April 19, 2010 in Realty Times
Real Estate Outlook: Faster Recovery?
by Kenneth R. Harney
It's been a long time since we've seen the Wall Street Journal run a front-page article suggesting that the national economy appears to be rebounding faster than most analysts forecast. But that happened last week.
And over the past couple of years, we haven't seen retail sales -- a key barometer of consumer confidence -- jump by almost two percent in a single month. But we saw that last week as well.
And then there's real estate: The latest Federal Reserve "beige book" on economic conditions nationwide, issued last week, said something we haven't heard in a long, long time. Housing activity is up in 11 of the 12 bank districts.
All of this, of course, sounds like promising news for home sales in the coming months. In fact, Freddie Mac's economists see total sales this year at least 10 percent higher than last year, even with the possibility of higher mortgage interest rates.
But there are complications in the mix: The Fed's "beige book" report essentially said, yes, housing is on an upward path at the moment, but what happens to sales after the home purchase tax credits expire mid-year?
Will expansion elsewhere in the economy be able to sustain sales and prices?
Lawrence Yun, chief economist for the National Association of Realtors, has similar concerns. In his latest commentary, Yun says steadily rising employment will be essential to keeping housing positive once the credits disappear.
The employment report for March was encouraging: 162,000 net new jobs, Yun noted, even in hard hit sectors like manufacturing. Yun's forecast model projects one million additional new jobs this year, plus another two million next year.
But even that sort of rebound in employment won't be enough to replace the 8.2 million jobs lost in the recession years. So the unemployment challenge is likely to be with us for a few years -- at best.
Meanwhile, though foreclosures remain troublingly high, the rate of delinquencies on existing mortgages may have actually peaked and could be headed downward. Equifax and Moody's Economy.com report that the percentage of home loans thirty days late dropped in the first quarter - the first decline in four years.
And in major housing markets that took hard hits during the bust, signs of recovery continue to multiply. For example, in the six counties of Southern California, home sales were up 33 percent in March over February, and were up five percent over 2009 levels, according to MDA Data Quick.
Even median prices were on the rise -- by 14 percent over year-earlier levels.
Copyright © 2010 Realty Times. All Rights Reserved.
Monday, April 19, 2010
Tuesday, April 13, 2010
Mortgage Rates Dip
April 13, 2010 Realty Times
Mortgage Rates Dip - Private Buyers Fill Government Void
by Ed Ferrara
Last Wednesday afternoon, just as results of the weekly Freddie Mac survey were finalized, mortgage rates dipped. The decline in long term mortgage rates was an effect of rising MBS prices. Mortgage rates move opposite mortgage-backed securities prices. Surprisingly, so far private buyers have successfully filled the void left in mortgage-backed securities markets since the government discontinued their MBS purchasing program on Mar. 31st.
FreeRateUpdate.com research of wholesale lenders' rate sheets shows conventional 30-year fixed mortgages are available today at 4.875% to well-qualified consumers paying a standard .07 to 1 point origination, down from 5% this time last week. 15-yr fixed mortgages are available at 4.25, and 5/1 adjustable rate mortgages at 3.75.
FHA 30-yr fixed loans are available at 4.75%, down from 4.875 last week. Despite the FHA 30-yr rate being slightly better than that of the conforming 30-yr, cost and in turn APR is significantly higher because of MI and other FHA fees.
Jumbo 30-yr fixed mortgages remain available at 5.625%.
Despite rates near all time lows refinance applications are down a whopping 16% according to the Mortgage Bankers Association. Purchases, up for the third straight week, now make up half of all applications.
Today's Mortgage Rates:
30-yr fixed-rate - 4.875%
15-yr fixed-rate - 4.250%
5/1 ARM rate - 3.750%
FHA 30-yr fixed-rate - 4.750%
FHA 15-yr fixed-rate - 4.50%
FHA 5/1 ARM rate - 3.750%
VA 30-yr fixed-rate - 5.000
Jumbo 30-yr fixed-rate - 5.625%
Jumbo Conforming 30-yr fixed-rate - 5.250%
Source: freerateupdate.com
Copyright © 2010 Realty Times. All Rights Reserved.
Mortgage Rates Dip - Private Buyers Fill Government Void
by Ed Ferrara
Last Wednesday afternoon, just as results of the weekly Freddie Mac survey were finalized, mortgage rates dipped. The decline in long term mortgage rates was an effect of rising MBS prices. Mortgage rates move opposite mortgage-backed securities prices. Surprisingly, so far private buyers have successfully filled the void left in mortgage-backed securities markets since the government discontinued their MBS purchasing program on Mar. 31st.
