pickup from their September meeting, when the 18 policymakers split over whether to lift rates a single time in 2022.

Even Fed officials who have long been focused on keeping rates low to combat unemployment – such as San Francisco Federal Reserve Bank President Mary Daly and Minneapolis Fed President Neel Kashkari – now cite concerns about high inflation as a reason for raising interest rates this year.

The Fed’s key rate, which has been pinned near zero for nearly two years, influences many consumer and business loans, including mortgages, credit cards and auto loans. Rates for those loans may start to rise, too, later this year, though changes in Fed policy don’t always immediately feed into other borrowing costs.

Since the pandemic struck in March 2020, the Fed has purchased more than $4.5 trillion in Treasurys and mortgage-backed securities, more than doubling its financial holdings to nearly $8.8 trillion. At last month’s meeting, Fed officials discussed when and how quickly they would reduce those bond holdings, another step that could lift interest rates, and suggested they could start doing so this year, after the first interest rate hike.

That would be much more quickly than after the Fed’s last round of bond purchases, known as “quantitative easing,” which it implemented in several stages after the 2008-2009 Great Recession.

The Fed didn’t start reducing its bond holdings then until October 2017, nearly two years after it first hiked rates.

But in December, Fed policymakers noted that the economy is “much stronger” than it was in 2017, “with higher inflation and a tighter labor market.”

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.floridarealtors.org/news-media/news-articles/2022/01/fed-expect-interest-rate-hike-sooner-later

How Profitable Will Commercial Real Estate Be This Year?

A Dec. national poll found 69% of commercial RE brokers said they made more money in 2021 than in 2020, and a NAR report predicts a strong year in 2022.

DENVER – Sixty-nine percent of commercial real estate brokers say they made more money in 2021 than in 2020, according to the latest Apto National Broker Buzz Poll conducted in December 2021. They’re even more optimistic about this year.

Commercial real estate has posted a dramatic recovery ever since the beginning of the pandemic. 2021 marked a big turn for the sector, notably in the multifamily and industrial spaces, as well as a demonstrated resiliency within brick-and-mortar retail, according to the National Association of Realtors®’ December 2021 Commercial Market Insights.

In fact, investment acquisitions helped the commercial sector in 2021 surpass pre-pandemic levels. “This strong foundation of recovery puts the commercial market on pace for sustained demand for the commercial and investor sectors in 2022,” NAR says in its report.

That’s translated into more business for commercial real estate practitioners. Sixty-six percent of brokers say they completed more transactions in 2021 than in 2020. What’s more, 60% of brokers expect 2022 to be an even better year in profitability, according to the Apto survey.

“The poll results reflect the overall economy’s strength this past year, which translated to most brokers making more money, especially those focused on industrial or multifamily real estate,” says Tanner McGraw, a former CRE broker and the founder of Apto, a commercial real estate broker software company.

“But the tide is turning for retail real estate and high-quality office. As we know, brokers can do well whether owners and investors are buying or selling, or whether tenants are adding or shedding space. It’s movement that matters, and we saw considerable business activity in the economy in 2021.”

CRE sectors to watch

The multifamily sector, in particular, had a historic year in 2021. Vacancy rates hit a record low in December 2021 while the median asking rent growth reached a record high of 11% year over year, NAR reports. Rental demand has soared since the pandemic began as double-digit home price growth has priced out some aspiring homeowners and turned them into renters.

Further, the industrial property market posted a record year, experiencing a boon due to the continued growth in online shopping. Nearly 700 million square feet of space has been absorbed since the pandemic began, and rents have soared to record highs of 8.4%, NAR reports. Meanwhile, vacancies have fallen to all-time lows.

2022 outlook

NAR expects demand for commercial real estate to strengthen in 2022, despite an uptick in interest rates largely expected this year. Persistent strong demand and supply will keep commercial real estate strong, NAR says.

The multifamily sector is expected to stay robust. Also, NAR researchers are optimistic about brick-and-mortar continuing to make gains as it solidifies its place in complementing online shopping fulfillment. Retail brick-and-mortar market growth is expected to be largely driven by smaller shops, such as neighborhood centers, strip centers, and single-tenant stores.

Further, the office market will likely continue to see an increase in net absorption as more workers return to the office, even if only on a hybrid work schedule.

Seventy-five percent of brokers who work in an office setting say they have returned to the office following the holidays, according to the Apto survey.

“It’s nice to see brokers back in the office leading the way as real estate consumers,” McGraw adds. “The new coronavirus variant is posing a last-minute threat to office returns, but the desire and intent to be in the office is very apparent based on brokers’ response to our survey.”

Source: NAR’s December 2021 Commercial Market Insights

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/how-profitable-will-commercial-real-estate-be-year

Fannie, Freddie Should Consider Climate Change

Financial risks caused by climate change pose “a serious threat to the U.S. housing finance system,” says FHFA Acting Director Sandra Thompson.

WASHINGTON – The Federal Housing Finance Agency (FHFA), which regulates Fannie Mae and Freddie Mac, says the government-sponsored enterprises (GSEs) should take into account financial risks posed by climate change into their decision making.

The FHFA is also expanding its monitoring and supervision of climate change issues, according to FHFA Acting Director Sandra Thompson. She says climate change “poses a serious threat to the U.S. housing finance system,” and that the GSEs “have an important leadership role to play in addressing this issue.”

Each year, FHFA issues a scorecard intended to hold Fannie and Freddie accountable for fulfilling their core mission requirements – promoting sustainable and equitable access to affordable housing, and operating in a fiscally safe and sound manner. The FHFA’s 2022 Scorecard states that Fannie and Freddie will be expected to demonstrate that they have a governance structure in place “to prioritize the effects of climate change throughout … decision making.”

A September report funded by the Mortgage Bankers Association warned of the potential for increasingly devastating natural disasters, causing the National Flood Insurance Program to be stretched thin and driving more homeowners to default on their mortgages.

A previous academic study of property records estimated that homes located in floodplains are overvalued by $43.8 billion because buyers aren’t factoring in the cost of fully insuring them. The U.S. Department of Housing and Urban Development has in the past repossessed homes in floodplains and resold them without disclosing flood risk to buyers, a probe by NPR found in September. 

Source: Inman (01/03/22) Carter, Matt

© Copyright 2022 INFORMATION, INC. Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/fannie-freddie-should-consider-climate-change

Home Co-owner: Leave Share to Other Owner in Will?

