Lew Sichelman
Most homebuyers know that the key to obtaining a lower mortgage rate is a good credit score. But new research has also found a direct link between credit scores and insurance premiums.
In a report released in August, the Consumer Federation of America and the Climate and Community Institute found that having a low credit score (around 630) drove up consumers’ premiums to more than double what they’d be with a high score (around 820). All told, those with a low score spend nearly $2,000 more per year on insurance premiums.
For those with middle-of-the-road scores, say around 740, the average annual premium increased by $792.
The study also found that average premiums for homeowners with low credit scores who live in “low-risk” insurance areas (those less prone to natural disasters) were often higher than those for high-credit-score homeowners in “high-risk” communities.
Are You Wearing Future Insulation?
Where do old blue jeans go? Some are recycled into insulation that is said to be as strong as the pink stuff, but with less of an impact of the environment.
The process works like this: Old denim is sent to a recycling center, where the zippers and buttons are removed and mechanical shredders grind the cotton into small pieces. Once it is in a fibrous state, the cotton is pressed into large mats that can be cut to fit into wall and floor cavities.
One producer of recycled denim insulation said the process diverts 20 million pounds of fabric from landfills annually, and recycles 500,000 pairs of jeans – and 5 tons of zipper fragments – every month. Best of all, there are no itchy fiberglass particles to aggravate installers and homeowners.
Why Old Clients Hit Up Agents
Have you reached out to your real estate agent lately? Most homeowners don’t, according to a survey by marketing firm 1000watt.
Nearly two-thirds of the buyers queried have not contacted their agents since buying their homes, the company found. Of the 31 percent who did, almost half were looking for a recommendation for a painter, plumber or some other service provider.
Slightly more than a third were seeking an update on their home’s current value, while 1 in 8 wanted to get the agent’s opinion on an upgrade, such as a new kitchen or landscaping.
Builder Shortage Defies Downturn
Jobs are still going unfilled on construction sites across the country, but houses these days are being built faster than at any time in the past two years.
On average, it takes 9.1 months from start to finish – 1.4 months for government approval to start construction, and 7.6 more to build the place, according to Census Bureau data. Speedy as that seems, it’s still almost two full months longer than it took in 2015.
The National Association of Home Builders said the turnaround is due mostly to the fact that builders have solved the supply chain challenges they faced during the pandemic. But construction is still taking longer than a decade ago because of the more stringent regulatory environment, elevated mortgage rates and a shortage of skilled labor, the trade group said.
Counterintuitively, it takes longer to build a small house than a big one, largely because half of such structures are being built for rent, and therefore must go through a lengthier approval process.
Speaking of the construction workforce, the Trump administration’s crackdown on immigrants – and on many people of color, regardless of immigration status – could wreak havoc on the construction business.
Hispanic workers make up nearly a third of that industry’s labor force, per the 2023 American Community Survey. White workers account for 57 percent of construction industry workers; Hispanic workers make up 32 percent; and Black workers account for 5 percent.
The National Association of Home Builders calls the steady rise in Hispanic workers on construction sites “the most notable trend in construction labor.” Between 2010 and 2023, their numbers in the industry increased from 2.5 million to almost 3.8 million.
KB Home Goes Transparent
Going against the industry grain, KB Home is opting for transparent pricing, rather than using incentives like rate buydowns or upgrades to lure buyers.
“By advertising the true base price on our website, we let buyers know exactly what to expect before they ever visit a community,” Robert McGibney, the builder’s president and chief operating officer said during a recent earnings call. “It is a clear, upfront way of doing business.”
The company emphasizes built-to-order homes, with buyers picking the base model and price and then adding on whatever options they wish to make.
Lew Sichelman has been covering real estate for more than 50 years. He is a regular contributor to numerous shelter magazines and housing and housing-finance industry publications. Readers can contact him at lsichelman@aol.com.
