Weak Demand for Home Ownership Feared
The percentage of U.S. homes that are vacant and for sale remained at elevated levels during the third quarter, and the percentage of people who own their homes continued to decline, according to a Census Department report. These are the starkest signs yet of the severity of the damage in the housing market caused by speculation, overbuilding and rising foreclosures.
The homeowner-vacancy rate, which measures the number of vacant homes for sale, rose to 2.7% — which translates into about 2.1 million houses — in the third quarter from 2.6% in the previous quarter. Such vacancies hit a high of 2.8% in the first quarter. Before 2006, the number hadn't risen above 2% since the government began keeping such records in 1965.
Economists say the rising supply of vacant homes means construction activity will likely have to fall further, while buyers slowly absorb these vacant homes, creating an even greater drag on prices and on economic growth. Housing starts fell 10% in September from August. In previous housing downturns of the early 1980s and early 1990s, annual starts fell below one million; in September, annual housing starts were at 1.19 million. But, according to some economists, further declines are likely if the vacant inventory continues to rise.
The latest decline in the homeownership rates indicates that this year, as many as 900,000 households moved from owning homes to renting them, which implies a very low level of housing demand over the next several years.
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If you have any questions about how to save money on your homeowner's insurance, leave your question below by clicking on the comment link. Your Email Address, although needed to send us your question, will NEVER be published here to protect your privacy.
Home Buyer Incentives? Doesn't Hurt to Ask
In a seller's market, a prospective home buyer needs to be a little more cautious when negotiating a purchase; however, in today's buyer's market, incentives are an accepted part of the deal. It certainly never hurts to ask for incentives, but be careful not to get carried away to the point of alienating the seller totally to the point they are willing to even negotiate.
It's not uncommon for a seller to wait for three months or longer to sell their home, especially during this time when the market is saturated with homes for sale. They need to make their home stand out amongst the rest, and often times, offering sales incentives is the easiest way to accomplish this.
When purchasing a new home from a builder, the incentives can be almost endless, and range from new appliances, landscaping, big screen TV's and even swimming pools.
This buyer's market won't be here forever. Right now, if you're a buyer, you've got an edge; be sure to take advantage of it.
Townhouse or Condo: Which is Better?
The confusion comes because a town house, which is simply a multi-story, attached residence, can be owned one of two ways — either with or without the lot. If the developer includes the town house's lot in the sale, ownership is "freehold" or "fee simple," just like most single-family detached homes. If the lot isn't included in the sale, the town-house development is considered either a condominium — where owners own everything up to party (or shared) walls individually, but share ownership of the land and common elements like pools and swimming pools with other neighbors — or a co-op, where individuals receive a fractional stake in buildings, land and common elements that are owned and controlled by an association.
Other factors, like finishes, location and demographics, muddy the comparison, too.
There are many factors that go in to determining which is better, a townhouse or condo, too numerous to cover them all here. But if you're considering one or the other and have questions you'd like answered, we'd be happy to answer them for you. Just use the comment link below and leave us your question. We'll get back to you with answers. Your privacy is protected, as email addresses are NEVER published here, although you need to enter one to comment. We look forward to hearing from you.
Home Builders See Worse Times Ahead
Home builders' confidence stayed at record low levels in a November as a slight uptick in buyer traffic was balanced out by a slightly more pessimistic view six months down the road.
The overall National Association of Home Builders index was 19, which was the same as the upwardly revised October reading.
The index measuring how builders view buyer traffic edged up to a reading of 17 from 15 in October. But the subindex measuring builders' view of the market six months from now slipped to a record low 25 from 26 a month ago.
Builders have widely reported offering incentives such as covering closing costs and extra features on a new home for free in order to spur demand.
If you are in the market for a home, would you think you'd get a better deal on a new home, or a resale right now? We'd love to hear your opinion. Just use the "comment link" below and tell us what you think.