RE Q&A: Is that the better plan, or should the co-owner draft a deed to safeguard his share for his friend and co-owner of the house?

FORT LAUDERDALE, Fla. – Question: I own my home 50/50 with a friend. Neither of us has any close relatives that we would want to leave our half of the house. I read your article about owning a property with other people. Would it be OK to add something to my will stating that my friend will get my share of the house when I die rather than drafting a new deed making us joint tenants with the right of survivorship? – Evie

Answer: Unless you are married or have minor children, you can devise your part of the home to your friend in your will. But having you and your friend deed the house to yourselves as joint tenants with right of survivorship is a much better option for many reasons. The first reason is cost. Preparing a will is more expensive than a deed. Add the cost of probating your will, and it becomes much more costly. A survivorship deed would automatically vest in the surviving friend upon the first death – no need to file for probate. The deed method also avoids any issues with creditors that remain when you pass since the property goes to your friend outside of probate.

Both the deed and wills can be changed at any time by you and your friend. However, because deeds are freely available in the public records, you will know if your friend changes her mind and decides not to leave her half to you. Wills are private, and you would not know if they were changed until after her death. Also, if either of your wills gets lost or destroyed, your intentions might not be carried out. This is not an issue with a deed because it is recorded in your county’s land records. In most legal matters, such as estate planning, there are many ways to accomplish your goals, but not all methods work as well or are as efficient as others.

Copyright © 2022 South Florida Sun Sentinel. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/01/home-co-owner-leave-share-other-owner-will

Millennials Are Supercharging the Housing Market

CoreLogic: From Jan.-Aug. 2021, millennials made up about 67% of first-time home purchase loan applications and 37% of repeat purchase applications.

NEW YORK – Millennials accounted for over half of all home-purchase loan applications in 2020, and this generation’s eagerness to own homes is a key factor in economists’ expectations of strong home-buying demand continuing for years.

Housing analysts say the pandemic and the advent of remote work have added momentum to already building millennial home-buying trends.

CoreLogic calculates that millennials constituted 67% of first-time home purchase mortgage applications and 37% of repeat purchase applications in January through August, and those numbers could grow even more as the largest percentage of millennials turned 30 this year.

Millennials defied projections by choosing not to sit on the sidelines, and pursued building equity in a home. Whereas in 2019, households of older millennials had a net worth of about 11% below expectations based on what older Americans had at the same age, younger millennials’ net worth was 50% below, according to the Federal Reserve Bank of St. Louis.

First American Financial Corp. chief economist Mark Fleming says buying a home is still more affordable for many first-time buyers than it was for older generations due to higher incomes and falling mortgage-interest rates. He adds that the big decider for millennials in buying a home is whether they can win a bidding war, rather than affordability.

A persistent housing shortfall is also coinciding with swelling millennial demand, and the Third Avenue Real Estate Value Fund’s Ryan Dobratz suggests demand could be massive in the years ahead “because of the millennial cohort finally moving to single-family housing in a big way.”

Source: Wall Street Journal (12/14/21) Friedman, Nicole

© Copyright 2022 INFORMATION, INC. Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/millennials-are-supercharging-housing-market

Americans Quit at Record Pace in Nov.

McLEAN, Va. – Americans quit jobs at a record pace in November as job openings hovered close to their all-time highs in a sign that workers continued to hold most of the leverage before the omicron variant sent COVID-19 cases soaring.

The number of workers quitting jobs vaulted to 4.5 million from 4.2 million, above the prior record of 4.4 million reached in September, the Labor Department said Tuesday. That means 3% of workers voluntarily left their positions, matching September’s record high.

Employers posted 10.6 million job openings, down from a near-record 11 million the previous month and just below July’s all-time high, Labor said in its Job Openings and Labor Turnover Survey. Openings have topped 10 million for six straight months.

The decline was fueled by a drop of 261,000 openings in restaurants and hotels. Even as vacancies in that industry have fallen from their July peak, quitting and hiring have stayed strong, “suggesting that some of the hiring difficulties might be easing,” says Nick Bunker, director of research for Indeed, a leading job site.

Still, since there were 6.9 million unemployed Americans in November, that means there were 1.5 available jobs for each unemployed person, the most on record dating back two decades.

The number of total hires jumped from 6.5 million to 6.7 million, the highest level since July, in a possible signal that employers’ struggles to find workers eased a bit as some Americans idled by COVID-19 or its ripple effects returned to the work force.

A confluence of forces has left workers with most of the bargaining power.

Consumer demand has been surging as the economy continues to rebound following the pandemic-induced recession and government shutdowns, driving openings to record highs.

Meanwhile, many Americans are still on the sidelines, squeezing the labor supply. Some parents are still caring for young children because they can’t find or afford child care. Other people are afraid of contracting COVID-19, especially with the emergence of omicron, a more infectious but milder variant.

And many people can put off their return to the workforce because they’re still living off government stimulus checks or generous unemployment benefits doled out earlier in the health crisis.

Many employers, in turn, are lifting wages and offering signing bonuses and other perks to entice workers at other companies to jumps ship.

Employees are doing so in record numbers to take advantage of the abundance of job openings and higher pay.

In November, job quitting leaped from 761,000 the prior month to 920,000 in restaurants and hotels, the industry hit hardest by job losses and worker shortages during the health crisis. Quits rose from 606,000 to 660,000 in education and health services; from 953,000 to 996,000 in trade, transportation and utilities; from 113,000 to 154,000 in financial activities; and from 730,000 to 798,000 in professional and business services.

The balance of power could shift slightly this year. The supply of workers is likely to grow as the health crisis wanes and Americans sidelined by COVID-19 or child care duties resume their job hunts, says economist Kathy Bostjancic of Oxford Economics.

Also, consumer demand could soften modestly after the economy has fully reopened, tempering the number of job openings, Indeed said in a report.

Other changes could be more enduring. Most of the 5 million people who have left the labor force since the start of the pandemic are over 55 and have retired – early or naturally, Goldman Sachs says. Others are switching careers or industries, for example, from restaurants and hotels to technology and warehousing, leaving some sectors with lots of openings and fewer candidates to fill them.

The upshot: Worker shortages are likely to persist but ease somewhat this year, Bostjancic says. As a result, job openings and quits could fall further from their highs but stay elevated.

