Here’s a look at recent news of interest to homebuyers, home sellers, and the home-curious.
INDEX SAYS THAT BUYING IS EVEN WITH RENTING IN SAN FRANCISCO
It is currently better to buy a U.S. home than it is to rent one, say the latest numbers from a real estate index. However, in the San Francisco metro area, where both home prices and rents are through the roof, neither option emerges as the clear favorite.
Produced by Florida Atlantic University’s College of Business, the September Beracha, Hardin & Johnson Buy vs. Rent Index ranks 23 major U.S. metropolitan areas based on whether it is a better financial option to purchase a property or rent one. The index evaluates housing markets on a scale of -1.0 to 1.0, with lower numbers indicating that buying is a better decision.
The company’s latest results put the nationwide buy-versus-rent ratio at -.216 as of the second quarter of 2015, putting the country “in clear buy territory.” San Francisco received a score of .005, which means that difference between monthly rent and mortgage payments have reached a point where statistics don’t favor either. Other cities where the gap between buying and renting appears to be negligible include Honolulu, Seattle, and Pittsburgh.
OFF-MARKET LISTINGS INCREASINGLY POPULAR IN SILICON VALLEY
With housing inventory tight across the U.S. and particularly here in the Bay Area, so-called “pocket listings” — those that never appear on an MLS — are gaining greater traction with home sellers.
Citing data from MLSListings, The Wall Street Journal reports that the five counties that make up Silicon Valley saw pocket listings increase from 13.6 percent in 2012 to 17 percent in the first half of 2014. The article notes that while keeping a property off the MLS can generate a quicker sale, it doesn’t always mean that the seller will get full market value.
Earlier in the summer, Pacific Union found that pocket listings accounted for nearly one-third of second-quarter transactions in the San Mateo County communities of Atherton, Menlo Park, Portola Valley, and Woodside. That’s one reason that MLS home sales in our Silicon Valley region declined by 11.5 percent between the second quarter of 2013 and the second quarter of 2015.
IS A TUDOR WORTH THREE TIMES AS MUCH AS A RANCH HOME?
Ranch homes are the most dominant architectural style in America, but the lucky few folks that own a Tudor could pull in a handsome price when the time comes to sell.
A RealtyTrac analysis of properties with a structural description found that 24.6 percent of U.S. single-family homes were ranch-style homes, with an average estimated value of $206,371. Conventional and split-level were the next two most prevalent architecture styles and together with ranch homes account for just over half of the study’s 25 million homes.
Gambrels, Garrisons, and Tudors are much rarer, collectively comprising just 0.3 percent of American homes. Of the 10 architecture styles included in RealtyTrac’s study, Tudors have the largest average estimated value: $601,590
MORTGAGE RATES BELOW 4 PERCENT FOR NINTH STRAIGHT WEEK
Mortgage rates fell last week following the Federal Reserve’s decision to delay interest-rate hikes, the ninth consecutive week they have been below 4 percent.
“Global growth concerns and lackluster inflation convinced the Fed to defer a hike in the Federal funds rate,” Freddie Mac Chief Economist Sean Becketti said in a statement accompanying the company’s mortgage-rate release for the week ended Sept. 24. “In response, the interest rate on 30-year fixed rate mortgages dropped by 5 basis points to 3.86 percent.”
Although many pundits expect the Fed to boost rates later this year, CNBC reports that the likelihood of that happening appears to be dwindling.
(Photo: Flickr/Nicu Buculei)