A lack of housing supply is a serious issue in the U.S. It has put upward pressure on home prices and made buying prohibitively expensive for many.

That said, new housing units are being constructed. We have a long way to go before the nation’s housing shortage is fully addressed, but it’s worth recognizing the progress. To find out where these new homes are being built, we analyzed the latest housing data and found that recently built houses aren’t particularly common in the nation’s 50 largest metropolitan areas. Here's what else we found. 

• Across the nation’s 50 largest metros, 1.48 million housing units were built from 2020 through 2022. Put another way, just 1.95% of these metros’ 75.89 million housing units were built from 2020 through 2022.
• Recently built housing units make up the largest share of homes in three South metros — Austin, Nashville, and San Antonio. In these metros, 5.97%, 5.04% and 4.74% of housing units, respectively, were built from 2020 through 2022. 
• New homes make up the smallest share of the housing supply in three Northeast metros — Hartford, Buffalo, and Providence. In these metros, 0.47%, 0.59% and 0.67% of housing units, respectively, were built from 2020 through 2022.
• New homes tend to be more expensive than other houses, though exceptions exist. For example, the median value of homes built from 2020 through 2022 was lower than the overall median home value in only two metros, San Francisco and Austin. 

You can check out our full report here: https://www.lendingtree.com/home/mortgage/new-housing-units-study/

LendingTree's Senior Economist and report author, Jacob Channel, had this to say:

"Ultimately, home prices in the United States are unlikely to become truly affordable until more new homes are built. The more housing supply there is, the less upward pressure there’s likely to be on prices and the more affordable buying a home will be. Unfortunately, as LendingTree’s study shows, most areas aren’t building particularly large amounts of new housing and we have a long way to go before we’ve introduced enough supply to bring prices down."

The buzzwords of today’s digital age are ‘AI’ and ‘Artificial Intelligence.’

These excite some and strike fear into others. Yet whatever your position, this Hard Trend is undeniable and will shape the future of your business or organization in some way.

Applications like ChatGPT, deep data algorithms, and others are changing the face of work and how we approach business practices at an unprecedented speed. So what does that mean for the roles we have at work? Better yet, how do employers acquire talent with the skills necessary to keep operations progressing into the future? And finally, how do employees adapt when many of the tasks they are used to completing are being transformed by AI?

AI Is Moving Fast

Organizations and employees alike find comfort in their tried-and-true operations, but the business world is never constant — change is the only constant. According to a recent report completed by Goldman Sachs, 60% of the jobs available today did not exist in the 1940s. With the accelerated rate at which AI is transforming our current roles, today’s positions will be exponentially different in the next 5, 10, 15, and 20 years.

We do not have the luxury of sitting back and becoming complacent in our current roles, no matter what level they are at. Instead, we need to take an Anticipatory approach to work, looking at the future of AI technology in the workplace and proactively arming our workforce with essential knowledge and skills.

Do Not Let AI Lead You — Be the Leader

Because AI is progressing at such an exponential rate and will continue to do so, many organizations are still finding it difficult to obtain and retain top talent. Likewise, workers are finding it difficult to assimilate to their new roles in a technology-driven workforce.

Adaptation to AI is certainly on everyone’s minds; however, there is a slight problem with the concept of adaptation. It is a complacent and reactive approach to this digital disruption and will continue to be. Essentially, using agility to face AI will continue to put you in a place of professional anxiety.

With the uptick in AI applications, many companies have allowed AI to come to them. As a result, they wind up disrupted and feel that AI is at fault. Let me be frank: AI applications are not sentient beings. They merely exist and can or cannot be put into action.

It is up to you to apply AI within your business or organization. But applying AI is only half the battle. There is the human factor of the equation, in which your employees are affected by those AI applications. What ends up happening is business leaders either replace employees with those who have the technical skills necessary to work with AI or they force their current employees to learn these skills at unrealistic speeds.

But in reality, no matter the option you select, you are already behind at this point.

High-Level Skills and Technical Knowledge Are a Powerful Combination

Implementing AI applications in Anticipatory ways is definitely part of the equation, but as a leader, you are dealing with humans at your organization. Humans need to be taught how to work with these AI applications.

Teaching the essential skills at the heart of AI encompasses more than just technical know-how of coding languages, data sets, and machine learning principles. These are valuable skills, but employers need to teach how to leverage the higher levels of cognitive domain that human beings bring to the table.

In 1954, psychologist Benjamin Bloom developed a framework for categorizing educational goals: Bloom’s Taxonomy of Educational Objectives. The categories are:

■ Knowledge

■ Comprehension

■ Application

■ Analysis

■ Synthesis

■ Evaluation

Knowledge and comprehension are the lower levels, while application, analysis, synthesis, and evaluation are higher. By creating a space for employees to foster these higher levels, you not only encourage them to develop confidence in their use of these new skills, but employees will also have the advantage of examining data and filtering the most crucial information in a way that AI cannot. 