“The short-term outlook for the labor market suggests workers are likely to continue to have considerable bargaining power in 2022,” Indeed says in its report.

Fifty-four percent of workers surveyed by ZipRecruiter in September said they preferred a job that let them work from home. Only about 10% of jobs offer that option, though that’s up from 3% before the pandemic, ZipRecruiter chief economist Julia Pollak says.

Many employees, in turn, are leaving jobs that require them to work in offices, says Jim McCoy, senior vice president of talent solutions at ManpowerGroup.

That could eventually prod more companies to allow remote work, Pollak says.

Nineteen percent of workers said they’re unhappy with how employers treated them during the pandemic. This could include those who burned out after being forced to work long hours while colleagues were out, or those in stressful industries such as health care.

Twenty percent of workers surveyed by Joblist quit jobs to pursue new career paths, and their passions.

Many restaurant and retail workers, in particular, grew weary of the low pay and health risks that came with their jobs.

About 25% of hospitality workers surveyed by Joblist said they wouldn’t want to work in the industry again.

And 20% of all workers say the pandemic caused them to change the kind of role they were seeking to one that permitted remote work, a ZipRecruiter survey shows.

Thirteen percent of workers quit because their jobs didn’t provide work-life balance, the Joblist poll reveals.

One-third of workers quit jobs to launch businesses, a Digital.com survey shows.

Copyright © 2022 USATODAY.com, USA TODAY. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/01/americans-quit-record-pace-nov

Can a Son Use My Credit Score to Buy a Home?

RE Q&A: A mother wants to share title for one year and sign the home over to him because she has a stronger credit score. Is there a downside?

FORT LAUDERDALE, Fla. – Question: What are the pitfalls for a mother to use her credit to buy a house for her thirty-something son in another state? Both of our names would be on the title. He would make the down payment and make the mortgage payments. After a year, how would I remove my name? – Peggy

Answer: As a parent myself, I understand the urge to help your child.

This is a common scenario I see in my law practice, and sometimes it works out fine. That said, it often turns into a disaster for the family member.

Your credit is yours and not something to use for someone else. If your son cannot qualify for a loan, there is a good chance he cannot afford the payments or has a history of not paying his bills. You will be on the hook if your son does not pay the mortgage.

Because both of your names are on the title, you would be unable to sell the home to pay off the mortgage without his consent.

You could also be liable if someone gets hurt at the property. The injured person would sue all property owners to recover for their damages.

While you can remove your name from the property’s title, you cannot take yourself off the mortgage loan even if you no longer own part of the home. You would then be in the unenviable position of personally owing money collateralized by the property you have no interest in or control over.

Finally, you must be truthful when applying for a mortgage. You will need to inform the lender that you are not paying the deposit or making the monthly payments. A lender probably will not want to make a loan in this circumstance, but not being truthful when applying for credit is a crime.

If you still want to go through with this, you should speak with a local attorney to properly structure the transaction to minimize the pitfalls.

Copyright © South Florida Sun Sentinel, Gary Singer. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/01/can-son-use-my-credit-score-buy-home

2022 Property Tax Appeals May Be Less Successful

Property owners who wish to appeal their taxes must prove that their house is over-assessed – a tall order in an era of rapidly rising home prices.

NEW YORK – Homeowners who face rising property taxes are often tempted to appeal. But in 2022, homeowners may not be as successful at lowering their bills as they have been in the past, according to The Ascent, a Motley Fool publication.

Property taxes are calculated by taking a home’s assessed value – the amount a local assessor thinks it could sell for – and multiplying it by the area’s local tax rate. To successfully appeal a property tax, homeowners must prove that their home is over-assessed. With rapidly rising home prices in 2021, however, that may be tough to prove.

An appeal could prove more challenging because home prices have risen in many parts of the country. The National Association of Realtors® (NAR) reported double-digit annual percentage gains in existing-home prices for the past year. In November, existing-home prices were up 13.9% compared to a year earlier.

Still, some homeowners may have success with an appeal. If they feel an assessment has risen by too much, they can appeal and show comparable sales at lower price points.

The amount that property taxes are expected to rise due to higher home prices will vary greatly across the country. Changes even in a home’s assessed value are not completed at the same time everywhere; some local assessors may do it in a cycle of one year or even five years.

“It depends on where you live as to when those changes in property values that we are seeing take place,” Marc Pfeiffer, senior policy fellow and assistant director at the Bloustein Local Government Research Center at Rutgers University in New Brunswick, N.J, told Barrons.com.

Source: “Appealing Your Property Taxes Could Be Tough in 2022. Here’s Why,” The Ascent/Motley Fool (Dec. 25, 2021) and “Here’s What Could Change Your U.S. Property Tax Bill in 2022 and Beyond,” Barrons.com (Dec. 6, 2021)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/2022-property-tax-appeals-may-be-less-successful

Floridians More Optimistic About the Future

UF’s monthly sentiment index ticked up 2.6 points in Dec. Current attitudes were mixed, but people showed increased optimism about the economy later this year.

GAINESVILLE, Fla. – After four months of consecutive declines, consumer sentiment among Floridians rose to 72.2 in December, up 2.6 points from November’s revised figure of 69.6. That increase was also reflected in a study of national consumers.

“Though consumer sentiment among Floridians ended 2021 on a positive note, the continuing declines experienced during the second half of the year have left a 10-point gap between this month’s figure and December of last year,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research. “In fact, consumer confidence has been declining over the past two consecutive years.”

Among the five components that make up the total index, four increased and one decreased.

Current conditions: Floridians’ opinions about current economic conditions were mixed. Views of personal financial situations now compared with a year ago decreased slightly, two-tenths of a point from 65.0 to 64.8. In contrast, opinions as to whether it’s a good time to buy a major household item like an appliance increased 2.9 points from 58.3 to 61.2.

UF says that upward trend is shared by all Floridians, and it’s “particularly strong” among people with an annual income above $50,000.

Future expectations: All three components that measure Floridians’ opinions about the future rose this month:

  • Expectations of personal finances a year from now increased 3.4 points, from 83.9 to 87.3
  • U.S. economic conditions over the next year rose 5.1 points, from 68.1 to 73.2
  • The outlook for U.S. economic conditions over the next five years increased 2.2 points, from 72.5 to 74.7

According to UF, those rosier future expectations applied to almost all Floridians except for people age 60 and older, who have pessimistic viewpoints regarding both their personal finances a year from now and the nation’s economic outlook over the next five years.

