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New Home Sales Grew 35.0% YOY In February As Consumers Pushed Past…

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Zonda New Home Pending Sales Index

“Saving for a down payment is one of the biggest hurdles to becoming a homeowner,” said Ali Wolf, Zonda’s Chief Economist.

Today, the experts at Zonda, the housing industry’s foremost advisors, released the New Home Pending Sales Index (PSI) for February 2021. The New Home PSI shows pending sales decreased month-over-month but increased year-over-year across the United States. The index is a leading residential real estate indicator based on the number of new home sales contracts signed across the country.

The New Home PSI came in at 168.3 for February, representing a 35.0% increase from February 2020. On a month-over-month basis, new home sales fell by 2.4% from January.

This is the last report for a few months that provides a reasonable take on year-over-year housing trends before the comparisons get muddied by the pandemic slowdown in March, April, and early-May 2020.

We expanded our select markets list from 20 to 25 markets this month. Pending new home sales trended above February 2020 levels in 22 of our select 25 top markets. The best new home markets in February were Jacksonville, Cincinnati, and San Antonio. The homebuilding industry lost a week in February in parts of the South during the harsh winter weather, and yet contracts signed in top Texas markets surprised to the positive as sales were strong in the month otherwise.

The New Home PSI is made up of two components: new home orders and the average sales rate per community. New home orders look at total sales and will fall based purely on limited supply. The average sales rate per community captures how well builders are selling at the open communities and strips out the supply side. Both, however, can be negatively impacted by builders intentionally capping sales. The included table shows the year-over-year change for the two components and is sorted by the spread to quickly identify the markets where supply is impacting sales the most. Note that the PSI calculation includes weights and seasonal adjustments. The year-over-year changes in the table removes both and are just looking at the raw index values.

Jacksonville, the strongest for new home sales among our select markets, could be hitting ever better numbers if more inventory were available. The spread between new home orders and the average sales rate per community in Jacksonville is the highest rivaled only by Baltimore.

Salt Lake City slipped year-over-year on both measures on insatiable demand driven by a robust economy and positive migration trends causing builders to sell out of communities quicker than they can replace them and sales caps.

“70% of builders are intentionally slowing or pausing sales to better align contracts with production capacity, which makes drawing market conclusions more difficult,” said Wolf. “The underlying demand in the housing market is still there, though, even as prices and mortgage rates rise.”

New home data is susceptible to outsized swings in contract activity based on shifts in the number of actively selling communities. As a result, Zonda normalizes the data to ensure consistency across the index. The New Home PSI blends the cumulative sales of active or recently sold-out projects with the average sales rate per community, which adjusts for fluctuations in supply. Furthermore, the New Home PSI is seasonally adjusted based on each markets’ specific seasonality and removes outliers. The index is baselined to 100 for June 2016. Today’s national New Home PSI is 68% above the base level.

The next Zonda New Home PSI press release, featuring March 2021 data, will be issued on Wednesday, April 21, 2021 at 9:00 a.m. ET.

Methodology
The Zonda New Home Pending Sales Index (PSI) is built on proprietary, industry-leading data that covers 60% of the production new home market across the United States. Reported number of new home pending contracts are gathered and analyzed each month. Released on the 15th business day of each month, the New Home PSI is a leading indicator of housing demand compared to closings because it is based on the number of signed contracts at a new home community. Zonda monitors 18,000 active communities in the country and the homes tracked can be in any stage of construction.

The new home market represents roughly 10% of all transactions, allowing little movements in supply to cause outsized swings in market activity. As a result, the New Home PSI blends the cumulative sales of activity recently sold out projects with the average sales rate per community, which adjusts for fluctuations in supply. Furthermore, the New Home PSI is seasonally adjusted based on each markets’ specific seasonality, removes outliers, and uses June 2016 as the base month. The foundation of the index is a monthly survey conducted by Zonda. It is necessary to monitor both new and existing home sales to establish an accurate picture of the relative health of the residential real estate market.

About Zonda

Zonda provides data-driven housing market solutions to the homebuilding and multifamily industries. From builders to building product manufacturers, mortgage clients, and multifamily executives, we work hand-in-hand with our customers to streamline access to housing data to empower smarter decisions. As a leading brand in residential construction, our mission is to advance the home building industry, because we believe better homes mean better lives and stronger communities. Together, we are building the future of housing.

