NAHB: New-home sales will ‘rev up’ in 2015

WASHINGTON – Oct. 31, 2014 – A growing economy, rising household formations, low mortgage rates and pent-up demand will help single-family housing production to rev up in 2015, according to economists who participated in yesterday's National Association of Home Builders (NAHB) 2014 Fall Construction Forecast Webinar.

The economists also said that renter growth will keep the multifamily market at cruising altitude or higher.

"Single-family builders are feeling good. They are not overly confident, but confident enough to keep moving forward," says NAHB Chief Economist David Crowe. He says the single-family sector will finish out the year much stronger than it began, and he set the stage for a robust 2015.

"This is mostly due to significant pent-up demand, and steady job and economic growth that will allow trade-up buyers who have delayed home purchases due to job insecurity to enter the marketplace," say Crowe.

New-housing forecast

NAHB forecasts 991,000 total housing starts in 2014, an increase of 6.6 percent from 930,000 units last year.

Single-family production is expected to rise 2.5 percent this year to 637,000 units, increase an additional 26 percent next year to 802,000 and reach 1.1 million in 2016.

The economists used the 2000-2003 period as a benchmark for "normal housing activity," and, in comparison, single-family starts in the third quarter of this year are 48 percent of normal. However, NAHB predicts that they'll rise to 90 percent of normal by the fourth quarter of next year.

Multifamily starts, which Crowe says are currently at a normal level of production, are projected to increase 15 percent by the end of this year and hold steady in 2015.

Meanwhile, the NAHB Remodeling Market Index matched its all-time high of 57 in the third quarter of 2014, and it's been above 50 for six consecutive quarters. A reading above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it's lower.

Housing to soon be undersupplied?

Taking an even more bullish outlook, Mark Zandi, chief economist at Moody's Analytics, said that prospects are good for continued gains in overall economic and housing activity.

"The reason is that job growth is quite strong," says Zandi. "Currently, we're creating about 225,000 jobs per month, or 2.75 million per year. That is double the pace necessary to reduce unemployment and under employment, which augers very, very well for housing demand and the housing market more broadly."

With the current supply of housing running just over 1 million units on annualized basis, Zandi said that this figure is well below what's needed for the longer run.

In the aftermath of the Great Recession, new household formations were depressed as the number of Millennials living with their parents or doubling or tripling up in apartments soared to about 3 to 4 million above normal, according to Zandi. As the economy continues to improve and these 18-to-34 year-olds begin to form their own households, it will boost overall demand for new housing construction.

"In a normal year, there should be demand for 1.7 million units," Zandi says.

Taking this one step further, Zandi said that increasing the housing stock by 700,000 units to meet this unmet demand would create 2.1 million jobs, which "would reduce unemployment by 1.5 percentage points."

By the end of 2017, Zandi expects mortgage rates to rise from their current rate of about 4 percent back to their "equilibrium" of 6 percent, which he noted would be very consistent with a solid job market and solid housing market. "The housing market will be fine because of better employment, higher wages and solid economic growth, which will trump the effect of higher mortgage rates," he says.

Zandi predicts that single-family starts could close in on 1 million units by the end of 2015, and multifamily production could go as high as 500,000 units.

Housing and jobs go hand-in-hand

Delving beneath the national numbers, Robert Denk, NAHB's assistant vice president for forecasting and analysis, noted the housing recovery will vary by state and region.

"We're getting back to the point where economic conditions are dictating the strength of local housing markets," says Denk. "It's very clear that those states with higher levels of payroll employment or labor market recovery are associated with healthier housing markets."

Average 30-year loan rate up, but still under 4%

WASHINGTON (AP) – Oct. 31, 2014 – Average U.S. long-term mortgage rates arrested their five-week decline this week, but the benchmark 30-year loan remained below 4 percent.

Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year mortgage rose to 3.98 percent from 3.92 percent last week. It remained at its lowest level since June 2013. The rate stood at 4.53 percent back in January.

The average for a 15-year mortgage, a popular choice for people who are refinancing, increased to 3.13 percent from 3.08 percent.

The sustained decline in long-term rates sparked a boomlet of homeowners looking to refinance mortgages. Homeowners eager for a bargain rate fired off inquiries to lenders. Applications for "re-fi's" jumped 23 percent in the week ended Oct. 17 – reaching their highest level since November 2013, according to the Mortgage Bankers Association.

But refinance applications fell 7 percent in the latest week, ended Oct. 24.

In recent weeks concern over global economic weaknesses brought market turmoil and sent investors seeking safety by pouring money into U.S. Treasurys. Higher demand drives up prices for those government bonds and causes their yields to drop. The yield on the 10-year Treasury note touched new lows. Mortgage rates often follow the yield in the 10-year note.

This week, the 10-year note rose to 2.32 percent Wednesday from 2.22 percent the previous week. The note traded at 2.29 percent Thursday morning.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged from last week at 0.5 point. The fee for a 15-year mortgage also remained at 0.5 point.

The average rate on a five-year adjustable-rate mortgage rose to 2.94 percent from 2.91 percent. The fee was steady at 0.5 point.

For a one-year ARM, the average rate edged up to 2.43 percent from 2.41 percent. The fee held at 0.4 point.

Celebrity Real Estate: Dolphins’ Brent Grimes Drops Price on Chic Georgia Home

Big, bold and filled with all things on a grand scale, professional athletes’ homes are the stuff of which dreams are made. Miami Dolphins cornerback Brent Grimes’ Atlanta-area house is no exception.

