Mortgage rates lay a cold hand on housing sector
According to the study, Los Angeles County had the second-lowest vacancy rate at 3.2 percent, down 10.6 percent. On average, renters countywide paid an average of $1,435 per month and had the largest rate of increase at 2.86 percent. The vacancy rate for Orange County was also at 3.2 percent, down 12.4 percent; and the Inland Empire was 3.6 percent, down 17.3 percent. The sharp rise in demand is being primarily driven by deteriorating home affordability, according to Richard Green, director of the Lusk Center and co-author of the study. Despite marked improvements in employment and the overall economy, the rapid increase in home prices and interest rates are pricing first-time homebuyers out of the local market, Green said. As more and more of these households become renters instead of buyers, we will continue to see fewer vacancies and higher rents. Santa Monica had the highest average rent price at $2,328, while Victorville had the lowest at an average of $755.
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Of the two, Lennar had the stronger report , which explains the 5% gain in its share price. Lennars home deliveries rose 37%, the average selling price rose 16%, and their backlog a key indicator of future business rose 32% to 5,958 homes. KB Home also put up solid numbers for its fiscal third-quarter , prompting their CEO to point to low inventories and that old favorite pent-up demand. The company dismissed rising mortgage rates as a temporary property management companies in baltimore md brake on the market, and predicted housing demand would resume its steady advance as soon as consumers adjust to higher rates and prices.
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