Eccentric Homes Made From Zany Materials

March 27, 2012

Photo: Costa Verda

While traditional homes are at the forefront of most homebuyers’ minds, some homeowners go to extremes by using unconventional material for their homes.

Seen in places all over the world, airplane fuselages have been repurposed into homes. The home on the right uses teak paneling from the cockpit to the tail of this vintage Boeing 727 plane.

Anything goes when it comes to unconventional homebuilding – one artist has created a “luxury” home out of a dumpster in Berkeley, California. Repurposed silos are also common for this type of creation.

To see more wacky homes, read the Yahoo article here.

Homes With Vivid Color Schemes: New Trend?

Most homes are painted subdued colors such as white, grey, and beige. Some homeowners, however, have taken their love of color and infused their houses with it.

While the extreme color schemes are an acquired taste, listing prices certainly speak well for the homes, including a $1.95 million dollar price tag for the North Carolina home pictured above.

Other homes featured in this Yahoo News article have listing prices as high as $14.5 million.
Could you see yourself in a home this colorful?

Can Baby Boomers Boost the Market?

March 14, 2012

Baby Boomers – those between the ages of 47 to 65 – are in the best position to buy real estate that they’ve been in in years, according to a spokesperson for the National Association of Realtors, and could help revive the real estate market.

According to the Housing Affordability Index, affordability is at an all-time high, and many baby-boomers already have solid home equity to rely on.

The spokesperson said in an AOL Real Estate article that “the roadblock is really with first-time buyers… and many of them are being thwarted by credit issues.”

The article cites two major reasons that the baby boomer generation may boost the real estate market: that home equity, and a desire for ease of living factored into their real estate purchases.

A survey done by Met Life Mature Market Institute and National Association of Home Builders showed that 61% of those moving in to a 55+ community cited room layout as a decision-maker, as did 62% of those not moving into such a community, but in non-age-restricted communities. The vast majority of the generation falls in the second category, but the percentages are almost identical.

Room layout and the ease of living asks are not shared as a top priority with younger and first-time buyers.

For more information on how the baby boomer generation may impact the real estate market, read the full article here.

This Week’s Market Commentary

March 5, 2012

This week has four government-compiled economic reports for the markets to digest. Only one is considered to be highly important, but it is a big one. The rest of the reports are moderately important to the markets, meaning they have the potential to affect mortgage rates but usually don’t cause a noticeable change.

The most important data comes the matter part of the week, but sizable moves in stocks can impact bond trading and mortgage rates any day.

The week’s first data comes tomorrow with the release of January’s Factory Orders during late morning hours, which will give us a measurement of manufacturing sector strength. This data is similar to last week’s Durable Goods, except this report covers orders for both durable and non-durable goods. Current forecasts are calling for a drop in new orders of approximately 1.9%. A larger than expected drop would be good news for the bond market and could lead to an improvement in mortgage rates since it would point towards economic weakness.

There is nothing of relevance scheduled for Tuesday, but Wednesday has a couple of releases that are considered moderately important. The first is the revised Productivity index for the 4th Quarter of last year. The preliminary reading posted last month showed an annual growth rate of 0.7% in worker output. Analysts are expecting to see an upward revision of 0.2% to last month’s initial reading. Employee productivity is watched fairly closely because a higher level of output per hour is believed to mean that the economy can expand without inflation concerns. However, since this data is quite aged now, it likely will have little impact on Wednesday’s mortgage rates unless it shows a significant change.

Wednesday also has a couple of private sector employment-related reports due to be posted. The biggest one comes from payroll processor ADP who will announce their change in payrolls processed last month. Since it is not a government agency report, it isn’t considered to be highly important, but as with any employment-related data, it does draw some attention. This is especially true for this report because it is posted just before monthly employment figures are released by the Labor Department.

Thursday has nothing to be concerned with but Friday is a different story. The biggest news of the week comes early Friday morning when one of the single most important monthly reports we see will be posted. The Labor Department will release February’s Employment report at 8:30 AM ET Friday. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a much smaller increase in payrolls than expected and little or no increase in earnings. Current forecasts are calling for no change in the unemployment rate of 8.3% and approximately 207,000 new jobs added to the economy. Stronger than expected readings will likely fuel a stock market rally and selling bonds that would cause a sizable upward revision to mortgage rates. On the other hand, disappointing numbers would raise concerns about the economy’s ability to continue to grow at its current pace that would have an opposite impact on the markets and mortgage pricing.

January’s Goods and Services Trade Balance report will also be released early Friday morning, but it will likely draw little interest from market participants. It will give us the size of the U.S. trade deficit, but often does not directly impact mortgage rates and is the week’s least important piece of news. Current forecasts are calling for a $48.1 billion trade deficit during January, but we will need to see a large variance from this estimate and little surprise in the employment figures for this news to influence bond trading enough to affect mortgage pricing. It is highly likely that this report will be a non-factor in Friday’s pricing.

Overall, look for a fairly active week in the markets and mortgage rates. I suspect there will be some optimism leading up to Friday’s Employment report, which could lead to support in stocks and pressure in bonds as we get closer to Friday. That day is undoubtedly the biggest of the week and we can label Tuesday as the least important. Please be careful this week if still floating an interest rate, especially the latter part of the week.