Couples able to afford more homes than singles:

A couple with a combined household income of $80,800 could afford 82% of all US homes and would be able to save their down payment in just 5 years.

But for singles, its another story. 

An analysis from Zillow calculates that less than half of all US homes are affordable for a single buyer based on a median household income of $34,500.  And since they don't have the help of a spouse, it could take up to 11 years to save up enough for a standard down payment.

"Nearly two-thirds of Americans agree that buying a home is a central part of living the American Dream, but for unmarried or un-partnered Americans, that dream is increasingly out of reach," said Zillow senior economist Aaron Terrazas. "Single buyers typically have more limited budgets, which means they are likely competing for lower-priced homes that are in high demand. Having two incomes allows buyers to compete in higher priced tiers where competition is not as stiff."

Source: Zilllow.com

Millennials Search for Unconventional Down Payment Funds, but at What Cost?

Rising home prices are standing in the way of millennials who want to buy their first home; however, these challenges are being overcome via some unconventional methods. Millennials are getting creative and finding sources for their down payment by any means necessary. But are these methods hurting the millennial generation financially?

Borrowing from family: Sure, gifted money doesn't sound bad. But what if the families don't have the cash to give? Instead, buyers are asking that their parents' home be refinanced, using the home equity as a way to fund their own home purchase.

Of course, this can be beneficial in multiple-offer situations to get a competitive edge with an all-cash offer, but borrowing from a relative can go south fast. Not being able to pay a bank back can have repercussions like lowering a credit score, but missed payments to a relative can damage familial relations. Is it worth the risk?

Crowdfunding: There are new crowdfunding platforms being introduced every year, and more of them are tapping into the real estate industry. This can be a great way to amass gifted money from friends and family, but not everyone may see it that way. Instead of crowdfunding for their honeymoon, newlyweds are asking their wedding guests to donate toward their first home.

This method can get complicated in the lending world. Buyers will need to look into gifting regulations before accepting any gifted money. 

By Liz Dominguez

Pending Home Sales Better than Expected:

Pending Home Sales in November (signed purchase contracts that are not yet closed) were much stronger than expected (+0.2% vs market expectations of -0.5%) on a month-over-month basis.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 0.2 percent to 109.5 in November from 109.3 in October. With last month’s increase, the index remains at its highest reading since June (110.0), and is now 0.8 percent above a year ago.

Lawrence Yun, NAR chief economist, says contract signings mustered a small gain in November and were up annually for the first time since June. “The housing market is closing the year on a stronger note than earlier this summer, backed by solid job creation and an economy that has kicked into a higher gear,” he said. “However, new buyers coming into the market are finding out quickly that their options are limited and competition is robust. Realtors® say many would-be buyers from earlier this year, stifled by tight supply and higher prices, are still trying to buy a home.”

“The strengthening economy, and expectation that more millennials will want to buy, serve as promising signs for solid home buying demand next year, while also putting additional pressure on inventory levels and affordability,” said Yun.

Source: National Association of Realtors

Home Builder Optimism at Highest Level Since 1999:

Builder confidence in the market for newly-built single-family homes increased five points to a level of 74 in December on the National Association of Home Builders Housing Market Index (HMI) which is the highest reported level since July 1999, over 18 years ago.

“Housing market conditions are improving partially because of new policies aimed at providing regulatory relief to the business community,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas.

“The HMI measure of home buyer traffic rose eight points, showing that demand for housing is on the rise,” said NAHB Chief Economist Robert Dietz. “With low unemployment rates, favorable demographics and a tight supply of existing home inventory, we can expect continued upward movement of the single-family construction sector next year.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All three HMI components registered gains in December. The component measuring buyer traffic jumped eight points to 58, the index gauging current sales conditions rose four points to 81 and the index charting sales expectations in the next six months increased three points to 79.

Looking at the three-month moving averages for regional HMI scores, the Midwest climbed six points to 69, the South rose three points to 72, the West increased two points to 79 and Northeast inched up a single point to 54.

