Page 25 - Aruba Today

BUSINESS A25
America’s housing recovery divided on age, race and place
JOSH BOAK
AP Economics Writer
WASHINGTON (AP) — It’s
the most profitable time
to sell a house since the
Great Recession started in
late 2007. But first-time buy-
ers are increasingly scarce.
More Americans are quali-
fying for mortgages, yet
minorities still get dispropor-
tionately rejected.
Three new industry analy-
ses released late last week
show that the recovering
economy has produced a
divided U.S. housing mar-
ket. Where people live,
their age and the color of
their skin have largely influ-
enced who has benefited
as real estate continues to
heal from the bursting of
a mortgage bubble that
triggered the worst eco-
nomic downturn in nearly
80 years.
Budding sales growth over
the past year has over-
whelmingly helped existing
owners who are seeking an
upgrade. But the millenni-
als buying their first home
are being priced out of the
market because student
debt has prevented them
from saving. And a ma-
jor gap exists among who
qualifies for a mortgage
even as the overall ap-
proval rate improves.
SELLER’S MARKET
Between July and Septem-
ber, sellers unloaded their
homes for an average of
$40,658 more than they
paid for their properties,
according to RealtyTrac,
the California-based real
estate information compa-
ny. This was the largest prof-
it recorded since the third
quarter of 2007, although it
remains below profits aver-
aging in excess of $100,000
during the height of the
boom in late 2005.
The financial gains might
be enough to coax more
people to list their proper-
ties for sale, ending a short-
age of homes on the mar-
ket.
The profits are “enough to
say, yes, I can leverage this
into moving up and buying
a bigger home,” said Dar-
en Blomquist, a vice presi-
dent at RealtyTrac.
But not all markets are
equal.
Monday 9 November 2015

Sellers in San Francis- Milwaukee and Tampa, homebuyers has fallen for years. A quarter of the first-
co pocketed $463,505. Florida. the third consecutive year time buyers identified sav-
Manhattanites reaped “In some cases, it may have to its lowest level since ing for a down payment
$385,909. Those in Washing- to do with outlying areas 1987, according to a sur- as their biggest challenge,
ton, D.C. made $130,593, that people were willing to vey by the National Asso- with the majority of this
while sellers in Los Angeles buy into during the housing ciation of Realtors. group saying that educa-
came away with $115,573. bubble,” Blomquist said. First-timers accounted for tion loans hurt their ability
to set aside money.
This problem may only
worsen as student debt
burdens continue to ex-
pand.
College borrowers who
graduated in 2014 finished
on average with $28,950
in debt, a 31 percent in-
crease over the past de-
cade after adjusting for
inflation, according to a
report last week by The In-
stitute for College Access
and Success.
This photo shows a sign in front of a home for sale in Roswell, Ga. Three new industry analyses MORTGAGE APPROVALS
It’s gotten easier to receive
released late last week show that the recovering economy has produced a divided U.S. housing a mortgage, yet black and
Hispanic homebuyers con-
market. Where people live, their age and the color of their skin have largely influenced who has tinue to lag substantially
behind whites and Asians.
benefited as real estate continues to heal from the bursting of a mortgage bubble that triggered The mortgage rejection
rate fell last year to 11.2
the worst economic downturn in nearly 80 years. (AP Photo/John Bazemore) percent from 12.4 percent
in 2013, according to Zil-
Meanwhile, housing in oth- “They’re not close enough less than a third of sales low, the real estate market-
er major U.S. counties sold to jobs to make sense for that are expected to com- place. The rejection rate
on average at a loss. buyers now.” fortably exceed 5 million for blacks also fell over the
This includes the Chica- this year. This group has tra- past year, but it remains
go suburbs outside Cook FIRST-TIME STRUGGLES ditionally represented 40 elevated at 23.5 percent.
County, with McHenry Millennials, ages 18 to 34, percent of sales. Just 2.5 percent of ap-
County sellers losing an face a less affordable The Realtors survey indi- provals for conventional
average of $19,849. Sellers housing market than their cates that student loans mortgages went to blacks
tended to unload proper- parents, forcing them to and other debts have de- in 2014, even though they
ties for less than they paid put off ownership. layed down payment sav- represent 12 percent of the
in Baltimore, Cincinnati, The share of first-time ings by a median of three U.S. population.q
Corporate deals set to rise despite global jitters
PAN PYLAS The figure for October is are focusing on M&A to se- by Anheuser Busch InBev
Associated Press up from 56 percent in April cure innovation, competi- is to cope with faltering
LONDON (AP) — There is and 40 percent at the tive advantage and mar- beer consumption in many
no let-up in executives’ same time last year. It rep- ket share for the foresee- parts of the world.
appetite for corporate resents the highest inter- able future,” she added. Other big deals this year
takeovers despite volatil- est in acquisitions that EY’s M&A activity has really include Royal Dutch Shell’s
ity in the stock market and survey of corporate deal- gathered pace this year 47 billion-pound ($71 bil-
mounting concerns over making has found in its six- with deal values, accord- lion) yet-to-be-completed
the global economy, par- year history. The low point ing to EY, already up 35 acquisition of BG Group,
ticularly China. was at the start, when only percent on 2014 and more as well as the $62.6 billion
According to a survey re- 24 percent of companies megadeals — those val- merger between Heinz
leased recently by con- signaled the intention to ued above $10 billion — in and Kraft Foods, which is
sulting firm EY, the recent make a takeover. 2015 than in any previous now called Kraft Heinz.
wave of mergers and ac- “With modest increases year of the survey’s history. EY said the boundaries
quisitions, or M&A, is set to in global GDP, organ- Earlier this month, the between industries looks
continue over the coming ic growth alone is not world’s top two beer mak- set to blur, with 48 percent
year. It found that 59 per- enough for companies to ers agreed to join forces of executives planning
cent of global companies expand and reshape at to create a company acquisitions in a different
are planning to secure at the pace they need,” said that would control nearly sector as new technology
least one deal over the Pip McCrostie, EY’s global a third of the global mar- impacts almost everything
next 12 months, partly as a head of transactions. ket. Much of the logic be- along the business chain.
means of cushioning wan- “The search for growth is hind the 69 billion-pound The manufacturing and
ing global growth as Chi- lifting deal-making to re- ($106 billion) takeover of retail sectors are set for the
na’s economy slows. cord highs, and executives British-based SAB Miller most such activity.q