Sited on a half-acre lot on a lovely course, this five-bedroom, six-bathroom house in Duluth, GA, is decidedly swanky. At just about 7,800 square feet, it has enough space to house and entertain the entire roster of an NFL team.

And with its recent price reduction—it was just lowered by $145,000 to $1.25 million—the property is within reach for aspiring ballers.

Filled with gleaming hardwood floors and crowned with intricate architectural details, this house oozes elegance. There are cathedral ceilings, tray ceilings, dramatic crown moldings, catwalks, bead board, wainscoting and more—seemingly no detail has been overlooked or expense spared.

The newly remodeled kitchen is open, airy and jam-packed with stainless Viking appliances: restaurant-grade range hood, side-by-side fridge/freezer and six-burner gas range.

There’s a spacious center island perfect for dishing up party platters or for gathering the team for a cozy breakfast, with an expansive fireplace to make those breakfasts even cozier.

The master suite—cleverly and conveniently located on the main level of the house—has plenty of space to get ready, with his and hers closets, a morning bar and a spa bath.

Out back, beneath a spacious covered porch, there’s an expansive patio overlooking the home’s Pebble-tech pool and spa, as well as wide-open views of the golf course beyond.

If you know anyone who’s game, give listing agent Tracy Haskins a ring; she’ll do all she can to help you score with this property.

Brent Grimes, who roamed the defensive backfield for the Atlanta Falcons from 2006-2012, moved down to the Miami Dolphins in 2013 and is ready to bid adieu to this Georgia home. He is a two-time Pro Bowl performer (2010, 2013).

Celebrity Real Estate: Designer Alexander Julian Offers 30-Acre CT Estate

There are houses, and then there are houses.

This one falls solidly into the latter category.

Set on 30 densely wooded acres in Ridgefield, CT, the Alexander Julian Estate—named for the American clothing designer who owns the property—is a masterpiece of architecture in which no detail was overlooked.

Best known for his signature Colours label and his original design of the NBA’s Charlotte Hornets uniforms in 1988, the designer’s home is now listed for $8.5 million.

The hipped-roof Craftsman style home was inspired by the works of Frank Lloyd Wright and designed in 1992 by renowned architect John Marsh Davis.

Just an hour’s drive from Manhattan, the home—with its 10 bedrooms, seven full bathrooms and two half baths—is nothing short of extraordinary.

Filled with sumptuous wood finishes—a solid mahogany front door, mahogany balusters on the staircases and 11-foot mahogany French doors that flank the 42-foot by 13-foot dining room—the house is simply grand.

The living room has a six-foot Rumford fireplace—a tall and shallow fireplace that reflects more heat and warms rooms more efficiently—surrounded by massive mahogany moldings, along with floor-to-ceiling mahogany bookcases.

This is, clearly, the anchor of this stately mansion.

The kitchen, with its glass-front cabinets designed an extra 6 inches deep to accommodate the countertops and sinks, is outfitted with twin 36-inch Viking ranges and a SubZero freezer, as well as black Vermont slate countertops. There’s a dramatic plate rack that spans the length of the room and offers a homey feel quite unexpected in such an elegant home.

The master bedroom has a pine-paneled ceiling with mahogany beams, a separate dressing room and an en-suite bath with a luxurious steam shower and a charming claw-foot bathtub.

The grounds are rounded out with a 3,000-square-foot guesthouse, two ponds (stocked for fishing pleasure), a pool, tennis courts and a greenhouse.

Truly special, the home is presented by REALTOR® David B. Everson of William Raveis Real Estate.

In addition to his work for the original Charlotte NBA franchise, Alexander Julian also did uniform design work for the men’s basketball team at the University of North Carolina in Chapel Hill back in the early 1990s.

Furthermore, Julian was the costume designer for the 1992 Robert Altman film, “The Player,” and he won five Coty Awards before the honor was discontinued in the mid-1980s.

Q&A: Did the Fed’s $4 trillion experiment work?

NEW YORK (AP) – Oct. 30, 2014 – The $4 trillion experiment is over.

The Federal Reserve announced the end of its economic stimulus known as quantitative easing on Wednesday. Launched during the financial crisis in 2008, it was an unprecedented effort aimed at reviving a dormant economy through buying trillions in bonds. It also provoked a political backlash.

Q: Did the stimulus work?

A: It depends on who you ask. But many economists say the Fed accomplished the bulk of its goals. In the beginning, the Fed just wanted to stop the financial crisis from getting worse. It's impossible to know what would have happened without the Fed's help. But buying mortgage bonds, which many considered toxic at the time, arguably prevented more banks from failing and breathed life into frozen lending markets. The first round of quantitative easing was a rescue program. The second round, called QE2, was met with heated criticism.

Q: Why did people have such strong opinions about it?

A: Politicians, investors and even well-respected economists said pumping all that money into the banking system would cause the dollar to plummet and result in rampant inflation. They also feared bubbles in financial markets that would soon pop.

Q: What happened?

A: Since August 2010, when Fed Chairman Ben Bernanke argued for a second round of stimulus, the dollar has gained strength against major currencies and inflation has stayed tame. One widely used measure, the dollar index, has bounced around over recent years, but is currently 3 percent higher. Over the past year, overall prices have climbed a modest 1.7 percent.

Q: What has happened to the stock market since then?

A: If you made a bet on the stock market when Bernanke made his speech in the summer of 2010, your investment doubled. The most widely used benchmark for investment funds, the Standard & Poor's 500 index, has returned 101 percent since then, powered by a stronger economy, higher spending and record corporate profits.

Q: So now the Fed owns $4 trillion in bonds. Does it have to sell them?