Attitudes appear to have improved along with other Florida economic indicators.

Florida’s labor market continued to recover in the final months of the year. In November, the state’s unemployment rate was 4.5%, down 0.9% from a year ago. Similarly, new applications for unemployment benefits have remained low. However, inflation accelerated in November reaching a 39-year high.

“The increasing cost of everyday essentials such as food and gasoline could reduce spending elsewhere, thus slowing the economic recovery,” Sandoval says.

“Floridians’ optimistic opinions about the national economy over the next year suggest that they anticipate improved economic prospects in 2022. Nevertheless, the rising Covid-19 cases due to the fast-spreading omicron variant are expected to slow economic activity in the short run, as demonstrated by the recent disruptions in air travel. As a result, we expect consumer confidence to remain weak in the first months of 2022,” Sandoval adds.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/floridians-more-optimistic-about-future

Economy and Job Growth to Slow but Remain Strong

NEW YORK – After hunkering down at the start of the COVID-19 pandemic, Darris Johnson splurged last year after he and his wife were fully vaccinated: They shelled out about $150 for a weekly dinner at a nice restaurant and several thousand dollars on new bicycles and accessories.

What will 2022 bring?

“We certainly have to rein it in” says Johnson, 42, a biotechnology salesman who lives in the Houston area.

That will be easier to do while the omicron variant rages across the country.

“We’re starting to be a lot more cautious,” Johnson says.

If 2021 was the year of over-the-top as the economy reopened – in spending, job growth, worker shortages, inflation and, yes, supply chain bottlenecks – 2022 will be marked by a gradual return to normal, economists say.

The economy still is expected to notch historically strong growth with booming job gains, returning the U.S. to its pre-pandemic employment level. But the performance won’t be quite as robust as 2021’s and, by year-end, neither will headaches such as product shortages and soaring prices, experts say.

Mark Zandi, chief economist of Moody’s Analytics, said 2020 “was the year the pandemic hit, 2021 was the year of recovery and 2022 will be the year of getting back to normal.”

“There will be a rebalancing,” says Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. “We think we’ll still end up with pretty sturdy growth,” she adds, though likely not without a new array of stumbling blocks. “I think there will be a lot of uncertainty, volatility.”

Perhaps the biggest hurdle is omicron, which quickly has become the dominant coronavirus strain and pushed new daily cases to a record seven-day average of 265,000.

While omicron is highly infectious, top health experts say it appears to cause milder symptoms than its predecessor, delta, and should subside by mid-March. Until then, however, it will mean less travel, dining out, moviegoing and other activities by consumers as well as a worsening of labor shortages and supply snarls, Bostjancic says.

As a result, Zandi has lowered his forecast for first-quarter economic growth from about 5% annualized to 2.2%. And both he and Bostjancic have cut their growth estimate for all of 2022 to about 4% from 4.4%.

That’s down from a projected 5.5% advance in 2021 – most since 1984 – but still a healthy showing and well above the average yearly 2% gains for a decade after the Great Recession of 2007-09.

The rosy outlook comes with caveats.

Omicron could linger longer and cause more severe illness than expected. And Zandi and Bostjancic both figure President Joe Biden’s $1.75 trillion Build Back Better social spending plan will be passed by Congress in some form early in the year. But if Democrats can’t corral the support of holdout Sen. Joe Manchin, D-WV, and the legislation fails, economic growth will downshift to a still solid 3.7%, the economists say.

Beyond the wild cards of omicron and Build Back Better, the economy will get another big lift from consumers, who account for 70% of economic activity and will continue to benefit from severe worker shortages that have spawned lots of job openings and higher pay. They’ll likely spend some of that income as coronavirus eases and they return to traveling and other activities.

But the big spending burst from the reopening economy is history.

In November, households still had $2.6 trillion in extra COVID-19-related savings from federal stimulus checks and paring back early in the health crisis, Zandi says. But that’s down from a high of $2.7 trillion the prior month. Lower-income households who spend nearly all of their additional income will see their extra cash reserves run dry by midyear, Zandi says. He reckons consumer spending will grow a still solid 4.1% in 2022, down from 8.1% this year, while Bostjancic expects a drop to 3.9%.

Beth Stuever, 53, of Marshall, Michigan, has been spending more on food takeout and delivery since divorcing her husband earlier this year and gaining sole custody of their three children. She expects that to continue as the family moves to a new house with a swimming pool next month, a shift that will mean increased outlays for new furniture and pool upkeep.

They have put off trips to Costa Rica and Disney World, but if the pandemic eases as anticipated, “I do hope we can get back and start doing more of that,” Stuever says.

At the same time, she says she’ll be cautious. With the pandemic still galloping across the nation, “I feel ok, not great,” she said. “I worry what the economy will look like, and my investments.”

The outlook for other parts of the economy in 2022:

Jobs

The solid gains in consumer spending should keep the nation’s jobs engine humming in 2022 but at a slower pace than 2021.

Keep in mind the U.S. already has recovered 18.4 million, or 82%, of the 22.4 million jobs lost in spring 2020, leaving less room for outsize advances, Zandi says. He expects an average of 330,000 payroll gains a month, down from 555,000 so far this year but far above the monthly average of 167,000 in 2019.

The remaining 4 million jobs wiped out in the pandemic should be recovered by the end of 2022, Zandi says, as the 4.2% unemployment rate is projected to tumble to 3.5%, matching the half-century low touched before the pandemic began decimating the economy in March 2020.

Robert Stehlik, who owns two surf shops on the island of Oahu in Hawaii, says his hiring plans are on hold until he sees how the pandemic plays out. Sales were roughly flat this year as sturdy demand from local customers offset the hit to tourism from the delta wave.

“It’s just hard to predict,” he says. “There’s definitely a lot of uncertainty. You just have to be ready to change and adjust” by emphasizing online sales if the retail business falters.

Just before Christmas, Stehlik and his three employees at one of his shops, Blue Planet Surf Gear, contracted coronavirus, forcing him to close during one of the busiest weeks of the year. “It’s been a little bit challenging,” he says.