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Source: https://www.prweb.com/releases/new_home_sales_grew_35_0_yoy_in_february_as_consumers_pushed_past_rising_home_prices_and_mortgage_rates_according_to_zonda/prweb17808404.htm

Real Estate

Knox Financial raises $10M to take the pain out of being a landlord

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We’ve all heard the phrase “passive income” to describe how people can make money by owning rental properties. Many Americans would love to passively earn money, but the process of becoming a landlord can be intimidating and complicated. 

I mean, how many people have looked back and wished they hadn’t sold a property after seeing its value rise years after selling it?

And those who are already landlords can get overwhelmed by the complexities of managing properties.

One startup out of Boston, Knox Financial, aims to help people identify and manage residential rentals with its algorithm-based platform, and it’s raised a $10 million Series A to help it further that goal. Boston-based G20 Ventures led the round, which included participation from Greycroft, Pillar VC, 2LVC, and Gaingels.  

The investment brings Knox’s total raised since its inception in 2018 to $14.7 million. The company closed on a $3 million seed round in January 2020, led by Greycroft.

Knox co-founder and CEO David Friedman is no stranger to startups. He founded Boston Logic – an integrated marketing platform and online marketing services for real estate offices and agents – in 2004. He sold that company (now under the name Propertybase) to Providence Equity for an undisclosed amount in 2016.

Knox launched its platform in March of 2019, with the goal of offering homeowners who are ready to move “a completely hands-off way” of converting a home they’re moving out of into an investment property. It also claims to help landlords more easily and efficiently manage their rentals.

At the time of its seed round early last year, the company was only operating in the Boston market and had 50 units on its platform. It’s now operating in seven states, has “hundreds” of investment properties on its platform and is overseeing a portfolio of more than $100 million.

So how does it work? Once a property is enrolled on Knox’s “Frictionless Ownership Platform,” the company automates and oversees the property’s finances and taxes, insurance, leasing and legal, tenant and property care, banking and bill pay.

Knox also has developed a rental pricing and projection model for calculating the investment rate of return a property will produce over time.

Image Credits: Knox Financial

“We save investors a lot and almost always make their portfolios more profitable,” Friedman said. “If someone is moving or upsizing, we can turn properties into incredible ROI generators or cash flow.”

The company’s revenue model is simple.

When a dollar of rent moves through our system, we keep a dime,” Friedman told TechCrunch. “We align our interests with our customers. If there’s no rent coming in, we’re not making money. Or if a tenant doesn’t pay rent, we don’t make money.”

Knox plans to use its new capital to continue expanding geographically and getting the word out to more people.

“We want to become the de facto platform for real estate investment acquisition and ownership,” Friedman said. “And we have to be coast to coast to really do that for everybody. So, we’re still very early in our growth trajectory.”

Bob Hower, co-founder and partner of G20 Ventures, shared that weeks after his college graduation, he had bought a fixer upper with his mother’s help. A week after finishing renovations, he put the house on the market. Over the subsequent 5 months, he gradually reduced the price as the market softened, and eventually the property sold at a small profit.

“That house now is worth a multiple of what I paid for it,” Hower recalls. “In hindsight, the mistake I made was deciding to sell the house at all.”

That experience helped Hower appreciate what he describes as a “clarity of thinking” in Knox’s business model.

“Had Knox existed decades ago, I’d likely still have that fixer-upper I bought after college,” he said. “Investing platforms such as Betterment have collapsed multiple advising and optimization activities into a simple single-sign-on service, and Knox is the first company to apply this type model to residential real estate investing.”

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://techcrunch.com/2021/04/19/knox-financial-raises-10m-to-take-the-pain-out-of-being-a-landlord/

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Real Estate

Uber vets raise $12.5M for real estate property management startup Doorstead

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Doorstead executives, from left to right: William Wu, CTO; Jennifer Bronzo, co-founder and COO; Jason Karas, VP of Growth; Ryan Waliany, co-founder and CEO. (Doorstead Photo)

New funding: Doorstead, a San Francisco real estate property management startup founded by former Uber employees, raised a $12.5 million Series A round led by Seattle firm Madrona Venture Group.

