Adults who opt not to have kids cause ripple effects in US housing market

With a decrease in the number of people having children, smaller homes are gaining favor. Photo: Creighton A. Welch, STAFF / CWELCH@EXPRESS-NEWS.NET

Sara Moran’s closet in her Colonial house, built in 1920, once served as a nursery for a past homeowner. But Moran and her husband don’t need that nursery. They have no plans to extend beyond the confines of their two bedrooms and small yard in Stratford, Conn.

“Because we’re not going to have kids, I don’t really worry about having a big yard. Same with having more room,” she said. “We’re never going to have kids and ever feel like we’re going to be expanding.”


The fertility rate in the United States has fallen to its lowest levels since the Centers for Disease Control and Prevention began keeping records in 1909. The general fertility rate is the total number of births per 1,000 women age 15 to 44. According to provisional data, the rate last year was 62 births per 1,000 women.

The decrease in the number of people having children affects the real estate market and decisions.


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“Clearly, it’s not a one-year change,” said Lawrence Yun, chief economist at the National Association of Realtors. “It’s been occurring throughout the years here in the U.S. and many developed countries (with) smaller family size, delayed marriages, fewer kids, so all these trends, and how does this impact housing or could impact housing for the long haul.”

In 2015, just over 70 percent of households had no children living there, a growth of three percentage points over 2011, according to the U.S. Census Bureau’s American Housing Survey.

The numbers grow starker when filtered by age. Compared with four years earlier, the number of people 25 to 29 years old and 35 to 44 who didn’t have kids in their household grew by more than 5 percent. The number of 30- to 34-year-olds without children rose by 4 percent.

Those statistics for people age 25 to 44 outpace the 3 percent growth in childless households across all age groups.

Robert Dietz, chief economist at the National Association of Home Builders, said people generally look for 800 square feet of home per person in the household.

Moran said not many people want a two-bedroom house such as hers because they anticipate having children. But she and her husband, who bought their home in 2015, are content with their 1,200 square feet.

“Even our real estate agent said, ‘It’s going to be too small. You’re going to want to move,’ ” Moran said. “I kept saying, ‘Well, I’m not having children, so it doesn’t really matter.’ ”

About 90 percent of buyers with children younger than 18 at home bought a detached single-family house, according to the National Association of Realtors’ 2016 Profile of Home Buyers and Sellers. But for those without children at home, that number fell to 79 percent. Instead, more chose townhouses and condos.

Part of the reason for this trend, besides wanting less space, is people without children tend to prefer urban areas. Those desires go hand in hand.

“We’re seeing this trend in many metro markets, so clearly there is a consumer desire and preference for wanting to move closer to the city,” Yun said. “That’s generally associated also with smaller-sized homes because those big McMansions that are being built are typically out in the more distant suburbs where the land is plentiful.”

Buyers without children said their neighborhood choice was more influenced by convenience to friends, family, shopping and entertainment, according to the 2016 Profile of Home Buyers and Sellers.

This mirrors trends on the home building side. Builders have less land available to develop in desirable urban areas, leading to smaller yards and lot sizes, Dietz said.

But Dietz said many people still want a suburban feel, perhaps with townhouses.

Experts agreed that there is demand for medium-density, walkable neighborhoods closer to city centers – and for smaller homes.

Houston Association of Realtors: HAR’s temporary housing website responds to needs after Harvey


One of the basic necessities of life is shelter. With this in mind, the Houston Association of Realtors has launched a temporary housing section of its Texas real estate search site, HAR.com.

With the goal of helping as many people as possible who had their homes damaged or destroyed along the Texas Gulf Coast, the site will allow Realtors, property owners, landlords and property managers to post homes that they agree to make available on a temporary basis.

Some of the homes posted may be available for reduced rent or even free, depending on the owner.

If someone would like to post a home available for anywhere from one week to 12 weeks, they may visit www.har.com/temporaryhousing and input the requested contact and property information.

Once the process has been completed, the property will be posted on HAR.com and be searchable by those looking for temporary housing.

Since HAR.com displays properties for sale or lease across the state of Texas, this temporary housing service is available in any areas that were impacted by Hurricane Harvey.

The Realtor community has come together in support of those affected by the storm in a variety of ways.

HAR contributed $250,000 to the Texas Realtors Disaster Relief Fund, which is administered by the Texas Association of Realtors.

The San Antonio Board of Realtors contributed nearly $110,000 ($10 for every member) to the effort. The National Association of Realtors also contributed $1 million to the same fund. More than $1 million was dispersed in the first week following Hurricane Harvey, with a total of $2.6 million and counting contributed by individuals, associations and businesses.

While the fund has currently stopped accepting new applications for assistance due to the overwhelming response, it continues to accept donations to help as many people as possible. You may contribute by visiting TexasRealEstate.com and clicking on the red banner at the top of the page.

