NEWPORT BEACH, Calif.--(BUSINESS WIRE)--The first major survey into Generation Y’s perception of the U.S. housing crisis reveals a surprisingly strong sense of optimism about the future despite cautious near-term sentiment.
First major national housing survey during current downturn reveals surprising results
While the housing industry is readying for this wave of future homeowners (approximately 80 million strong), there is little data on what this influential buying group actually wants in their next home or how the current downturn has affected their future plans.
According to the national survey conducted by The Concord Group:
50% say they are likely to purchase a home within the next three years
50% say tax credits or lower interest rates would motivate them to purchase a residence sooner
70% believe home prices will be higher or at today’s levels in two years
62% say wealth creation is a very big advantage of real estate ownership
Although economic conditions factor strongly in their decision-making process, survey respondents say that lower home prices and/or a raise at work would be the top motivations for buying a home sooner than planned.
"Generation Y is going to have more impact on the national housing market than any group since the early Baby Boomers. We wanted to better understand their preferences and expectations especially as they will have such an impact on our future,” said Emma Tyaransen, Principal of The Concord Group, a national real estate advisory firm.
The majority of respondents to The Concord Group’s survey say they are:
Willing to pay a premium to live closer to their job
Seeking out a larger space for their next residence
Interested in living near alternative modes of transportation
Likely to put down less than 20% on their next residential purchase
Planning to eventually abandon the cities for a life in the suburbs
“What’s so interesting about this data is that it supports our prediction that transit-oriented development will command a premium in the near future. It also proves that suburban development will continue to play an important role in the housing market that emerges from the downturn,” said Tyaransen.
The Concord Group is a premiere national real estate advisory firm with offices in Newport Beach, CA; San Francisco, CA; Portland, OR and Boston, MA. The Concord Group provides developers, investors and public planning agencies with vital analytical input throughout all phases of real estate financing, development and operations. www.theconcordgroup.com
Jason Donn
AllStar Realty
954-892-6244
Tuesday, April 14, 2009
Wednesday, April 8, 2009
A shadow lurks in the housing market
This is scary. The San Francisco Chronicle reports that lenders are sitting on hundreds of thousands of foreclosed homes that haven’t even been listed yet. If this “shadow inventory” hits the market, we’ll have a new definition of bottomless pit.
From the article:
“We believe there are in the neighborhood of 600,000 properties nationwide that banks have repossessed but not put on the market,” said Rick Sharga, vice president of RealtyTrac, which compiles nationwide statistics on foreclosures. “California probably represents 80,000 of those homes. It could be disastrous if the banks suddenly flooded the market with those distressed properties. You’d have further depreciation and carnage.”
The Chronicle suggests several reasons why banks might not be selling off their foreclosures:
— The “pig in the python”: Digesting all those foreclosures takes awhile. It’s time-consuming to get a home vacant, clean and ready for sale. “The system is overwhelmed by the volume,” Sharga said. “In a normal market, there are 160,000 (foreclosures for sale nationwide) over the course of a year. Right now, there are about 80,000 every month.”
— Accounting sleight-of-hand: Lenders could be deferring sales to put off having to acknowledge the actual extent of their loss. “With banks in the stress they’re in, I don’t think they’re anxious to show losses in assets on their balance sheets,” O’Toole said.
— Slowing the free-fall: Banks might be strategically holding back some foreclosures so prices don’t fall as fast. “They want to be careful about not releasing them too quickly so they don’t drive prices down and hurt the values,” O’Toole said.
And then, there are people scamming the system. Two dozen people have been indicted for “allegedly conducting a wide-ranging mortgage fraud based in San Diego and led by a street gang member.” From Reuters:
The defendants allegedly used straw buyers and inflated appraisals to purchase homes that had sat on the market for extended periods and had been reduced in price.
They submitted offers that exceeded the homes’ asking prices, and had the overage paid to a shell construction company that they claimed would make upgrades or handicap modifications to the properties, prosecutors said.
The defendants instead disbursed the “kickback amount” to members and associates of the enterprise as payments for their participation, the indictment said.
Lenders later foreclosed on the properties, taking “severe financial losses,” after the straw buyers failed to make payments, the indictment said.
Jason Donn - Real Estate Open Networkers
From the article:
“We believe there are in the neighborhood of 600,000 properties nationwide that banks have repossessed but not put on the market,” said Rick Sharga, vice president of RealtyTrac, which compiles nationwide statistics on foreclosures. “California probably represents 80,000 of those homes. It could be disastrous if the banks suddenly flooded the market with those distressed properties. You’d have further depreciation and carnage.”
The Chronicle suggests several reasons why banks might not be selling off their foreclosures:
— The “pig in the python”: Digesting all those foreclosures takes awhile. It’s time-consuming to get a home vacant, clean and ready for sale. “The system is overwhelmed by the volume,” Sharga said. “In a normal market, there are 160,000 (foreclosures for sale nationwide) over the course of a year. Right now, there are about 80,000 every month.”
— Accounting sleight-of-hand: Lenders could be deferring sales to put off having to acknowledge the actual extent of their loss. “With banks in the stress they’re in, I don’t think they’re anxious to show losses in assets on their balance sheets,” O’Toole said.
— Slowing the free-fall: Banks might be strategically holding back some foreclosures so prices don’t fall as fast. “They want to be careful about not releasing them too quickly so they don’t drive prices down and hurt the values,” O’Toole said.
And then, there are people scamming the system. Two dozen people have been indicted for “allegedly conducting a wide-ranging mortgage fraud based in San Diego and led by a street gang member.” From Reuters:
The defendants allegedly used straw buyers and inflated appraisals to purchase homes that had sat on the market for extended periods and had been reduced in price.
They submitted offers that exceeded the homes’ asking prices, and had the overage paid to a shell construction company that they claimed would make upgrades or handicap modifications to the properties, prosecutors said.
The defendants instead disbursed the “kickback amount” to members and associates of the enterprise as payments for their participation, the indictment said.
Lenders later foreclosed on the properties, taking “severe financial losses,” after the straw buyers failed to make payments, the indictment said.
Jason Donn - Real Estate Open Networkers
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