From Realty Times of May 28, 2010
Instability in Financial Markets Overseas Lowers Mortgage Rates Here
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 4.78 percent with an average 0.7 point for the week ending May 27, 2010, down from last week when it averaged 4.84 percent. Last year at this time, the 30-year FRM averaged 4.91 percent. The 30-year FRM has not been lower since the week ending December 3, 2009, when it averaged 4.71 percent.
The 15-year FRM this week averaged 4.21 percent with an average 0.7 point , down from last week when it averaged 4.24 percent. A year ago at this time, the 15-year FRM averaged 4.53 percent. The 15-year FRM has not been lower since Freddie Mac started tracking the 15-year FRM in August of 1991.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.97 percent this week, with an average 0.7 point, up from last week when it averaged 3.91 percent. A year ago, the 5-year ARM averaged 4.82 percent.
The 1-year Treasury-indexed ARM averaged 3.95 percent this week with an average 0.6 point, down from last week when it averaged 4.00 percent. At this time last year, the 1-year ARM averaged 4.69 percent. The 1-year ARM has not been lower since the week ending May 27, 2004 when it averaged 3.87 percent."
"These low rates will help to elevate home-buyer affordability and soften the effects of the sunset of the home-buyer tax credit," said Frank Nothaft, Freddie Mac vice president and chief economist. "The credit substantially propelled home sales, as reflected in the strength of the April existing and new home sales, which were up 7.6 percent and 14.8 percent, respectively.
Copyright © 2010 Realty Times. All Rights Reserved.
Friday, May 28, 2010
Tuesday, May 25, 2010
Mortgage Rates at an All Time Low
From Realty Times of May 25, 2010
Today's Mortgage Rates at an All Time Low by Ed Ferrara
Wary of a volatile stock market and concerned about by European debt woes investors moved to bonds last week pushing bond prices up and mortgage rates down. Mortgage rates, which move the opposite direction of mortgage-backed securities prices, had wavered just below 5% for much of the year until last weeks big decline. Mortgage rates today are even lower than levels December of last year, what's now the previous all time low.
Today's official FreeRateUpdate.com conventional 30 year fixed mortgage rate, available to well-qualified borrowers paying about a point origination, is 4.5%. Today's conventional 15 year fixed rate is 4%, with some lenders reported "squeezing" out 3.875%.
Today's FHA 30 year fixed rate is 4.375%. APR (closing cost) on an FHA loan is typically much higher than that of a conventional mortgage because of MI and other FHA fees.
Today's jumbo 30 year fixed rate, for jumbo mortgages exceeding jumbo conforming loan limits, is 5.5%. It's reported 5.375% is available to borrowers with an extremely low loan to value ratio.
Wells Fargo, the nations largest volume mortgage originator, is currently offering a conventional 30 year fixed rate of 4.875%, with an APR of 5.065. Wells Fargo mortgage rates are available on their website.
FreeRateUpdate.com researches over 2 dozen wholesale lenders' rate sheets for brokers on a daily basis to determine the most accurate mortgage rates for well-qualified borrowers paying a standard origination fee of about 1 point.
Today's Mortgage Rates - currently available to well-qualified consumers at a standard .07 to 1 point origination.
30-yr fixed-rate - 4.500%
15-yr fixed-rate - 4.000%
5/1 ARM rate - 3.500%
FHA 30-yr fixed-rate - 4.375%
FHA 15-yr fixed-rate - 4.00%
FHA 5/1 ARM rate - 3.500%
VA 30-yr fixed-rate - 4.625%
Jumbo 30-yr fixed-rate - 5.500%
Jumbo Conforming 30-yr fixed-rate - 4.750%
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Today's Mortgage Rates at an All Time Low by Ed Ferrara
Wary of a volatile stock market and concerned about by European debt woes investors moved to bonds last week pushing bond prices up and mortgage rates down. Mortgage rates, which move the opposite direction of mortgage-backed securities prices, had wavered just below 5% for much of the year until last weeks big decline. Mortgage rates today are even lower than levels December of last year, what's now the previous all time low.
