Kathy & Terry Sullivan

Kathy: 978-927-9199


RE/MAX Advantage Real Estate
Boston's North Shore, Essex County MA

Offices: Beverly, Gloucester, Marblehead, Peabody, Salem MA

Luxury Homes Waterfront Properties Condos
Multi Family Investment Properties Land All MLS

Judith Coughlin


Buyer Specialist
RE/MAX Advantage Real Estate, Beverly, Marblehead, Salem, Peabody, Gloucester, MA

3 Reasons Mortgage Demand Dropping to Lowest Level Since 2000

3 Reasons Mortgage Demand Is Dropping

Mortgage origination volume this year will be lowest since 2000, about $1.15 Trillion

Freddie Mac analysts point to three main factors behind the decrease in mortgage originations:

  1. The refinancing boom has ended. From 2013 to 2014, mortgage applications for refinancings have fallen about 60 percent. Freddie Mac projects refinance applications will drop by another 50 percent from 2014 to 2015. When mortgage rates rise—as they are expected to soon—borrowers will have less incentive to refinance. Applications for home purchases are not expected to be able to fill the void from the refi boom.
  2. Home sales are down. Sales of existing and new homes have fallen about 5 percent during the first six months of 2014 compared to the first half of 2013, according to Freddie Mac. “A period of higher mortgage rates, a harsh winter, and slower economic growth compared to a year earlier contributed to the slowdown,” researchers explain.
  3. More buyers are paying cash. The number of borrowers who took out a mortgage to purchase a home is down compared to last year, but that could be due to more buyers using cash. In the first six months of this year, all-cash home sales were up slightly from 31 percent to 33 percent, according to National Association of REALTORS® data. Yet, “with rising home values and fewer distressed homes coming the market, expect the available inventory for all-cash buyers to trend down in the coming year,” researchers note.

“Overall, recent economic and employment improvements should help bolster household formation and contribute to gains in construction, home sales—and also mortgage originations,” Freddie Mac researchers note.

“However, even with these improvements, expect new and refinance mortgage origination volume for this year to be the lowest since 2000 at about $1.15 trillion.”

DAILY REAL ESTATE NEWS | MONDAY, AUGUST 25, 2014     http://bit.ly/1tD3Mxw

Mortgage Rates Drop - 4.15% for 30 Year Fixed

Rates drop again as Yellen defers raising rates.  30 Year fixed now 4.15%.  

U.S. Home Size Levels Off

U.S. Home Size Levels Off, for Now at Least

The two-year trend of big, new houses getting even bigger appears to have peaked—at least for now—as more buyers seeking modest homes enter the market.

The median size of U.S. homes on which builders started construction in the second quarter registered 2,478 square feet, unchanged from the first quarter but still close to the all-time high of 2,491 set in last year's third quarter, according to Commerce Department data released Tuesday.

Entry-level and first-time buyers, who tend to buy smaller homes, have largely remained sidelined due to strict mortgage-qualification standards and tepid wage and job growth.

Economists and builders don't predict that median new-home sizes will drop sharply. That's mainly because the return of entry-level buyers is expected to be gradual as move-up buyers continue to account for the majority of sales in the next year or two.

Factors driving the rise in median sizes since 2012, in addition to move-up buyers' greater financial clout, include buyer preferences for more rooms, bigger garages, basements and wide-open living spaces like great rooms. A 2012 survey by the builders group of new-home buyers found that 47% of respondents wanted three bedrooms, 66% wanted a basement, 53% wanted a two-car garage and 19% wanted a three-car garage. 

The median size of new homes in the Northeast declined by 6.3% from the first quarter to 2,374 square feet in the second. 
The Midwest declined by 13.6% to 2,354. The South increased by 1.4% to 2,502. The West increased by 1.9% to 2,477.
For article: http://on.wsj.com/1oe5HTA
For Video - http://on.wsj.com/1tqaVQB

FICO Scoring Changes Could Help Borrowers - Effective This Fall

FICO Scoring Changes May Help More Qualify for Mortgages

FICO, the nation’s most popular credit-scoring system, announced it is tweaking some of the criteria used in coming up with consumers’ scores, which could help consumers save more money in qualifying for mortgages and other types of loans.

The changes include reducing the toll that overdue medical bills can take on credit scores, as well as removing other past penalties from consumers who have paid off debts that had been assigned to collection agencies. A consumer whose only major delinquency comes from an unpaid medical bill could see their credit score rise by 25 points due to the changes.

The changes come after a recent Consumer Financial Protection Bureau study, which found that both paid and unpaid medical debts were unfairly penalizing consumers’ credit ratings. An estimated 64 million Americans have a medical collection item on their credit reports, according to Nick Clements of Magnify Money, a personal finance site.

The FICO changes will go into effect this fall, but borrowers may have to wait a year or more until they see the impact of the changes in their scores, lenders say.

