BROADCASTS.com

In this Real Estate News Brief for the week ending April 1st, 2023\u2026 new PCE numbers show inflation is weakening, where investors are reaping the biggest returns for single-family rentals, and how much apartment renters are saving if they don\u2019t buy. \xa0 Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review. \xa0 Economic News \xa0 We begin with economic news from this past week, and a favorable report on inflation. The Bureau of Economic Analysis released a report on the February Personal Consumption Index, or PCE, and it shows a mild .3% increase. That\u2019s down from a .6% increase in January, and suggests that the Fed may be getting the upper hand on high prices. With this report, the yearly rate dropped from 5.3% to 5%, which is the lowest it\u2019s been in more than a year and a half. (1) \xa0 Senior Federal Reserve officials are suggesting that another quarter point rate hike is still needed, before they call for a pause. That would be decided at the Fed\u2019s next meeting in May as Fed officials also weigh the risk of further interest rate hikes on the banking system. \xa0 The government revised their Q4 GDP for a third time. It was initially 2.9%. Last month, it was lowered to 2.7%. The government is now saying it was 2.6%. As MarketWatch reported, the GDP was reduced because data shows weaker consumer spending, and a decline in corporate profits. (2) \xa0 The weekly jobless report shows 198,000 people applied for benefits. That\u2019s a three-week high, but it\u2019s still a very low number and indicates that the labor market remains strong in the face of high-interest rates and a potential recession. (3) \xa0 Reports on housing include the latest Case-Shiller home price report. The national index fell .2% in January, while the 20-city index was down .4%. Year-over-year home prices are still 2.5% higher, but that\u2019s down from 4.6% last month. (4) \xa0 Home buyers seem to be warming up to the idea of higher mortgage rates. The National Association of Realtors reports that pending sales were up for a third month in a row. They rose .8% in February. That\u2019s after a huge 8.1% surge in January. If you compare the numbers to one year ago, they are down 21.1%. (5) \xa0 Mortgage Rates \xa0 Mortgage rates didn\u2019t move much in the last week, but they remain at a lower level than recent highs. Freddie Mac says the average 30-year fixed-rate mortgage was down one point to 6.32%, which is essentially the same as the previous week. The 15-year dropped 12 points to 5.56%. (6) \xa0 In other news making headlines\u2026 \xa0 More Sellers Sitting on the Sidelines \xa0 While it seems the spring buying season is producing a surge in buyers, and mortgage rates have come down slightly, sellers are still in a wait-and-see mode. Realtor.com says that new listings fell again in March, and are down 20% compared to a year ago. The active inventory is about 60% higher year-over-year, but that\u2019s because homes are taking longer to sell. \xa0 Realtor.com says that homes are now sitting on the market for an average of 54 days. That\u2019s up from an average of 36 days last spring. Chief economist, Danielle Hale, says shoppers are very sensitive to mortgage rates and they \u201conly jump back in the market when rates dip.\u201d She says rates will play a big role in whether the housing market \u201cbumps along or picks up speed this year.\u201d \xa0 Best Counties for Single-Family Rentals \xa0 If you\u2019re trying to decide where you might get the best returns for a single-family rental, real estate data firm ATTOM just issued its Q1 2023 Single-Family Rental Market report. ATTOM analyzed 212 U.S. counties with a population of at least 100,000.\xa0 \xa0 The report shows the overall single-family rental yield increasing from last year in 91% of those counties. It was 6.7% last year, and rises to 7.5% this year. Rents are rising faster than home prices in many counties. CEO, Rob Barber says: \u201cRents for single-family homes are growing while prices have flattened out, which has helped boost yields for landlords for the first time in at least several years.\u201d \xa0 Three of the top five counties for rental returns are in Florida, including River County, Florida, in the Sebastian-Vero Beach area; Collier County, Florida, in the Naples area; and Charlotte County, Florida, in the Punta Gorda area. A few other counties with high rental yields include Chicago\u2019s Cook County, Cleveland\u2019s Cuyahoga County, and West Palm Beach\u2019s Palm Beach County.\xa0 \xa0 Looking at the top 50 counties for rental returns: 29 are in the South, 13 are in the Midwest, eight are in the Northeast, and none are in the West. \xa0 Big Savings for Apartment Renters \xa0 The savings gap is growing for people who rent an apartment instead of buying a home. The National Multifamily Housing Council says it\u2019s now more than $1,000 dollars more expensive per month to buy a home than it is to rent an apartment \u2013 $1,176 to be exact. That\u2019s the widest gap in 15 years. (9) \xa0 Apartment rent growth has been slowing. It was only up 2.6% in March and is now back to pre-pandemic levels. Vacancies are also returning to normal levels. They are currently at 6.6%. That\u2019s up from 6.4% in February. (10) \xa0 That\u2019s it for today. Check the show notes for links at newsforinvestors.com. You\u2019ll also find market data at our website, along with investing education and opportunities. You need to become a member to access some of our information, but it\u2019s free to join and will only take a few minutes.\xa0 \xa0 We also ask that our listeners subscribe to the podcast, if you haven\u2019t done so already. And if you have a minute, please leave us a review! \xa0 Thanks for listening. I'm Kathy Fettke. \xa0 Links: \xa0 1 - https://www.marketwatch.com/story/u-s-inflation-softens-in-february-pce-finds-785c116e?mod=home-page \xa0 2 - https://www.marketwatch.com/story/u-s-gdp-in-fourth-quarter-trimmed-again-to-2-6-on-weaker-consumer-spending-663e9a5b?mod=search_headline \xa0 3 - https://www.marketwatch.com/story/jobless-claims-rise-to-three-week-high-of-198-000-but-layoffs-still-extremely-low-3efde979?mod=economy-politics \xa0 4 - https://www.marketwatch.com/story/u-s-home-price-rises-slow-again-in-january-with-western-markets-leading-declines-2ea97cfb?mod=economic-report \xa0 5 - https://www.marketwatch.com/story/u-s-pending-home-sales-rise-for-the-third-month-in-a-row-in-february-18c2a392?mod=economic-report \xa0 6 - https://www.freddiemac.com/pmms \xa0 7 - https://www.cnbc.com/2023/03/30/more-home-sellers-are-sitting-out-of-the-spring-housing-market.html \xa0 8 - https://www.attomdata.com/news/market-trends/attom-2023-single-family-rental-market-report/ \xa0 9 - https://www.globest.com/2023/03/31/renting-an-apartment-is-now-1175-cheaper-per-month-than-owning-a-home/ \xa0 10 - https://www.cnbc.com/2023/03/28/rent-growth-drops-to-pre-covid-levels.html?__source=realestate%7cnews%7c&par=realestate