Today's official FreeRateUpdate.com conventional 30 year fixed mortgage rate, available to well-qualified borrowers paying about a point origination, is 4.5%. Today's conventional 15 year fixed rate is 4%, with some lenders reported "squeezing" out 3.875%.
Today's FHA 30 year fixed rate is 4.375%. APR (closing cost) on an FHA loan is typically much higher than that of a conventional mortgage because of MI and other FHA fees.
Today's jumbo 30 year fixed rate, for jumbo mortgages exceeding jumbo conforming loan limits, is 5.5%. It's reported 5.375% is available to borrowers with an extremely low loan to value ratio.
Wells Fargo, the nations largest volume mortgage originator, is currently offering a conventional 30 year fixed rate of 4.875%, with an APR of 5.065. Wells Fargo mortgage rates are available on their website.
FreeRateUpdate.com researches over 2 dozen wholesale lenders' rate sheets for brokers on a daily basis to determine the most accurate mortgage rates for well-qualified borrowers paying a standard origination fee of about 1 point.
Today's Mortgage Rates - currently available to well-qualified consumers at a standard .07 to 1 point origination.
30-yr fixed-rate - 4.500%
15-yr fixed-rate - 4.000%
5/1 ARM rate - 3.500%
FHA 30-yr fixed-rate - 4.375%
FHA 15-yr fixed-rate - 4.00%
FHA 5/1 ARM rate - 3.500%
VA 30-yr fixed-rate - 4.625%
Jumbo 30-yr fixed-rate - 5.500%
Jumbo Conforming 30-yr fixed-rate - 4.750%
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Monday, May 17, 2010
Real Estate Outlook: Up or Down?
From Realty Times of May 17, 2010
Real Estate Outlook: Up or Down? by Kenneth R. Harney
You may have seen the latest home sales and price numbers and wondered: What's going on here? Are we up? Are we down?
Depending on which TV network reported the news last week, it sounded either like real estate is continuing along its steady road to recovery - -or that we just hit a pothole in the road.
One major business news channel reported it this way: "Home sales down 14 percent in the first quarter." Other media reported an 11 percent GAIN.
So what is it?
Well, dig down into the actual numbers from the National Association of Realtors and you find that, yes, 2010 first quarter home sales were 14 percent lower than they were in the final quarter of 2009.
Home sales nationwide, however, in the first quarter of 2010 were 11.4 percent higher than they were during the same quarter the year before. And any economist will tell you: year to year comparisons are more meaningful than quarter to quarter data, which tend to be more volatile.
Lawrence Yun, chief economist for the National Association of Realtors, pointed out that sales in the fourth quarter of last year were unusually high because of a surge of closings related to the original expiration date of the housing tax credit.
We can probably expect a similar surge to show up some time in the coming two quarters caused by sales closings before the June 30 termination date of the credit program.
The 11 percent year over year gain is a much more reliable gauge of where the market really is, says Yun -- and that's a very healthy trajectory because consumers have more confidence in the economy, are spending more, and mortgage rates remain near all-time lows.
Gains in prices year over year in local markets are especially encouraging: Of the 152 metropolitan statistical areas surveyed by the National Association of Realtors, median prices in 91 were higher than the year before. Though most of the gains were in single digits, 29 markets saw median price increases in double digits.
Economists say the price and sales gains reflect the improvements underway in the overall US economy. The latest federal employment numbers saw a 290,000 net job increase in March, plus a drop in new filings for unemployment insurance claims.
Manufacturing jobs are expanding again, after years of declines, and the Gross Domestic Product (or GDP) is up by more than 3 percent.
In the words of Freddie Mac's chief economist, Frank Nothaft, "the underlying fundamentals for housing markets are improving rapidly" -- and should continue to do so through 2010.
