Buyers Face a Brighter Affordability Picture This Spring

Slower home price growth, deflated sales, and lower mortgage rates could create abundant opportunities for potential home buyers this spring.

Though home prices are still up year over year in all 50 states, the overall affordability outlook is improving, according to Black Knight’s latest Mortgage Monitor Report. The decline in mortgage rates has helped increase consumers’ buying power by more than 6 percent and reduced mortgage payments on an average-priced home by $62, according to the report.

“There is good news in these numbers for prospective home buyers,” says Ben Graboske, president of Black Knight’s data and analytics division. “Combined with the average 30-year fixed-rate mortgage declining by more than half a point over the last three months, housing is now the most affordable it’s been since early in the 2018 homebuying season.”

With a 30-year fixed-rate loan, it currently takes 22.2 percent of the national median income—along with a 20 percent down payment—to cover the mortgage costs of an average-priced home, Graboske says. That’s down from a post-recession high of 23.4 percent just a few months ago and well below the long-term average of 25 percent in the late 1990s and early 2000s, he adds.

Home prices have slowed the most on the West Coast, particularly in California and Washington, the report notes. For example, California has seen its annual rate of appreciation drop from more than 10 percent in February 2018 to 3 percent at the end of 2018. The slowdown is most apparent in San Jose, Calif., San Francisco, and Seattle.

Nationwide, annual home price appreciation slowed for the 10 consecutive months ending in December 2018. Home price appreciation has dropped from a high of 6.8 percent annual growth in February 2018 to 4.6 percent by the end of the year, according to Black Knight. The lower home prices and mortgage rates will certainly help buyers who had been struggling with affordability, the report notes. Still, “while this is all welcome news for consumers heading into the spring homebuying season, it remains to be seen whether recent rate declines and easing affordability will be enough to halt the deceleration in home price growth,” Graboske notes.

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New Appraisal Tools Section on REALTOR.org/appraisal

NAR has added a new resource on the REALTOR.org/appraisal page called “Appraisal Tools.”  The Appraisal Tools page provides links to educational resources for real estate agents who want to educate clients about the appraisal process.  Links include NAR’s new Frequently Asked Questions brochure about appraisals as well as three publications from the Appraisal Foundation including common myths about the appraisal process.  The “Tools” page also has links to Seller and Servicer Guides from Fannie Mae and Freddie Mac, as well as the Green MLS toolkit and a Field Guide to Appraising a Real Estate Office. 

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FHA Single Family Draft Handbook Appraiser Requirements

The Federal Housing Administration posted four draft appraiser-specific policy documents that will be part of the Single Family Housing Policy Handbook. FHA specifically encourages FHA Roster appraisers, and mortgagee staffs that underwrite appraisals, to submit feedback through September 2.

See the FHA Single Family Policy Drafting Table for more information.

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Blog: The Jewelry in Your Kitchen Design

By Melissa Dittmann Tracey, REALTOR® Magazine

Great lighting is definitely stealing more of the spotlight in kitchen design lately. Pendant lights that hang from the ceiling above your kitchen island—usually in a row of two or three–is really a place to show off lighting to dress up your kitchen.

Some designers refer to pendant lights as the jewelry of your kitchen. They add a little decorative sparkle to catch the eye.

Blown glass pendants are one of the top trends. This is a clear glass light fixture with an exposed Edison light bulb inside. Glass pendants in geometric shapes, like a glass boxed pendant or a glass sphere, are popping up in more kitchens lately.

Glass pendants can be a great choice for smaller kitchens or kitchens within an open floor plan. That’s because the see-through glass doesn’t disrupt the line of sight in your kitchen space. The lighting adds just enough statement and shine to accent that kitchen island.

Check out a few examples.

Source: Styled, Staged & Sold