Bonita real estate agent

Bonita real estate agent

New condo rules can help student debt challenge

"Realtors help make the dream of homeownership for so many Americans a reality, and HUD is committed to partnering with them to ensure that the hard-won progress we're seeing in our housing market continues to grow for many years to come. The Federal Housing Administration (FHA) announced changes to condo rules last November that address a complex recertification process, owner-occupancy requirements, and limits on the types of property insurance that FHA considers acceptable coverage.  "Realtors know that condos are an important option for buyers, especially for first-time buyers looking for affordable options in the marketplace."
Affordability concerns, inventory shortages and lifestyle factors such as marrying later and having to student loan debt, burden a segment of creditworthy buyers by making it difficult to save for a downpayment. Julián Castro led the session on student loan debt and its impact on first-time buyers. During his remarks, Castro announced that some regulatory changes were coming soon for young men and women, many of whom are currently repaying loans they borrowed to earn a college degree. Change in condo financing that could have an outsized effect on Florida due to state's high number of condos.
 "We need to make sure the pillars of the American Dream of graduating from college and owning a home go together – and not compete with each other," he said. Student debt balances, however, have been the exception and ballooned from about $300 billion at the end of 2004 to over $1.2 trillion debt today.

Pointing to NAR survey data, even with the numerous obstacles they face, millennials do make up the largest share of buyers among all generations, and over 90 percent of them currently renting have indicated a desire to become homeowners in the future."Realtors can be a resourceful advocate for their young clients repaying student debt by educating them about their housing options and pointing them to credible resources, such as the Consumer Financial Protection Bureau's information on student debt". U.S. Housing and Urban Development (HUD) Secretary Julián Castro

Good time to buy a home say 3 out of 4 people


Current and prospective homeowners are increasingly optimistic about U.S. real estate, according to a sentiment survey conducted by Berkshire Hathaway HomeServices. Respondents cited low interest rates, an improving economy and increasing housing inventory as key reasons for their growing optimism.Three out of four (76 percent) prospective homeowners said this year is a more ideal time to buy a home – an 11-point jump from December.

Overall, downward trends noted in the two previous surveys reversed course: 61 percent of current homeowners and 65 percent of prospective homeowners now see the real estate market as more favorable for sellers and buyers.
"Our data underscores what we're beginning to see across America – that millennials are increasingly interested in homeownership and its virtues, they understand that mortgage rates are still low, the economy and jobs pictures look good and that housing remains a fundamental, long-term investment. Opportunity is opportunity, no matter your demographic."
In the December Homeowner Sentiment Survey, 68 percent of prospective homeowners said that increased interest rates would have "some impact or a strong impact on my life." Yet mortgage rates trended lower and remain near historic lows. And even though the Federal Reserve has pledged additional increases in its benchmark interest rate, respondents cited lower rates as the primary reason for their optimism toward real estate. In fact, an increasing number of current homeowners – mostly Boomers and Gen-Xers – see modest mortgage rate hikes as a sign that the real estate market is heading in the right direction.
Prospective homeowners are significantly less concerned than they were late last year that a low listing inventory of for-sale homes will hurt their chances to find the right home. They are less concerned (by 10 percentage points from the previous survey) that new lending requirements will make it more difficult to qualify for a mortgage loan.

To purchase their ideal home, current homeowners and prospects said they're more willing to forego swimming pools, accessibility to public transportation, basements and proximity to their workplace. However, they're less likely to compromise on location within a good community, a good floor plan, proximity to solid schools and the outward appearance of a home.

Foreign Home buyers show no signs of slowing down

Foreign real estate investors went on a buying binge last year, acquiring a record $91.1 billion in properties in the U.S. – more than double the amount spent in 2014, according to New York City-based research firm Real Capital Analytics (RCA).