A: No, they can sit on them. Some analysts wonder how the Fed will be able to unload its massive collection of bonds without disrupting markets. Very, very slowly, is the Fed's answer, and only if needed. One way is to stop re-investing money from bonds when they mature.

Q: What will the end of QE mean for markets?

A: Many investors expect more turbulence over the short term. In the bond market, the Fed's efforts have helped keep prices high and yields low. But there are plenty of other reasons besides the central bank's actions. Low long-term interest rates reflect sluggish economic growth, so slowdowns across the industrialized world mean government borrowing rates in Japan and Germany are even lower than U.S. rates. As a result, foreign banks and investors keep buying U.S. bonds – which has tugged rates lower and kept the yield on the benchmark 10-year Treasury note well below 3 percent for most of the year – the opposite of what market strategists expected.

Q: What about the stock market?

A: The big question for stock investors is: When will the Fed start hiking its benchmark lending rate? The move is expected to come at some point next year. Investors say more sharp swings in stocks are likely as that day draws closer. But there's general agreement on Wall Street that the central bank will increase rates slowly enough that it won't derail the U.S. economic recovery.

What do buyers want? And what do they fear?

CHICAGO – Oct. 30, 2014 – According to a survey conducted by Pollara for BMO Harris Bank, American homebuyers visit an average of 10 homes before making a purchase, and about half (51 percent) spend up to six months searching.

According to the study, half (52 percent) of today's current buyers believe they'll find their dream home in their price range, but 48 percent say it's impossible – and 71 percent will settle for something less than perfect.

Still, buyers believe in the American Dream: 77 percent of homebuyers say they'll know immediately if they've found their ideal house.

Feelings associated with home buying

Excited: 44 percent (47 percent of first-time buyers)

Hopeful: 33 percent (43 percent of first-time buyers)

Cautious: 32 percent (26 percent of first-time buyers)

Optimistic: 28 percent (26 percent of first-time buyers)

Happy: 26 percent (37 percent of first-time buyers)

Anxious: 25 percent (31 percent of first-time buyers)

While overall stress levels are moderate, American buyers still have some concerns. Their biggest worry is that they'll find something wrong with the house after they move in (79 percent); and 69 percent worry that housing prices will drop after the purchase, and 61 percent fear the possibility of not being able to afford their mortgage.

"In the third quarter of this year, mortgage lending standards were being relaxed more prolifically than at any other point since the Federal Reserve's new survey began in 2007," says Michael Gregory, Head U.S. Economics, BMO Capital Markets.

"Meanwhile, 30-year fixed mortgage rates have dipped back below the 4 percent level in recent weeks, for the first time since the spring of 2013," Gregory adds. "Both of these developments point to a pickup in housing market activity, in terms of turnover and homes – yes, even 'dream homes'– available for sale."

Among first-time homebuyers, only 13 percent are currently pre-approved for a mortgage; however, 83 percent plan to go through the process before they purchase a home.

Florida ranked No. 5 for best ‘business tax climate’

WASHINGTON – Oct. 30, 2014 – The Tax Foundation says 45 U.S. states are worse for business than Fla. in a comparison of tax climates, while only four states are considered more competitive.

To create a state ranking, the Tax Foundation looks at five individual tax components. In one of those, individual income taxes, Florida logs the No. 1 spot as best in the nation.

Other Florida category rankings include corporate taxes (No. 14 in a state comparison), sales taxes (No. 12), unemployment insurance taxes (No. 3) and property taxes (No. 16).

The 10 most competitive states are: Wyoming (No. 1), South Dakota (No. 2), Nevada (No. 3), Alaska (No. 4), Florida (No. 5), Montana (No. 6), New Hampshire (No. 7), Indiana (No. 8), Utah (No. 9) and Texas (No. 10).

On the flipside, the 10 least competitive states are: New Jersey (No. 50), New York (No. 49), California (No. 48), Minnesota (No. 47), Vermont (No. 46), Rhode Island (No. 45), Ohio (No. 44), Wisconsin (No. 43), Connecticut (No. 42) and Iowa (No. 41).

The Tax Foundation report measures each state's code by analyzing over 100 tax variables in five different categories: corporate, individual income, sales, property and unemployment insurance taxes.

States are punished for overly complex, burdensome and economically harmful tax codes, but rewarded for transparent and neutral tax codes that do not distort business decisions. A state's ranking can rise or fall significantly based not just on its own actions, but on the changes or reforms made by other states.

The biggest change in this year's report occurred in North Carolina, which jumped from 44th to 16th place due to a fundamental overhaul of the state's tax code.

"The federal government is gridlocked, but state policymakers on both sides of the aisle are enacting truly fundamental reforms," says Tax Foundation Economist and Manager of State Projects Scott Drenkard. "States are doing their part and it's time that Washington steps up."

The Tax Foundation's full state-by-state report, the 2015 State Business Tax Climate Index, is available online.

© 2014 Florida Realtors®

Economy 101: 5 things to know about U.S. growth

WASHINGTON (AP) – Oct. 29, 2014 – Is the U.S. economy accelerating – finally? If it is, which sorts of Americans stand to benefit most? And why is it doing better than other major economies?

Such are the questions surrounding a report coming Thursday on economic expansion in the July-September quarter. It's likely to be the fourth quarter in the past five in which annual growth reached at least 3 percent – a level that would be the envy of most other big economies.

Some questions and answers to consider:

Is the U.S. strength for real?

Probably so. Thanks to robust job gains, most analysts think the economy is finally emerging from five-plus years of stop-and-start expansion. They foresee growth at a healthy 3 percent annual rate from now through 2015. If so, next year would be the first full year of 3 percent growth since 2005 – two years before the Great Recession began.