In 2022, worker shortages should persist but ease somewhat as the health crisis wanes and Americans sidelined by COVID-19 or childcare duties resume their job hunts, Bostjancic says.

In turn, the share of adults working or looking for jobs – who make up the workforce – is likely to rise from 61.8% to 62.6% by year-end, Bostjancic says. That will still be short of the pre-pandemic high of 63.4%, a level that will be difficult to reach after many baby boomers retired early during the pandemic.

The result: A labor market that continues to leave workers with most of the bargaining power, a dynamic that generated record job openings and quitting in 2021 as employees bolted for higher-paying positions.

Wages and salaries increased 4.6% annually in the third quarter, the most on record dating back two decades, according to the Labor Department’s Employment Cost Index. Zandi expects pay increase to slow to a still-sturdy 4% annual pace next year.

But with inflation likely to cool, “It may even feel better” because consumer price increases will be less likely to outpace pay hikes, especially for low- and middle-income Americans.

Inflation

Consumer prices rose 6.8% annually in November, a 39-year high, as supply chain bottlenecks triggered product shortages that, along with employee wage increases and strong customer demand, pushed up prices for everything from food and gasoline to cars, sofas and hotel stays.

Simply put, a supply network hobbled by the pandemic wasn’t ready for consumers who were flush with cash and eager to spend it.

The higher prices have prompted some Americans to pull back.

Joyce O’Brien, 56, a dental hygienist who lives in Florida’s Gulf Coast area, says she, her husband and adult daughter have noticed the higher cost of gas, food and haircuts in recent months.

“I have become very cautious about how I spend my money,” she says, adding that her family largely has ditched dining out, shopping and attending concerts. And with rent soaring, she and her husband advised their daughter not to move out and instead save money to buy a home when prices fall.

But as the pandemic ebbs, more truck drivers, as well as warehouse and port workers, should return to work even as companies take steps to streamline deliveries. Supply snags have started to improve – notwithstanding the omicron rash – and should largely be resolved by year’s end, Zandi and Bostjancic say.

Meanwhile, Americans who snapped up furniture, TVs and appliances during the pandemic, driving up their prices, are expected to shift their consumption to services such as traveling and dining out as more people are vaccinated and the crisis abates.

With oil and gasoline prices falling in recent weeks, Zandi believes inflation already has peaked and should gradually fall to about 3% by the end of 2022, just above the Federal Reserve’s 2% target. Bostjancic thinks price gains will intensify before peaking early next year.

Business investment

Like consumer spending, business outlays are expected to soften in 2022 but remain solid. A big surge from technology purchases as millions of office employees shifted to telecommuting largely has petered out, Bostjancic says.

Yet companies still need to buy new factory machines and computers to meet growing consumer demand and replenish inventories depleted during the supply kinks, Bostjancic says.

Companies are likely to continue to buy robots and other labor-saving equipment to cope with worker shortages. She expects investment to grow 4.6%, down from 7.6% in 2021.

Housing

The housing market boomed in 2021 as Americans moved from dense cities to more spacious homes in less crowded suburban and rural areas both to accommodate remote work and cope with the hazards posed by COVID-19.

Low housing inventory means the gains are likely to continue at a slower pace in 2022. Housing starts should rise 5.7% to 1.67 million next year after a 14.4% gain in 2021, according to Lawrence Yun, chief economist of the National Association of Realtors.

He expects existing home sales to dip 1.7% after a 6.4% rise this year.

Government spending

Government spending is expected to decrease and constrain growth as the economy improves and programs to aid low-income and jobless people shrink, Zandi says. Build Back Better, if it’s passed, would bolster government outlays.

Trade

The trade deficit is expected to widen as the U.S. economy recovers faster than those overseas, Zandi says. That means Americans will continue to buy more imports while U.S. exports increase more slowly.

Copyright 2022, USATODAY.com, USA TODAY. Contributing: Karen Weintraub

https://www.floridarealtors.org/news-media/news-articles/2022/01/economy-and-job-growth-slow-remain-strong

Higher Rates and Replacement Costs Will Raise Prop. Ins.

FORT LAUDERDALE, Fla. – Embattled by years of property insurance rate increases, Florida homeowners are about to get hit by a double whammy: Your insurance costs will likely rise even higher than you expected next year as companies increase the replacement value, or the estimated cost of replacing a damaged home, to reflect the skyrocketing costs of construction materials and labor.

And those higher values will be multiplied by higher rates approved by state regulators over recent years in response to increased claims costs and related litigation.

“I empathize [with policyholders], but it is reality,” said Paresh Patel, founder and CEO of Clearwater-based Homeowners Choice and TypTap insurance companies. “Costs of labor, materials, etc., are going up. This is inflation.”

If you are a customer of Citizens Property Insurance Corp., the so-called insurer of last resort, your replacement value is likely to increase sharply and drive up your overall renewal bill. In some cases, inflation will push your replacement value over $700,000 – the eligibility threshold for Citizens coverage in all counties except Miami-Dade, where the coverage threshold is $1 million.

Citizens customer Bob Colgan was stunned in early December when his agent told him he would have to shell out $900 more next year to renew coverage for his Lake Worth home.

Colgan knew that state law requires Citizens to cap annual rate increases at 10%. But the premium-cost increase his agent showed him – from $2,673 to $3,573, or 34% more – far exceeds the rate-hike limit adopted by the state Legislature a decade ago to keep coverage affordable for Citizens customers.

“I was shocked,” Colgan said. “Why do they need these big increases? We haven’t had a major hurricane in years. I don’t understand it.”

The increase was driven by a dramatic hike in what Citizens estimated it would cost to rebuild the home and replace its contents if destroyed by a hurricane, fire or other calamity. And because premiums are determined by multiplying rates by a home’s value, those replacement-cost increases can make that 10% rate increase cap feel like a bad joke.

According to the estimate, the cost to replace Colgan’s home increased from $233,000 to $278,700 – a 20% hike. After getting the estimate, Colgan asked another insurance agent to recalculate the renewal price. That agent said the replacement-cost increase seemed higher than it should have been and resubmitted the renewal application based on new calculations. Citizens has not yet approved the revised application, Colgan said.

But Citizens spokesman Michael Peltier said a 20% replacement cost hike is in line with what all single-family homeowners can expect to see on their next Citizens bill.

