Header image alt text

Neighborhood Development Collaborative

Creating, protecting and preserving affordable housing for 34 years across from the Nation's Captal to the capital of California.

The National Association of Home Builders (NAHB) released today that Issuance of new building permits rose 6.2 percent to a seasonally adjusted annual rate of 1.034 million units in October due primarily to a double-digit increase on the multifamily side, the U.S. Census Bureau reported today. This follows a 5.2 percent increase in permit issuance in September to 974,000 units.

Multifamily Index Stays Above 50

Posted by David Cole on November 20, 2013
Posted in Home  | No Comments yet, please leave one

The National Association of Home Builders (NAHB) announced that its Multifamily Production Index (MPI) released on November 19th reached 54 in the third quarter, the seventh consecutive reading above 50. The MPI measures builder and developer sentiment about current conditions in the apartment and condominium market on a scale of 0 to 100. The index and all of its components are scaled so that any number over 50 indicates that more respondents report conditions are improving than report conditions are getting worse.

“Multifamily developers remain positive about where the market is right now, despite the dip in the index,” said W. Dean Henry, CEO of Legacy Partners Residential in Foster City, Calif., and chairman of NAHB’s Multifamily Leadership Board. “There are challenges still facing the industry such as availability of labor and rising cost of some building materials, but the demand for apartments and condos is strong enough for developers to proceed in most markets.”

“The multifamily industry has recovered significantly from its trough in 2009 and is getting close to reaching equilibrium,” said NAHB Chief Economist David Crowe. “NAHB’s forecast calls for continued improvement through 2015, but at a decreasing rate.”

CNBC: The housing stat you need to watch

Posted by John Carlisi on November 5, 2013
Posted in Home  | No Comments yet, please leave one

Home ownership is now at the lowest rate in 13 years, and it isn’t moving much, despite the recovery in home prices. More disturbing, however, is the dramatic drop in household formation.

Household formation—when a person who lives with someone else (parents, roommates, etc.) moves into another housing unit on his or her own, creating a new household—has averaged around 1 million per year historically as the U.S. population grows. In the early part of this century, when housing was just beginning its boom, it jumped by nearly 2 million. In the third quarter of this year, just 380,000 new households were formed, according to the U.S. Census. MORE: http://www.cnbc.com/id/101172009

It feels like back to the future in bonds. A brand-new investment product will launch next week that is born of the housing and mortgage crashes but based on the same strategy that caused at least some of the crisis.

Blackstone, the largest investor in single-family rental homes, is introducing a new security backed by those homes. The as-yet unnamed bond will provide investors with not only a rental stream from the properties but potential yield if they are sold. Much like a mortgage-backed security (MBS), it is a rental-backed security. MORE: http://www.cnbc.com/id/101143966

Home purchases by institutional buyers reached a record high in September and all-cash buyers accounted for almost half of sales as investors responded to rising demand from renters.

The homeownership rate declined to 65 percent in the first half of this year from a peak of 69.2 percent in June 2004. Photographer: Patrick Fallon/Bloomberg

Institutional purchases accounted for 14 percent of sales, according to a report today from RealtyTrac. That was the highest share since the real estate data firm began in 2011 to track transactions by that group, which it defines as buyers of 10 or more homes a year. All-cash sales rose to 49 percent from 40 percent in August and 30 percent a year earlier, a sign that rising mortgage rates since May have kept some people out of the market and that smaller investors are stepping up purchases. MORE: http://www.bloomberg.com/news/2013-10-24/families-blocked-by-investors-from-buying-u-s-homes.html

CNBC: Home affordability sinks as housing slows

Posted by John Carlisi on October 23, 2013
Posted in Home  | No Comments yet, please leave one

Rising home prices and higher mortgage rates are a toxic cocktail for homebuyers, pushing affordability down dramatically.

Prices are up more than 12 percent from a year ago, according to several reports, and the average rate on the 30-year fixed is a full percentage point higher than it was last spring. It is now far harder for the average U.S. household to afford a home. MORE: http://www.cnbc.com/id/101137109

When Montoria Freeland separated from her husband of 15 years in 2008, she left a four-bedroom house and economic security. Before long, her pay and hours as a pharmacy technician were cut and she found herself and her son facing homelessness.

Freeland lived with family for a time, she said, and four months ago moved into transitional housing funded by the city government in Washington, D.C., while searching for work that pays more than her $8.25-an-hour retail job. Having lost her oldest son in a 2000 homicide, Freeland said she insists on looking for housing in a safe neighborhood for her surviving one, now 17. She found that’s available only at an increasingly steep price. MORE: http://www.bloomberg.com/news/2013-10-18/families-with-kids-go-homeless-as-u-s-rents-exceed-pay-economy.html

Highlights

  • The nation’s supply of affordable rental housing — both subsidized and unsubsidized — is shrinking, even as demand increases.
  • Preserving existing affordable housing has a variety of economic and social benefits and is typically more efficient than building new units.
  • Federal, state, and local governments and nonprofits are employing creative financing and ownership structures to preserve affordable rental housing in both the public and private stock.

The United States was home to 9.9 million low-income renters in 2010, according to data from the Joint Center for Housing Studies of Harvard University. At the same time, there was a shortfall of 5.1 million rental units in adequate physical condition and affordable to these households.1 The level of unmet demand varies regionally, with long waiting lists and extremely low vacancy rates in expensive markets such as New York City and San Francisco and high vacancy rates and more affordable housing in weaker markets such as Flint, Michigan and Youngstown, Ohio. MORE: http://www.huduser.org/portal/periodicals/em/summer13/highlight1.html

 

The consensus in Washington that Fannie Mae (FNMA) and Freddie Mac should be dismantled is weakening amid opposition from hedge funds, regional banks and others who could benefit if the companies survive in some form.

President Barack Obama and lawmakers from both parties have called for the two mortgage-finance companies to be replaced by a new U.S. housing system. While the official position hasn’t changed, a bipartisan group of U.S. senators writing legislation is grappling with how to ensure that changes to Fannie Mae and Freddie Mac don’t disrupt the recovering housing market. MORE: http://www.bloomberg.com/news/2013-10-15/fannie-mae-survival-is-back-on-the-table-in-washington.html

A U.S. government shutdown will immediately slow approval of thousands of mortgages. If it lasts more than a week, it threatens housing and the broader economic recovery.

Congress forced the first partial government closure in 17 years after failing to pass a budget, meaning borrowers in the process of obtaining home loans could be delayed as lenders are blocked from verifying Social Security numbers and accessing Internal Revenue Service tax transcripts. MORE: http://www.bloomberg.com/news/2013-10-02/u-s-government-shutdown-threatening-housing-recovery.html