MReport September 2020

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M R EP O RT | 51 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST ORIGINATION Changing Expectations for Homebuyers The pandemic is placing new emphasis on what buyers expect and prioritize. W hile COVID-19 might have heightened the heart's affinity for the home, the pandemic has also placed new emphasis on what people expect of their residenc- es, according to Point2homes. Additional space and outdoor amenities are still highly in de- mand. Are homebuyers compro- mising on their housing wish lists amid continuing economic uncertainty? Last year's Point2homes analysis of the most popular keywords, features, and amenities showed that, regardless of the price tag, granite countertops, stainless steel appliances, and hardwood floors topped the list of desired features. Now, while those amenities maintain a special place in the hearts of home seekers, interest in them is taking a back seat to square footage and living space, floor plan design, and outdoor home features. That said, sweeping changes like those aren't made by all homebuy- ers. For many first-time and repeat buyers, for example, affordability is a higher priority. More cautious buyers in certain areas have an eye out for less expensive, smaller properties. Searches for homes under 1,000 square feet in cities such as Houston, Columbus, Charlotte, and Seattle have spiked, while interest in properties with at least three bedrooms and more bath- rooms also has increased. The work-from-home require- ments spawned by the pandemic could significantly reverberate throughout homebuying over the coming year, data from another recent industry survey suggests. A June poll of 2,000 potential shoppers who indicated plans to purchase a home in the next year, 63% of those currently working from home stated their potential purchase stemmed from their abil- ity to work remotely, while a home office was the most popular feature in the next residence of more than 20% of respondents who are buying due to remote work. A garage, quiet location, an updated kitchen, a large backyard, and an open floor plan followed in popularity. "The ability to work remotely is expanding home shoppers' geo- graphic options and driving their motivation to buy, even if it means a longer commute, at least in the short term," Senior Economist George Ratiu said. Although it's too early to tell what long-term impact the COVID-19- era of remote work will have on housing, it's clear that the pan- demic is shaping how people live and work under the same roof, he continued. House Prices Experience 'Strong Early Summer Gains' Recent home prices reflected re-opening of local economies. Forecasters predict continued growth. C asting aside trepidation generated by COVID-19, it seems a growing number of Ameri- cans are feeling positive about homeownership, as indicated by an upward trend in U.S. house prices, which rose 5.4% from the second quarter of last year to the same period in 2020, ac- cording to the Federal Housing Finance Agency (FHFA) House Price Index (HPI). In the second quarter of 2019, they spiked 0.8%. From May, FHFA's seasonally adjusted month- ly index for June ballooned 0.9%. House prices have escalated for 36 weeks in a row—dating back to September 2011 and have ticked up in all 50 states and the District of Columbia between the second quarters of 2019 and 2020. Idaho, at 10.8%, which has led the pack or the last seven quarters, topped the five areas in annual appreciation. It was followed by Arizona, 9.1%; Washington, 8.6%; Utah, 8.1 %; while News Mexico came in at 7.7%. On the other side of the coin, at 1.1.% each, West Virginia and North Dakota paced the areas with the lowest appreciation. District of Columbia, 1.4%; Illinois, 2.5%; and Alaska, 2.6%, held up the flank. Meantime, over the last four quarters, there was a hike in house prices in 99 of the top 100 U.S. largest metropolitan areas. Urban Honolulu, HI, where prices were up by 11.7%, commanded the list in annual process hikes. Conversely, in San Francisco-San Mateo-Redwood City, California, prices labored most significantly, spiraling by 0.3%. Among nine census divisions, with a 7.0% gain between the sec- ond quarters of last year and 2020 and a jump of 0.9% in the second quarter of 2020, the strongest fourth- quarter appreciation unfolded in the Mountain division. It's a familiar position for the division, a leading region for 11 weeks in a row. Middle Atlantic division, where price prices parachuted by 4.5% between the second quarters of 2019 and 2020, Dr. Lynn Fisher, Deputy Director of the Division of Research and Statistics at FHFA. "Although house prices fell slightly in May relative to April, in June prices rebounded by 0.9% over the month as local economies re-opened and transactions picked up again. Four Census Divisions showed strong early summer gains with month-over-month growth of one percent or more in June." Prices spiked 0.2% in April from the month before. A broader look showed that prices were up 5.3% from April 2019 to April 2020, while the previ- ously reported 0.1% hike for March 2020 remained unchanged. For the nine census divisions, seasonally adjusted monthly house price changes from March 2020 to April 2020 ranged from -0.5% in the South Atlantic to +0.8% in the West South-Central division. The annual changes all pointed up, from +5.0% in the Middle Atlantic division to +6.8% in the Mountain division. "U.S. house prices posted an- other positive monthly increase in April," Fisher noted. property preservation executive forum A Five Star Global Organization FOR MORE INFORMATION, CONTACT RACHEL WILLIAMS AT RACHEL.WILLIAMS@THEFIVESTAR.COM. positioned to influence Partner with the nation's leading organization in championing the cause of the mortgage field services industry. GENERAL CONTRACTORS ASPEN

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