Multi-Family Mortgage Originations Surge 29% From Q1

For the last four years inventory of available homes for sale has consistently dropped, oftentimes in the double digits from year to year and even quarter-to-quarter.

As this has taken place, concurrently housing prices have risen, which makes the affordability for a home higher and higher.

As homes become more unaffordable for many first-time buyers especially, the demand for rentals has increased. Currently the average rent paid nationwide is at $1,453 a month.

With inventory shortages and rental prices going higher, it is no surprise that mortgage originations of commercial and multifamily properties have surged by 10% on a year-to-year basis.

What was even more startling was that originations increased by 29% from the first quarter of 2019 to the second quarter of 2019.

The increase in multifamily and commercial properties originations is in part due to the shortage of affordable housing and the high price of homes. Multifamily originations are probably being fueled by the lower interest rates and the higher demand for rental

According to the Mortgage Bankers Association, 2019 is shaping up to be another record year for commercial mortgage lending.

“A rise in originations for health care, office, industrial and multifamily properties led the overall second quarter increase in commercial/multifamily lending volumes when compared to the second quarter of 2018. The second quarter saw a 151% year-over-year increase in the dollar volume of loans for health care properties, a 23% increase for office properties, a 16% increase for industrial properties and a 15% increase for multifamily properties. Retail property loan originations fell 32%, and hotel property lending decreased 28%.”

Quick Stats for the 2nd Quarter vs 1st Quarter
■ Second quarter originations for office properties increased 66% vs. first quarter 2019
■ Health care property originations increased 62%
■ Multifamily properties increased 32%
■ Hotel properties increased 18%
■ Retail properties increased 15%
■ Industrial buildings declined 27%

 

Perth Amboy’s Newest Rehab

One of the most prominent property sites in Middlesex County, the vacant property sites in Perth Amboy located on Elm Street, the former ASARCO property, is coming back to life. What began back in 2009 is finally coming to fruition as the Bridgeport Logistics Center.

The fact that one of Wall Street’s major icons, Home Depot, now is coming to build a warehouse center at the location is going to be a real boost to the Perth Amboy economy. This historic shoreline has been remediated from contaminated brownfields and soon to be a state-of-the-art industrial complex. The site borders the Arthur Kill, a major navigational channel for the Port of New York and Newark.

According to an article, more than $100 million in remediation and construction to redevelop a 190-acre brownfield has been spent with the expectation that this reconstruction and rehab will result in 400 to 600 potential new jobs.

The specs for the site call for the work to be completed by the end of 2020, which appears to be quite optimistic.

The redevelopment will provide public access, waterfront, an amphitheater, a public picnic area, restrooms, a senior citizen park, as well as a mile-long green pathway that borders the shoreline.

The Commercial Development Company [CDC] acquired the site in 2009. The CDC has since relocated 22 tenants, demolished 13 buildings and remediated 80 years of environmental residue from ASARCO’s metal smelting business. The site was a smelting and refining facility for 80 years, owned and operated by American Smelting and Refining Co., which closed in 1979.

The remediation also involved removing 14,000 shipping containers, rebuilding a cell tower and raising the site to post-Sandy flood elevations.

Phase 2 of the project will complete a total of 2.4 million square feet at Bridgeport Logistics Center. Bridge Development has invested $180 million for the construction of 3 warehousing and distribution facilities totaling nearly 1.3 million square feet, where Target has established its first distribution center in New Jersey and now Home Depot.

Home Depot is looking to build-out its warehouse to enhance its delivery to consumer and commercial customers in one day or less.

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

LET’S CONNECT ONLINE!

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CoreLogic: The State of Real Estate

Key Findings on the Economic Influence of Housing  

The number of homes with negative equity has decreased.
Total percent of homes underwater went from 25.9% in the first quarter of 2010 to 4.1% in the first quarter of 2019.

Total home equity hits new record.
At the end of the first quarter of 2019, total home equity reached $15.8 trillion, up from $6.1 trillion in the first quarter of 2009. Between the first quarter of 2010 and the first quarter of 2019, the average equity per borrower increased from approximately $75,000 to approximately $171,000.

Since 2010, the housing flip rate has increased significantly.
In the first quarter of 2018, the number of properties bought and sold again within a two-year period reached its highest point at 11.4%.

Strong recovery for home prices and rents.
Since June 2009, home prices and rents have continued to grow. Through May 2019, home prices increased a cumulative 50% and single-family rents increased 33% in the United States.

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

LET’S CONNECT ONLINE!

