Market Trends and Condition

Buying a piece of property in another country is a good strategy for diversifying your investment portfolio, but it’s much more than that, too.

This isn't like investing in a stock. You don’t buy a beachfront lot or a rental condo overseas and then set it on a shelf to wait for its value to increase. An investment in foreign real estate requires active and ongoing management and administration, including visits to the property and establishing an infrastructure of support on the ground in the place where the property is located.

The result is that, while you’re diversifying your portfolio and potentially increasing your net worth, you’re also reinventing your life. I’d say this is the real upside to foreign real estate as an investment class.

In the latest edition of CoreLogic's Market Pulse the company's senior economist Mark Fleming provides a different take on housing affordability which he says economists are predicting will experience a "shock" in 2014. There is a degree of uniformity in their predictions, he says, that rising rates, increasing house prices and stagnant incomes will soon herald the demise of the era of affordable housing.

Subzero temperatures and heavy snows in January may have kept children home from school, but they didn't freeze the Chicago-area residential market.
Preliminary sales data suggest the home-buying market stayed warm last month, but not hot. Thirty-five percent of homes listed in January sold in the same month, up from 29.5 percent in January 2013, according to Midwest Real Estate Data LLC, the Chicago-area multiple listing service.
For all homes that sold in January, their average time on the market was 106 days, nearly 25 percent less than homes that sold in January 2013.
It will be another month or two before more data becomes available to draw a definitive conclusion about sales activity last month. But Laurie Christofano, a Re/Max agent in Oak Park, saw little drop-off.

Poor weather combined with existing credit and labor concerns to bring home-builder confidence down this month to its lowest level in the better part of a year.
The National Association of Home Builders' (NAHB) Housing Market Index (HMI), released in partnership with Wells Fargo, posted a 10-point decline to 46 in the group’s latest report. It was the first time since May 2013 that the index measured below 50, the "neutral" point between a market viewed as "good" or "bad."
The index measures builder confidence in newly built, single-family homes based on current home sales, expected sales six months out, and observed traffic of prospective home-buyers—the latter faring the worst over the month, falling nine points to 31.

Home sellers could make out like bandits this year in Houston, as the region ranked No. 8 on Zip Realty's Top 10 Best Cities for Home Sellers.
The study -- which is based on housing market trends in 24 metro areas in the United States -- ranked the markets based on the performance of median home sales, number of days houses stayed on the market and total housing inventory, according to the research conducted by California-based ZipRealty Inc. (Nasdaq: ZIPR)

The real estate markets in the western part of the country soared in 2013 and is expected to continue to outperform this year, albeit at a measured pace, said Zip Realty CEO Lanny Baker.

Would you buy a property if your job was on the line?
Would you take out a mortgage if you thought you could be retrenched?

Recent data may well add a dose of reality to property markets – and offer buying opportunities for those who have been previously outbid at auctions.

This week the Australian Bureau of Statistics released its Wage Price figures which showed that wages rose only 0.7 per cent in the December quarter 2013 and 2.6 per cent over the last year. This is the worst result since this data has been collated.

Given this, plus the rising unemployment rate, it’s hard to see it not having an impact on property markets.

So fast, in fact, that 156 sell per month, on average, in Miami-Dade and one in every five sales of single-family houses is for a property costing at least $1 million.

As for million-dollar-plus condominiums, they account for one in every eight sales countywide.

A million-dollar home sold every 17 hours in the past year, with brokers moving more than 500 such properties between November 2012 and November 2013.

“And we don’t have December’s numbers yet,” said Valaree Byrne, an EWM broker and member of the Commercial Industrial Association of South Florida.

Countywide each month, brokers trade 71 single-family houses and 85 condos in the million-dollar range.

As 2014 advances, the nation’s foreclosure problem continues. While foreclosure properties are not nearly as prevalent as they were only a couple of years ago, they still abound – and one state attorney general isn’t going to let banks forget.

New York Attorney General Eric Schneiderman, long a fierce advocate for homeowners and an ardent enemy of big banks, is targeting banks who have an abundance of abandoned foreclosure properties, the kind that stay on a bank’s ledgers and contribute to price drops and neighborhood blight but aren’t being marketed or sold to prospective buyers.

According to CoreLogic's Home Price Index (HPI), the 11 percent increase in December home prices represented the 22nd consecutive monthly year-over-year increase.

Freezing temperatures did little to cool the housing market in January. The Pending HPI forecasts home prices to have risen 10.2 percent higher than the year before.

Excluding distressed sales, including short sales and foreclosures, equity sales prices rose 9.9 percent in December and are expected to rise 9.7 percent in January year-over-year.

A slowdown in momentum is not necessarily a halt to brisk housing sales.

While house swapping is not very common in real estate investing, it is an available tool for some investors and homeowners. There are actually two types of swapping methods available for sellers and buyers of properties.
The most common type of property swap is called a 1031 Exchange. In a 1031

exchange, two property owners come together with at least one party having a substantial capital gain or profit in the property. These exchanges are carefully controlled by IRS (Internal Revenue Service) guidelines. These exchanges have so many time and other parameter restrictions, that investors should not try these on their own. Have a company that specializes in these property transfers handle all the paperwork and compliance issues that are involved.