For more information
Call 1-800-351-0222

Flux in the U.S. Real Estate Market
  Term Paper ID:27888 		Get This Paper Free! or
Essay Subject:
Examines the conundrum that there is a so-called housing shortage while there are a large number of houses going unsold.... More...
6 Pages / 1350 Words
5 sources, 8 Citations, APA Format
$24.00

More Papers on This Topic


Paper Abstract:
Examines the conundrum that there is a so-called housing shortage while there are a large number of houses going unsold.

Paper Introduction:
The real estate market in the U.S. today is in flux and is much affected by the larger economic realities such as the recession, the possibility of a recovery, unemployment figures, and loan rates. Housing is seen as a problem, with a higher people today unable to buy a home than was true in the past. Many parents are faced with the fact that their children will not be able to afford to do anything but rent for the rest of their lives unless the housing situation is addressed and solutions are proposed. The housing situation is gauged in several ways, including average prices in different areas, new housing starts, and the number of units that change hands in a given period of time. The housing situation varies greatly from one region to another, with California being seen as having particular problems while many mid-Western areas have relatively fluid housing markets

Text of the Paper:
The entire text of the paper is shown below. However, the text is somewhat scrambled. We want to give you as much information as we possibly can about our papers and essays, but we cannot give them away for free. In the text below you will find that while disordered, many of the phrases are essentially intact. From this text you will be able to get a solid sense of the writing style, the concepts addressed, and the sources used in the research paper.


