I was on Fox Business yesterday summarizing the conflicting housing data. Here is a brief summary of my comments:
•The recovery is still occurring but at a more normal pace.
•There are huge differences by geography. Las Vegas and San Francisco have both appreciated 20%+ in the last year, but for completely different reasons.
•Entry-level buyer activity is slowing down, not because of rising mortgage rates but because the most qualified buyers have already purchased.
•Mortgage lending is only getting slightly more aggressive and won’t heal completely until the Dodd-Frank QRM rules get defined.
•Home sizes are rising because that is what consumers still want. While some older buyers are choosing to downsize and first-time buyers are being forced to buy a smaller home, the number of people desiring larger homes is much greater.
The foreign buyer is also having a noticeable impact on price increases, particularly in the hottest markets. Given the diversity of nationalities involved, this is a complicated part of the puzzle we are working hard to understand. We welcome any insight you may have.