Many local and state associations and Multiple Listing Services have reached out to offer assistance to those in Texas who were affected.

HAR heard from associations in North Carolina, Virginia, Pennsylvania, Alabama, Nevada and many others.

The Florida Association of Realtors put together 25,000 shelter kits that included all the necessities like soap, deodorant, shampoo, toothpaste, toothbrush and more.

RealTracs, which is the MLS for Middle Tennessee, offered its own disaster relief fund to assist Realtors and their families in Texas.

Additionally, national real estate franchises, brokers and real estate-related corporations have contributed in aggregate millions of dollars, as well as their other resources to the Hurricane Harvey recovery effort.

Association Of Realtors Working To Spruce Up Part Of St. Joseph Trail

The Southwest Michigan Association of Realtors is making a difference in St. Joseph Township by paying for the creation of a new park. Association Executive Alan Jeffries tells WSJM News the group as received a $4,000 Grant from the National Association of Realtors as part of the Placemaking program. It’s designed to help local chapters make an impact.

“Anywhere we can find an area that could use some kind of money to make a park or a playground or a trail or something like that, then the national association of realtors has grants available for us to get from them in order to better these communities,” Jeffries said.

Specifically, the Southwest Michigan Association of Realtors is using its grant to install a small park along the Hickory Creek Nature Trail. It’ll be located near Cleveland Avenue and Hickory Creek. Jeffries tells us the park will include picnic tables, a grill, trash cans, and signage in an area that’s now gravel. The association is working with the township on the project.

Fix for Mortgage Giants Fannie Mae, Freddie Mac Returns to Back …

Mortgage-finance giants Fannie Mae and Freddie Mac, which have been under government control since the financial crisis, don’t appear to be getting a new life as quickly as some had hoped might happen under a Trump presidency.

Overhauling the two companies remains a back-burner issue for the Trump administration and Congress, crowded out by matters such as taxes, immigration and flood insurance. Moreover, prospects that the Senate…

Fannie Mae Prices $772.5 Million Multifamily DUS REMIC (FNA 2017-M11) Under Its GeMS Program

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Fannie Mae increases economic growth predictions for first time in 2017

After the Bureau of Economic Analysis increased the second quarter gross domestic product to 3%, Fannie Mae pushed up its full-year growth forecast for the first time in 2017.

The company increased its growth forecast to 2.2% for 2017, up from its previously forecasted 2%, according to the Fannie Mae Economic and Strategic Research Group’s September 2017 Economic and Housing Outlook.

“For the first time in 2017, we have increased our full-year growth outlook,” Fannie Mae Chief Economist Doug Duncan said. “The upgrade reflects economic activity gaining momentum at the end of the second quarter, though we see a great deal of uncertainty surrounding the forecast.”

“The list of uncertainties now extends beyond the geopolitical and legislative, as the effects of Hurricanes Harvey and Irma will require time to untangle,” Duncan said.

This increase is despite the rising economic uncertainty caused by Hurricane Harvey which hit South Texas and parts of Louisiana and Hurricane Irma, which swept through Florida. Geopolitical and trade uncertainties also pose downside risks to economic growth.

Goldman Sachs recently explained the hurricanes could have a significant downward pull on GDP, but that it would quickly bounce back from the drop.

And Fannie Mae cited similar data, saying while the storms may lead to near-term declines, economic activity will quickly rebound.

“Historically, natural disasters that hit heavily populated areas led to substantial near-term declines in economic activity but meaningful rebounds in subsequent quarters due to rebuilding efforts,” Duncan said. “Thus, economic growth in the second half of 2017 could still average a slightly stronger pace than the first half.”

The group explained the increase is due to greater strength in consumer spending and nonresidential investment in the second quarter as well as investment in business equipment.

Housing, however, saw a rough start to 2017 as existing and new homes sales reached year-to-date lows, and could only continue to decrease.

“Unfortunately, we continue to expect home sales to be flat during the second half of the year compared to the first half due to strong home price appreciation and lean inventories,” Duncan said.

But despite these weaknesses, Fannie expects the Federal Reserve will announce it will begin to taper its balance sheet at its September meeting. And while the ESR Group continues to predict a third rate hike in December, it explained there is a growing possibility the interest rate hike will have to hold off until next year.

Freddie Mac Tackling Senior Housing Needs

Senior, elderly,

The United States Census Bureau reported that in 2029, more than 20 percent of the total U.S. population will be over the age of 65—that’s why part of Freddie Mac’s mission is addressing the impending issue of senior housing.

The aging baby boomer population is going to cause a doubling of individuals between 65 and 74 by 2030—from 21.7 million in 2010 to 38.6 million, according to Harvard’s Joint Center for Housing Studies. This becomes a problem because seniors’ fixed-income and health care needs require affordable options and specialized facilities.