Despite some global headwinds, that momentum is expected to stay strong in 2016 as investors continue to expand their acquisition activity across property types and into more secondary markets. 
"Foreign capital is still looking at the same positives in the U.S. that they saw last year," says Jeanette Rice, head of investment research, Americas, for real estate services firm CBRE. Although the term "safe haven" does tend to get over-used, U.S. real estate is an attractive place to park money for capital preservation and an opportunity to create yield, Rice notes.
The U.S. economy is outperforming most other regions with expected GDP growth of 2.2 to 2.3 percent in 2016. In addition, property values and property fundamentals stateside remain favorable.
Canada has been one of the dominant sources of foreign capital coming into the United States. Although the country has been slightly impacted by the oil crisis, Canadian investors' appetite for real estate is expected to remain strong as they have a lot of capital to invest and fewer opportunities in their domestic real estate market. The U.S. is also likely to see steady inflows from Europe, Korea and Singapore, and there may even be an uptick in investment from Japan and Australia as more buyers look outside of their home countries for investment opportunities, says Riaz Cassum, a senior managing director and co-head of the global capital team at mortgage banking firm HFF.
Chinese capital continues to be a formidable force in the U.S. real estate market.
"We are seeing more capital coming out of China," Cassum says. Slowing growth in China and the decline in value of the Chinese RMB is a greater motivating factor for more investors to seek alternatives outside of their home country. One potential problem for Chinese investors is if their government puts controls in place to make it more difficult for capital to leave the country, according to Cassum.
Latin American investors, on the other hand, may be less active in the coming year due to some currency challenges and slower economic growth, notably in Brazil and Chile.
Middle Eastern investors, including sovereign wealth funds, have been impacted by the drop in oil prices and high deficits they now have to fund at home. However, while the large sovereign funds from the Middle East may not have new capital, they do already have significant investment holdings in the U.S. that are generating income or proceeds from property sales.
"So the expectation with the big sovereigns is that they will stay active, but are likely to have less new capital allocated to real estate in the U.S.," according to Cassum.
Another factor that could serve to drive more foreign capital to the U.S. this year involves changes to the U.S. Foreign Investment in Real Estate Property Tax Act (FIRPTA). One of the changes involves the lifting of a tax penalty for pension funds.
"So we do expect more interest from those qualified pension funds in U.S. real estate. It just has made real estate cheaper in a way due to fewer taxes," says Rice.
International groups are actively buying across the four main property types – office, industrial, retail and multifamily – and they are more willing to consider alternative assets such as student housing and seniors housing.
For example, HFF has brokered a number of joint venture development deals where foreign investors have partnered with U.S. apartment builders in cities such as Orlando, Dallas and Seattle.
Asian investors in particular are looking outside of the gateway markets for opportunities that can give them slightly more yield. Some are hoping to take advantage of weakness in the energy sector by going after buying opportunities in markets such as Houston and Denver, he adds.
Like RCA, research firm CoStar also reported that foreign investment sales more than doubled in 2015, although it provided a lower volume than RCA, at $69.4 billion. Of that amount, office investments represented the lion's share of the acquisition volume at $23.9 billion.
However, buyers have been more active across the board. Industrial assets saw a big spike in total sales to $18 billion, largely due to the IndCor portfolio sale. Foreign buyers also spent $9.9 billion on multifamily properties, $8.0 billion on hospitality assets and $6.8 billion on retail properties, according to CoStar.
Some investment groups, notably the Canadians, have been investing outside of U.S. gateway markets for a long time. Although other foreign investors still tend to prefer gateway cities that capital is increasingly branching out to other metros.
According to CoStar, the top three metros in 2015 by acquisition volume were New York City, Washington, D.C. and Boston. However, the top 10 also included smaller metros such as Atlanta, Houston and Seattle.

It remains to be seen whether foreign investment will be able to exceed the high volume of buying that occurred in 2015, but so far, that activity doesn't seem to be slowing down, says Cassum. Although there are some geopolitical, economic and currency issues that might create hiccups for some countries, many of the same factors that have been driving foreign investment into the U.S. are still very much in play, he notes. March 2016