August Newsletter

Jeff Fleming headshot 2012

Greetings!  It’s almost October and you know what that means!  Are you ready to meet in Memphis and learn more about retiree recruitment and market trends?

Mark your calendar for the annual AARC Conference to be held at the home of blues, barbeque, and the King of Rock ‘n’ Roll.

As the economy continues to improve, baby boomers will again search for their future homes. Don’t miss the opportunity to share with your peers the valuable techniques and best practices to attract retirees to your destination or development. This conference offers two tracks – one each for communities and developers – to enable your business with the latest trends in retiree recruitment.

The American Association of Retirement Communities is a 20 year old not-for-profit professional association that assists communities interested in attracting retiree buyers – and the AARC’s Annual Conference is the largest retiree research, training and networking event of its kind.

AARC is your source for market trends and customer insights.  Tell a friend today!

Sincerely,

Jeff Fleming, Chair



Join us October 15th – 17th for The AARC’s Annual Conference in Memphis, Tennessee

Early Bird Discount Expires in 30 Days! – Click To Sign Up

Memphis

Mark your calendar for the annual AARC Conference to be held at the home of blues, barbeque, and the King of Rock ‘n’ Roll—Memphis, Tennessee.

As the economy continues to improve, baby boomers will again search for their future homes. Don’t miss the opportunity to share with your peers the valuable techniques and best practices to attract retirees to your destination or development. This conference offers two tracks – one each for communities and developers – to enable your business with the latest trends in retiree recruitment.

The Tennessee Vacation Guide boasts Memphis as front and center in West Tennessee. The city’s story and history are best told through its music, from Beale Street and its blues clubs to the soulful sounds of Stax (the neighborhood recording studio where Otis, Isaac, and Booker T. recorded), to the legendary 60 year old tale of Elvis Presley’s meteoric rise as the king of rock ‘n’ roll at Graceland. Graceland and the newly renovated National Civil Rights Museum, both in Memphis, recently placed 1st and 3rd inUSA Today’s Best Iconic American Attractions list.

Sheraton ExteriorThough Memphis may be ground zero for the blues, it’s also grounded in green—as in eco-friendly, with plenty of green spaces and an impressive farm-to-table scene. Young chefs like Ryan Trimm of Sweet Grass and Southward Fare & Libations, Kelly English of Iris, and Michael Hudman and Andrew Ticer of Andrew Michael Italian Kitchen and Hog & Hominy are gaining national notice for their culinary creativity as well as their dedication to using locally-sourced ingredients. If you’re looking for more fun green spaces to explore, don’t forget Justin Timberlake’s public golf course Mirimichi, located in nearby Millington.

Attendance at the 2014 Conference starts at just $325.00 and hotel accommodations are 

Sheraton Memphisonly $142/night and include breakfast each morning.

Early Bird Discount Expires in 30 Days! – Click To Sign Up

To Signup for this year’s conference visit – Conference Signup

To book your hotel accommodations visit – Hotel Signup (click the Reserve link)



AARC Conference Presentation Highlight

At this year Conference in Memphis learn how one community, Kingsport, TN dealt with the economic downturn’s effects on local builder/developers.  Hear Lynn Tully, Development Services Director outline these creative efforts!

When the housing bubble burst in 2008, it lead to sweeping changes in the lending environment.  Bank loans for new subdivisions and spec housing practically dried-up. kingsport2

In many communities, there is a deficiency of new housing options that won’t improve any time soon – at least not on their own.  See how one community decided to take control of its own destiny with a pilot program to encourage housing development.  While many other places were adopting policies to slow development or collect “impact’ fees, this community was developing programs to offset the cost of public infrastructure – water, sewer and roads.  The developer’s savings could then be leveraged to build more houses.

kingsport1The community’s payback was determined to be less than 10 years (in property tax collections).   While offered for a limited time only, the program demonstrates the creativity required to attract and retain developers in the future.

Join us at the 2014 AARC Annual Conference as we delve more into this topic with Lynn Tully of Kingsport, TN as well as many more,  focused programs to get your Retiree Recruitment efforts into full force!

Early Bird Conference Signup starts as low as $325 – Click To Sign Up



July Existing Home Sales Hit Highest Pace of 2014

By Erin Carlyle, Forbes

Sales of previously-owned homes in July rose for the fourth straight month, hitting their highest pace in 2014, according to data released Tuesday by the National Sold Home For Sale Sign and HouseAssociation of Realtors.

Sales of existing-homes–which include single-family homes, townhomes, condominiums and co-ops–climbed 2.4% to an annual (seasonally adjusted) pace of 5.15 million in July. That tops June’s downwardly revised annual (seasonally adjusted) pace of 5.03 million and is the highest rate in nine months.

July’s numbers are good news for housing after a sluggish start this year, when the market was weighed down by winter storms, underwater mortgages, tight inventory, and rising mortgage rates. However, the numbers can’t match housing’s 2013 hot streak: last month’s pace was 4.3% below the July 2013 (last year’s peak), when the pace stood at 5.38 million units.

