Eye on Santa Fe
From Scott Robinson, Gateway Mortgage
Home affordability is at 1971 levels, due to falling home prices and record low rates, pushing home ownership in reach to more families, according to the U.S. Department of Housing and Urban Development (HUD). Home owners are bringing in nearly double the median income they need to cover the cost of an average home, HousingPredictor reports. “With rates at historically low levels and markets across the country beginning to improve, home ownership is within reach of more households,” Bob Nielsen, chairman of the National Association of Home Builders, said in a statement. Home sales have been ticking up, according to recent reports by the National Association of Realtors®, the National Association of Home Builders, as well as the Obama administration’s December Housing Scorecard.
Source: HousingPredictor
The apartment vacancy rate is at its lowest level since late 2001 as the rental market continues to soar, according to the latest fourth-quarter data by Reis Inc. As demand increases, the vacancy rate for apartments dropped in the fourth quarter to 5.2 percent compared to 6.6 percent a year prior. “Multifamily property has been the star of the real-estate sector for more than a year, generating profits for landlords but headaches for renters struggling with the economic downturn,” an article in The Wall Street Journal notes. “Demand has swelled from people being foreclosed out of their houses as well as those unable or unwilling to buy.” Landlords are also raising their rents. Asking rents moved up 0.4 percent in the fourth quarter, averaging $1,064 a month nationwide — compared to $1,026 in 2009. New York City continued to have the highest rent in the country at $2,876 a month. Meanwhile, as the rental market takes off, builders are rushing to play catch up in building new units to meet the demand. In 2011, Zelman & Associates estimates that more than 173,000 units were started, and about 225,000 and 280,000 starts are expected in 2012 and 2013.
Source: The Wall Street Journal
Borrowers who have a history of paying rent on time may see a boost to their credit score. Experian, a leading credit report company, added a section to its credit reports last year that reflected on-time rent payments, which helped give a boost in the credit scores to some on-time rent payers. Now the two other major credit reporting companies are following suit. CoreLogic and FICO recently announced they are also adding a score that reflects payment histories from landlords, The New York Times reports. “Evidence of positive rental payments could be a plus for consumers,” Joanne Gaskin, FICO’s director of product management global scoring, told The New York Times. Nearly half of high-risk consumers saw an increase of 100 points or more after their rental history was added to their credit report, says Brannan Johnston, the managing director of Experian’s rent bureau. Consumers with average or higher credit scores, on the other hand, did not see any major difference to their scores. For former home owners who lost their homes to foreclosure, they may be able to rebuild their credit histories more quickly now by showing they are “very responsible renters,” Tim Grace, senior vice president of CoreLogic, told The New York Times.
Source: The New York Times