Company background: The 2-year-old startup targets 15 million small real estate investors who own single-family units and need help renting out their space. It provides data on optimal rental prices and offers a guaranteed rental offer in less than 24 hours.

Doorstead also manages the property, including preparing it for lease, the screening of tenants, and negotiating rent. It manages more than 300 properties in the Bay Area and recently launched in Los Angeles and Orange County. The startup has more than $10 million of rent under management.

Revenue model: Doorstead follows the industry standard of approximately 8% of monthly rents as a management fee, and 50% of one month’s rent when a tenant is placed. It guarantees payment to a property owner upfront — if the company misses estimates, it covers the difference, and if it rents out a higher rate, the extra cash goes to the owner.

Leadership: Uber vets Ryan Waliany and Jennifer Bronzo started Doorstead in 2019. Waliany worked in product at Uber and previously started Kitchenbowl, a Seattle social recipe app that sold to ABC Cooking in 2017. He also co-founded HotSwap, Bullet Media, and Idealix. Bronzo co-founded gaming startup Thumper Studios and hardware company ZowPow, and was also a property manager for Maywood Construction.

Funding: The 24-person company has raised $17.3 million to date. Other backers include executives from OpenDoor, Uber, and Docusign.

“Like we have seen in the market for buying and selling residential real estate with our previous investment in Redfin, when you eliminate friction and apply data and technology to the transaction, both buyer and seller (or in this case owner and renter) win,” Madrona’s Scott Jacobson and Elisa La Cava wrote in a blog post. “Doorstead has the winning approach for the market, and the team to build what we believe will become a household brand.”

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://www.geekwire.com/2021/uber-vets-raise-12-5m-real-estate-property-management-startup-doorstead/

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Blockchain

Bubble or a drop in the ocean? Putting Bitcoin’s $1 trillion milestone into perspective

Bitcoin is relatively small compared to stocks and real estate, and those holders might reinvest dividends in other assets.

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On Feb. 19, Bitcoin’s (BTC) market capitalization surpassed $1 trillion for the first time. While this was an exciting moment for investors, it also concerned investors that the asset is in a bubble.

Although a handful of listed companies ever achieved this feat, unlike gold, silver, and Bitcoin, stocks potentially generate earnings, which in turn can be used for buybacks, dividends, or developing additional sources of revenue.

On the other hand, as Bitcoin adoption increases, those same companies will likely be forced to move some of their cash positions to non-inflatable assets, ensuring demand for gold, silver and Bitcoin.

In fact, data shows that diversification between Bitcoin and traditional assets provides better risk-adjusted performance for investors, which is getting increasingly difficult for companies to ignore.

Bitcoin continuing to push above the trillion-dollar mark is also easy to overlook until one compares it to the market cap of other significant global assets. To date, less than ten tradable assets have achieved this feat.

World’s 20 most profitable companies. Source: fortune.com

As depicted above, the world’s 44 most profitable companies combined generate more than $1 trillion in earnings per year. One must keep in mind that stockholders might as well reinvest their dividends into equities, but some of it might end up in Bitcoin.

$1 trillion is small compared to real estate markets

Corporate earnings are not the only flows that may trickle into scarce digital assets. Some analysts estimate that part of the real estate investment, especially those yielding less than inflation, will eventually migrate to riskier assets, including Bitcoin.

On the other hand, current holders of lucrative real estate assets might be willing to diversify. Considering the relatively scarce assets available, stocks, commodities, and Bitcoin are likely the beneficiaries of some of this inflow.

Global real estate markets. Source: visualcapitalist.com

According to the above chart, the global agricultural real estate is valued at $27 trillion. The U.S. Department of Agriculture estimates a return on farm equity at 4.2% for 2020. Albeit very raw data, considering there are multiple uses for agricultural real estate, it is quite feasible that the sector generates over $1 trillion per year.

As recently reported by Cointelegraph, there are 51.9 million individuals worldwide with $1 million or higher net worth, excluding debt. Despite representing only 1% of the adult population, they collectively hold $173.3 trillion. Even if those are unwilling to sell assets in exchange for BTC, an insignificant 0.6% annual return is enough to create $1 trillion.