Rising construction costs blamed

Until this year, the company typically increased replacement values by 1% to 3% annually to keep up with normal inflation rates, Peltier said. This year, replacement values have been increased from 15% to more than 20% in some areas, he said.

One possible reason is that Citizens changed the software used to determine replacement values. As of July 1, agents have been directed to use a new cost estimator developed by CoreLogic Spatial Solutions LLC.

CoreLogic officials did not respond to requests for comment.

In an Oct. 5 bulletin, Citizens alerted agents that “inflation factors for renewal policies are higher than previous years to address increasing costs in building materials and to ensure the dwelling is insured for full replacement cost.” Inflation factors, the bulletin said, may increase replacement values as high as 25%.

Inflation impacts are adjusted quarterly in CoreLogic’s cost estimator and could result in further premium hikes after Jan. 1, the bulletin said.

Replacement value increases “do increase the premium,” Peltier said in the email, “but failure to make the adjustment could leave the policyholder significantly underinsured.”

Construction costs skyrocketing

Replacement values are rising for property insurance customers across the nation, said Mark Friedlander, spokesman for the Insurance Information Institute, an industry-backed research and trade group.

A big reason is the price of lumber, which increased 16.5% in 2020 – significantly higher than last year’s 1.4% overall inflation rate. So far this year, lumber prices have moderated and increased just 2.8% compared to 2020. But overall inflation, which includes costs of labor and other building materials, is up 6.3%, institute data states.

Between August 2020 and August 2021, costs of construction materials increased 23% while labor costs rose by 4.5%, according to figures from the Associated General Contractors of America provided by Citizens.

Inflation’s effects on insurance costs are particularly painful in Florida, where premiums have been rising as much as 40% to cover costs of increased litigation and aggressive claims solicitation by roofing and water restoration companies.

Facing even more price hikes, typical Florida homeowners are two years away from seeing average home insurance costs exceed what they pay each month toward their mortgage loans, said Ryan Papy, president of Palmetto Bay-based Keyes Insurance.

Patel estimates that most private market insurers will increase replacement values of their customers’ homes between 7% and 15% when policies come up for renewal over the next year. Rather than reevaluating each insured home separately, Patel said his company will increase replacement value of all houses by 7% after Jan. 1.

Each insurer approaches replacement value calculations differently, Papy said, which can make it difficult to predict how any individual policy premium will be affected by the rise of inflation.

Locke Burt, president and CEO of Ormond Beach-based Security First Insurance Co., also acknowledged that his company increased replacement values. He didn’t estimate the average replacement value increase, saying that company officials who could determine that number were out of the office between Christmas and New Year’s Day.

Keeping Citizens from growing

Citizens, created to provide affordable insurance coverage for homeowners otherwise shut out of the insurance market, might be seeking steeper replacement value hikes as part of a strategy directed by Carlos Beruff, chairman of the company’s board of governors, to ward off further growth by raising prices as high as legally possible.

Beruff and the board are asking state insurance regulators to approve rate increases even higher than those recommended by the company’s actuaries to scare off potential new customers and force existing customers to seek coverage from private market insurers. As private market insurers have been withdrawing from South Florida and other urban markets in recent years, tens of thousands of homeowners have had no choice but Citizens.

Meanwhile, those homeowners have caused Citizens to grow from 420,000 policies in 2019 to 748,000 in early December. Beruff and other officials say they are worried that if Citizens were to grow too large, it wouldn’t be able to pay all claims after one or more catastrophes. If that happens, Citizens customers will face surcharges of up to half of their annual policy costs. If that money doesn’t cover all claims costs, all property insurance customers in Florida will face surcharges to cover any shortfall.

Those officials, which include state legislators, say the annual 10% rate cap has made the company too attractive as an alternative to private-market companies that cost more.

To make it less so, the Florida Legislature last spring approved increasing the rate cap from 10% to 11% on Aug. 1 and to 15% by 2025. Then on Dec. 15, Beruff led the board of governors to approve average rate increases at the maximum 11% for all customers statewide.

New customers can only be eligible for Citizens if no coverage is available from a Florida-regulated private market insurer, or if the only available coverage exceeds the cost of Citizens by more than 20%.

Citizens did not respond to questions about whether its high replacement value increases are part of the company’s strategy to drive up costs.

A comparison of total insured value per policy from insurance company data downloaded from the Florida Office of Insurance Regulation showed that average property values of 189,328 Citizens customers in Broward, Palm Beach and Miami-Dade counties increased 11.5% between the third quarter of 2020 and the same period in 2021.

Insured values of properties insured by four private-market carriers increased at lower rates, ranging from 3.2% to 5.4%. Those numbers will climb in future reports, Patel said.

Papy said it would make sense for Citizens, restricted by the rate-hike cap, to disproportionately increase replacement costs as part of the company’s effort to keep pace with private-market insurers’ prices in hopes of driving customers back to those companies.

“Overall, the more private market carriers we have, the better it is for the consumer,” he said.

Citizens policyholders have the right to challenge replacement cost estimates. But they must use estimates from recognized sources – such as CoreLogic or a competing replacement cost estimator; a licensed insurance appraiser; property inspector; general contractor; architect or engineer.

Many homeowners will decide not to seek an alternative valuation because it can cost $500 and more, said Paul Handerhan, vice president of president of the consumer-focused watchdog group Federal Association for Insurance Reform.

Papy and Dulce Suarez-Resnick, vice president of the Miami-based Acentria Insurance agency, both said by increasing replacement values at steep rates, Citizens is pushing out customers whose home values climb above $700,000 in most of the state, or above $1 million in Miami-Dade.

If no private market offers are available, “how are they going to get coverage?” Papy asked.

© 2021 South Florida Sun-Sentinel. Distributed by Tribune Content Agency, LLC.

https://www.floridarealtors.org/news-media/news-articles/2022/01/higher-rates-and-replacement-costs-will-raise-prop-ins

Inflation Pushing 1 in 4 Buyers to Accelerate Plans

Inflation is weighing on buyer decisions, according to a study. While 24% now plan to move faster, 1 in 10 have canceled plans and 29% have decided to delay.

SEATTLE –  Three out of four (73%) of homebuyers and sellers say inflation is influencing their future plans, according to a study commissioned by Redfin.

Of Americans planning to buy a home in the next 12 months, 29% of respondents said they’re delaying homebuying plans due to inflation. Twenty-four percent of respondents are moving up their homebuying plans and 11% are canceling plans altogether.