Keep in mind, though: Nothing is certain. Economists made similar predictions for 2014, only to see a brutal winter and a plunge in exports cause the economy to shrink at a 2.1 percent annual pace from January through March. Growth did roar back in the April-June quarter. Still, for the first half of 2014, it was just 1.2 percent.

Why is the U.S. outpacing others?

Europe is on the brink of its third recession in seven years. Japan is faltering. Persistent weakness is slowing China, Brazil and other major economies.

Even as the United States enjoyed a second-quarter burst of growth – a vigorous 4.6 percent annual rate – the 18 nations that use the euro didn't grow at all. And Japan's economy, squeezed by a sharp sales tax increase, shrank 7.1 percent.

In China, the world's second-largest economy, year-over-year growth slowed from 7.5 percent in the second quarter to 7.3 percent in the third. That's still robust. But to keep things in perspective, growth in China had topped 10 percent for three decades.

Brazil's economy has been gasping after years of solid growth, partly because of slumping commodity prices.

The U.S. economy is benefiting from a range of factors. The Federal Reserve acted more aggressively to stimulate growth than central banks in other countries did. The nation has significantly strengthened its financial system. The economy is relatively insulated from weakness overseas because it depends much less on exports than most other countries do.

Is U.S. growth historically impressive?

The U.S. economy may look sizzling next to many other countries. But compared with its own history? Not so much. Though the recovery has proved durable into its sixth year, expansion has been the weakest of any post-World War II rebound of similar length.

Growth has averaged just 2.2 percent annually since the recession ended in 2009. Compare that with an average 3 percent annual growth rate in the five years after the 2000-01 recession, 5 percent after the steep 1981-82 downturn and 6.3 percent after the 1961 recession.

Who's really benefiting?

Healthy growth doesn't necessarily serve everyone. For a typical U.S. household, income has fallen 2.9 percent to $54,045 in the five years since the recession ended in June 2009, according to Sentier Research.

That's partly because little of the economy's output is actually going to workers. Pay equaled just 42 percent of GDP in 2011, a record low. It's recovered only slightly since then.

Much of the economy's growth is instead being captured as corporate profits, which reached an all-time high of 12.6 percent in 2011. Profits have barely dipped since then. As those profits have strengthened, so has the stock market, which disproportionately benefits affluent Americans.

So what's driving growth?

An unusual aspect of this recovery is that there's been no consistent driver of growth. At times, consumer spending has jumped. At other times, businesses have briefly ramped up spending on machinery, computers and software. In other cases, healthy exports or a burst of home building spurred growth.

That's different from most recoveries, which are usually driven by housing, says John Silvia, chief economist at Wells Fargo. When the Federal Reserve cuts interest rates to spur growth, the resulting drop in mortgage rates usually boosts home sales and construction. Yet the Great Recession resulted from a housing bubble that peaked in 2006.

So once the recession ended, there was little pent-up demand for homes. And since job gains and wage growth have been historically weak, it's been harder for potential buyers to afford a home.

"Housing never really kicked in," Silvia said. "It's a very different ball game."

Home prices rise, but at a nice, ‘boring’ pace

NEW YORK – Oct. 29, 2014 – Home prices continued to rise more slowly in August, turning in their smallest year-over-year gains in nearly two years, a closely followed report out Tuesday shows.

The Standard & Poor's/Case-Shiller 20-City Index of home prices rose 5.6 percent from August 2013, S&P said.

That's down from a 6.7 percent gain in July and well below the double-digit annual increases seen in most of 2013 and earlier this year.

The broader S&P/Case-Shiller National Home Price Index also slowed in August, posting a 5.1 percent annual gain compared with 5.6 percent in July.

Slower rising home prices bode well for the housing market's continuing recovery nearly seven years after the market's historic collapse, economists say.

Greg Bird, an economist with Moody's Analytics, points to the smaller decline in the national price index than the 20-city index. Price appreciation is slowing most in big cities where gains were sharpest in recent years due to investor demand for foreclosures and distressed properties, Bird says. But prices have been rising slowly all along in markets that didn't see such feverish investor buying.

Increasing household formation and restrained home building is a recipe for prices to climb, but gains are likely to be modest over the next couple of years, Bird says.

Stan Humphries, chief economist of the real estate website Zillow, says the recovery is shifting to a more slow and steady course.

"In housing, boring is better," he says. "As appreciation cools and more inventory comes on line, buyers will start to gain a more competitive advantage, after years of sellers being in the driver's seat. More sedate home value growth, coupled with interest rates that remain incredibly low, will also help housing stay affordable, which is critical to drawing in the next generation of younger, first-time buyers that had been sitting on the sidelines."

The Case-Shiller report shows annual gains fell in 19 of the index's 20 cities in August, with Cleveland being the lone exception. The slowdown was greatest in Las Vegas, where the year-over-year return fell from 12.8 percent in July to 10.1 percent in August.

Miami, which had a 10.5 percent annual gain, took the lead away from Las Vegas as the city with the sharpest annual gain. In San Francisco, average prices rose 9 percent in August – the first month since November 2012 when the annual increase was measured in single digits.

Copyright © 2014 USA TODAY, Doug Carroll

U.S. consumer confidence surges 5 points in Oct.

NEW YORK – Oct. 28, 2014 – The Conference Board Consumer Confidence Index rebounded in October after a slight decrease last month. The Index now stands at 94.5, up from 89.0 in September.