Bringing It All Together

Creative problem-solving, decision-making, and the ability to communicate effectively are key skills that AI cannot touch. A mastery of these skills gives you, your team, and your business or organization the competitive advantage in your industry!

As you can see, an Anticipatory approach to AI in your industry and others is not just about working AI into your system. Human employees will always be a valuable asset to any business or organization, but much like AI applications, they too need to evolve and “upgrade.”

Combine these high-level skills with modernized knowledge in your training, make it interactive, and give current employees downtime to explore and learn these competencies fully. Meshing teaching critical-thinking skills with learning new technology is the way of the future.

To learn more about how you can take advantage of AI and accelerated digital transformation while retaining high-value employees, join my Anticipatory Leader Membership. Right now, you have a choice to make. You can react to problems and disruptions to your life, your career, and your organization after they happen, or you can tap into this unique learning system that will empower you with the ability to accurately foresee disruptions and game-changing opportunities. Learn more: https://www.burrus.com/become-anticipatory.

Luxury sales are outperforming partly because elevated mortgage rates aren’t a deterrent for many luxury buyers, as a record 47% of luxury homes were bought in cash at the start of 2024

The median-priced U.S. luxury home sold for a record $1,225,000 in the first quarter, up 8.7% from a year earlier, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Prices of non-luxury homes rose at roughly half the pace; they were up 4.6% to a median of $345,000, also a record high.

Redfin defines luxury homes as those estimated to be in the top 5% of their respective metro area based on market value, and non-luxury homes as those estimated to be in the 35th-65th percentile based on market value.

Luxury prices are rising largely because demand for high-end homes has held up better than demand for middle-of-the-road homes. Sales of luxury homes are on the upswing, partly because many high-end buyers are undeterred by high mortgage rates, with the share of luxury homes bought in cash sitting at record highs. New listings of luxury homes are soaring—but not enough to curb the price growth that comes with rising demand; the total supply of luxury homes is still far below pre-pandemic levels.

“People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise,” said David Palmer, a Redfin Premier agent in the Seattle metro, where the median-priced luxury home sells for $2.7 million. “They’re ready to buy with more optimism and less apprehension. It’s a similar sentiment on the selling side: Prices continue to increase for high-end homes, so homeowners feel it’s a good time to cash in on their equity. Even though mortgage rates remain elevated and demand isn’t as high as it was during the pandemic, many homebuyers and sellers feel the worst of the housing downturn is behind us.”

Luxury home sales rise for first time since 2021 as record share of affluent buyers pay cash

Sales of luxury homes rose 2.1% year over year in the first quarter. Luxury sales started posting year-over-year increases in January for the first time since August 2021.

Sales of non-luxury homes decreased 4.2% year over year. Non-luxury sales haven’t posted an increase since the end of 2021.

Sales are growing for luxury homes and declining for non-luxury homes largely because so many affluent buyers are able to pay in cash, meaning today’s elevated mortgage rates don’t deter them from purchasing homes. Nearly half (46.8%) of luxury homes bought during the three months ending February 29 were purchased in cash. That’s the highest share in at least a decade and up from 44.1% a year earlier.

The weekly average 30-year fixed mortgage rate has hovered between 6.6% and 7% since the beginning of 2024, more than double pandemic-era record lows. Elevated mortgage rates have driven down demand for the average American homebuyer, but rates are irrelevant to cash buyers.

Supply of luxury homes for sale posts biggest year-over-year increase on record

The total number of luxury homes for sale rose 12.6% from a year earlier in the first quarter, the biggest increase on record. That’s compared with a 2.9% decline in non-luxury inventory.

New listings of luxury homes soared 18.5% from a year earlier in the first quarter, the second consecutive quarter of double-digit increases. That’s roughly seven times bigger than the 2.7% increase for non-luxury homes.

Supply of luxury homes is shooting up for several reasons. One, the mortgage-rate lock-in effect has a lesser impact on luxury homeowners because they’re more apt to buy their next home in cash or be in a financial position to take on a higher rate. Two, owners of luxury homes, many of whom have a lot of equity, are putting their houses on the market to cash in while prices are at record highs. Three, luxury supply had a lot of room to grow, as it was sitting at low levels during the first quarter of 2023.

It’s worth noting that while luxury inventory is on the rise, total supply and new listings are below typical pre-pandemic first-quarter levels. Relatively low inventory is one reason luxury prices are increasing.

Metro-Level Luxury Highlights: Q1 2024

Redfin’s metro-level luxury data includes the 50 most populous U.S. metros. Some metros are removed from time to time, to ensure data accuracy. All changes noted below are year-over-year changes.

