July Sees Strong Year-over-Year Gains For Single-Family Permits

 According to the U.S. Census Bureau’s Building Permits Survey, since the beginning of 2020, there have been 525,623 single-family permits issued YTD. They go on to report that this is a 5.8% increase over July 2019’s 496,726.

Across the country’s four regions the outcome was both an increase and decrease in certain areas. The

South saw an 8.6% increase while the Northeast saw a 1.7% decrease. From July 2019 to July 2020 35 states reported an increase in single-family home permits and 14 states and the District of Columbia reported a decline.

Louisiana did not see a change while South Dakota saw the highest growth rate from 1,508 to 2,050, a 35.9% increase. The District of Columbia reported a 41% decline from 117 in 2019 to only 69 in 2020.

The top 10 metro areas with the highest single-family permits issued were Houston-The Woodlands-Sugar Land, TX with 25,577, Dallas-Fort Worth-Arlington, TX with 23,535, Phoenix-Mesa-Scottsdale, AZ with 16,584, Atlanta-Sandy Springs-Roswell, GA with 14,505, Austin-Round Rock, TX with 11,649, Charlotte-Concord-Gastonia, NC-SC with 10,071, Tampa-St. Petersburg-Clearwater, FL with 8,924, Orlando-Kissimmee-Sanford, FL with 8,244, Nashville-Davidson-Murfreesboro-Franklin, TN with 8,000 and Washington-Arlington-Alexandria, DC-VA-MD-WV with 7,592.

Multi-family permits saw different statistics from July 2019 YTD to 2020 YTD. Reports showed a 2.3% decline from July 2019. Half of the states saw an increase while the other half saw a decline. North Dakota had the highest rise from 218 to 760, which was a 248.6% increase. New Hampshire saw the sharpest decline from 577 to 265 making it a 54.1% decrease.

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Benefits of a Green Mortgage

 The home has definitely turned into the live work and play of 2020. COVID-19 has caused many to rethink rooms and turn them into home offices and exercise rooms. The overall need for our home has changed due to shelter-in-place.

Energy usage has also gone up as we are staying home more than ever. According to Freddie Mac,

March saw a 22% higher household electrical usage than March of 2019. The biggest consumption was midday between 10 am to 3 pm. Shelter-in place caused the nation to live work and play in their homes 24/7. On average there was a $25 increase to monthly utility bills the month of April.

COVID-19 will not be going away anytime soon, and shelter-in-place could be a likely possibility for us in the near future. Homeowners are looking for ways to cut back on energy consumption.

Energy-efficient appliances are a good way to conserve energy and cut down on the cost of utility bills. Other options to reduce energy consumption are updated HVAC units, new windows, and new doors. Sealing around entryways can also help with insulation. Solar panels and geothermal heating are other good solutions.

If the cost of upgrading is an issue, energy or green mortgages might be the solution. Green mortgages can offer homeowners an opportunity to purchase homes that utilize these technologies through mortgages that permit higher debt-to-income ratio requirements. Freddie Mac states that purchasing a home that is green-building certified will not only help decrease utility bills but will also increase the house’s market value.

If you are not planning on moving anytime soon, there is a type of energy (green) mortgage that is specifically for energy improvements to existing homes. Homeowners are able to finance through this mortgage to help increase their home’s energy efficiency.

Green mortgages have many advantages such as greater purchasing power, affordable energy-efficient upgrades and an increase in home values. If you are looking to purchase a home or update your current home to make it more energy efficient a green mortgage is right for you.

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9th Time This Year for Record Low Mortgage Rates

 Freddie Mac announced another round of record-low mortgage rates. This will be the ninth record low since March 2020. The first full week of September saw a 2.86% drop in the average interest rate on a 30-year fixed-rate mortgage and a 2.37% drop on a 15-year fixed-rate.

“Mortgage rates have hit another record low due to a late-summer slowdown in the economic recovery,” said Sam Khater, Freddie Mac’s chief economist.

Home sales remain very strong according to Joel Kan, the Mortgage Bankers Association’s associate

vice president of economic industry and forecasting. Both the loan size and applications for new mortgages rose. For the week ending on September 4, applications were up 3% and the average loan size was the highest amount since the Mortgage Bankers Association began recording at $368,600.

“Homebuyers continue placing offers on homes, pushing existing inventory toward historic lows,” said George Ratiu, Realtor.com’s senior economist. “Would-be sellers are stuck in their homes, struggling to find their next house amid a dearth of supply, further contributing to the decline in inventory.”

The limited supply of homes for sale is driving the price higher. Home prices are 11% higher than they were a year ago. Homebuyers have to purchase less home at a higher price.

Refinancing for homeowners has also been on the rise. The record-low interest rates makes it more affordable for homeowners who would like to refinance.

Black Knight, a mortgage data company, says there are approximately 19.3 million high-quality refinance candidates. This number includes 43% of all 30-year mortgage holders, making this the largest group of this kind there has ever been.

Whether you are looking for your first home, a new home or refinancing your current home, now is the time. The mortgage rates are very low and FHFA also announced Fannie Mae and Freddie Mac will exempt refinance loans with balances under $125,000 from the fee. The housing market is the strongest we have seen in a long time and only proves to make a great investment for the future.

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Total Payroll Rose by 1.4 Million in August

 The U.S. labor market saw 1.4 million jobs added in August. The unemployment rate dipped to 8.4% which shows a strong recovery from the COVID-19 pandemic.

The U.S. Department of Labor’s The Employment Situation for August shows total nonfarm payroll

employment jumped by 1.4 million. This increase comes after a 4.8 million increase in June and a 1.7 million increase in July.

The summary indicates that in the past four months, the country has seen 10.6 million new jobs created. This is good news after 22.1 million jobs in March and April were lost due to the pandemic.

Government employment rose in August which added up to 25% of the gain in total payroll employment recorded for the month. The 344,000 new jobs were due mainly to the hiring of temporary positions for the 2020 census.

Retail trade, professional and business services, leisure and hospitality, education and health services and temporary health services all saw an increase in jobs in the six figures. Health care and social assistance, transportation and warehousing, goods-producing, financial activities, manufacturing, nondurable goods, construction, information, wholesale trade, durable goods and utilities fell under the six-figure mark while mining and logging lost jobs.

August also saw an 8.4% decline in the unemployment rate which dropped 1.8 percentage points. Those that were unemployed declined by 2.8 million and those looking for a job or already with a job (labor force participation rate) rose to 61.7%.

As far as the housing industry goes, residential construction employment went up 27,700 to 2.9 million in August. The breakdown shows 820,000 builders and 2.1 million residential specialty trade contractors.

The unemployment rate for construction workers also dropped 9.9% on a seasonally adjusted basis. This shows a drop in the unemployment rate for construction workers for the past four months.

Along with the data, the Household Survey indicated 24.3% of employed teleworked or worked from home due to COVID-19. The Household Survey report comes from questions added to the Current Population Survey (CPS) since May 2020.

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