Sullivan Team

Home Sizes Expand, Along With Prices

Home Sizes Expand, Along With Prices

New U.S. houses are getting bigger in size and more expensive, but larger new homes do not necessarily mean strength in the housing market. Here's why. 

By
Laura Kusisto
Jan. 24, 2016 4:48 p.m. ET

The size of new homes rose last year, suggesting Americans’ love of space remains strong but making new homes less affordable for a bigger swath of buyers.

The average size climbed to about 2,720 square feet in 2015 from about 2,660 square feet the previous year, according to data released by the National Association of Home Builders at its annual trade show.

Almost half of the homes started last year had four or more bedrooms, and one out of four had garages with room for three or more cars.

That isn’t necessarily a sign of strength in the housing market, however. 

Home sizes have grown lately because new construction has been tilted toward the high end. Builders do aim to draw young buyers in at lower price points, so that there is a market for some of their more expensive products over the long term. But they haven’t made more starter homes in recent years mainly because of land prices, construction costs and lack of available mortgages for less-affluent buyers.

Those potential buyers, who may also be younger, help bring down the average size of new homes because they tend to live in smaller spaces than their older counterparts. They have been slow to purchase homes because they are struggling to save for down payments or be approved for mortgages. 

The average price of new homes for sale in 2015 climbed to $351,000, up $100,000 from 2009.

The average new-home size bottomed during the 2008 financial crisis at about 2,360 square feet and climbed sharply before leveling out in 2014 and then jumping again in 2015. Rose Quint, assistant vice president of survey research at the home builders association, said she expected square footage might begin to decline as more first-time buyers came back into the market.

“Last year I was expecting, and I wasn’t alone, that the average size of homes would actually fall … because there were new measures that were supposed to bring in a wave of first-time home buyers,” Ms. Quint said. “That didn’t happen.”

Measures to help entice younger buyers into the market included lowering fees on loans from the Federal Housing Administration, which tend to be more appealing to first-time buyers because they have lower down-payment requirements.

The share of first-time buyers of U.S. homes fell to 32% of all purchasers in 2015 from 33% the previous year, according to the National Association of Realtors, its lowest level in three decades.

A major topic of conversation at this year’s International Builders’ Show was how to entice younger buyers to begin purchasing homes again. Ideas ranged from more communal amenities, such as pools and clubhouses, to mimicking high-end rentals to smaller homes with more outdoor space that tend to be cheaper.

“It’s a little bit concerning,” said Jeff Roos, a regional president for Lennar Corp. He said the company is looking at integrating technology and designs that appeal to younger buyers. “As the millennials get older they’ll see the value of buying versus renting.”

http://www.wsj.com/articles/home-sizes-expand-along-with-prices-1453672105

The Future for Wearable Devices Like Apple Watch - UP

http://www.wsj.com/articles/the-future-of-the-wearables-market-1452736738

Real Estate Shined As An Investment in 2015

So how did homeownership match up against other investments in 2015? 

Here is a chart that compares its return on investment against precious metals and the stock market last year:

 

 

 

Bottom Line

Not only did homeownership offer all its social benefits. It also was a great investment financially.

Historic Salem Colonial affords opportunity of a lifetime

Historic Salem Colonial affords opportunity of a lifetime

BY LILLIAN SHAPIRO DIRECTOR OF REAL ESTATE, SALEM NEWS, http://goo.gl/VIuvin

  

After a remarkable $2 million overall renovation and modernization, the famed Joseph Story House, just steps from Salem Common, the waterfront and a vibrant downtown, is being exclusively offered by the Sullivan Team at RE/MAX Advantage for $2,650,000. While this regal home affords every modern-day convenience, the stately Federal, built in 1811 for U.S. Supreme Court Justice Joseph Story, retains every ounce of its historic integrity.

“This home represents three centuries of history and architecture. It has had many illustrious owners including Dr. Amos Howe Johnson who added the two-story addition on the back,” says Broker Kathleen Sullivan. “After extensive consultation with the Historic Commission and meticulous planning, the current owners followed their hearts and completed a truly majestic residence. I can honestly say that in my 30 years of selling real estate, I have never seen a house quite like this.”