• Prices: The median sale price of luxury homes rose most in Providence, RI (16.2% increase to $1,400,000), New Brunswick, NJ (15% increase to $1,900,000) and Virginia Beach, VA (12.8% increase to $1,100,000). It fell in just eight metros, with the biggest declines in New York (-9.9% to $3,250,000), Austin, TX (-6.9% to $1,629,300) and Minneapolis (-2% to $975,000).
• Sales: Luxury home sales rose in just over half the metros. They increased most in Seattle (36.9%), Austin, TX (25.5%) and San Francisco (23.9%). They decreased most in Newark, NJ (-23.6%), Philadelphia (-23%) and Detroit (-19.4%).
• Active listings: The total number of luxury homes for sale increased most in Austin, TX (40.5%), Jacksonville, FL (35.9%) and Fort Worth, TX (32%). Total inventory fell in 15 metros, with the biggest declines in Detroit (-16.8%), Atlanta (-14.1%) and Chicago (-13%).
• New listings: New listings of luxury homes increased most in Jacksonville, FL (63.6%), Fort Worth, TX (41.7%) and Nassau County, NY (40.5%). New listings fell in eight metros, with the biggest declines in Detroit (-17%), Atlanta (-8.2%) and Chicago (-7.7%).
• Speed of sales: Luxury homes sold fastest in Seattle, Oakland, CA and San Jose, CA with median days on market of 9, 12 and 12, respectively. They sold slowest in Miami (118 days), Austin, TX (106) and Nashville, TN (104).

10 Most Expensive U.S. Home Sales: Q1 2024

1. Miami, FL (Surfside): $48M
2. Seattle, WA (Medina): $38.9M
3. Los Angeles, CA (Malibu): $38.5M
4. Glenwood Springs, CO (Aspen): $37M
5. Santa Maria, CA (Santa Barbara): $36.8M
6. Hilton Head Island, SC (Yemassee): $35M
7. Glenwood Springs, CO (Aspen): $33.5M
8. West Palm Beach, FL (Lantana): $32.5M
9. Santa Maria, CA (Santa Barbara): $32M
10. Nashville, TN (Nashville): $32M

To view the full report, including charts and a full metro-level breakdown, please visit: https://www.redfin.com/news/q1-2024-luxury-report/

We all know that you can’t fight the FED, but when the FED doesn’t do what people want them to do, the markets are the ones that respond! We spoke a couple of weeks ago about wishing certain people would just keep their mouths shut until AFTER certain actions do or don’t happen. However, we got to see what happens when people get too far out in front of a story, or just downright say things that aren’t true. Here are a few issues that were front and center.

•  The FED didn’t cut rates.

•  Inflation isn’t going lower.

•  Most of the jobs created were part-time jobs.

•  The actual number of full-time workers has gone down.

•  Mortgage rates didn’t go to 5% in March.

•  Home prices continue to rise.

•  What happens when CPI/PPI show stress and your leadership says “Don’t” and they DO?

•  The NAR agreement has yet to be signed off on by a judge.

•  While some of the mortgage agencies have made their voice heard on what happens when sellers pay buyer’s agents, there are still some that have yet to weigh in.

•  Let’s not even get started with 50 states having to approve disclosures, listing agreements, and buyer agency contract language, and get it done by July!

That said, people are still buying houses and taking mortgage loans to do it. Mortgage rates are still lower than historical averages and in some parts of the country we are seeing the return of multiple offers and offers well over list price to secure the deal. It’s important to stay on top of the FACTS of the matter and be prepared to execute your success strategies because it's helping people navigate the process that gets you paid!

Questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.

Daily average mortgage rates jumped to their highest level since last November after last week’s disappointing inflation report

The median U.S. home-sale price increased 5% from a year earlier during the four weeks ending April 14, bringing it to $380,250—just $3,095 shy of June 2022’s all-time high. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

The average daily mortgage rate this week surpassed 7.4%, the highest level since last November, after a hotter-than-expected inflation report and the Fed’s confirmation that interest-rate cuts will be delayed. The combination of high mortgage rates and prices have brought homebuyers’ median monthly housing payment to a record $2,775, up 11% year over year.

There are signals that buyers are out there touring homes despite rising rates. Mortgage-purchase applications are up 5% week over week, and Redfin’s Homebuyer Demand Index—a measure of requests for tours and other buying services from Redfin agents—is near its highest level in seven months. Chen Zhao, Redfin's economic research lead, said some house hunters are hoping to buy now because they're concerned rates could rise more, and others have grown accustomed to elevated rates and pushed down their home-price budget accordingly.

“Home sales are slower than usual, but there are still people buying and selling because if not now, when?” said Connie Durnal, a Redfin Premier agent in Dallas. “I’ve had a few prospective buyers touring homes for the last several years, since mortgage rates started going up, and they wish they would have bought last year because prices and rates are even higher now. My advice to them: If you can afford to and you find a house you love, buy now. There’s no guarantee that rates will come down soon.”

For more of Redfin economists’ takes on the housing market, including how current financial events are impacting mortgage rates, please visit Redfin’s “From Our Economists” page.

Leading indicators

Key housing-market data

To view the full report, including charts, please visit:
https://www.redfin.com/news/housing-market-update-home-prices-mortgage-rates-increase