FreeRateUpdate.com research of wholesale lenders' rate sheets shows conventional 30-year fixed mortgages are available today at 4.875% to well-qualified consumers paying a standard .07 to 1 point origination, down from 5% this time last week. 15-yr fixed mortgages are available at 4.25, and 5/1 adjustable rate mortgages at 3.75.
FHA 30-yr fixed loans are available at 4.75%, down from 4.875 last week. Despite the FHA 30-yr rate being slightly better than that of the conforming 30-yr, cost and in turn APR is significantly higher because of MI and other FHA fees.
Jumbo 30-yr fixed mortgages remain available at 5.625%.
Despite rates near all time lows refinance applications are down a whopping 16% according to the Mortgage Bankers Association. Purchases, up for the third straight week, now make up half of all applications.
Today's Mortgage Rates:
30-yr fixed-rate - 4.875%
15-yr fixed-rate - 4.250%
5/1 ARM rate - 3.750%
FHA 30-yr fixed-rate - 4.750%
FHA 15-yr fixed-rate - 4.50%
FHA 5/1 ARM rate - 3.750%
VA 30-yr fixed-rate - 5.000
Jumbo 30-yr fixed-rate - 5.625%
Jumbo Conforming 30-yr fixed-rate - 5.250%
Source: freerateupdate.com
Copyright © 2010 Realty Times. All Rights Reserved.
Monday, April 12, 2010
Mortgage Rates Lower After Strong Auction Demand
Rates Lower After Strong Auction Demand
Highlights Average 30 yr fixed rate Stocks (Weekly)
Continuing Jobless Claims fell to the lowest level since December 2008
The Fed lowered its forecasts for inflation in 2010 and 2011
As expected, the European Central Bank (ECB) made no change in rates
The Dow stock index reached an 18-month high
This week: -0.05% Dow: 10,950 +50
Last week: +0.10% NASDAQ: 2,425 +25
Although this week's economic data was generally stronger than expected, it was overshadowed by solid demand for the Treasury auctions and intensified concerns about the economic situation in Greece, which helped mortgage markets. After reaching the highest levels since August, mortgage rates ended a little lower than where they ended last week.
Recent increases in yields on long-term fixed-rate securities such as 10-yr Treasuries and mortgage-backed securities (MBS) appeared to have been sufficient to attract investors. Very strong demand from both foreign and domestic investors for Wednesday's 10-yr auction pushed Treasury yields lower, and mortgage rates followed. Increasing the appeal, renewed worries about the fiscal situation in Greece caused investors to seek the safety of US securities. Comforting statements from Fed officials that they expect inflation to remain low for a long time also added to the demand.
In the housing sector, February Pending Home Sales jumped 8% from January, far exceeding the consensus forecast. Pending Home Sales are a leading indicator of housing market activity. The chief economist of the National Association of Realtors (NAR) considered the data to be a potential sign of a 'second surge of home sales this spring'. To receive the homebuyer tax credit, contracts must be signed by the end of April, which likely boosted the results for February. As buyers seek to take advantage of the program, March and April pending sales may show strength as well.
Courtesy of:
Craig Bohall
Loan Officer
5304 E Southern Ave #101
Mesa, AZ 85206
480-344-3646
craig@myazmp.com
www.myazmp.com
Highlights Average 30 yr fixed rate Stocks (Weekly)
Continuing Jobless Claims fell to the lowest level since December 2008
The Fed lowered its forecasts for inflation in 2010 and 2011
As expected, the European Central Bank (ECB) made no change in rates
The Dow stock index reached an 18-month high
This week: -0.05% Dow: 10,950 +50
Last week: +0.10% NASDAQ: 2,425 +25
Although this week's economic data was generally stronger than expected, it was overshadowed by solid demand for the Treasury auctions and intensified concerns about the economic situation in Greece, which helped mortgage markets. After reaching the highest levels since August, mortgage rates ended a little lower than where they ended last week.
Recent increases in yields on long-term fixed-rate securities such as 10-yr Treasuries and mortgage-backed securities (MBS) appeared to have been sufficient to attract investors. Very strong demand from both foreign and domestic investors for Wednesday's 10-yr auction pushed Treasury yields lower, and mortgage rates followed. Increasing the appeal, renewed worries about the fiscal situation in Greece caused investors to seek the safety of US securities. Comforting statements from Fed officials that they expect inflation to remain low for a long time also added to the demand.
In the housing sector, February Pending Home Sales jumped 8% from January, far exceeding the consensus forecast. Pending Home Sales are a leading indicator of housing market activity. The chief economist of the National Association of Realtors (NAR) considered the data to be a potential sign of a 'second surge of home sales this spring'. To receive the homebuyer tax credit, contracts must be signed by the end of April, which likely boosted the results for February. As buyers seek to take advantage of the program, March and April pending sales may show strength as well.
