Housing News
The top 10 best college towns for real estate investors
Aerial view of downtown Boston and the harbor, photo by Kevin Tostado.
Investing across America
Recently, AGBeat columnist Jeff Brown extolled the virtues of investing in Texas and CondoDomain.com President Hoyt Morgan named Washington D.C. as the top city for investing.
There are many reasons a city can be seen as a quality location for investment, and today in the spirit of school starting, we look to Move.com‘s list of Top 10 Best Back to School Real Estate Investment Cities, giving Boston the top spot.
“Pahk the cah in Hahvad Yahd”
So why did Boston take the cake? According to Move:
With a median list price of $335,000 in June 2011, the Boston/Cambridge market has one of the higher median list prices of the bunch, but also has high renter demand from students at over 50 colleges including Harvard and MIT, ranked two and four. The median list price in Boston has dropped by 2.62% since last June. Average rental rates in Boston in June 2011 ranged from $3,122 for a two bedroom to $3,913 for a three or more bedroom unit, both higher than a mortgage payment of around $1,370 for a median-priced home with a 20% down payment and current mortgage rates for a 30-year fixed loan. Boston was also named one of the top 10 turnaround towns by CNN Money in May 2011.
“In Cambridge and some of the Boston Proper neighborhoods we have been seeing rents rising with demand and projections of further increases of up to 25%,” said Boston-area broker owner Paul Turcotte.
Investors will soon outnumber traditional buyers
According to the recent Move, Inc. investor survey, “In the next two years, real estate investors are expected to outnumber traditional homebuyers in their local markets by three to one, and 56.5 percent plan to put their investments to work as rental properties.”
“Local markets with universities or colleges can be an attractive option for many local real estate investors,” said Move, Inc., Chief Executive Officer, Steve Berkowitz. “Housing demand in college towns is generally high and vacancy rates are usually low. Combine the supply and demand ratio with rising admissions and the five percent rise in rental rates expected by the end of the year, and rental property in college towns can be a smart option for the right investor.”
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Housing News
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
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Housing News
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.
…Click here to continue reading this story…
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Stephanie Crawford, @AgentStep
August 11, 2011 at 1:38 am
Yay Nashville! Each year I normally get a handful of Vanderbilt parents who are interested in condos for their kids.
Manhattan Beach Agent
August 11, 2011 at 9:13 am
Investors have the ability to carry capital and risks to bridge demand gaps for markets. If investors outnumber investors now that means that prices are probably starting to make sense for buyers; non-investors will enter markets as consumer balance sheets improve, and IF labor markets pick up. Right now it's investors who are putting a floor to this market, but there's much more work that needs to be done in absorbing REO inventory.
Michael
August 11, 2011 at 9:53 am
I would hardly call 3/4 of this list college towns. When I think college town, I think of places like Athens, Tallahassee, Ann Arbor, Berkeley, and Boulder… places where the university props up the local economy.
I would hardly define places like Atlanta, Chicago, Baltimore, Nashville, and St. Louis college towns. Yes there happens to be colleges there, but the cities run 110% independent of the schools.
The list up here could just as easily read, "Big Cities that happen to have colleges in them."
Jill Kipnis
August 11, 2011 at 6:34 pm
Thanks for the post. Our list mentions the top ten college towns based on the leading universities featured in the US News Rankings and Reviews list of best colleges in 2011, however there are certainly opportunities nationwide. If there's a college nearby, there's also a steady stream of potential renters each academic year.