What’s trending?

There’s a lot going on in the real estate market. So let’s take a look at what some of the top “trending topics” are, to use a popular Twitter expression.

Pending home sales

Last week it was reported that pending home sales increased 6.1% in May. Attributed to these figures were the increasing home inventories that are out there. It was the largest month-over-month increase for this forward-looking indicator since April 2010 when first-time buyers were motivated to sign purchase contracts before a tax credit program ended.

The Northeast and West led all four regions across the nation in increases in pending home sales. Sales contracts in the Northeast increased 8.8% month-over-month in May and are slightly above year-ago levels. Sales contracts increased 6.3% month-over-month in May and are 6.6% below May’s 2013 levels. Sales contracts increased 4.4% month-over-month in May and are almost 3% below year-ago levels.

Sales contracts in the West increased 7.6% month-over-month in May but are slightly over 11.1% below May 2013’s levels, according to the National Association of Realtors.

Cash buyers

Cash buyers are driving sales in many markets across the country as mortgage applications remain “soft.” In Greenwich, Realtors are seeing retirees down-sizing, fueling this trend.

Home prices

Home prices across the country, including distressed properties (which are short sales and foreclosures), increased 8.8% last month compared to what they were in May 2013. On a month-over-month basis, home prices across the county including distressed sales increased 1.4% in May as compared to April, according to Corelogic.

Trulia estimates that home prices nationally are 3% undervalued in the second quarter of 2014. According to Trulia, 76 of the 100 largest metros appear undervalued.

Home sales

Sales of newly constructed homes surged 18.6% in May to their highest level in six years, according to the U.S. Commerce Department. Sales of existing homes increased almost 5% seasonally adjusted, according to the National Association of Realtors.

Rental history

Rental payment histories may soon be factored into credit scores. Experian and TransUnion are reportedly starting to incorporate verified rental payment data into credit files and factoring into a person’s credit scores when they apply for a mortgage.

Some companies are starting to ensure renters get their timely rent payment histories included when applying for a mortgage. ECredable, a credit data company, plans on verifying renters’ payment histories that haven’t been reported to the major credit bureaus and then produce a credit report and score. This report can then be presented by those seeking a mortgage.

Routine credit payments for utilities, cell phones and TV services may also be factored into a person’s credit scores. The intention is for parties who timely pay for these services will have a better chance of getting a mortgage. The net is that consumers will be more motivated to pay all their bills on time in the future should they wish to obtain a loan.

 

Mary Ann Clark is a Realtor with Coldwell Banker at 177 West Putnam Avenue in Greenwich. Questions or comments may be emailed to [email protected] 

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