In the News Presented by Prairie Title
Commentary
by Frank Pellegrini, Prairie Title CEO
January 25, 2016
Winter is here in full force, the stock market is gyrating
and we’re in the midst of an annual lull in the real estate business. So why be
optimistic? Two reasons:
1)
Home buying season is just around the corner!
2)
Commercial real estate is in good shape for
2016 and the years beyond.
On the housing front, while it’s true that things are a bit
slow for the moment, as is typical in January (complicated this year by TRID
implementation), the trends look promising. As reported by
the MBA, total mortgage application activity
— for refinancings and home purchases combined — posted strong numbers
the last three weeks, climbing 21.3 percent on a seasonally adjusted basis the week
ending Jan. 8, and a further 9 percent following week.
“The good news for the new year is that following the
holidays, application activity resumed at levels just exceeding those observed
during early December, suggesting that the purchase market has picked up right
where it left off,” noted Lynn Fisher, the MBA’s vice president of research and
economics. Meanwhile Interest rates have trended lower the
last two weeks, also a good sign that activity is poised to pick up.
Commercial: Last month, Congress passed a tax bill that includes a number of
provisions favorable to commercial real estate, including one that analysts say
could spur some $30 billion in annual
foreign investment in U.S. commercial real estate starting this year. The provision
eases 1980s tax requirements imposed on foreign investors to curb their
appetite for U.S. commercial real estate.
Meanwhile, the Daily
Real Estate News reported on Jan. 14: “Over the next three years,
developers are expected to construct nearly 1 million apartments nationwide,
hoping to snag wider profits from soaring rents.”
Need another reason for optimism? Baseball’s Spring
Training starts in less than a month.
Let’s keep the discussion going. Call me, email
me, or post a comment.
Other stories we’re following:
Chicago Housing Market saw Solid 2015 Improvement.
Home Construction up Last Year.
Big Banks Pulling Back from Mortgages.
Cybercriminals Targeting Mortgage Industry.
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