The Present Situation Index that gauges consumers' attitudes about current conditions edged up slightly from 93.0 to 93.7, while the Expectations Index, which gauges attitudes about the economy six months from now, surged to 95.0 from 86.4 in September.

"A more favorable assessment of the current job market and business conditions contributed to the improvement in consumers' view of the present situation," says Lynn Franco, director of economic indicators at The Conference Board.

"Looking ahead, consumers have regained confidence in the short-term outlook for the economy and labor market, and are more optimistic about their future earnings potential," Franco adds.

Consumers' appraisal of current conditions

The view of current business conditions was mixed; while the proportion saying conditions are "good" inched up from 24.2 percent to 24.5 percent, those claiming business conditions are "bad" also increased slightly from 21.2 percent to 21.7 percent.

Consumers' assessment of the job market improved moderately, with the proportion stating jobs are "plentiful" rising marginally from 16.3 percent to 16.5 percent, as those claiming jobs are "hard to get" declined slightly from 29.4 percent to 29.1 percent.

Consumers' appraisal of future conditions

The percentage of consumers who expect business conditions to improve over the next six months increased from 19.0 percent to 19.6 percent, while those expecting business conditions to worsen fell from 11.4 percent to 9.3 percent.

Consumers' outlook for the labor market improved markedly. Those anticipating more jobs in the months ahead increased to 16.8 percent from 16.0 percent, while those anticipating fewer jobs fell from 16.9 percent to 13.9 percent.

The proportion of consumers expecting growth in their incomes rose from 16.9 percent in September to 17.7 percent in October, while the proportion expecting a drop in income fell from 13.4 percent to 11.6 percent.

Nielsen conducts the monthly Consumer Confidence Survey for The Conference Board. The cutoff date for the preliminary results was October 16.

Former MLB Hurler Kelvim Escobar Drops Price on Florida Mansion

Before his career was sadly derailed by shoulder troubles in 2008, right-handed pitcher Kelvim Escobar racked up over 100 wins in his major league career.

Over the past few months, the former hurler has been trying to offload his Florida pad with no takers. Now in a save situation, the home’s price was reduced again a couple of weeks ago to $3.85 million.

Escobar spent the bulk of his time in the big leagues bouncing between the bullpen and the starting rotation during his 12 years with the Toronto Blue Jays and the Los Angeles Angels. In a similar fashion, property records indicate his Surfside, FL, home has been bounced on a few different price points over the past six months.

Listed in early April for $5.25 million, the waterfront pad hit every branch on the pricing tree: It went from $4.75 million, to $4.5 million, to $4.2 million, to $4 million before landing on its current price tag.

The listing indicates the home is in need of some TLC, which may explain its pricing problems. The spacious two-level home offers just over 6,000 square feet of interior space with six bedrooms and five bathrooms.

And although the home itself may require some fixes, the location is what will tip a buyer into making a move. Backing right up to Biscayne Bay, the home comes fully equipped with a boat dock for any aspiring captains.

On the flip side, the home is just about a mile west of the Atlantic Ocean and Surfside beach. Miami‘s hopping South Beach neighborhood beckons from just a few blocks away.

After enjoying his best season with the Angels in 2007, Escobar faced a shoulder injury that limited him to only one appearance in the majors in 2009. He pitched in over 400 games and finished his career with a 4.15 ERA.

Escobar likely is enjoying his retirement and rooting for his cousin Alcides Escobar, currently playing shortstop in the World Series for the American League champion Kansas City Royals.

Retired MLB Pitcher Graeme Lloyd Offers Gulf Home in Florida

Azure skies, gentle breezes, magical sunsets, and sweeping gulf-front views: These lovely elements meld together at Graeme Lloyd’s custom waterfront estate in Palm Harbor, FL.

And as luck would have it, the retired Major League Baseball reliever is selling this tropical paradise for $1.5 million.

With four bedrooms and five bathrooms, the 3,100-square-foot home is a dream. It’s got a graceful circular drive offset by mature palms and crisp landscaping trimmed to the most meticulous detail. There are gorgeous stone facades as well as arches and gables that add terrific architectural flair.

Beyond the glass entryway, there are high ceilings with stately crown molding and gleaming cherry hardwoods that extend throughout the home.

The master suite has access to a large, wrap-around deck with endless views of the Gulf of Mexico and its colorful sunsets—not to mention a spa bath with a sunken tub from which you can look out across the water and gaze off into another world.

The kitchen is an entertainer’s playground, with top-of-the-line stainless appliances and a large granite-topped center island with its own gas range—all set amongst custom cherry cabinetry and artisan tile flooring.

Downstairs, there’s a billiards table, a bar, and access to the home’s outdoor oasis. With an expansive, paver stone patio, glittering pool and spa, a private dock with two boat lifts, an outdoor shower and a massive deck, it’s an area you might never want to leave.

Australian Graeme Lloyd spent his 10-year MLB career with seven teams, most notably the New York Yankees from 1996-98. He won two World Series championships with the Bronx Bombers as a left-handed relief specialist in the bullpen.

Lloyd’s final 16 games in the major leagues were with the Kansas City Royals in 2003, so we know he will be watching his former club tonight as they play Game Three of the World Series in San Francisco against the Giants.

Interested in his home? Give Maryann Carroll a buzz at Homeward Real Estate. She’s done a fine job presenting the house, and we’re betting she’d do a great job helping you, too.

NBA’s Tayshaun Prince Purchases Florida Waterfront Pad

Memphis Grizzlies forward Tayshaun Prince is ready to tip off his 14th season in the NBA, but it looks like he has his gaze fixed on a place to settle down once his playing days are done.

