Millennials are the largest living population in the United States, and have become a big player in the housing market. According to a Zillow group report, millennials made up 42 percent of home buyers in 2016 – more than any other generation.
Unsurprisingly, we are seeing mortgage companies vying for the millennial market. Recently, lenders started offering ‘reward points’ to attract the young generation. However, advisors would still recommend looking for the mortgage with the best rates and closing costs instead of basing a major financial decision on reward points.
It should be noted that some baby boomers have acquired higher mortgage debt through the years due to circumstances. A New York Times article, “They’re Growing Older. Their Mortgage Debt is Growing Deeper.”, touches on the issue that people with more mortgage debt tend to stay in the workforce longer than they may have originally planned. This also increases the possibility of more real estate inventory changeover in the coming years.
We all know that there are new scams and cyber threats daily, more systems and companies are being hacked into, and our personal data is potentially at risk. Some of us have even been the victims of credit card fraud and had our data stolen, just by using our credit cards for basic purchases. We know that the big banks are getting hit as well, and they are trying to battle this growing threat. Sadly, knowing that these security risks are so common can lead to these stories being white noise.
A recent article, ‘Public yawns at threat of cybercrime’, touches on this disconnect with what is becoming an everyday story. Part of the problem may lie in the fact that even with our data being taken or our credit cards being fraudulently used, the problem seems just a hassle to fix. Most of the times the problems can still be resolved with a few phone calls and possibly some fees, but not much else lost. We can forget that these types of things are happening to people at an alarming rate, and often we may not be as vigilant to protect ourselves as we should.
A major issue is that some may not realize how easily scams can happen when buying, selling or refinancing your home. A couple months ago, a woman was tricked into sending money to the wrong bank account. Prior to her closing, the victim received an email saying that as her last step before closing she needed to wire funds, and gave fraudulent bank account information. She thought it was an email from her title company, but it was cyber crooks posing as the company she was doing business with. Her wire of $25,000 that was supposed to go towards the purchase of a new house instead went to these criminals. “Basically everybody said that their hands are tied and it’s our battle because it’s our money,” the victim said. Around the country, similar stories and scams are becoming more prevalent in the real estate industry.
You will find there is a myriad of suggestions out there to protect yourself against different threats in different ways.
Be cautious of sharing your personal information, including what you post on social networks and online.
Beware of phishing emails, even when it looks like it is coming from a company you are doing business with. When in doubt, contact the company by phone (look up the phone number, don’t trust that the phone number in the email is the correct one).
Talk about these things with family, friends, and coworkers to promote others to learn how to protect themselves. Sharing a cybercrime story with a neighbor could be the eye-opener to save them from falling into a scam.
The best way to protect yourself is to continue to be vigilant and educate yourself.
Follow this link to see the April 2016 Housing Update for the Minneapolis/St. Paul area, from MAAR (Minneapolis Area Association of Realtors) – called ‘The Skinny.’ https://www.wmtitle.com/blog/
Summarized; our local market remains strong, with inventory levels low, good buying activity, housing prices increasing, and mortgage rates remaining @ 3.6% on average.
The salient points;
– The number of homes for sale are @ 15%-20% lower than one year ago (April 2016 to April 2015).
– Pending sales (homes that have sold, but not yet closed) have risen by 1.6%, for a total of 6,373 when comparing April 2016 with April 2015.
– Closed sales are up by 6.1% (for a total of 5,128) when comparing April 2016 with April 2015.
– The median sales price increased by 7.7%, to $231,500.
– Our market has 2.6 months of inventory/supply, which is down 27.8% from this same time (April), last year.
– The percentage of list price received at sale is up 1%, to 98% – this is phenomenal.
– Mortgage rates remain @ 3.6% – which is historically low. This is causing lenders to be slightly backlogged with files.
Generally speaking, the local housing market outlook is very good.
Link to ‘The Skinny’ video: https://youtu.be/7CEaZ9aPMS0
Interesting. We’re really in a seller’s market again. The news nationally is that the housing market is seeing some difficulty with low inventory. **Reminder; all real estate is local. Thus, local stats and analysis are necessary for our Minneapolis/St. Paul metro market.
Summarized, the analysis is; A) We have a very low inventory. We’re at just over 2 months of housing inventory. This means we’re in a seller’s market, and that there are more buyer’s than homes available. A balanced market (between buyer’s and seller’s, is defined as roughly 5-6 months of inventory/supply. B) This low inventory has slowed down the number of sales, thus overall sales transactions are down – YTD – by @ 20%. C) This low inventory, which creates the seller’s market with more buyer’s than homes available has caused housing prices to increase, by over 5% so far, YTD. Some prime areas in our local market have seen significantly larger increases in pricing, YTD. Again, supply and demand. D) I’ll add: I’m hearing from bother lenders and realtors, about lender’s appraisal issues again (coming in low – it’s been a couple/few years since the last outbreak of this plague: And I call it a plague this time, as I’m not terribly worried about the fundamentals of current home value increases – my only concern is for the mid and long term with respect to what an increase in interest rates above 5.5/6.0% will do).
The takeaway for Sellers, or people considering selling their home: Get your home on the market. The timing is optimal. The takeaway for Buyers: Be prepared to get into multiple offer scenarios. Be comfortable with this notion. Follow the lead of your Realtor in how best to navigate this process, and also when you’re reaching the upper limit on fair market value for your prospective home. Have your lender’s pre-approval letter ready, and don’t ‘sleep on it’ overnight, or over the weekend, if you think it’s the right home. Aggressively move on it right away. It will most likely be gone when you awake in the morning.