Tag Archives: Rent prices

In a study to examine what factors would drive a person to rent or own in their next move, Fannie Mae found that a mix of demographics and attitudinal drivers were key, while negative housing events appears to do little to thwart would-be buyers. The study categorized respondents into three groups: renters, those with a mortgage, and outright homeowners. The study found that renters tended to be younger and fall into the low income category.

A new analysis released by real estate marketplace Zillow revealed that for most buyers who intend to spend at least three years in a home, buying is a better option than renting. An analysis of the ""breakeven horizon"" in more than 200 metros and 7,500 cities showed that in more than 75 percent of metros examined, a homeowner would break even after owning a home for three years or less.

A new asset management firm announced plans to invest over $1 billion into distressed properties and convert them into rental homes. Sylvan Road Capital, LLC, which launched Wednesday, was co-founded by a former head of U.S. housing strategy at Morgan Stanley, Oliver Chang. According to a company release, the $1 billion will be invested over the next two years, and Sylvan Road will acquire over $300 million in distressed single-family homes through initial capital from an unnamed private equity firm.

Downturns in economic confidence hasn't shaken consumers' optimism in the housing market, Fannie Mae's National Housing Survey for June showed. According to the survey, the average home price expectation rose to 2 percent in June, up 0.6 percent from May and the highest recorded value since the survey began two years ago. In addition, 35 percent of respondents expect that home prices will go up in the next year, the highest level recorded since the survey's inception.

In a report released Thursday, Wells Fargo's Economics Group cautioned that although the housing recovery is picking up steam, the good news needs to be placed in the larger context of a weakened market. The Housing Data Wrap-Up for June 2012 shows that even with the overall economy slowing, the recovery in the housing market seems to be picking up momentum. A mild winter boosted construction in the Northeast and Midwest during what is traditionally a slow season, giving builders more inventory to sell in the spring.

After falling flat in May, asking prices went up in June, and rent prices continued to see significant increases, according to Trulia reports released Tuesday. Asking prices on listed homes made a 0.3 percent month-over-month and year-over-year increase in June, according to Trulia's price monitor. Phoenix and two Florida metros posted double digit gains, but Trulia warned that some of the top performing metros are facing another wave of foreclosures.

The winning bidders for the REO-to-rental pilot initiative have been selected and the deals are expected to close in the early third quarter, the Federal Housing Finance Agency (FHFA) announced Tuesday. The pilot program was first launched in February in select markets where inventory is high and rentals are in demand. Investors interested in bidding for properties were asked to submit an application to qualify and were evaluated based on factors including financial ability, asset management experience, property management expertise, and familiarity with select locations. There were about 2,500 single-family Fannie Mae owned REOs up for sale through the program.

The rental market appears to be doing more than just sustaining its health. After surveying property managers, TransUnion found that increasing prices aren't keeping tenants away. Overall, managers reported they are doing better than the year before and are having an easier time attracting residents despite the increase in prices. Almost half (48 percent) of the managers surveyed reported rental price increases on the majority of their units since last year in June. Nearly 73 percent of managers said finding residents is not difficult compared to 67 percent last year.

In Pro Teck Valuation Services' June Home Value Forecast report, Phoenix was used as an example to argue the point that some of the hardest hit markets have ""overshot on the downside."" The real estate valuation company looked at two traditional appraisal methods for determining property values: replacement cost and income capitalization. Based on these two factors, Pro Teck concluded that home prices in certain markets are selling at prices which are actually way below their replacement costs and the rental yields.

Optimism is good for the recovery, but too much optimism can lead us back on the path to the next housing bubble, said Trulia Chief Economist Jed Kolko during a conference call Wednesday. Although home prices are rising, renters might be overconfident, with 58 percent of respondents expecting home prices to return to peak in the next 10 years. In this case, Kolko said optimism is outpacing reality, and it is very unlikely that prices in those hardest hit markets will return to the peaks in the next 10 years. As for the rental market, Kolko said there is no danger of a bubble and if anything, we are in danger of the rental market becoming extremely tight in some markets.