The lanky, long-limbed Prince recently jumped on on a luxury spread in North Palm Beach, FL, and scored the place for a cool $3.1 million.

The mammoth Mediterranean mansion offers 5,358 square feet of living space with four bedrooms and five bathrooms. The two-story home comes with requisite huge family room, living room and formal dining room.

Located in the gated waterfront community of Harbour Isles, the home also provides plenty of diversion for off-season down time.

The home backs up to a canal with an 80-foot deep water dock that will allow the NBA star to park a really big boat. From the backyard, it’s just a short jaunt out to the Intercoastal Waterway and the blue waters surrounding the ritzy enclave of Palm Beach.

Across the canal lies the North Palm Beach Country Club complete with a Jack Nicklaus-designed golf course.

The home also offers a large patio area out back with ample space for entertaining and grilling, an infinity pool and picturesque views of the waterway. With palm trees swaying in the breeze and boats puttering by, the home offers the prototypical Florida outdoor feeling.

With a NBA championship on his record with the Detroit Pistons in 2004, Tayshaun Prince now is entering the final year of his current contract and embarking on his second full season with the up-and-coming Grizzlies. We’re not sure if he’s eyeing Orlando or Miami as possible destinations to wind down his career, but he’s surely planting some real roots in the Florida sun.

Fannie Mae expects stronger homes sales in 2015

WASHINGTON – Oct. 27, 2014 – Real economic growth in the U.S. appears ready to exceed 3.0 percent for the second half of the year, providing a sound basis for growth in 2015, according to mortgage giant Fannie Mae's Economic & Strategic Research (ESR) Group.

According to Fannie Mae, momentum in the private sector expanded in the first part of this year as the government pulled back intervention programs and investors started to feel more secure about the economy.

However, Fannie says there are some factors currently slowing growth on a global scale, and that may discourage the Federal Reserve Board from making any changes in interest rate policy until the third quarter of 2015. Still, it says the global economic slowdown has had little negative impact on the fundamentals of the U.S. economy so far.

"Given the expected strengthening economic activity in the U.S. in the second half of the year, we continue to expect to finish just above 2 percent growth for all of 2014," says Fannie Mae Chief Economist Doug Duncan. "The risks are tilted to the downside due to current geopolitical events in Russia, Ukraine, Hong Kong and the Middle East, as well as the economic slowdown in the Eurozone, China, and Japan. However, recent data suggest these factors have not significantly swayed American consumers."

According to Duncan, "Real consumer spending is poised to pick up in the second half of 2014 from the first half, due in large part to improving labor market conditions, continued declines in gasoline prices and a subdued pace of inflation."

Housing market

"From a housing perspective, we anticipate that overall home sales will be weaker in 2014 than in 2013," Duncan says. "For 2015, we expect only a moderate pickup in total home sales but enough to post the best performance since 2007."

Duncan says Fannie Mae is "cautiously optimistic that ongoing labor market improvements, low mortgage rates, rising inventories and some easing of lending standards will boost home sales by roughly 5.0 percent" in 2015. He still sees the housing recovery as an "upward grind" rather than a predicting a "breakout year."

© 2014 Florida Realtors®

4 Metros Singled Out as 'Overheated'

Is Texas getting too hot?

Two metro areas in Texas, Austin and Houston, topped CoreLogic's list of markets that are seeing skyrocketing appreciation. The oil and gas boom there, along with rapid job and population growth, has pushed home prices above historical sustainable levels, according to CoreLogic.

Home prices in Austin are 22.8 percent above their historical peak levels, and in Houston, prices have broken that barrier by 16.2 percent.

Two other housing markets also at risk of being overvalued are Miami and Washington, D.C., which both saw prices rises significantly in 2013, making homes less affordable and future rises less sustainable, CoreLogic notes. However, those two markets remain down from their peak levels: Miami is still 30 percent below its historical peak level while D.C. is 13.1 percent below, according to CoreLogic.

Austin, Houston, Miami, and D.C. were the only four metros singled out as at risk of being overvalued in CoreLogic's list of the top 50 markets nationwide. Despite national home-price gains of 11 percent last year and 6.5 percent this year, the majority of housing markets overall are still in recovery mode. Most markets will likely continue to lag their long-term sustainable level through 2016, CoreLogic notes.

Source: “Find out Which Four Housing Markets CoreLogic Says Are Overvalued,” HousingWire (Oct. 20, 2014)

Feds consider money-saving Fannie, Freddie change

WASHINGTON – Oct. 16, 2014 – A change in policy for Fannie Mae and Freddie Mac could save taxpayers a lot of money. The Federal Housing Finance Agency (FHFA) is currently seeking comments on the proposal.

The proposal: Make the mortgage security documents issued by Fannie Mae and Freddie Mac – the paperwork that gives the lender legal rights to a property if a borrower fails to pay – the same.

In practice, the change would be a large, multi-year task.

In a letter to FHFA backing the change, Financial Services Roundtable President John Dalton said: "A single security would benefit the housing finance market, consumers, investors and taxpayers. A single security would minimize, if not eliminate, some of the pricing inefficiencies in the market and save taxpayers hundreds of millions of dollars per year, which Freddie Mac currently pays to originators in order to maintain market share."

The Roundtable recommended that FHFA move quickly because it would "help the process of easing new entrants into the market."

The Roundtable's letter also stressed a gradual transition period to "ensure that the transition to a single security is conducted properly and does not disrupt the market for agency mortgage backed securities."

