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Phoenix Real Estate Reading 3.4.16


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Blog by Doug Ingersoll | March 4th, 2016


The article, Signs point to end of 7-year new-home slump in metro Phoenix, from AZCentral.com, reports that Metro Phoenix's new-home market is definitely rebounding from its seven-year slump. And builders started 2016 strong. New-home permits in January were up 57 percent from the same month in 2015, according to RL Brown Housing Reports. Lower prices could be drawing more buyers. The median price of new home fell to about $294,800 in January from $298,100 in December. Housing analysts RL Brown and Greg Burger say Valley builders are offering more lower-priced homes to better compete with the resale market. The median price of an existing home is about $225,000 now. In Pinal County, metro Phoenix's farthest southeastern suburb, new-home prices start as low as $140,000. And that's probably why new-home construction there shot up 114 percent last month. The increase in new-home building and sales is expected to continue for the new few years. Brown and Burger are forecasting about 18,000 new homes will be built Valley-wide this year. That will be about a 13 percent increase from last year's home total.  Here is the link to the entire article:  http://www.azcentral.com/


The article, Big banks are fleeing the mortgage market, from MSN.com, reports that when it comes to residential mortgages, big banks are waving the white flag. Banks originated 74% of all mortgages in 2007, but their share fell to 52% in 2014, the most recent data available from the Mortgage Bankers Association. And it could go even lower. They now face a regulatory environment so strict that many are afraid to lend, even to customers with the most pristine credit. They're still paying up for misdeeds done during the bubble. There's essentially no private bond market to whom to sell mortgages. And fighting those battles on behalf of their least-profitable divisions means residential lending just isn't worth it for many banks. Of the top 10 originators in 2015, banks lent 28.6% of all mortgages, according to data from Inside Mortgage Finance. That's about half their share in 2012, when banks among the top 10 originators accounted for 54.4% of all mortgages. In 2015, four of the top ten originators were such entities, according to data from Inside Mortgage Finance - Quicken Loans, PennyMac Financial, PHH Mortgage, and Freedom Mortgage. Those institutions, also known as "independent mortgage bankers," made up 43% of all originations in 2014, according to the Mortgage Bankers Association, a share that's stayed steady or grown every year since 2007, when it stood at 23%.
Here is the link to the entire article:  http://www.msn.com/en-us/money/companies/big-banks-are-fleeing-the-mortgage-market/ar-BBpqiGS#image=1


The article, Arizona economy to outperform, report predicts, from www.azcentral.com, reports that Arizona's economic growth will remain steady this year and next, helping the state outperform the nation by a slight margin, according to a new forecast. Robert Kavcic, senior economist at BMO Capital Markets, expects Arizona's economy to outperform the nation by 0.4 percent when final 2015 results are in, and by the same margin this year and in 2017. "The Arizona economy is posting solid and stable economic growth amid an ongoing housing-market recovery and positive demographic trends," Kavcic wrote in a report last week, as the state also benefits from good performance in tourism. Employment has been rising as consumer confidence improves, while the state's jobless rate slowly declines. Most recent job gains have come in the services sector, and Kavcic indicated that he expects Arizona high-tech manufacturing to pick up. The housing recovery has settled into a "sustainable pace," with moderate supply increases and Phoenix-area home prices up 5.9 percent in November, according to the S&P Case-Shiller index. "The good news is that the foreclosure rate has leveled off below 1 percent and is now among the lowest in America, though a still-elevated vacancy rate has also subdued the pace of price growth in recent months," the report said. Improved statewide economic conditions are driving stronger population gains around 1.5 percent. "That is still well below the 3.3-percent pace at the height of the housing boom but twice the national average," Kavcic reported. "Interstate migration has accelerated from the recession lows, netting out to an inflow of 46,000 people in 2015, with a smaller assist from international inflows."
Here is the link to the entire article: http://www.azcentral.com/story/money/business/economy/2016/02/22/arizona-economy-outperform-report-predicts/