Connect with Ralph on Facebook: https://www.facebook.com/CounsellorsTitleAgency/

Connect with Ralph on LinkedIn: https://www.linkedin.com/in/ralphaponte/

July Sales for Morris and Middlesex Counties

Morris County
Single Family Homes for July
Key Metrics    2018   2019   Change
New Listings  779   692   – 11.2%
Closed Sales     574     566  – 1.4%
DOM*              46        46     – 0.0%
Median PX     $454K  $486K  + 7.1%
% of PX      99.1%   98.3%   – 0.8%
Inventory     2,504  2,363   – 5.6%
Months Supply 5.9  5.7      – 3.4%
*Days on Market

Middlesex County
Single Family Homes for July
Key Metrics      2018     2019    Change
New Listings     895       863    – 3.6%
Closed Sales       659      659      + 0.0%
DOM*                56         53      – 5.4%
Median PX      $350K    $370K    + 5.7%
% PX Rec’d     98.8%     98.7%    – 0.1%
Inventory     2,312       2,233      – 3.4%
Month Supply   4.3         4.2      – 2.3%
*Days on Market

Monmouth and Ocean County Sales

Monmouth County
Single Family Homes for July
Key Metrics    2018   2019   Change
New Listings  1,016   958   – 5.7%
Closed Sales     728     692 – 4.9%
DOM*              48        52     + 8.3%
Median PX     $430K  $469K  + 9.2%
% of PX      98.0%   98.2%   + 0.2%
Inventory     3,327  3,058   – 8.1%
Months Supply 5.6  5.3      – 5.4%
*Days on Market

Ocean County
Single Family Homes for July
Key Metrics      2018     2019    Change
New Listings    1,269     1,224    – 3.5%
Closed Sales       751      794      + 5.7%
DOM*                63         63        0.0%
Median PX      $301K    $307K    + 1.9%
% PX Rec’d     97.3%     97.4%    – 0.1%
Inventory     4,993       4,261      – 14.7%
Month Supply   7.5         5.9       + 21.3%
*Days on Market

Home Prices Rise 3.4 Percent

In July, the U.S. economic expansion that began in June 2009 became the longest in the nation’s history, marking 121 straight months of gross domestic product growth and surpassing the 120-month expansion from 1991 to 2001. The average rate of growth during this expansion has been a milder 2.3% per year compared to 3.6% during the 1990s. Although the economy should continue to perform well for the rest of 2019, most economists see a mild recession on the horizon.

• Single Family Closed Sales were down 1.6% to 8,485.
• Townhouse-Condo Closed Sales were down 6.2% to 2,212.
• Adult Communities Closed Sales were up 3.9% to 749.
• Single Family Median Sales Price increased 3.4% to $351,500.
• Townhouse-Condo Median Sales Price increased 4.8% to $283,000.
• Adult Communities Median Sales Price increased 4.8% to $220,000.

During the record-setting 121-month economic expansion, the unemployment rate has dropped from 10.0% in 2009 to 3.7%, yet many consumers continue to struggle financially. Low mortgage interest rates have helped offset low housing affordability, but high home prices are outpacing median household income growth. In a move to stoke continued economic prosperity, the Federal Reserve reduced the benchmark interest rate by a quarter point to about 2.25%, marking the first reduction in more than a decade.

 

The Digital Culture: Avoiding Burning Out

The 24/7 digital culture of connectivity isn’t the problem; it is overload of too much data frying our brains. This is why everyone needs a strategy to combat Digital Burnout Syndrome [DBS].

Our bodies and our minds were never designed to withstand a never-ending cycle of stimulation. DBS occurs most often to people who are highly committed to their work.
Before you can beat DBS, you have to recognize it. Anyone with with a smart phone and a laptop needs to have their own DBS strategy in place. Here are some of the signs that you are suffering from DBS:
  • Do you find your capacity to handle distractions, delays, and disappointments is very slim?
  • Are you having a difficult time waking up and going to sleep?
  • Are you failing to plan your week and make time for your weekend recreational events?
  • Are you experiencing longer and longer periods of deep disillusionment?
If you said yes to two or more, you are most likely suffering from DBS. Here are some ways you can avoid burning out:
Rest: Taking time to intentionally unplug from the constant flow of data is critical.
Stick to a Schedule: Have a schedule. Create that schedule earlier in the morning. Now this might appear to be counter-productive, but one way to achieve this is by setting an earlier bedtime. Rising early is one hack that gets you focused on the high priorities of the day, before the onslaught of the urgent.
Exercise: Definitely begin exercising, and understand that when you exercise, you are going to be taking time away from something. Make exercising a value, not part of your job. If your body isn’t cooperating with what you need to get done, everything collapses.
Practices: Develop other stress management practices: less coffee, less sugar, less alcohol, and fewer late nights. One tip is to even begin a stress diary to  document what routinely causes you stress.
Deep Breathing: Breathing deeply releases stress. We forget to breathe, and that builds up over the hours in a day. Stop, breathe deeply and refocus on your true morning priorities.

New Home Sales Up

Sales of new homes were up slightly, by 0.8% year-over-year, in 2Q, reversing the trend in the previous two quarters, when new-home sales dropped, while existing home sales were down 0.7% in 2Q.

The supply of new homes was down 1%, representing the biggest annual decline since Q1 2013. The number of existing homes was up 1.1% in Q2, the fourth consecutive quarter of increases.

There was also a 3.4% annual drop in building permits, which is partially due to high material costs and the shortage of skilled labor.