Meanwhile, 10% of sellers said inflation caused them to move up their home selling plans, 7% are delaying and 3% are canceling.

“The way Americans interpret news about rising prices can have a variety of effects on their financial decisions, including homebuying,” says Redfin Chief Economist Daryl Fairweather. “Some people may delay buying because they’re worried that with prices rising on everything from food to fuel, now is not the right time to make a huge purchase – but others might move faster to find a house because they’re worried home prices and rent prices will increase even more, and they want to lock in a fixed payment.”

The survey results come amid reports that inflation is at its highest level in nearly 40 years, with consumer prices jumping 6.8% in November from a year earlier. Increasing prices for gas and other energy sources are driving the inflation surge.

Inflation’s impact isn’t always directly related to the cost of a home purchase. For many buyers (73%), higher gas prices have caused them to rethink the cost of a longer commute. To compensate for a higher commuting cost, 35% plan to drive less often or drive a more efficient vehicle, and 25% plan to shorten their commutes. One in five buyers (21%) plans to buy a cheaper home.

“Different homebuyers react to high fuel prices in different ways, depending on their circumstances,” says Redfin Deputy Chief Economist Taylor Marr. “Some people will pay a premium to shorten their commute, while others will opt for a more affordable home to make up for expensive gas or a new – but more fuel-efficient – vehicle.”

Inflation fears also impacts rising home energy costs: 36% of respondents said they plan to add energy-saving features to their home, 33% plan to move to a more energy-efficient home and 15% plan to move to a smaller home.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/inflation-pushing-1-4-buyers-accelerate-plans

Sellers: Study Suggests More Owners Ready to List

The current market favors sellers, but owners see slowing price increases and buyers being priced out of the market. Many who held off may decide it’s time to sell.

FORT LAUDERDALE, Fla. – Some possible good news for buyers – more inventory could be headed to the South Florida market in the coming months, as sellers become more willing to list their homes.

A survey of 1,300 consumers by realtor.com, conducted in fall of 2021, revealed that 65% of homeowners across the country planned on selling their home within the next six months, while 26% of homeowners planned on selling their home within the next year.

“Sellers are recognizing that the markets are leaning heavily in their favor, with millions of millennials entering their 30s and seeking to buy their first home while taking advantage of low interest rates,” said George Ratiu, manager of economic research at realtor.com.

It may be good news for buyers, who have been dealing with record low inventory in South Florida over the past year-and-a-half. According to October numbers from the Broward, Palm Beach and St. Lucie Realtors, single family home inventory dropped 53% in Palm Beach County to 1.3 months of inventory. For Broward County, inventory of single family homes plummeted 44% in October compared to the previous year to 1.4 month’s worth of inventory. In Miami Dade County, inventory in the county dropped 40% year over year to 2.2 month’s worth of inventory.

The realtor.com survey also indicated that 2021 saw an increase in listings over time. In spring, 9% of sellers said they’d already listed their home when surveyed. That number jumped to 19% in the fall. The survey was conducted on a national level, so South Florida housing market and sellers may react differently.

It’s not uncommon for sellers to list more actively in the beginning of the year, as it’s usually a high point for new listings, said Bonnie Heatzig, executive director of luxury sales at Douglas Elliman in Boca Raton.

For Heatzig, she said she’s seeing sellers who are slightly more open to the idea of selling their home now than they were earlier in 2021. She notes that any reluctance that they may have is tied to worries that they may not be able to find a suitable home in their price range in today’s current market.

“The most compelling reason I am hearing from those willing to sell … is that they want to capitalize on the higher sale prices, coupled with the fact that their homes no longer fit their needs or desires,” added Heatzig.

Sellers’ desire to capitalize on the market grew from the spring to the fall, too, according to the realtor.com survey. A little under 25% of sellers wanted to sell to take advantage of the current market in the spring, with the number rising to 35% in the fall. Around 13% of sellers wanted to sell because they saw news it was a seller’s market, according to the spring survey. But in fall, that number jumped to 30%.

Jeff Grant with ReMAX Realty in Palm Beach Gardens said that while he has seen a steady stream of sellers, he expects to see single family home listings increase in January, with more condos being listed in the spring, adding that many potential sellers are trying to capitalize on high seasonal rent prices currently.

It remains to be seen if these national numbers would play out in South Florida. Demand is so high that it may not make much of a difference in alleviating current pressure on the housing market, local real estate agents say. Home prices in South Florida are expected to increase at a slower pace in the new year, by about 5.8%.

“I think that the current backlog of buyers will continue to put pressure on the market and any new inventory will be absorbed quickly in multiple offer situations,” said Grant.

© 2021 South Florida Sun-Sentinel. Distributed by Tribune Content Agency, LLC.

https://www.floridarealtors.org/news-media/news-articles/2022/01/sellers-study-suggests-more-owners-ready-list

NAR: Nov. Pending Home Sales Down 2.2%

The drop reverses an increase in Oct. NAR Economist Yun attributes it to a tight inventory supply and buyer hesitation over rising home prices.

WASHINGTON – Pending home sales slipped in November (down 2.2%), receding slightly after a previous month of gains, according to the National Association of Realtors® (NAR). Each of the four major U.S. regions included in the monthly study saw a month-to-month decline. The drop was similar (down 2.7%) year-over-year.

The Pending Home Sales Index (PHSI) – a forward-looking indicator of home sales based on contract signings – fell to 122.4 in November. An index of 100 is equal to the level of contract activity in 2001.

“There was less pending home sales action this time around, which I would ascribe to low housing supply, but also to buyers being hesitant about home prices,” says Lawrence Yun, NAR’s chief economist. “While I expect neither a price reduction nor another year of record-pace price gains, the market will see more inventory in 2022, and that will help some consumers with affordability.”

Yun says overall housing demand remains high, noting that homes placed on the market go from “listed status” to “under contract” in about 18 days.

“Buyer competition alone is unrelenting, but home seekers have also had to contend with the negative impacts of supply chain disruptions and labor shortages this year,” he says. “These aspects, along with the exorbitant prices and a lack of available homes, have created a much tougher buying season.”

Yun adds one more reason into the mix for the December decline: The omicron variant of the COVID-19 virus. He says that poses a risk to the housing market’s performance, as buyers and sellers are sidelined, and home construction is delayed.