If there’s a bubble, Bitcoin is not alone

These numbers confirm how a $1 trillion market capitalization for Bitcoin should not be immediately considered a bubble.

Maybe those Bitcoin maximalists are correct, and global assets are heavily inflated due to a lack of scarce and secure options to store wealth. In this case, which doesn’t seem obvious, a global-scale asset deflation would certainly limit BTC upside potential. Unless they somehow think a cryptocurrency can extrapolate global wealth, which seems odd.

Back to a more realistic worldview, the above comparison with equities, agricultural real estate, and global wealth also confirms how insignificant Ether’s (ETH) current $244 billion capitalization is, let alone the remaining $610 billion in altcoins.

Assuming none of the corporate profits or real estate yield will be allocated to cryptocurrencies seems unlikely. Meanwhile, a mere $100 billion annual inflow for Bitcoin is five times higher than the $20.3 billion newly-minted coins per year at the current $59,500 price.

For example, $100 billion flowing into Bitcoin would only be 5% of the $1 trillion yearly corporate dividends and 5% from global wealth or agricultural real estate returns. Even though the impact on gold’s $11 trillion market capitalization would be negligent, such allocations would certainly play a vital role in Bitcoin’s path to becoming a multi-trillion dollar asset.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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Source: https://cointelegraph.com/news/bubble-or-a-drop-in-the-ocean-putting-bitcoin-s-1-trillion-milestone-into-perspective

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Crowdfunding

LendInvest Teams Up with Credit Kudos to Improve Underwriting Process via Open Banking

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LendInvest has teamed up with Credit Kudos in order to improve the underwriting process via Open Banking.

Through the partnership, LendInvest and Credit Kudos will aim to provide brokers and clients a more accessible and secure service. The initiative also aims to enable LendInvest with making more informed lending-related decisions with the help of Open Banking insights.

LendInvest is a technology-focused property finance Fintech specialized in providing property developers a more intuitive and flexible way to gain access to commercial property finance. The company chose Credit Kudos to improve its time-to-decision with a seamless customer experience and to enhance affordability and credit risk assessments via Open Banking-powered risk insights.

Unlike the typical credit assessment providers, Credit Kudos leverages Open Banking data to offer a holistic, up-to-date view to lenders of a business or company’s financial situation. By leveraging bank transaction information and loan outcome details, it offers key insights to assist lenders with making informed credit-related decisions.

Credit Kudos’ tech supports a more seamless experience for customers and lenders. It aims to remove the requirement to manually upload business documents, and it also allows lenders to automate many parts of the underwriting assessment process.  LendInvest reports that it experienced a 50% reduction in overall assessment times.

Open Banking insights have also assisted LendInvest with offering its products to clients it was not able to work with before. These customers include self-employed and sole traders who might not have traditional or more typical income patterns. This seamless, quicker application process has also provided a 26% increase in Open Banking-related conversion rates after launching last month.

Arman Tahmassebi, COO of LendInvest, stated:

“Getting rid of the manual documentation process has allowed us to offer a far faster and more convenient service. Although we have been using Open Banking for two years, this new partnership with a like-minded fintech has allowed us to take it to the next level and really reap the benefits of the technology. The greater insights are empowering us to make better informed, faster lending decisions to more people. We have been particularly impressed with the seamless integration of Credit Kudos into our system – the new dashboard is highly intuitive and it’s already helping us serve more customers.”

Freddy Kelly, Founder and CEO at Credit Kudos, remarked:

“Like LendInvest, we are committed to making credit applications smoother and fairer for both the lender and applicant, so this partnership is a natural fit. Open Banking technology is transformative for lenders who want to make smarter and faster decisions to better serve their customers. With our technology in place, lenders can automate the underwriting process and get a far more accurate picture of an applicant’s true financial position. It not only helps them lend responsibly but also opens up their service to underserved customers who may not have traditional income patterns, such as sole traders.”

Credit Kudos’ tech is completely integrated within LendInvest’s application process for buy-to-let mortgages. It will be launched along with integrations within other services in the foreseeable future.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://www.crowdfundinsider.com/2021/04/173847-lendinvest-teams-up-with-credit-kudos-to-improve-underwriting-process-via-open-banking/

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