Rising Sea Levels Wallop Property Prices
Where once beachfront property was considered prime real estate, rising sea levels are changing things dramatically. Homes in eight U.S. states have lost $14.1 billion in market value due to rising sea levels, rising river levels, floods, etc.
Florida leads the pack in almost every category. The other states include Georgia, North Carolina, South Carolina, Virginia; and in the tristate area of New Jersey, New York, and Connecticut, pricey homes lost $7 billion in value. Homes in Ocean City, New Jersey lost $530 million versus $337 million lost in the Miami Beach area.
Steve adds that insurance premiums should go up for homes in high-risk areas. (1010)
Non-Bank Mortgage Lenders
In the past, if you wanted a mortgage, you’d go to a bank. But today, non-banking financial institutions have entered the mortgage-lending business. As a result, it’s much easier to get a mortgage loan today.
In her own experience, Terry Story finds that getting loans from non-bank mortgage lenders is far easier, quicker, and more convenient.
Non-bank lender, Quicken Loans, for instance, is the third largest mortgage originator after Wells Fargo and JP Morgan Chase.
Steve attributes this to fewer regulations on non-bank mortgage lenders than on banks, which were chastened for the 2007 mortgage crisis. (926)
Home Buyers Want Property Photos Removed
Some home buyers are concerned that pictures of their homes and properties continue to stay on real estate websites long after the sale has closed. They cite privacy and security issues. Often, homeowners’ requests for removal go unheeded. (919)
We are familiar with the term, single-family homes. Yet, only a few know what that means.
Terry defines single family homes as ones that:
- share no walls with neighboring homes
- have their own dedicated kitchen, not shared with any other home
- own the land that they sit on
- have private direct access to a street or a thoroughfare
- have dedicated utilities servicing the house
- are built as residences for single families, persons, or households, with undivided interest in that property.
The one big benefit of buying single-family homes is that you can do whatever you want with them, provided your city permits it.
Townhomes, on the flip side, have shared walls and strong limits on property modifications. (912)
Mortgage Fraud Up 12.4%
A recent report from CoreLogic shows a 12.4 percent year-over-year increase in mortgage fraud risk for the second quarter of 2018. The report notes that the fraud risk index has steadily climbed over the past seven quarters and that those states with heavy outside investment are at risk for significantly higher mortgage fraud.
New York, New Jersey, and Florida topped the list of fraudulent applications. Risk increased at each of the top 10 riskiest states, with the greatest increases in New Mexico, Mississippi, Illinois, Oklahoma, and Texas.
CoreLogic’s analysis showed that about one in 109 mortgage applications contained some type of fraud, up from one in 122 a year ago. Mortgage applicants incorrectly reported data on identity, income falsification, undisclosed real estate liabilities, credit repair issues, and questionable down-payment sources.
Terry notes that the recent upsurge in home prices has led to a situation where bona fide home buyers are “lying a little” on their mortgage applications to get approved for loans. (1017)
A recent CoreLogic report on April 2018 home prices, highlights 12 markets with the largest annual increases. This distinction could mean there is a danger of a housing bubble.
CoreLogic defines an overvalued market as one where home prices are at least 10% above long-term sustainable levels. Conversely, an undervalued market is one where home prices are at least 10% below sustainable levels. (618)
Here’s how you can protect yourself. Before you go to see a property for sale or rent, do an online search on its owner. If you meet someone at the house, ask the person you’re meeting for a copy of their driver’s license. If they claim to be an agent, ask them for the owner’s name and number. This way, you’ll know if you’re dealing with the owner or a scammer. (718)
Recent tariffs on lumber imports from Canada will increase construction costs by $9,000 per home. Additionally, tariffs on steel, aluminum, and other raw materials, will add to cost. Overall, Trump’s tariffs could increase construction costs by about $10,000 per home, on average. (718)
It’s called white-boxing, ever heard of it? White-boxing is when sellers on the luxury market strip out furnishings, rip out well-appointed bathrooms and kitchens and get the home down to its bare-bones structure. This creates a clean slate. It also caters to luxury buyers’ desires to uber-customize the homes they buy. White-boxing is also popular with older, outdated homes in upscale neighborhoods, where buyers will likely gut the house to build the home of their dreams. (518)
Luxury home buyers from colder northern climes are sharply driving up prices in Florida. According to Realtor.com’s May 2018 Luxury Home Index Report, the nation’s top 5 fastest growing luxury markets included Florida’s Sarasota, Collier, and Broward counties. Prices of entry-level luxury homes were up 19% in Sarasota, 14% in Collier, and 9% in Broward. (718)
Top of the list is having their own bedrooms, preferably with their own bathrooms. Kids also strongly value being close to where their friends live. Other kiddie considerations include having a large yard and proximity to parks and playgrounds for biking, recreation, and sports. (618)
The rise of technology has made information easily accessible. That’s both for us and for thieves interested in stealing from us. The housing market is no exception. This begs the question, can someone steal your home? Yes, says Terry. Homeownership fraud involves entering fraudulent documents into public housing records. Often, this means using the homeowner’s stolen identity. (618)