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Real Estate Outlook: Up or Down? by Kenneth R. Harney
You may have seen the latest home sales and price numbers and wondered: What's going on here? Are we up? Are we down?
Depending on which TV network reported the news last week, it sounded either like real estate is continuing along its steady road to recovery - -or that we just hit a pothole in the road.
One major business news channel reported it this way: "Home sales down 14 percent in the first quarter." Other media reported an 11 percent GAIN.
So what is it?
Well, dig down into the actual numbers from the National Association of Realtors and you find that, yes, 2010 first quarter home sales were 14 percent lower than they were in the final quarter of 2009.
Home sales nationwide, however, in the first quarter of 2010 were 11.4 percent higher than they were during the same quarter the year before. And any economist will tell you: year to year comparisons are more meaningful than quarter to quarter data, which tend to be more volatile.
Lawrence Yun, chief economist for the National Association of Realtors, pointed out that sales in the fourth quarter of last year were unusually high because of a surge of closings related to the original expiration date of the housing tax credit.
We can probably expect a similar surge to show up some time in the coming two quarters caused by sales closings before the June 30 termination date of the credit program.
The 11 percent year over year gain is a much more reliable gauge of where the market really is, says Yun -- and that's a very healthy trajectory because consumers have more confidence in the economy, are spending more, and mortgage rates remain near all-time lows.
Gains in prices year over year in local markets are especially encouraging: Of the 152 metropolitan statistical areas surveyed by the National Association of Realtors, median prices in 91 were higher than the year before. Though most of the gains were in single digits, 29 markets saw median price increases in double digits.
Economists say the price and sales gains reflect the improvements underway in the overall US economy. The latest federal employment numbers saw a 290,000 net job increase in March, plus a drop in new filings for unemployment insurance claims.
Manufacturing jobs are expanding again, after years of declines, and the Gross Domestic Product (or GDP) is up by more than 3 percent.
In the words of Freddie Mac's chief economist, Frank Nothaft, "the underlying fundamentals for housing markets are improving rapidly" -- and should continue to do so through 2010.
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Thursday, May 13, 2010
Home Buying Secrets for the 'Average Joe'
Realty Times of May 13, 2010
Home Buying Secrets for the 'Average Joe' by Broderick Perkins
New York City attorney Edward A. Mermelstein is, well, a big shot in the Big Apple -- but he hasn't forgotten the little guy.
Co-founder of the international, multilingual (11 languages) real estate law firm Edward A. Mermelstein & Associates, he's also got an office in Moscow and offers legal services to financial and real estate institutions, including representation for international transactions, business litigation, dispute resolution and insurance matters.
Clients include international conglomerates, start-up ventures and entrepreneurs, multi-national corporations, land charitable organizations, government officials and others, but he also offers insight for the 'Average Joe' -- home buyers who need all the help they can get right now.
Mermelstein's "Home Buying Secrets for the Average Joe" are a timely example of his insight for buyers.
• Study - Do your homework before you buy. Review the prices of comparable homes in the neighborhood, which can be found on websites such as Zillow.com, PropertyShark.com, StreetEasy.com, HouseValues.com, Trulia.com and others. Keep in mind these numbers sometimes trail the market by several months. A real estate agent can provide the latest sales data.
• Cure your credit - Today's best mortgage rates require a credit score of more than 700. Learn how to boost your credit score before you apply for a mortgage. Not only will a low credit score cost you more in terms of the interest rate on your mortgage, it could also prevent you from obtaining a mortgage.
Go to AnnualCreditReport.com, the only federal government-sanctioned service for obtaining a truly free credit report from one or all three of the major credit bureaus. On AnnualCreditReport.com, select your state and hit the red "Request Report" button and follow the instructions. The report is free, but you will have to pay a nominal fee to get your credit score.