Courtesy of:
Craig Bohall
Loan Officer
5304 E Southern Ave #101
Mesa, AZ 85206
480-344-3646
craig@myazmp.com
www.myazmp.com
Pending Sales Up
April 12, 2010 Realty Times
Real Estate Outlook: Pending Sales Up by Kenneth R. Harney
Signs of recovery in the housing market and the national economy keep popping up - and are even beginning to surprise veteran analysts on Wall Street and elsewhere.
Though economists had expected the latest pending home sales index to be down - after all, February saw the worst weather in decades in large parts of the U.S. - the numbers actually took a big bounce.
The National Association of Realtors reported that pending sales jumped 8.2 percent for the month and were 17 percent higher than they were at the same time last year.
Contracts in the Northeast were up by 9 percent, the Midwest by 22 percent and in the South by 9 percent. Only the Western region came in negative - down by 5 percent. But even in the West, pending sales were 15 percent higher than they were the year before.
With the April 30 deadline for sales contracts to qualify for the two housing tax credits just weeks away, analysts expect home sales activity to remain high. Lawrence Yun, chief economist for the National Association of Realtors, says he thinks we may be in “the early stages of a second surge” of real estate transactions that could continue into mid-year.
But let's be clear: Home sales are not only being pushed by tax credits. Far stronger impetus is coming from steadily improving conditions in the national economy and rising consumer perceptions that finally things are getting better.
Look at the latest monthly employment numbers from the Bureau of Labor Statistics. For the first time in nearly two years, there was significant new job creation during the month of March - 162,000 payroll positions.
That was helped along in part by Census Bureau hiring to conduct the 2010 census, but there was growth elsewhere as well: 15,000 net new construction jobs, 17,000 manufacturing jobs, and 11,000 business services jobs.
Home Depot and other big household-oriented retailers announced that they have begun hiring again. Retails sales nationwide jumped by 23 percent for the month; home furnishings and furniture sales were up 14 percent
Mark Zandi, chief economist for Moody's Economy.com, told the New York Times that “consumers are (getting) almost giddy” in their zeal to resume spending, and they are cutting their savings to fund their new purchases.
All of this, of course, is great news for housing, which is hardwired to employment growth and consumer confidence
But don't assume we're out of the woods quite yet -- not with the national unemployment rate stuck at 9.7 percent. And there's another challenge taking shape on the horizon: Rising mortgage rates that are inevitable in an economy rebounding out of recession.
Copyright © 2010 Realty Times. All Rights Reserved.
Real Estate Outlook: Pending Sales Up by Kenneth R. Harney
Signs of recovery in the housing market and the national economy keep popping up - and are even beginning to surprise veteran analysts on Wall Street and elsewhere.
Though economists had expected the latest pending home sales index to be down - after all, February saw the worst weather in decades in large parts of the U.S. - the numbers actually took a big bounce.
The National Association of Realtors reported that pending sales jumped 8.2 percent for the month and were 17 percent higher than they were at the same time last year.
Contracts in the Northeast were up by 9 percent, the Midwest by 22 percent and in the South by 9 percent. Only the Western region came in negative - down by 5 percent. But even in the West, pending sales were 15 percent higher than they were the year before.
With the April 30 deadline for sales contracts to qualify for the two housing tax credits just weeks away, analysts expect home sales activity to remain high. Lawrence Yun, chief economist for the National Association of Realtors, says he thinks we may be in “the early stages of a second surge” of real estate transactions that could continue into mid-year.
But let's be clear: Home sales are not only being pushed by tax credits. Far stronger impetus is coming from steadily improving conditions in the national economy and rising consumer perceptions that finally things are getting better.
Look at the latest monthly employment numbers from the Bureau of Labor Statistics. For the first time in nearly two years, there was significant new job creation during the month of March - 162,000 payroll positions.
That was helped along in part by Census Bureau hiring to conduct the 2010 census, but there was growth elsewhere as well: 15,000 net new construction jobs, 17,000 manufacturing jobs, and 11,000 business services jobs.
Home Depot and other big household-oriented retailers announced that they have begun hiring again. Retails sales nationwide jumped by 23 percent for the month; home furnishings and furniture sales were up 14 percent
Mark Zandi, chief economist for Moody's Economy.com, told the New York Times that “consumers are (getting) almost giddy” in their zeal to resume spending, and they are cutting their savings to fund their new purchases.
