Walkability Adds Value in Commercial Market | Realtor Magazine


A new index out this month seeks to measure the walkability of commercial sectors to help better determine value and potential investment opportunities.

Read moreNo Parking, No Problem

Last week, Real Capital Analytics, Inc., an international data and analytics firm focused on commercial real estate investment markets, announced a new collaboration with WalkScore, a private company providing a numerical index of community walkability via websites and a mobile app. The companies called the RCA & Walk Score Commercial Property Price Indices (CPPI) "the first of its kind to quantify the price value of walkability for commercial properties."

"Prices for commercial properties in highly walkable locations show significantly greater appreciation trends than car-dependent locations," said RCA Founder Robert White in a release accompanying the announcement. "The findings cut across both urban and suburban locales, large and small markets and each of the office, retail and apartment sectors."

RCA says the first-quarter results for this year will be released next month. The current release analyzes data through December 2014. RCA says the data "supports growing evidence that demographic shifts and preferences have shifted back to urban locations and more dynamic live/work/play environments."

They found that over the past ten years, prices for properties located in central business districts have risen 125 percent, while comparable properties located in car-dependent areas have risen only around 20 percent during the same time period. And properties don't have to be located in purely urban areas to benefit; the index finds that prices for suburban properties that are also considered highly walkable are up 43 percent.


Source: "Walkability Premium Found in Price Trends for Commercial Property According to New Indices Released by RCA," Real Capital Analytics, Inc. (April 15, 2015). 

Consumers Show Shift in Home Ownership | Realtor Magazine


The majority of consumers are upbeat when it comes to the housing market. Low interest rates and a strengthening economy have prompted this consumer optimism, according to Berkshire Hathaway HomeServices' Homeowner Sentiment Survey, a survey of about 2,000 consumers' attitudes toward home ownership.

Home Ownership Optimism

Income Increases Boosting Housing Optimism

REALTORS® More Confident for the Spring

Millennials Move Toward Home Ownership

94 percent of home owners and potential buyers surveyed say that home ownership is a critical piece to their long-term financial planning.

"Home owners today seem to have a longer term perspective for their properties," says Gino Blefari, HSF Affiliates CEO. "Owners are telling us a home is more than its price tag, and they're placing more value in a home's intrinsic qualities of wealth building, safety, satisfaction, and a place to raise a family."

However, there are some differences among age groups when it comes to home value perceptions. Baby boomers and Gen Xers, tend to embrace home ownership first as a "smart, long-term investment." On the other hand, millennials are "thinking in the now" about real estate and tend to place the highest priority on the "ease of a purchase decision," including the ability to close quickly on the property, secure financing, and afford monthly payments.

Millennials' say they see one of the major benefits to home ownership is having a place they’re proud to show family and friends. They also value a community with great schools and seek locations that encourage healthier lifestyles. 61 percent of millennials say it's also important to live in a neighborhood with a variety of trendy dining and retail options.

"As millennials become a larger part of the home-buying market, their preferences become better defined and seemingly more traditional," says Stephen Phillips, president of Berkshire Hathaway HomeServices. "We have always believed there is more similarity than difference among home-buying groups, and this new data seems to support that view."

Overall, the majority of current home owners – 88 percent – say it's important to update or renovate their home over time to enhance its long-term value. Many home owners seek home improvements that are energy efficient and eco-friendly systems and materials. More than 60 percent of current home owners said they favor "green" home improvements – even over kitchen, bath, and flooring projects.

The millennial generation is the most enthusiastic about home improvement projects. Sixty-one percent surveyed say they wan ta home they can upgrade to their preferences.

Source: "Homeowners Voice a Shifting Sense of Home Value in New Study," Berkshire Hathaway HomeServices (April 23, 2015)

Mortgage Rates Hover Around Yearly Lows | Realtor Magazine


The 30-year fixed-rate mortgage averaged 3.65 percent this week, remaining near its 2015 low and offering "positive news for potential home buyers in the market this spring," Freddie Mac reports in its mortgage market survey.

Read moreHome Buyers Push Up Loan Demand

The low rates are helping to provide a boost to loan demand. Mortgage applications for home purchases in 60 of the 100 markets that Freddie Mac tracks in its index are up compared to the same point last year. Twenty markets alone are showing double-digit increases in applications.

Freddie Mac reports the following national averages with mortgage rates for the week ending April 23:

  • 30-year fixed-rate mortgages: averaged 3.65 percent, with an average 0.6 point, dropping from last week's 3.67 percent average. Last year at this time, 30-year rates averaged 4.33 percent.
  • 15-year fixed-rate mortgages: averaged 2.92 percent, with an average 0.6 point, falling from last week's 2.94 percent average. A year ago, 15-year rates averaged 3.39 percent. 
  • 5-year hybrid adjustable-rate mortgages: averaged 2.84 percent, with an average 0.4 point, dropping from last week's 2.88 percent average. Last year at this time, 5-year ARMs averaged 3.03 percent.
  • 1-year ARMs: averaged 2.44 percent, with an average 0.4 point, falling from last week's 2.46 percent average. A year ago, 1-year ARMs averaged 2.44 percent.

Source: Freddie Mac

Even 'Stale' Listings Are Finding Buyers | Realtor Magazine


A limited number of homes for-sale has been plaguing housing markets for months. And despite recent gains, for-sale inventories remain a big concern, particularly when you "take the quality of the inventory into account," according to a new report by the real estate brokerage Redfin.

Existing-Home Sales Report:Home Sales Surge to 18-Month High

The number of both fresh and dated listings remains low, painting a bleak picture for buyers in many cities.

As of March 31, nearly 70 percent of the homes on the market were considered "stale"– homes that have sat on the market unsold for more than a month.

"A home that’s been sitting for 30 days is more likely to be overpriced, in need of renovation, or have other problems that prevent it from selling," according to Redfin.

"It’s normal for stale listings to make up the bulk of inventory, but now two things are happening. In some places, both fresh and stale listings are dwindling. And in a handful of cities, fresh listings are becoming a bigger share of inventory as high prices and competition lead would-be home owners to lower their expectations. That means even hard-to-love homes are finding buyers, who are chipping away at inventory."

The total number of unsold homes rose 5.3 percent in March to 2 million – reaching a 4.6-month supply pace, according to the National Association of REALTORS®. In Redfin's analysis of 50 markets, about 30 percent of the unsold homes were considered fresh listings.

"Buyers tend to become 'inventory blind' and tune out old listings, but that could be changing as desirable properties get fewer and further between," Redfin’s report notes.

"There’s a lot of fighting for that fresh inventory," adds Michael Alderfer, a Redfin real estate sales associate in Washington, D.C. "When new buyers find out they're going to have to beat other offers on the newer stuff, they adjust and start looking for things on the market 21-plus days."

Source: "Homes For Sale or Homes Gone Stale?" Redfin Research Center (April 23, 2015)