Source: NAHB

How to Make an Open Floor Plan Work for You

Once a trend, open floor plans have become a staple of most modern homes. An open floor plan generally means the living room, kitchen, and dining room are combined into a large space or great room. Before taking a hammer to all interior walls, it's important to know the structure of your home, as well as the benefits and ways you can accomplish an open concept.

Benefits of an Open Floor Plan

Space
Small, cluttered homes can be transformed into airy, more breathable spaces by knocking down a few dividing walls. A demolition project may seem daunting, but the average cost is just over $3,000. Just be sure to have a professional take a look before wielding a sledgehammer. Hiring a structural engineer will cost you about $500, but you'll save yourself the headache of rebuilds, fines, or structural problems.

Natural Light
Without walls blocking the windows, natural light is able to stream in your home, making the open space seem even larger and more airy. Along with knocking down walls, you can bring natural light into your home by connecting the outdoors to your home's interior with large patio doors. On average, you can install glass doors for about $1,600. 


Inclusivity
It's right there in the title: an open floor plan means more openness and inclusivity in your home. When you're preparing dinner in the kitchen, for example, you won't be closed off from the rest of the house. This is great for both entertaining and every day. When you're entertaining, you can still be a part of the party, even while preparing food and drinks. And as an everyday solution, you're able to keep an eye on children, pets, or—let's be honest—the TV, while still going about your daily tasks. 

3 Reasons Your Smaller House Can Sell for More Than Ever Before

It can seem like having a small home is a liability. After all, there's a certain feeling that home buyers are always looking for something bigger and better. But that trends has shifted over the last few years. Smaller homes are beginning to sell faster than many of their larger competitors. Here are three reasons why. 

Area Over Square Footage. Buyers have also become incredibly conscious about the areas in which they live. With some buyers now targeting hip new areas, they are willing to put aside some of their size concerns in order to get into the hottest neighborhoods. These trends are especially true among younger buyers who don't plan on having large families; they now know that they can get a good space near everything they loved without having to travel.

Bigger Means More Costs. Since the housing market crash in 2008, the way that people buy homes has changed and buyers are considering factors other than square footage in order to make a smart investment. Many buyers consider lower maintenance costs an important asset in a property. This, in turn, allows owners of smaller homes to be more competitive than their larger neighbors, especially when selling to investors.

Minimalism is In. Quite a bit of what's been discussed goes back to a single, overriding trend among younger buyers: minimalism. There are many who now see having a smaller, nicer home as a lifestyle statement. These are the same kinds of buyers who would have paid top dollar for a larger space years ago, but are now following current trends. 

Pending Home Sales Best Since June:

The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 3.5 percent to 109.3 in October. The index is now at its highest reading since June (110.0).

Lawrence Yun, NAR chief economist, says pending sales in October were primarily driven higher by a big jump in the South, which saw a nice bounce back after hurricane-related disruptions in September. “Last month's solid increase in contract signings were still not enough to keep activity from declining on an annual basis for the sixth time in seven months,” he said. “Home shoppers had better luck finding a home to buy in October, but slim pickings and consistently fast price gains continue to frustrate and prevent too many would-be buyers from reaching the market.”

According to Yun, the supply and affordability headwinds seen most of the year have not abated this fall. Although home builders are doing their best to ramp up production of single-family homes amidst ongoing labor and cost challenges, overall activity still drastically lags demand. Further exacerbating the inventory scarcity is the fact that homeowners are staying in their homes longer. NAR's 2017 Profile of Home Buyers and Sellers – released last month – revealed that homeowners typically stayed in their home for 10 years before selling (an all-time survey high). Prior to 2009, sellers consistently lived in their home for a median of six years before selling.

“Existing inventory has decreased every month on an annual basis for 29 consecutive months, and the number of homes for sale at the end of October was the lowest for the month since 1999¹,” said Yun. “Until new home construction climbs even higher and more investors and homeowners put their home on the market, sales will continue to severely trail underlying demand.”

With two months of data remaining for the year, Yun forecasts for existing-home sales to finish at around 5.52 million, which is an increase of 1.3 percent from 2016 (5.45 million). The national median existing-home price this year is expected to increase around 6 percent. In 2016, existing sales increased 3.8 percent and prices rose 5.1 percent.

Source: National Association of Realtors