According to recent data from Redfin, U.S. home-sale prices increased 3.3% in November compared to one year ago, coming in at a median price of $298,800. November marked the third straight month of annual home price gains under 4% after a 77-month-long streak of annual home price gains exceeding 4%. In addition, the number of completed home sales fell faster than it has in over two years, down 8.3% from November 2017. Home sales declined in 65 of the 74 largest metro areas that Redfin tracks.
“The tide has turned,” said Redfin chief economist Daryl Fairweather. “Sellers are now competing for buyers, but they haven’t all realized it yet. Sellers who have adjusted their price expectations downward are still finding plenty of willing buyers. Sellers holding out for high prices are contributing to declining home sales and growing inventories. We see few signs that buyers are likely to reward their patience.”
You’re going to be hearing a whole lot about Opportunity Zones in the near future – if you’re not already talking about them. They are, perhaps, one of the greatest opportunities for investors of all stripes in quite some time. An Opportunity Zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment, that were created by Tax Cuts and Jobs Act on December 22, 2017. They are an economic development tool designed to spur economic development and job creation in distressed communities.
To that end, the IRS recently put out a FAQ sheet about them and you can also download a spreadsheet listing all of the zones (by Census Tract) all across the nation. Now the cool part; The interactive map featured below (from CREmodes.com) allows you to zoom-in and click on a specific Census Tract that in-turn opens a popup window with information about the Opportunity Zone, Census Tract information, as well as demographic data such as population, density, number of households, average household size, and occupancy (total housing, vacant units, owner-occupied units, occupied rental units).
Click on the map to make it interactive at CREModels.com.
Ok…as a regular reader you know that we’ve posted a whole lot about millennials, but guess who’s coming up on their heels? Generation Z – and they approach finances way differently than their older siblings. Are you ready for them??? Today’s infographic from Rave Reviews shows how Generation Z is perhaps taking a more pragmatic approach to their finances. Here we go….. Happy Friday!!!
Over the past few years we’ve had several stories about HELOC loans (home equity lines of credit) and their potential expiration creating havoc in the housing market among current homeowners. However, as Keeping Current Matters points out, as we’ve experienced strong price appreciation over the last last 6 years they show that homeowners are being much more responsible with their home equity this time around. After all, according to data, over 48% of all single-family homes in the country have over 50% equity. What a difference indeed.
“When real estate values began to surge last decade, people started using their homes as personal ATMs. Homeowners would refinance their houses and convert their equity into instant cash (known as “cash-out” refinances). Because homes were appreciating so rapidly, many homeowners tapped into their equity multiple times….This left homeowners with little-or-no equity left in their homes, so when prices started to fall many homeowners found their houses in a negative equity situation…”
The U.S. Department of Housing and Urban Development recently announced that HUD Secretary Ben Carson will be chairing a new council, composed of 13 federal agencies, that will engage with all levels of government on ways to better use taxpayer dollars to revitalize low-income communities. It will work to improve revitalization efforts by streamlining, coordinating, and targeting existing Federal programs to economically distressed areas, including Opportunity Zones. The committee, known as the White House Opportunity and Revitalization Council was formed via an Executive Order from President Donald J. Trump.
Charles Tassell, Chief Operating Officer of National REIA, said “In an effort to help streamline reinvestment in America, President Trump has asked Secretary Carson to lead a 13 department team in focusing up to $6T in untapped equity that could rejuvenate impoverished areas through Opportunity Zone tax incentives! Unlike previous zones, the idea behind the Opportunity Zones is to unleash market forces and private money into areas desperately in need of jobs, housing, and business investments…by 2026. If you aren’t looking into these areas now, you are missing out on the ground floor growth potential!”
The information below is from a HUD release dated 12/12/18:
SECRETARY CARSON TO LEAD WHITE HOUSE
OPPORTUNITY AND REVITALIZATION COUNCIL
CREATING OPPORTUNITY FOR ALL: President Trump is encouraging investment to create opportunity in distressed communities.
President Trump today is signing an Executive Order establishing the White House Opportunity and Revitalization Council.
The Council will be chaired by Ben Carson, Secretary of Housing and Urban Development, and comprised of 13 Federal agencies.
The Council will engage with all levels of government on ways to better use tax payer dollars to revitalize low-income communities.
The Council will improve revitalization efforts by streamlining, coordinating, and targeting existing Federal programs to economically distressed areas, including Opportunity Zones.
