Sales of newly built, single-family homes rose 4.0% in March to a seasonally adjusted annual rate of 694,000 units after an upwardly revised February report, according to newly released data by the US Department of Housing and Urban Development and the US Census Bureau. This the second highest reading since the Great Recession. “The March new home sales report is consistent with our solid builder confidence readings over the past several months,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “As consumer confidence grows and more prospective buyers enter the housing market, the sales numbers should continue to make gains.” Regionally, new home sales rose 28.3% in the West and 0.8% in the South. Sales decreased 2.4% in the Midwest and 54.8% in the Northeast. “We saw sales move forward in the West and the South regions, which is in line with recent evidence of faster growth in population, employment and single-family construction in these areas,” said NAHB Senior Economist Michael Neal. “But with nationwide economic growth and favorable demographics, we can expect continued strengthening of the housing market across the country.” The inventory of new home sales for sale was 301,000 in March, which is a 5.2-month supply at the current sales pace. The median sales price of new houses sold was $337,200.
After tax overhaul, mortgage interest deductions seen plummeting
Former Reagan Economist Art Laffer on the outlook for the US housing market.
As Americans look ahead to next year’s tax filing season, many fewer individuals are expected to claim once-popular deductions, including the mortgage interest deduction. Taxpayers filing for 2018 can expect to save a total of $25 billion by taking advantage of the mortgage interest deduction, down from nearly $60 billion for 2017, the congressional Joint Committee on Taxation said on Monday. It expects 13.7 million taxpayers take the deduction, down more than 57% from 32.3 million.The Tax Cuts and Jobs Act nearly doubled the standard deduction for individuals and married couples filing jointly, making itemizing less attractive for a larger proportion of filers. About 18 million households are expected to itemize under the new law, compared with more than 46 million for 2017. The largest share of those individuals who are still expected to itemize have incomes of $100,000 to $200,000 and $200,000 to $500,000. Those same higher-income individuals are also more likely to claim the mortgage interest deduction. While the Republican tax reform was being crafted in Congress, homebuilders lobbied to keep the mortgage interest deduction limit unchanged after the House proposed cutting it in half. Ultimately it was capped at $750,000, compared with $1 million under the previous law. In addition, state and local tax deductions were limited at $10,000, drawing concern that the changes would dent purchases of new homes in expensive markets including New York and California.
NAR – consumer interest trends towards sustainability, say Realtors
As consumer demand trends toward green and sustainable home features, Realtors® continue to work to promote environmentally responsible features and business practices. Sixty-one% of Realtors® reported that consumers are interested in sustainability according to the National Association of Realtors®’ REALTORS® and Sustainability 2018 report. The report, www.nar.realtor/research-and-statistics/research-reports/realtors-and-sustainability, which stems from NAR’s Sustainability Program, surveyed Realtors® about sustainability issues in the residential and commercial real estate markets and the preferences they are seeing in consumers in their communities. “Consumers continue to make it clear that environmentally friendly features and neighborhoods are an important factor in deciding where and what home to buy,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “Realtors® are leaders in the conversation about real estate sustainability, energy conservation and resource efficiency, and will continue to promote environmentally conscious strategies and best practices that benefit not just our clients, but also our communities.” Seventy-one% of agents and brokers reported that promoting energy efficiency in listings is either somewhat or very valuable. When asked what they consider to be the top market issues and considerations regarding sustainability, agents and brokers listed understanding lending options for energy upgrades or solar panels (36%), improving the energy efficiency of existing housing stock (34%) and the lack of information and materials provided to real estate professionals (30%).
Amazon founder Bezos’ $65M jet seen at airports near potential HQ2 sites
Amazon founder and CEO Jeff Bezos’ corporate jet visited airports at or near locations being considered for its second US headquarters about the time the company made announcements regarding its search. The billionaire’s Gulfstream G650ER was at Boston Logan International Airport just days before and after Amazon said last year that it would commence its hunt for its “HQ2,” according to the Puget Sound Business Journal, citing flight records of Bezos’ aircraft. The records do not say who was on board or what the purpose of the trip was. Then, after the company shared its shortlist of 20 finalists earlier this year, the jet was at Reagan National Airport, near Washington, D.C. Bezos, who owns The Washington Post, also has a home in the nation’s capital. So far this week, the aircraft has made flights to Dallas Love Field and California’s Hollywood Burbank Airport. Additional stops Bezos’ Gulfstream made this year include airports in Teterboro, New Jersey, near Newark; the Boulder airport in Colorado, near Denver; and Los Angeles International Airport. The aircraft visiting these locations is owned by Bezos’ holding company, Poplar Glen LLC, and costs $65 million. With the ability to carry eight passengers more than 8,600 miles at a speed slightly higher than 650 miles per hour, the G650ER is an appropriate choice for zipping across the US to visit other locations on Amazon’s shortlist. Amazon reached out to FOX Business following our report with the following statement: “There’s no connection between Jeff’s personal and business travel, and our HQ2 search.”
CFPB considers ending public access to bank complaints
A new report from the Wall Street Journal says the Consumer Financial Protection Bureau is likely to end the public’s access to a web portal used by consumers to file complaints against financial companies. The WSJ’s Yuka Hayashi reports that CFPB Acting Director Mick Mulvaney addressed his intention of eliminating access to the database on Tuesday during an address at the American Bankers Association’s conference, saying it contains information the government hasn’t fully vetted. “I don’t see anything in here that says I have to run a Yelp for financial services sponsored by the federal government,” Mulvaney told an audience at the conference while holding up a copy of the Dodd-Frank Act, according to the report. From the report: “Mr. Mulvaney said the bureau would continue to maintain a toll-free number and a website to gather consumer complaints and forward them to companies, but the database would be hidden from public view. Mr. Mulvaney’s remarks came as the CFPB formally gathers comments from the financial industry and public on its handling of consumer complaints, including whether the bureau should change how it operates the database. The CFPB under the Trump administration has in recent weeks asked for public feedback on a dozen issues as part of an effort to “ensure the bureau is fulfilling its proper and appropriate functions.” The effort covers key areas of the CFPB’s operations, from enforcement to rule-making, and could be a precursor to wholesale changes coming to the agency created under the Obama administration and long criticized by Republicans. ‘Yes, this is a different bureau than it was under our predecessors,” Mr. Mulvaney said. “That is the nature of the business and elections do have consequences.'” Aaron Klein, fellow policy director at the Brookings Institute, responded to the news about the database, tweeting: “Thanks to @CFPB complaint data base, people are more informed when they make choices, and businesses have greater reputational incentives, which promotes a more efficient and effective free market. Eliminating #CFPB database is an attack on free markets.”