In June, the average FICO score for a closed mortgage was 728, a drop from 742 a year prior, according to data from Ellie Mae, a company that processes mortgage applications for lenders. FICO scores range from 300 to 850.

For Full Article go: http://bit.ly/1sPkg69

Zillow's Q2 Revenues up 68% to $78.4 Million, Loss was $10.5 Million

Zillow's rapid growth continues.  2014 Q2 revenues were up 68% from a year earlier to $78.7 million. 

However, Q2 expenses grew by 56% to $84 million and Zillow lost $10.5 million for the quarter. 
After Zillow acquires Trulia, it will be more than twice as large as Realtor.com
Zillow is upping its spend on its consumer marketing campaign for 2014 from $65 million to $75 million.

Company 2013 revenue  Projected 2014 revenue* Projected % YoY 2014 revenue growth
Zillow $197.5 million $322 million 63.0%
Move Inc. $227.0 million $253 million 11.5%
Trulia $143.7 million $251.5 million 75.0%
Source: Zillow

  1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014
Net annual growth in agent subscribers
15,414 16,111 18,046 18,841 18,938 18,011
Total number of agent subscribers 34,030 38,807 44,749 48,314 52,968 56,818

Source: Zillow, Move Inc. and Trulia *Midpoint of the firms’ projected revenues as of the second quarter.

Zillow quietly pursuing top producing agents

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July Unemployment 6.2% - 6 consecutive months with 200,000 + New Jobs

Best 6 months of job growth since 2006

July added 209,000 new jobs, Unemployment was 6.2% ( 9.7 million unemployed) which was the best 6 month job growth since 2006.

Major concerns:  A. The Under-employment rate is 12.2%, B.  the Labor Participation Rate is near a 40 year low at 62.9% and C. Wage Growth is stagnant when adjusted for inflation.  The unemployment rate for those with a high school diploma was 9.6% vs 3.1% for college graduates.

Hiring Settles Into Steady Gains


U.S. businesses added jobs at a sturdy pace last month, extending the most robust stretch of hiring since before the recession.

The question now: Is this the beginning of a breakout in hiring that will lift wage growth and finally bring unemployment down to levels consistent with a healthy economy?

In all, employers ranging from retail stores and professional offices to factories and construction sites last month added a total of 209,000 jobs, when adjusted for seasonal factors, the Labor Department said Friday.

That marked a downturn from the 298,000 jobs created in June, but was more than enough to yield the strongest six months of payroll gains since 2006. July was the first time since 1997 that employers added 200,000 or more jobs in six consecutive months.

Many scars from the financial crisis remain: 9.7 million Americans are out of work, and wage growth—closely watched by the Federal Reserve and others—didn't budge last month. Average hourly earnings for private-sector workers rose just 2% in July over last year, in line with the sluggish trend since the recession.

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June Housing Report - NAR

June Existing-Home Sales 5.04 Million, Highest Level Since October

Existing-Home Sales Hit Highest Level Since October

• June's Existing Home sales were up 2.3% from May, the 3rd consecutive monthly increase, reaching an annual pace of 5.04 million.

• Existing home Inventory was up 6.5% from a year earlier  -  5.5 months supply.

• Median home prices were $223,300, up 4.3% from the year earlier.

• First time buyers represented 28% of all sales, low by historic standards as the jobs market remains sluggish.

• Distressed sales slide to 11% of total sales as fewer investors entered the market.

• June sales were down 2.3% from last year.  However, 3 consecutive months of rising sales seems to indicate the housing market is recovering from a harsh winter.

• Borrowing rates remain near record lows at 4.13%


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Mobile Ad Spending To Jump 83% to $18 Billion Surpassing Print and Radio


Mobile-Ad Spending Leaps, but Trails User Growth

Outlays Expected to Jump 83% This Year, but Remain Small Compared to Time on Devices

Research firm eMarketer estimates that spending on mobile advertising, which includes both smartphones and tablets, will soar 83% to nearly $18 billion in 2014. Newspapers will draw nearly $17 billion, while radio will bring in $15.5 billion.



Updated July 21, 2014 8:02 p.m. ET

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Record 57 Million Americans Living in Multi-Generational Households - Pent Up Housing Demand

Record 57 Million Americans Living in Multi-Generational Households


Is your post-college 20-something still living in the basement? Why, yes. Yes, he is.

Driven by young adults, the share of Americans living in multi-generational households continues to climb, a new report released Thursday finds, a trend that accelerated during the recession but has extended beyond it.

A record 57 million Americans—or 18.1% of the population—lived in multi-generational households in 2012, according to an analysis of Census data by the Pew Research Center, a think tank. The rate, up from 17.8% in 2011, has been on a steady march upward since its post-World War 11 low in 1980, when just 12.1% of the population utilized these arrangements.

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