Though designated a National Landmark and included in the National Park Service’s Underground Railroad Network to Freedom due to Story’s judicial decision in the Amistad slave ship case, one should not be fooled into thinking that its intriguing past is all that defines this grand manse. Over the course of nearly three years, owners Neil and Martha Chayet painstakingly sought to bring it well into the 21st century, installing an innovative geothermal energy system, complete with a 14-zone heating and cooling capability, which earned the LEED (Leadership in Energy and Environmental Design) Silver Certification award. From there, major infrastructure work included the restoration of its Flemish bond brick façade and chimneys, new thermo pane windows, all new plumbing and wiring, a new generator, an audio system and an elevator to service all four levels of the home. Original Samuel McIntire moldings and mantels, believed to have been the famed architect’s last work, were meticulously refurbished, as were original oak floors, pocket doors and Indian shutters.

Aesthetic construction included a new brick “carriage house” wing, comprised of a two-car, heated garage with a ramp to the basement, a media room a with wet bar, and the most astounding chef’s kitchen complete with custom cabinetry, two dishwashers, gas and electric ovens, a Wolf range and a double Sub-Zero refrigerator. An adjacent butler’s pantry is complete with glass-front cabinets, marble counters and a recycling system. Ten rooms in the original part of the house include the stunning living room with a fireplace and hand-carved trims, the dining room with custom cabinetry and a pull-down movie screen, and a more leisurely family room complete with quarter-sawn oak paneling, a wood-burning fireplace and a breathtaking bow window, affording optimal views of the yard, which features a three-tiered fountain, outdoor lighting and an irrigation system. Additionally, find two home offices, two full and three half-baths, and three bedrooms, including a sumptuous master suite with a soaking tub, walk-in shower and two dressing rooms.

Zoned as a legal three-family home, this incredible offering also features a studio and a one-bedroom apartment with a separate entrance on Oliver Street. Currently used to host vacationing dignitaries, guests of the Peabody Essex Museum and other distinguished visitors, both apartments can be closed off for privacy or incorporated into the home.

“The Chayets have been incredible stewards. They have been methodical and studious every step of the way,” says Sullivan. “They created a spectacular home that will indeed be their legacy.”

At a glance: 14 rooms, 5 bedrooms, 4 full and 3 half-baths, Approximately 7,000 square feet, $2,650,000

This exquisite property is shown by appointment. For more information, call Kathleen Sullivan at 978-927-9199 or visit www.26WinterStSalem.com.

http://goo.gl/VIuvin 

 

 

 

 

 

 

 

http://www.salemnews.com/homes/historic-salem-colonial-affords-opportunity-of-a-lifetime/article_a1f395c7-bcf9-542b-9c70-2ecece84f0c2.html

10 Reasons Why the Holidays can be the Best Time to Sell Your Home.

 

10 Reasons Why the Holidays can be the Best Time to Sell Your Home. 

 1. Buyers love to shop for homes during the holidays when they have more time.

2. Because many families take vacation time during the holidays, more husbands and wives are available to see homes together.

3. The buyers who are actively looking during the holidays are serious and focused.

4. Many buyers who do not have school age children prefer to shop during the winter to avoid the spring and summer home buying rush when negotiations are more stressful.

5. The majority of families that are relocating now have school aged children they are trying to settle in school by the January semester or when the Spring break begins. 

6. During the winter holidays we focus on family and home.  Buyers viewing an attractively decorated home can easily imagine their own family living there. 

7. With reduced inventories and motivated buyers and agents, you could have more showings now than during the busier spring and summer markets. 

8. Buyers tend to be more flexible with contract terms and conditions during the holidays.

9. Buyers are more emotional during the holidays and are more likely to pay your price.

10. Selling now makes you an appealing, non-contingent buyer in the Spring.

MA July Unemployment Rate Unchanged at 4.7%, Labor Participation Rate 65.8%

 
MA July Unemployment Rate Unchanged at 4.7% VS US Unemployment Rate of 5.3%, also unchanged
MA unemployment Rate fell 1% from last year as  85,700 more jobs were added. 
MA Labor Participation Rate was 65.8% VS 62.6 for US.
 