Lack of coordination and targeting has led to cumbersome applications, program waste, and ineffective benefits.
The Council will consider legislative proposals and undertake regulatory reform to remove barriers to revitalization efforts.
The Council will present the President with a number of reports identifying and recommending ways to encourage investment in economically distressed communities.
ENCOURAGING INVESTMENT: Opportunity Zones will spur private investment to revitalize hurting communities and unleash their economic potential.
In 2017, President Trump signed the Tax Cuts and Jobs Act, which established Opportunity Zones to incentivize long-term investments in low-income communities across the country.
These incentives offer capital gains tax relief to investors for new investment in designated Opportunity Zones.
Opportunity Zones are anticipated to spur $100 billion in private capital investment.
Incentivizing investment in low-income communities fosters economic revitalization and job creation and promotes sustainable economic growth across the Nation.
LIFTING UP COMMUNITIES: Opportunity Zones help drive economic growth and lift up communities that have been left behind.
Opportunity Zones are a powerful vehicle for bringing economic growth and job creation to the American communities that need them the most.
On average, the median family income in an Opportunity Zone is 37% below the state median.
The average poverty rate in an Opportunity Zone is 32%, compared to the national rate of 17%.
There are approximately are approximately 760,000 persons living in public housing within Opportunity Zones.
8,761 communities in all 50 States, the District of Columbia, and 5 Territories have been designated as Opportunity Zones.
Nearly 35 million Americans live in communities designated as Opportunity Zones.
It’s that time of year when real estate prognosticators dust off their crystal balls and make prediction about the coming year. Zillow is weighing-in with their own list where they say rising mortgage rates will set the scene and will affect everyone, driving up costs for home buyers and creating more demand for rentals. Indeed…
Here are the 6 major items Zillow sees happening in 2019:
RPOA’s Rental Property OWNER & Real Estate INVESTOR Podcast hosted by Brian Hamrick
In a recent RPOA podcast, Brian Hamrick talks with Frederick Kidd about nuts & bolts techniques involved in successful short-term rental investing – especially when some owners are getting 3 to 4 times what they would be making from a long-term rental. But, as Brian points out, for every investor who’s making a killing with their short-term rental, there’s another investor who either hasn’t gotten started or is losing money because they’re doing it wrong. Frederick Kidd shares his best practices for managing short-term rentals remotely, finding the right team members, understanding the expenses, getting the 5-star ratings from guests, communicating effectively when problems occur, and the top things you must do to be successful. If you’re interested in getting into this market this podcast is a great place to start.
Government-back giants Freddie Mac and Fannie Mae have announced they will suspend eviction lockouts over the holiday season. As reported by Mortgage News Daily, the GSEs (Government-Sponsored Enterprises) will stat their eviction moratorium (applying to single-family through 4-unit properties) from December 17 through January 2, 2019.
“We believe it is important to extend the timeline of help for struggling borrowers during the holidays,” said Jacob Williamson, Vice President of Single-Family Real Estate at Fannie Mae.
Earlier this month a group of tenants and landlords in Seattle, Washington teamed up with the Institute for Justice to file a class action lawsuit against the city for its use of invasive, warrantless searches to inspect rental units. According to a recent article in the Rental Housing Journal, the lawsuit doesn’t seek to stop the city from inspecting rental units (where the tenants agree to the inspection) or keep the city from addressing problem properties. It does, however, want the city to stop entering private homes of Seattle’s renters without consent or a legally obtained warrant that is based on evidence of a specific problem or issue. Indeed…
“By subjecting tenants to random, government-mandated inspections that would not occur if that same person owned their home, Seattle is treating renters like second-class citizens,” said William Maurer, the managing attorney of the Institute for Justice’s Washington state office. “Your home is your castle, regardless of whether you rent or own it. It is plainly unconstitutional for Seattle to force renters to open up their homes to government inspectors when nothing is wrong inside.”
The U.S. Department of Housing and Urban Development (HUD) recently awarded over $23 million to nearly 80 fair housing organizations working to protect consumers from housing discrimination through their Private Enforcement Initiative (PEI). These grants will be used by fair housing organizations across the country so they can carry out testing and enforcement activities. Be sure to look at the list of recipients in your city and state.
“It’s been 50 years since the passage of the Fair Housing Act, yet the fight against housing discrimination continues,” said Secretary Ben Carson. “Today we are making another investment to support our fair housing partners and protect families from discrimination.”