Sale prices for newly built homes dropped 0.5% year-over-year to a median of $372,900 in Q2 2019.
Prices for new homes have remained largely unchanged throughout the first half of this year after seven straight years of increases. Meanwhile, the median sale price for existing homes rose 3.2% in Q2 to $309,700, continuing a seven-year trend of increasing prices.

Since the higher end of the market has softened, the first-time buyer market is currently where most of the demand is, which means that builders are now focused on homes that are less profitable for them.

Refin reported that “of the 10 metros with the highest sales volume, new-home prices were down in half and up in the other half.”

In regions such as Atlanta, new homes sale prices were up 5.7% annually, climbing to $309,900. Prices were also up 1.3% to $364,500 in Dallas and 4% in Nashville to $355,000.

Fast Stats for New Construction:
■ New homes, the median price per square foot was $175, up 2.8% from the year before.
■ Existing homes, the median price per square foot was $180, up 2% year over year.
■ For both new and existing homes, price per square foot has gone up every quarter for the last seven years.
■ New listings for new homes were down 0.7%, making it the second consecutive quarter of declines after seven straight years of increases.
■ For existing homes, new listings were down 0.9%.
■ For all types of residential construction, building permits were down 3.4% year-over-year.
■ For single-family homes, permits were down 5.6%, the third straight quarter of declines for the category.
■ Building permits per 10,000 people dropped 6% year-over-year.

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

LET’S CONNECT ONLINE!

Connect with Ralph on Facebook: https://www.facebook.com/CounsellorsTitleAgency/

Connect with Ralph on LinkedIn: https://www.linkedin.com/in/ralphaponte/

Home Purchases Closing Faster

As the housing market continues to trend higher and inventory becomes more scarce, the time it takes for a home to be bought and sold is also shrinking. Technology is clearly contributing to the speed of transactions, but considering the number of things that must be completed before a property can be bought can be over whelming.

  • Deposit of earnest money.
  • Title search and title policy.
  • Home inspection or waiver.
  • Fully executed purchase agreement and addendums.
  • Completion of buyer inspections, including release of contingencies, if demanded.
  • Appraisal of property by lender’s appraiser.
  • Buyer’s final walk-through inspection or waiver.
  • Lender’s loan approval and satisfaction of loan conditions by buyer such as depositing evidence of a homeowner insurance policy.
  • Seller’s and buyer’s signed escrow instructions.
  • Seller’s signed and notarized deed conveying title.
  • Buyer’s signed and notarized deed of trust and executed promissory note.
  • Buyer’s signatures on all loan documents and deposit of buyer’s funds from lender.
  • Deposit of balance of buyer’s down payment and buyer’s closing costs.

According to a recent analysis, homebuyers are now buying their homes 11 days faster than they were in 2018. The period it takes to close on a new purchase transaction, according to this report, has fallen from 74 days in 2017 to just 40 days in 2019.

Also, credit scores have significantly improved over the last few years, which has a corresponding benefit of causing the transaction to close faster. This same report revealed that borrowers with good credit scores (760+) averaged a closing time of just 38 days in 2019. This compares with those borrowers with lower credit scores (-720) taking 45 days.

Monmouth’s Biggest Tax Bills

Monmouth County’s average property tax bill came in at $8,975 during 2017, a bill that was about $300 higher than the state average. NJ property taxes: Schools soak up more than half of the average tax bills.

This features the top dozen properties and what they pay in taxes based upon documents with Monmouth County.

1. Freehold Raceway Mall, $11,228,637
Town: Freehold Township Property assessment: $500,608,000
2. Monmouth Mall, $5,227,556
Monmouth Mall in Eatontown Property assessment: $234,104,600
3. Pier Village Development, LLC, $3,673,827
Town: Long Branch Property assessment: $178,254,600
4. Jersey Shore Premium Outlets, $3,477,250
Town: Tinton Falls Property assessment: $175,000,000
5. AT&T Corporate Park, $3,398,400
Town: Middletown Property assessment: $160,000,000
6. Seabrook, $2,682,450
Town: Tinton Falls Property assessment: $135,000,000
7. New Jersey Sports & Exposition Authority (Monmouth Park), $1,895,343
Town: Oceanport Property assessment: $87,869,400
8. Avalon Bay Apartments. $1,496,680
Town: Freehold Township Property assessment: $66,726,700
9. Seaview Square Mall, $1,419,245
Seaview Square Shopping Center in Ocean.
10. Woodshire Apartments, $1,388,398 Town: Ocean Township
Property assessment: $67,693,700
11. Holmdel Towne Center, $1,292,487
Property assessment: $63,700,700
12. The Grove, $1,260,189
The Grove at Shrewsbury
Town: Shrewsbury Property assessment: $58,997,600

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

LET’S CONNECT ONLINE!

Connect with Ralph on Facebook: https://www.facebook.com/CounsellorsTitleAgency/

Connect with Ralph on LinkedIn: https://www.linkedin.com/in/ralphaponte/
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