Still, the slowed pace of price gains is helping to normalize the market. And as housing prices rise, more people put their homes on the market, easing inventory levels. “The number of houses for sale is higher than a year ago and tamer price increases are giving prospective buyers less hesitation about entering the market,” said Lawrence Yun, NAR chief economist. “More people are buying homes compared to earlier in the year and this trend should continue with interest rates remaining low and apartment rents on the rise.”

Existing-home sales data is an important bellwether of the housing market, since the vast majority of homes are resales rather than new construction. At the end of July there were 2.37 million existing homes available for sale, a 5.5-month supply at the current sales pace. (A six-month supply is considered a healthy market.) Unsold inventory is 5.8% higher than a year ago.

In addition to the eased inventory level, job growth is also helping boost home sales, Yun notes. The nation has produced some 200,000-plus jobs per month for six months running. Still, Yun and other economists warn that jobs being created are at lower pay than those lost during the recession, and that wage gains are not matching housing price gains, factors indicating that affordability will decline in the future. That mismatch will only be compounded when interest rates finally rise.

For now, home prices are rising at a slower rate than last year’s breakneck pace. In July the median price of an existing-home was $222,900, 4.9% over the median price one year earlier. Year-over-year, home prices have now risen for 29 consecutive months.

Sales pace and price level varied widely by region in July. In the Northeast, the pace stayed flat from June to July but was 9.9% below the rate one year earlier. The median price in this region was $273,600 in July, 2.4% above the price in July 2013.

In the Midwest, the pace increased 1.7% in July, but remain 4.7% below July 2013′s sales pace. The Midwest’s median price was $175,200, up 4.1% from a year ago. In the South, sales rose 3.4% in July, slightly up (0.5%) from July 2013. The median price in the South was $192,000, up 5% year-over-year.

Sales in the West rose 2.6% from June to July, but remained 8.6% below their level a year ago. The median price in the West was $304,100, 6.3% higher than one year earlier.

Distressed homes (foreclosures and short sales) accounted for just 9% of home sales in July, down from 15% one year earlier. That marks the first time the market share of distressed properties has dropped to single-digits since NAR started tracking them in October 2008.

“To put it in perspective, distressed sales represented an average of 36 percent of sales during all of 2009,” said Yun. “Fast-forward to today and rising home values are helping owners recover equity and strong job creation are assisting those who may have fallen behind on their mortgage due to unemployment or underemployment.”

The share of first-time buyers in the housing market rose slightly in July (for the second straight month) to 29%, but remains historically low.



When Will Rising Mortgage Rates Hurt The Housing Market?

By Jed Kolko, Trulia

Jed Kolko, Chief Economist at Trulia, digs into recent history to reveal how today’s rising rates may be more bark than bite. Typically, spiking mortgage rates take a big chomp out of refinancing immediately and smaller nibbles out of sales three months later. Longer term, the impact of rising rates is typically offset by stronger economic growth. 

home-prices-riseEver since mortgage rates started their steep climb in early May, we’ve all been on high alert, watching how higher rates will affect the housing market. For a would-be buyer calculating the mortgage payment on their dream home, the effects are obvious: the increase in the 30-year fixed rate from 3.59% in early May to 4.73% at the end of August (according to the Mortgage Bankers’ Association, or MBA) means a 15% increase in the monthly payment on a $200,000 mortgage. That should deter homebuyers and reduce mortgage applications, sales, and prices, right? In theory, yes, but of course the real world is much more complicated. Mortgage rates aren’t rising all on their own: other housing and economic shifts are happening at the same time.

Fortunately, the recent past is a useful guide. The 30-year fixed rate jumped .47 points in May 2013 and .51 points in June 2013, comparing the levels at months’ end (MBA). (Side point: the 30-year fixed reached 4.80 this morning, September 11, .22 points higher than at the end of June, which means July, August, and early September have seen much milder increases compared with the May & June spike.) But this year isn’t the only time when mortgage rates have jumped up: they also climbed at least .4 points in seven other months since 1999. With some simple time-series regressions, we traced out the typical paths of mortgage applications, sales, and prices in the months immediately after a mortgage rate spike. 

The Month-by-Month Impact of a Rate Spike
Our analysis of mortgage rates and other housing data from January 1999 through April 2013 – just before the current spike – shows that mortgage rates hit refinancing applications (MBA) earlier and harder than any other measure of housing market activity. (Not all of the data series are available back to 1999.) Here’s the timeline of what typically happens when rates spike by half a point in a month:

  • The month when rates spikeRefinancing applications typically fall by 45% in the month of a spike, with further falls one and two months after mortgage rates jump, compounding the effect. The drop in refinancing applications this year was roughly 50% cumulatively over two months, which actually looks small compared with similar rate jumps in the recent past.
  • 1-2 months after the spike: Pending home sales and home-purchase mortgage applications typically decline slightly, though the effect isn’t statistically significant. New home sales also decline modestly.
  • 3 months after a spike: New home sales and existing home sales drop. That means that the May mortgage rate spike should show up most strongly in August new home sales and existing home sales, both of which will be reported later this month (on September 25 and September 19, respectively).

Compared with the impact on refinancing, the impact of a rate spike on home-purchase mortgage applications and sales volumes is very small and not always statistically significant.

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