Small lenders bend more for risky borrowers

NEW YORK – Oct. 16, 2014 – Borrowers with minor imperfections on their credit applications – like a brief loss of employment or a temporary dip in their credit score – are starting to have better luck snagging a loan with smaller lenders, Bloomberg reports.

At least 15 smaller firms this year are offering slightly riskier mortgages, which in some cases come with higher interest rates, larger downpayment requirements and aren't backed by the government.

"Some lenders became afraid of their own shadows," RPM Mortgage Inc. Chief Executive Officer Rob Hirt told Bloomberg. The bank started a program this summer for borrowers who have higher debt burdens or who had sold a home for less than the outstanding mortgage. "The market is beginning to realize that if you make smart and sound loans to people who don't fit in the narrow box, it doesn't make them a worse risk."

On the other hand, larger banks, like Bank of America and JPMorgan Chase & Co., have generally tightened their credit standards over the last few years. The average score on mortgages that government-controlled Fannie Mae and Freddie Mac bought now stands at about 740 – well above the 660 level considered subprime.

Some big banks are reluctant to ease credit standards, concerned that Fannie, Freddie and the FHA will force them to buy back bad loans with underwriting errors – and the banks don't want to take on risk for loans that government programs won't insure. The lending giants from 2006 through 2012 faced more than $200 billion in losses from home loans, according to Moody's Analytics data.

But where big banks are stepping back, small banks are stepping in.

For example, Shellpoint Partners LLC's New Penn unit began offering mortgages this summer for homebuyers with debt-to-income ratios up to 55 percent, and interest-only loans when borrowers have "high disposable income" or "high income potential due to their line of work."

Lone Star Funds' Caliber Home Loans Inc. also debuted new programs that offer flexibility for foreign nationals and on condo purchases of without approval for government programs.

TD Bank's Right Step program allows borrowers to put 3 percent down and not pay mortgage insurance if they have credit scores of 660 or above.

Banc of California is providing loans to borrowers who have a foreclosure or late payments on their records, as long as they can make a downpayment of at least 20 percent and show other strong assets in their finances.

"To us, it's common sense," says Jeff Seabold, chief lending officer at Banc of California. "There's quite a few people who are boxed out that shouldn't be."

Source: "You Don't Need to Be Perfect to Get a U.S. Loan Anymore," Bloomberg Businessweek (Oct. 13, 2014)

Marco Island: Planning Board eyes vacation rental unit regulation by city

One of the third rails of politics on Marco Island certainly has to be regulating vacation rental units on the island.

On one side sits Realtors who fear an onslaught of over-regulation.

On the other side sits homeowners who merely wish a little reprise from homes packed to the rafters with rowdy vacationers looking to enjoy some great times with family and friends on what has become a popular spot here in Southwest Florida.

Six years ago, a committee looked at the issue, but they fell short of their goal – what was eventually sent to council for consideration was moved to the famous circular file and never saw the light of day, never mind any serious discussion.

Recently, some of the same individuals who served on that original committee again were exchanging thoughts about how the issue should be handled.

The Marco Island Area Association of Realtors was represented by the team of Marv Neddles and Paul Tateo. They came forward to inform the board that their group was assembling a “task force” to look into the issue, but cautioned that they didn’t want to see an omnibus piece of legislation that would be harder to manage than the problem they are trying to address.

“We recognize there are issues out there,” said Neddles as he addressed the board. “We want to find something that works for everyone.”

The discussions also came back around to code enforcement.

“Why don’t we just enforce the ordinances we have on the books regarding noise, trash and parking,” said attorney Craig Woodward. “A new ordinance doesn’t mean we’ve resolved anything. Enforce the regulations we have before we go further down this road.”

“We are not interested in destroying the rental business or imposing unnecessary regulations, but we have a problem and we need to have it addressed,” said Planning Board Chairman Monte Lazarus halfway through the discussions.

Kelly Linman of Osprey Court cautioned the board to “identify the scope of the problem before we decide how big of a net to cast. I’m seeing a lot of things in the draft legislation that just doesn’t fit the issues.”

Several owners who have had rental units next to them or in their neighborhoods asked that the board take the issue seriously and hoped that they would move forward to provide them with some relief.

Crystal Shores timeshare

The SDP (site development plan) for the longawaited completion of that project at the intersection of Winterberry and South Collier Boulevard took a lot less time than did the examination under the microscope than the layout for the public beach access point did.

Question after question came as to the design and many of the minor accoutrements being planned for that walkway originally promised almost seven years ago. Details covered from whether or not to light the pathway, what trees or shrubs were to be planted, to the shower at the end of the boardwalk.

The developer and its representatives went into a painstaking effort to assure board members of the details.

The final development of the property would complete a plan for that site first approved several years ago, but was only partially completed due to the downturn in the economy.

Marriott site plan review

All seven members of the board received one of the largest packets of support documentation ever seen at a Planning Board meeting. The packet itself weighed almost 25 pounds and had reams of paperwork and construction plans for review.

However, it passed through the review process in record time, with a minimum of questions or discussions. The plans were so concise and detailed some in the audience seemed to miss two major points about the finalized presentation.

Gone are two major points of contention during the months of hearings and discussions prior to this review in both the board and by the city council. Gone are both the elevated tennis courts and the extra cooling tower on the east side of Collier Boulevard. Also reduced in size is one of the main ballrooms.

A look around the room found hardly an eyebrow raised or a question as to why. The SDP passed by a 7-0 margin with hardly any debate.

Written by

Steve Stefanides

Expect wave of single buyers to impact housing

WASHINGTON – Oct. 14, 2014 – Half of all American adults now live in one-person households – a rapidly growing number, according to the Bureau of Labor Statistics. The singles demographic is likely to reshape multifamily communities and single-family home designs going forward, according to Builder Online.

