In the aftermath of the nation’s housing-market collapse and recession, more than 500 midsize and large cities have seen a rise in the share of homes that are rented rather than owned, according to a USA TODAY analysis of Census data.
Nationally, 34.9% of occupied homes were rented in 2010 compared with 33.8% in 2000, according to Census data.
Almost 4 million homes have been lost to foreclosures in the past five years, turning many former owner-occupied homes into rentals.
The shift to rental housing is potentially long-lasting and portends changes for neighborhood stability and how people build wealth, economists say.
“The changes are big but glacial,” says Mark Zandi, economist at Moody’s Analytics.
“This year’s Fiesta del Sol is on track to shatter last year’s record-breaking crowds. We’re serving up an eclectic mix of live music, multiple adult beverage venues, fun family activities, compelling food choices and great vendors —- all by the ocean. If you can’t have fun at Fiesta, you must be perpetually bummed out,” event co-chairman Peter Zahn said.
The party will be running from 9am to 9pm, and is off Lomas Santa Fe just west of Highway 101 – and you can shuttle from the Solana Beach train station!
The live music includes eight bands each day, and Peter’s description of eclectic is fitting – enjoy the blues, soul, reggae, ska, dance & world beat music.
Personally, I am looking forward to the Springsteen tribute band Thunder Road scheduled for 3pm on Saturday, plus on Sunday the Farmers at 1pm and Wild Child, the Doors tribute band at 4pm.
The weather is expected to be in the mid-to-high 60s.
Myself and some of the crew will be there, handing out pens, t-shirts, and our new coffee mugs. We’ll have a game or two, and hope readers will stop by and say hello!
The Case-Shiller Index for March was released today – quotes from David Blitzer:
This month’s report is marked by the confirmation of a double-dip in home prices across much of the nation,” David Blitzer, chairman of the index committee at S&P Indices, said in a statement. “Home prices continue on their downward spiral with no relief in sight.”
While the overall numbers in the S&P/Case-Shiller Home Price Indices for March are down and disappointing, the pattern is not uniform. A few cities — Washington DC and two in California — San Francisco and San Diego — remain above their recent lows. At the other end of the scale, Detroit is about 30% below its level of January, 2000.
“What we’ve seen over the last few months despite the decline in prices is we’ve gone back to the old ‘location, location, location’ story instead of everything going down at once,” Blitzer said. “California has clearly broken out of the pattern it was in, which is a big plus.”
Though there had been hopes in the industry that prices were troughing and ready to turn higher, the latest trends show little hope in sight until later this year or early in 2012, he added.
“Everybody’s now keeping their fingers crossed for 2012 and wondering whether people just don’t want to own homes anymore,” he said.
The official month-over-month reading for San Diego is -0.8 (March/February), which is better than the previous -1.3 (February/January).
Here are the peak-to-trough-to-now numbers:
Trough: 144.43 in April 2009 (-42.4% from peak)
Latest: 153.88 in March 2011 (-38.5% from peak)
How accurately does the Case-Shiller Index reflect reality? They don’t count any repeat sales within six months, so flippers are excluded for the most part, and they weight the rest. Here’s a summary of the index here, which notes how it can direct consumer mood and behavior.
But the C-S Index does make for great sound bites, which apparently is all we have time to digest.
Thank you to those who made the ultimate sacrifice for their country, and to those who served.
The previous generation was proud to serve – My dad was a ROTC second lieutenant in the U.S. Army, and my two uncles served as well – Tom was in the Navy, and John was in the Army too. All three served between Korea and Vietnam, so they didn’t face any live fire, but their contribution is worthy.
My Uncle John passed away last night, after a bout with Parkinsons. He was a great man, and we’ll miss him dearly – RIP.
The only value of this data below is trying to predict how home buyers and sellers will interpret it.
Because the accuracy is suspect. For example, the ‘homes in foreclosure process’ for San Diego is more than 20% higher than the 12,561 properties shown to be in default by foreclosureradar.com. But you could also wonder about the +7.5% increase in prices too.
Sellers are happy to ignore any bad news, but how about the buyers? Does the frustration cause buyers to settle after months or years, or do they get more determined? I think there is a little of both – in my experience the buyers are holding out more for the best quality, but once they find it, they’re willing to add a little extra mustard to the price if that’s what it takes to get it over with!
The media perpetuates the idea that more foreclosures means lower prices (whether it’s true or not). But with buyers squeezing for better quality, we’ll probably continue to see the best-quality homes getting bid up, and the inferior homes getting beat down.
If you’d prefer to buy an older house in a prime location, your patience will most likely be tested.
Sellers tend to have low, or no, mortgage balance, and they’ll only move when they don’t have any other choice – plus they love to hold out on price.
The houses are usually dilapidated, because when they only paid $38,500 like they did on this street in the 1960’s, the thought of spending $15,000 for a new roof sounds outrageous. Heck, if it’s leaking, you can always buy a couple of extra buckets!
But if you can outlast the initial aggravations, you can end up with the home of your dreams on a quiet 10,000sf culdesac lot with panoramic ocean view and no HOA or Mello-Roos fees for about the same money as a tract house:
Through four months of 2011, developers have placed a bet that there’s demand for new housing in a market dominated by severely discounted distressed properties.
While foreclosures and short sales continue to depress the housing market, builders have begun securing housing permits at the fastest rate since 2007 on the assumption that higher-priced homes that present less risk can coexist with the distressed properties that banks are increasingly releasing to the market.
Builders secured permits for 716 housing units in April, an annual increase of 120 percent and a monthly increase of 96 percent, according to numbers released by the Construction Industry Research Board (CIRB).
“The chance the industry is taking is that the lack of existing new product will itself create demand,” said Borre Winckel, president of the Building Industry Association of San Diego (SD-BIA).
It’s the highest monthly total since June 2008, when builders pulled permits for 986 units, and the highest April total since the 1,270 in 2005, at the height of the housing boom.
Home building activity in 2009 reached an all-time low in the county, with 2,990 total permits issued. Last year’s permit total increased only slightly, to 3,346.
The county needs to issue permits for the construction of 15,000 homes per year to keep up with population growth, according to Winckel
“The true measure of permit increases is a statistical false indicator, because the percentage numbers are so big, but off of such low volume,” he said.
Demand for new housing has been low in recent years due to the sustained presence of foreclosed homes available at substantial discounts compared to traditional sales.
But buyers have complained of an arduous process of buying those homes — whether as an REO or through a short sale — in which banks need documents submitted multiple times and often reject a sale after months of negotiation.
Distressed properties also carry discounts for a distinct reason: they’re in poor shape and can require expensive repairs just to return to a livable status.
Builders are therefore banking on buyers’ desire for a new home that carries less risk and a less stressful sales process — especially with the current pool of new homes at an all-time low, according to Winckel.
“It’s a cautious play by the major homebuilders who happen to have the cash to wage this waiting game,” he said.
Through the first four months of the year, county builders have secured permits to build 2,225 homes. That’s the highest total at this time of the year since 2007, when builders had pulled 3,094 permits, and is a 93 percent increase over the year-ago period, when 1,152 permits had been issued.
Of the 716 permits approved last month, 520 were for the construction of multifamily units, bringing the year-to-date total to 1,499.
There were 1,092 multifamily permits approved in all of 2010.
The word is on the street – Bank of America will stop taking loan applications for the super-conforming loans (max $697,500 in SD) on July 1, 2011, in order to comply with Fannie/Freddie’s October 1st deadline.
Their website today is quoting 5.0% with one point for jumbo money, so hopefully borrowers won’t be too bent out of shape about having to pay more – but the hysteria from the media is sure to ramp up concerns.