Regional breakdown: Month-over-month, the Northeast PHSI declined 0.1% to 99.4 in November, an 8.5% drop from a year ago. In the Midwest, the index fell 6.3% to 116.8 month-to-month, up 0.2% from November 2020.

Pending home sale transactions in the South ticked down 0.7% to an index of 148.2 in November, down 1.3% from November 2020. The index in the West slipped 2.2% in November to 105.5, down 4.6% year-to-year.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/nar-nov-pending-home-sales-down-22

Dec. Consumer Confidence: Americans More Optimistic

While attitudes about the current economy dropped slightly, consumers seem to think the future is brighter with the Expectations Index rising 6.7 points.

NEW YORK – The Conference Board Consumer Confidence Index increased again in December, after being revised upward for November. The Index now stands at 115.8, up from 111.9 in November.

The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – was relatively flat at 144.1, down from 144.4 last month. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – rose to 96.9 from 90.2.

“Consumer confidence improved further in December, following a very modest gain in November,” says Lynn Franco, senior director of economic indicators at The Conference Board. “The Present Situation Index dipped slightly but remains very high, suggesting the economy has maintained its momentum in the final month of 2021.”

According to Franco, the surge in the Expectations Index sets the “stage for continued growth in early 2022.” She says the numbers increased for the “proportion of consumers planning to purchase homes, automobiles, major appliances and vacations over the next six months.

“Meanwhile, concerns about inflation declined after hitting a 13-year high last month, as did concerns about COVID-19, despite reports of continued price increases and the emergence of the Omicron variant,” she adds. However, in 2022, “both confidence and consumer spending will continue to face headwinds from rising prices and an expected winter surge of the pandemic.”

Present situation

Current business conditions

  • 19.9% said business conditions were “good,” up from 17.9%
  • 26.8% said business conditions were “bad,” down from 27.3%

Assessment of the labor market

  • 55.1% of consumers said jobs were “plentiful,” down from 55.5%; still a historically strong reading
  • 12.5% of consumers said jobs are “hard to get,” up from 10.8%

Expectations six months from now

Short-term business conditions

  • 26.7% of consumers expect business conditions to improve, up from 25.6%
  • 17.9% expect business conditions to worsen, down from 19.6%

Short-term labor market

  • 25.1% of consumers expect more jobs to be available in the months ahead, up from 22.8%
  • 14.8% anticipate fewer jobs, down from 19.0%

Personal short-term financial prospects

  • 18.0% of consumers expect their incomes to increase, down from 18.9%
  • 11.5% expect their incomes to decrease, down slightly from 11.7%

 © 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/01/dec-consumer-confidence-americans-more-optimistic

Community Mourns Realtor Shot in S. Fla.

On Dec 23, a Coral Springs agent was killed inside her car near a house she was showing. The killer, a former tenant, allegedly mistook her for the landlord.

CORAL SPRINGS, Fla. – A Florida real estate agent was shot and killed outside a house she was showing in Coral Springs, Fla. Allegedly, a former tenant mistook her for the building’s landlord, according to reports from neighbors.

Around 12:30 p.m. on Dec. 23, Sara-Michelle Trost, owner and broker of 1% Lists SoFlo, was sitting in the driver’s seat of her Jeep in the driveway of a home she was showing when she was shot multiple times. Neighbors called the police when they heard two gunshots. Trost died at the scene.

Hours later, Raymond Wesley Reese, 50, was charged with first-degree murder in connection with Trost’s death. Reese reportedly had previously lived and rented the home Trost was showing. Neighbors allege that Reese had been recently been evicted from the home.

“There was a disgruntled tenant who was evicted,” Donna Smith, a neighbor, told the local news. “He thought that the Realtor®, who was showing the home, he thought it was the owner of the house, and she was ambushed.”

Trost, originally from Great Britain, started her own business flipping discount homes in South Florida. She was active in the community. Chabad of Parkland’s Rabbi Shuey Biston told CBS-12 that Trost was “so loving and caring. There wasn’t a project that we started in the community that she wouldn’t be a part of. She was just a really special person. Anything she touched, she turned to gold.”

Police continue to investigate the shooting and say no other suspects are being sought in connection with the murder.

Source: “Florida Real Estate Agent Shot Dead by Evicted Tenant in Case of Mistaken Identity,” New York Post (Dec. 25, 2021); “Mom, Real Estate Agent Killed in Coral Springs Remembered as ‘Loving and Caring,’” CBS-12 News (Dec. 24, 2021); “Man Charged With Murder After Florida Real Estate Agent Shot, Killed,” FOX News (Dec. 26, 2021)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/01/community-mourns-realtor-shot-s-fla

‘First-Time Buyer’ Season 2 Out Now

The NAR-produced TV show focuses on the challenges and joys exhibited by first-time homebuyers, and its second season debuted recently on Hulu.

CHICAGO – The second season of “First-Time Buyer,” which shows Realtors® guiding clients on their homebuying journey, can now be streamed on Hulu. The National Association of Realtors® (NAR) produces the show.

Episodes from season one of “First-Time Buyer” can also now be streamed for free on YouTube or Facebook.

The new eight-episode season follows a different couple, family or individual through the process of buying a home.

“‘First-Time Buyer’ gives viewers a genuine inside look into the emotions our clients face as they go through the homebuying process,” says NAR President Leslie Rouda Smith. “This series does a fantastic job of showing how Realtors help their clients navigate all the challenges that can pop up during a transaction to ensure a successful and secure first home purchase.”

The new season features Realtors from Colorado, Kansas, Missouri, New Jersey, New York, North Carolina and South Carolina.

“The appeal in these stories is that they feature people that you can relate to,” says Alicia Bailey, NAR’s head of production. “They face many of the common first-timer fears that can often prevent someone from starting or continuing their home search. We also see firsthand how Realtors’ expertise is invaluable when facing the unexpected.”

“First-Time Buyer” is an extension of NAR’s consumer advertising campaign, which highlights the Realtor brand by spotlighting Realtors’ commitment to the association’s Code of Ethics and how that distinguishes Realtors from non-member real estate agents and listing apps.

Source: National Association of Realtors® (NAR)

https://www.floridarealtors.org/news-media/news-articles/2022/01/first-time-buyer-season-2-out-now