In 1976, only 37 percent of adults were single. As of August, that percentage has bloomed to 50.2 percent, or about 124.6 million singles. It marks the first time that single Americans make up the majority of the adult population since the government began tracking such data.

"Thanks to the growth of single-adult households, floor plans will go from static to flexible, as living arrangements change more frequently," says Susan Yashinsky, vice president of innovation trends for Mich.-based Sphere Trending. "Analysts project that this group of adults will job hop more often, bring new types of living arrangements into the housing market (think friends buying homes together), and expect their environments to adapt to their frequently changing lifestyles as easily as picking a favorite Keurig coffee flavor."

Affordability will be key, since single homebuyers will have less income per household than dual-earner couples.

Also, "housing developments will need to embed elements of community that address the social aspects singles need, similar to what we have seen in multifamily new builds," according to Builder Online. "Builders, developers and designers who create housing for single consumers need to consider fresh concepts, such as communal sheds for lawnmowers and snow blowers, and even cars that can be rented as needed versus owned. Work/live spaces will evolve to reflect the growing number of entrepreneurs working from home; and backyard cottages will bring solutions for related and/or unrelated adults sharing a single lot."

Source: "More Americans Are Going Solo," Builder Online (Oct. 6, 2014)

Canadian snowbirds encouraged to buy a Florida home

MONTREAL, Canada – Oct. 14, 2014 – As Canadian snowbirds prepare to head south, the Annual Snowbird outlook from BMO Bank of Montreal is telling Canadians that "U.S. housing affordability remains healthy, and prices are expected to increase in Florida, Arizona and other popular areas."

The bank offers only two warnings to Canadians considering a southern move: The border crossing rules are more strict, and a strengthening U.S. dollar could make purchases in Florida and elsewhere more expensive.

"Overall, U.S. house prices have soared 20 percent in the past two years, but are only about half way back to their peak in 2006," and "Traditional destinations for Canadian Snowbirds remain affordable," the bank says. "Compared to their peaks, prices in Tampa are down 34 percent, Phoenix down 30 percent, Las Vegas off 43 percent, and Miami down a whopping 52 percent."

"Now, with the American economy and employment gaining strength, home sales should gather some momentum," advises Sal Guatieri, senior economist, BMO Capital Markets. "We expect prices to rise over time alongside growing family incomes."

Guatieri also says BMO expects "capital gains appreciation for Canadians who purchase U.S. property."

Florida a hotspot

Florida continues to be a hotspot with Canadians representing the largest foreign buyers of Florida housing, BMO says. More than 500,000 Canadians currently own real estate in Florida.

"Florida properties are a bargain compared to real estate in Canada. The median priced home in Florida is nearly half that in Canada," says Jack Ablin, chief investment officer, BMO Harris Private Bank. "Popular areas include Sarasota-Bradenton-Venice, Orlando-Kissimmee, Miami-Ft. Lauderdale-Palm Beach, Cape Coral-Ft. Myers, Tampa-St. Petersburg and Naples-Marco Island.

"We project retirement state housing prices to outpace the national average, due to increasing numbers of retirees, and abundance of capital from abroad and lower interest rates. Foreign buyers are interested in U.S. real estate because it's relatively cheap when gauged against incomes, and it's situated in a stable/safe haven economy," added Mr. Ablin.

Could 15-year mortgage product change lending?

NEW YORK – Oct. 13, 2014 – Two mortgage executives hope to overhaul the 15-year mortgage, and make it more available to low and moderate-income people. They say it helps borrowers build equity at a much faster pace compared to a standard loan.

Edward Pinto, a resident fellow at the American Enterprise Institute, and Bruce Marks, who heads the Neighborhood Assistance Corp. of America (NACA), have created a new product called the Wealth Building Home Loan, which has generated buzz since its September introduction at a mortgage conference in North Carolina.

The loan will initially be available through NACA's 37 offices, with plans to pilot it at other institutions in the coming months. NACA acts as mortgage originator for Bank of America.

The Wealth Building Home Loan is a 15-year mortgage with a fixed interest rate that requires little or no downpayment and no additional fees. In originating the loans, underwriters pay more attention to a borrower's income than credit score. They ensure that borrowers have enough money left over after the mortgage payment to cover other monthly expenses, reducing the risk of foreclosure in case of financial setbacks.

Typically, the monthly payment on a 15-year loan is higher than a 30-year loan, since the loan amortizes faster. In order to make the monthly payments more affordable, however, the Wealth Building Home Loan offers a rate about three-quarters of a percentage point below the 30-year FHA rate.

Borrowers can bring the rate down even further by increasing the downpayment. For example, for every 1 percent of the loan amount the borrower has as a downpayment, the interest rate will be lowered by half a percentage point, with the possibility of bringing it to zero.

The Los Angeles Times cites an example: A $6,000 downpayment on a $100,000 mortgage at 3 percent would bring the rate to zero. That means all of the borrower's monthly payment would go toward the principal – not interest.

Pinto and Marks say the goal was to create a product that would allow low and moderate-income borrowers to build wealth, and get them away from high-risk loans.

"This is an opportunity to spend a little more each month but build wealth much more rapidly," Pinto says. "But even better, there is only a small probability of going into foreclosure. If house prices should go down, you're covered because you have some equity to fall back on."

Source: "Loan Gives Low-Income Borrowers a Chance to Build Equity Fast," The Los Angeles Times (Oct. 5, 2014)