Freddie Mac focuses on rental as a way to help this aging population through independent living, assisted living, and memory care. The National Association of Home Builders reported that many home builders are also planning for the generation, designing homes with boomers in mind.

“As a person ages, there is a likelihood that use of a wheelchair might become a necessity,” the report said. “Designing a home that is livable now but can transition and be functional as the occupant ages is important in ensuring that the home will be a good long-term investment.”

Another issue is that boomer’s don’t want to move from their houses, furthering the inventory problem many metros are experiencing. MReport previously reported that 53 percent of U.S. owner occupied housing is currently taken up by individuals aged 55 and older, which is up from 43 percent since 2007. Millennials from 18 to 34 only make up 11 percent of the share. To put that in perspective, baby boomers inhabited almost double that amount when they were in the 18 to 34 bracket.

Freddie Mac said they are doing their part to increase the amount of senior living, financing more senior housing last year than they ever have.

“We are committed to helping accommodate the rising demand of this very important market—to ensure our nation’s seniors can age in comfort, dignity, and happiness.”

Freddie Mac to halt evictions, foreclosures in Harvey, Irma: impacted areas

(Reuters) – Freddie Mac (FMCC.PK) said on Wednesday it will suspend sales of foreclosed homes until year-end and will stop until further notice evictions of homeowners in eligible areas devastated by Hurricanes Harvey and Irma.

The U.S. mortgage finance agency said it is working with loan servicers to ensure that no property inspection costs resulting directly from Harvey or Irma are passed on to borrowers who were impacted.

“They may be able to put their mortgage payments on hold for up to one year if their mortgage is owned or guaranteed by Freddie Mac. The first step is for borrowers to contact their mortgage servicers — the companies they send their payments to each month,” Yvette Gilmore, Freddie Mac’s vice president of single-family servicer performance management, said in a statement.

Eligible areas for relief are counties or municipalities in Texas and Florida declared as disaster areas by the Federal Emergency Management Agency.

Reporting By Richard Leong; Editing by Meredith Mazzilli

Freddie Mac: Mortgage rates could begin to rise soon

Mortgage rates held steady this week, however they could be about to rise once again, according to the latest Primary Mortgage Market Survey from Freddie Mac.

“Following a sharp decline last week, the 10-year Treasury yield rose 11 basis points this week,” Freddie Mac Chief Economist Sean Becketti said. “The 30-year mortgage rate, however, remained unchanged at 3.78%.”

Click to Enlarge

(Source: Freddie Mac)

The 30-year fixed-rate mortgage held steady at 3.78% for the week ending September 14, 2017. This is up from last year’s 3.5%.

The 15-year FRM also remained unchanged from last week at 3.08%, but up from last year’s 2.77%.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage slipped slightly to 3.13%. This is down from last week’s 3.15% but up from 2.82% last year.

“Treasury yields continue to rise, mortgage rates could see an increase in next week’s survey,” Becketti said.

Flood insurance program set to expire Sept. 30

 

printed 09/15/2017

The National Association of Realtors issued the following news release alerting that the National Flood Insurance Program (NFIP) will soon expire. NFIP is now less than one month away from expiration, raising concerns that homeowners, consumers, and commercial property owners could soon find themselves either unprotected or unable to get a mortgage.

In July, the National Association of Realtors announced it had reached an agreement with the U.S. House Financial Services Committee on key legislation to reauthorize and reform the NFIP with important modifications to retain grandfathering and reduce rate increases. The move offered hope that reauthorization could win swift approval, but with less than a month left before the program expires, real estate professionals say time is running short.

NAR President William E. Brown, a second-generation Realtor from Alamo, California and founder of Investment Properties, believes that Congress needs to take swift action on a short-term extension of the program. That way, Congress can continue work on the 21st Century Flood Reform Act. Brown issued the following statement:

“The country has been here before, and we know what happens if the National Flood Insurance Program expires. Homebuying activity grinds to a halt, to the tune of 40,000 lost or interrupted sales every month. Meanwhile, existing homeowners as well as commercial entities may find their largest asset unprotected if the Federal Emergency Management Administration can’t renew NFIP policies that expire.

Consumers and homeowners alike deserve certainty. With Congress returning from August recess today, extending the NFIP to avoid a lapse should be a top priority.

Doing so will afford Congress the time necessary to finish work reforming and reauthorizing the program. The House Financial Services Committee has passed vital, long-term reauthorization legislation, which would strengthen the NFIP. These critical reforms are a long time coming, and we look forward to working with the House and Senate pass the 21st Century Flood Reform Act once the threat of a lapse has been addressed.”

Lauren Bunting is a licensed Associate Broker with

Bunting Realty, Inc. in Berlin.