All of this, of course, is great news for housing, which is hardwired to employment growth and consumer confidence
But don't assume we're out of the woods quite yet -- not with the national unemployment rate stuck at 9.7 percent. And there's another challenge taking shape on the horizon: Rising mortgage rates that are inevitable in an economy rebounding out of recession.
Copyright © 2010 Realty Times. All Rights Reserved.
Friday, April 9, 2010
30-Year Mortgage Rates to Highest Level
From Realty Times of April 9, 2010
Bond Yields Push 30-Year Mortgage Rates to Highest Level in Eight Months
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.21 percent with an average 0.6 point for the week ending April 8, 2010, up from last week when it averaged 5.08 percent. Last year at this time, the 30-year FRM averaged 4.87 percent. This is the highest the 30-year FRM has been since the week ending August 13, 2009 when it averaged 5.29 percent.
The 15-year FRM this week averaged 4.52 percent with an average 0.6 point, up from last week when it averaged 4.39 percent. A year ago at this time, the 15-year FRM averaged 4.54 percent. This is the highest the 15-year FRM has been since the week ending December 31, 2009, when it averaged 4.54 percent.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.25 percent this week, with an average 0.6 point, up from last week when it averaged 4.10 percent. A year ago, the 5-year ARM averaged 4.93 percent.
The 1-year Treasury-indexed ARM averaged 4.14 percent this week with an average 0.5 point, up from last week when it averaged 4.05 percent. At this time last year, the 1-year ARM averaged 4.83 percent.
"Once again, mortgage rates followed bond yields higher amid a positive March employment report," said Frank Nothaft, Freddie Mac vice president and chief economist. "The economy added 162,000 jobs, which was the largest monthly gain over the past three years. In addition, revisions raised the January and February figures by a combined 61,000 workers. Excluding government employees, private payrolls rose for the third consecutive month and were the strongest increase since May 2007."
"Following its extension in early November of last year, the homebuyer tax credit is showing some impact on housing market activity, mostly through the use of government-insured mortgages, which tend to be a favorite among first-time homebuyers. Compared to the week ending December 4, 2009, which was the first week after the original expiration date, mortgage applications for home purchases are up 17 percent for the first week in April of this year for government-insured loans, compared to an 11 percent decline in conventional loans, according to the Mortgage Bankers Association. Also, pending existing home sales jumped 8.2 percent in February, well above the market consensus and represented the second largest increase since records began in 2001, the National Association of Realtors ® reported. Homebuyers must enter a housing contract by April 30th and close by June 30th in order to receive the tax credit."
Copyright © 2010 Realty Times. All Rights Reserved.
Bond Yields Push 30-Year Mortgage Rates to Highest Level in Eight Months
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.21 percent with an average 0.6 point for the week ending April 8, 2010, up from last week when it averaged 5.08 percent. Last year at this time, the 30-year FRM averaged 4.87 percent. This is the highest the 30-year FRM has been since the week ending August 13, 2009 when it averaged 5.29 percent.
The 15-year FRM this week averaged 4.52 percent with an average 0.6 point, up from last week when it averaged 4.39 percent. A year ago at this time, the 15-year FRM averaged 4.54 percent. This is the highest the 15-year FRM has been since the week ending December 31, 2009, when it averaged 4.54 percent.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.25 percent this week, with an average 0.6 point, up from last week when it averaged 4.10 percent. A year ago, the 5-year ARM averaged 4.93 percent.
The 1-year Treasury-indexed ARM averaged 4.14 percent this week with an average 0.5 point, up from last week when it averaged 4.05 percent. At this time last year, the 1-year ARM averaged 4.83 percent.
"Once again, mortgage rates followed bond yields higher amid a positive March employment report," said Frank Nothaft, Freddie Mac vice president and chief economist. "The economy added 162,000 jobs, which was the largest monthly gain over the past three years. In addition, revisions raised the January and February figures by a combined 61,000 workers. Excluding government employees, private payrolls rose for the third consecutive month and were the strongest increase since May 2007."
"Following its extension in early November of last year, the homebuyer tax credit is showing some impact on housing market activity, mostly through the use of government-insured mortgages, which tend to be a favorite among first-time homebuyers. Compared to the week ending December 4, 2009, which was the first week after the original expiration date, mortgage applications for home purchases are up 17 percent for the first week in April of this year for government-insured loans, compared to an 11 percent decline in conventional loans, according to the Mortgage Bankers Association. Also, pending existing home sales jumped 8.2 percent in February, well above the market consensus and represented the second largest increase since records began in 2001, the National Association of Realtors ® reported. Homebuyers must enter a housing contract by April 30th and close by June 30th in order to receive the tax credit."
Copyright © 2010 Realty Times. All Rights Reserved.
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