 
 

U.S. Existing-Home Sales Reach Prerecession Pace

 

U.S. Existing-Home Sales Reach Prerecession Pace

Anna Louie Sussman, 

Updated Aug. 20, 2015 5:14 p.m. ET

WASHINGTON—Sales of existing homes climbed in July to their prerecession pace, but low inventory and higher prices threaten to curtail those gains heading into the fall. 

Existing-home sales rose 2% last month from June to a seasonally adjusted rate of 5.59 million, the National Association of Realtors said Thursday. Last month’s sales pace was the highest since February 2007 and 10.3% higher than a year earlier. ...

Total housing inventory fell 0.4% at the end of July to 2.24 million existing homes available for sale, 4.7% lower than a year ago. At the current pace of sales it would take 4.8 months to exhaust the supply of homes on the market, down from 5.6 months a year ago, the NAR said Thursday. ...

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Why Millennials Are Not Creating More Households and Buying Homes - 2 Views

Below is an article from Rise Media explaining that Millennials are not buying homes because of their lifestyle choices.

Forbes has a different read on the problem explaining that Millennials' life style choices are driven by low paying jobs  - see Forbes Article below.
 
Fact: 44% of college graduates in their 20s have low paying jobs and there is resistance to hire recent grads because:
1. Baby Boomers are delaying retirement and 2. Technology has replaced many lower paying jobs and this trend will continue
 
Today is a perfect time for Millennials to explore a career in Real Estate Sales, a  satisfying and rewarding profession for the right person.
 
Terry  
 

Lifestyle Choices—Not Student Debt—Keeping Homeownership at Bay for Millennials

The homeownership rate is falling — from a high of 69 percent in the mid-2000s to less than 64 percent today — and lack of millennial demand is a major factor. Some even see a lower homeownership rate as “the new normal,” as an Urban Institute study declared.

This trend appears worrying, especially with homeownership still strongly linked to the American Dream. But to fully assess the effects it’s having on society, we must actually answer the question of why millennials aren’t buying.

My research has led me to an unconventional, yet surprisingly obvious, answer. Lack of finances is not the primary reason millennials are shunning homeownership — in fact, it’s not a significant problem at all. The real reason they’re delaying or avoiding homeownership is their lifestyle choices, especially in the realm of marriage and children.

For full article go to: http://rismedia.com/?p=99036

 

Alternate View: The 5.4% Unemployment Rate Means Nothing For Millennials

The national unemployment rate has dropped to 5.4%, the lowest rate since 2008, but this low percentage means nothing for Millennials (born 1980-2000).

The data is actually pretty scary44% of college grads in their 20s are stuck in low-wage, dead-end jobs, the highest rate in decades, and the number of young people making less than $25,000 has also spiked to the highest level since the 1990s.

There are various factors contributing to the absence of jobs for Millennials.

First of all, employers are more hesitant to hire new graduates, as Baby Boomers are delaying retirement and holding onto their jobs due to financial insecurity. This creates stagnancy in the workplace.

Moreover, advances in technology are making many jobs obsolete because they can easily and cheaply be automated. In fact, renowned futurist Faith Popcorn argues that the “robot revolution” is coming, projecting that roughly one out of three U.S. workers will be replaced by robots by 2025.

We’re adapting to the changing job market. We’re not buying cars at the rates that previous generations have, instead opting to use public transportation or car-sharing services. Buying our first homes is no longer a part of the “American Dream,” as most of us aren’t even buying homes at all. 

For full article go to: http://onforb.es/1GZXI6r 

 

Mortgage Rates Hit 2015 High - 4.2% for 30 Year Fixed

Mortgage Rates Up - 30 Year at 4.2%

Mortgage Rates at 2015 High

Mortgage Rates jump to 2015 high, 4.13% for 30 year fixed