News & World Report, pp. Smith (1993) is more optimistic, seeing that at this time a fortunatecombination of factors may propel first-time buyers into the market at arecord rate, factors such as rock-bottom interest rates and a trough inhome prices joined with widespread optimism about the new administrationand a surge in consumer confidence. How to buy a house in California. In an economy whereunemployment is rising, this optimism seems not to be present. Home sales: Better but no boom. It is expected that prices willincrease a little faster than inflation over the next five or six years.Nothing in the economy at this time is pushing inflation up, and it isexpected that selling prices of existing homes will increase about 3percent on average this year. 14-15). The two must be matcheduntil the buyer understands the type of house sought and the price he orshe is able to pay for it. In the healthiest segment of the San Diegomarket, which is houses priced between $15 , and $2 , , hardbargaining and price cutting are common, and prices for more expensivehouses are even softer. For the higher-priced homes, however, there is less optimism. ReferencesRazzi, E. Berkeley, CA: Nolo Press.----------------------- 7 The housing situationvaries greatly from one region to another, with California being seen ashaving particular problems while many mid-Western areas have relativelyfluid housing markets today. The following are the mortgage rates in 1993: Average Monthly AverageMortgage type Rate now Payment A year ago3 -year fixed 7.63% $7 8 9.12%15-year fixed 7.17% $9 8 8.77%7-year balloon 6.62% $647 8.42%5-year balloon 6.25% $618 8.17%Two-step 6.82% $653 8.42%1-year adjustable 4.76% $523 6.23% In 1992, the following cities saw the sharpest rise in homeprices: 1992 price Change ('91-'92)Akron, OH $79,262 1 .8%Oklahoma City, OK $61,95 1 .1%Tacoma, WA $1 7,138 9.7%Portland, OR $97,275 9.4%Houston, TX $81, 12 8.9%Gary-Hammond, IN. Experts expect feesto run anywhere from a flat $15 to one-half percent of the loan amount,which on a $1 , mortgage would be $5 . (1989). There are isolatedhousing booms in different parts of the country (Razzi, 1993, p. The authors offer this advice: "Trust yourself,not experts" (p. Housing may appear to be more affordable because prices aredown, but buyers are staying away out of concern for the economy and theirfuture employment. The housing market across the country is beingaffected by such changes as the base closings instituted by Congress andthe Pentagon, and worry about the effects on the local economy are reducingbuyer interest in these areas for the most part. It is possible to adjust the way you pay for a house to make it moreaffordable, and this is determined in part by the size of the down paymentyou can make. (199 ). This makes housingmore affordable than it has been since 1974, according to an index compiledby the National Association of Realtors that measures how much income abuyer needs to buy the median-priced home at current mortgage rates. It remains to be seen whether this will happen. Home purchasers who are interested in buying have several questionsthey have to have answered before they complete the deal. A 1974 lawprohibited real-estate agents from accepting fees for such referrals, butthe new rules allow agents to charge for the service. Second, the size of the downpaymentwill also determine the size of the monthly payments, and the buyer has tobe certain that he or she will be able to afford those monthly payments aswell (pp. $71,218 7.6%Greenville-Spartanburg, SC $83,862 7.6% Changes in mortgage rates affect the decision to buy a home and thusthe buyer, the seller, lenders, builders--anyone involved in the industryin any way. %Tucson, AZ. (1993, June). today is in flux and is muchaffected by the larger economic realities such as the recession, thepossibility of a recovery, unemployment figures, and loan rates. How to buy a house with no (or little) money fown. Many parents are faced with the fact that theirchildren will not be able to afford to do anything but rent for the rest oftheir lives unless the housing situation is addressed and solutions areproposed. U.S. 7 -72.Warner, R., Serkes, I., & Devine, G. First, since a certainpercentage is required, the size of the downpayment is related directly tothe amount one can pay for the house. There is another HUDprovision allowing a brokerage to pay employees who steer buyers tomortgage or settlement companies owned by the brokerage, and critics see adanger in this in that home shoppers might be encouraged to accept mortgageor settlement packages in-house when there could be better deals elsewhere. Smith and Sherrid (1993) also note a number of changes in theregulatory environment that have been affecting how homes are bought andsometimes the prices paid for them. Even so, buyers have to feel that they can pay the prices asked andthat they will be able to make payments over time. As aresult, the National Association of Realtors expects sales of existinghomes this year to reach their highest level since 1979. In order to do this, though, you have to be certainof what you want and have enough understanding of the market to know a gooddeal when you find it. Where sales are rising, it is because of move-up buyers who arecoming back into the market, and they spend more than the first-timers whohave dominated statistics recently. In addition, the refinancing boom will keep many people where theyare for the year or two it takes to recoup the transaction costs.Additionally, and contrary to widespread reports, President Clinton's taxplan is not likely to help the market for high-end housing because whilethe mortgage deduction would in theory become more valuable to top-bracketearners, the higher tax savings that come with a bigger mortgage would meanan even greater outlay in additional interest (Smith, 1993, pp. 97). Razzi(1993) quotes Dave Liger, founder of the giant RE/MAX brokerage franchise,to the effect that talk of a hot real estate market at this time isnonsense. M., & Boroson, W. In SouthernCalifornia especially, dreary job prospects have created a one-year-plussupply of resale housing. Shenkman and Boroson (1989) note that there are two ways adownpayment can affect what house one can buy. This is seen as anticompetitive and anticonsumer.Appraisals The Federal Reserve Board, which oversees fair-credit standards, isto decide whether mortgage lenders must give applicants a new admonitionthat they have the right to see the appraisal used to decide on the loan.The American Bankers Association argues that this will mean added paperworkand that routine notification is unnecessary. Among these changes are the following:New Broker Charges for Referrals to Lenders Home buyers who look first to their real-estate agent for names ofmortgage lenders and settlement attorneys have done so in the past forfree, but this service could begin costing consumers because of a recentdecision by the Department of Housing and Urban Development. 2). Heads up, house hunters: Here's a guide to recent changes affecting buyers and sellers. News & World Report, pp. Mortgage rates were 8.98 percent for a3 -year fixed loan in 1992 and have plummeted to 7.57 percent in 1993.Prices have also fallen precipitously in many places. Government is being asked to find a way to provideaffordable housing, and many are hoping that evidence of a recovery wouldimprove the situation. Another provisions is known as "buyer's ammunition" and is based on alittle-noticed passed by Congress in late 1991 that was primarily intendedto give somebody denied a loan--or the full amount--ammunition to challengethe lender's decision (Smith and Sherrid, 1993, pp. (1993, April 5). (1993, April 5). New York: John Wiley & Sons.Smith, A. 6 -62). 7 -72). The real estate market in the U.S. Warner, Serkes, and Devine (199 )make a good point when they note that two of the most important steps beginwith the decision to buy a house--deciding what sort of house you want, anddetermining what sort of house you can afford. Economists state that homesin the upper price ranges will not appreciate at all over the next year ortwo. However, the prices and pace at which housessell still depend on the health of the local economy. Kiplinger's Personal Finance Magazine, p. U.S. $75,938 8.9%San Antonio, TX $71,438 8.8%Milwaukee, WI $98,138 8. Housingis seen as a problem, with a higher people today unable to buy a home thanwas true in the past. 1993 home guide. 6 -65.Smith, A.K., & Sherrid, P. Home buyers already have theright to appraisals if they ask for them in writing, and the document canbe a useful tool in dealings with lender and seller. The housing situation is gauged in several ways, includingaverage prices in different areas, new housing starts, and the number ofunits that change hands in a given period of time. K. Buying a house isa process involving a number of specific steps, some of which may beoptional but all of which have to be considered by the buyer in devising astrategy for acquiring the house that he or she wants. The strategy mustbegin with the decision to buy a house and continue through to takingpossession and paying off the mortgage. One puzzling aspect of the present market isthat though mortgage rates have fallen, buyers are still not purchasing.What was a seller's market for many years has soured, and houses are on themarket longer and usually sell for less than anticipated. 97.Shenkman, M. There is still ahousing shortage, and there is no one to buy those houses that areavailable.

If this paper is not what you are looking for, you can search again:

Search for:

or

We can write a Custom Essay just for you.


Browse Essays by Subject