• Bid low - In many of today's buyers' markets you can offer 10 to 15 percent below the list price because prices are based on contracts signed three to four months ago. List prices don't necessarily reflect the most current values, especially in markets still on the decline, according to Mermelstein.
• Consider a 'Lucky 7' loan - Take advantage of the lower interest rates available with a 7/1 adjustable rate mortgage (ARM), when compared to a fixed-rate 30 year mortgage. The interest rate on a 7/1 ARM is fixed for seven years. In the eighth year the loan resets as an ARM. Just be sure you know what the margin, life cap and periodic caps will be beginning in the eighth year to avoid surprises. Use those seven years to reduce debit and increase your income in preparation for what is likely to be a much higher rate than your starting rate.
Mermelstein also says to consider 30/15 year mortgages which are fixed for 15 years, amortized over 30 years and due in full in 15 years.
These and other mortgage options come with lower starting rates as a hedge against interest rates rising in the near future.
• Get pre-approved - Go beyond prequalifying for a mortgage, which only tells you what you can likely borrow. Get a pre-approved mortgage and you'll know your home price shopping parameters. You'll also present yourself to the seller as a serious buyer. Financing in hand will also help level the playing field with all-cash buyers and investors and it will help you negotiate a better purchase price.
• Consider a newly built home - The new home sector has been harder hit than resales. Concessions and reduced prices are the norm. The latest U.S. Census Bureau data reveal that sales of new homes fell for the fourth consecutive month in February, to a seasonally adjusted annual level of 308,000 sales - a year-over-year decline of 13 percent and the lowest level ever. Just be sure to check out the reputation of the builder.
• Inspect everything - Get a home inspection for a new home, a resale home, a nearly new home or a very old home. Always. Just because it's new doesn't mean it's defect free. Hidden problems can torpedo the value of your home.
• Read the title report - Make sure that any new additions or construction to an existing home are fully permitted and recorded with the local municipality. • Check the appraisal - Likewise check the appraisal report for any oversights, missed features or other errors that could cause the property to be undervalued.
• Negotiate - Don't be afraid to dicker. It's a buyers' market. Concessions are available from both new home builders and existing home sellers. Ask for help with the closing costs, repairs, even furnishings and other perks. Motivated sellers have much to offer.
• Don't skimp on the help - If you look for the least expensive attorney, real estate agent, inspector, etc., you will get what you pay for. Ask family, friends, co-workers, realty professionals and others you trust for referrals and then carefully vet them.
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Home Buying Secrets for the 'Average Joe' by Broderick Perkins
New York City attorney Edward A. Mermelstein is, well, a big shot in the Big Apple -- but he hasn't forgotten the little guy.
Co-founder of the international, multilingual (11 languages) real estate law firm Edward A. Mermelstein & Associates, he's also got an office in Moscow and offers legal services to financial and real estate institutions, including representation for international transactions, business litigation, dispute resolution and insurance matters.
Clients include international conglomerates, start-up ventures and entrepreneurs, multi-national corporations, land charitable organizations, government officials and others, but he also offers insight for the 'Average Joe' -- home buyers who need all the help they can get right now.
Mermelstein's "Home Buying Secrets for the Average Joe" are a timely example of his insight for buyers.
• Study - Do your homework before you buy. Review the prices of comparable homes in the neighborhood, which can be found on websites such as Zillow.com, PropertyShark.com, StreetEasy.com, HouseValues.com, Trulia.com and others. Keep in mind these numbers sometimes trail the market by several months. A real estate agent can provide the latest sales data.
• Cure your credit - Today's best mortgage rates require a credit score of more than 700. Learn how to boost your credit score before you apply for a mortgage. Not only will a low credit score cost you more in terms of the interest rate on your mortgage, it could also prevent you from obtaining a mortgage.
Go to AnnualCreditReport.com, the only federal government-sanctioned service for obtaining a truly free credit report from one or all three of the major credit bureaus. On AnnualCreditReport.com, select your state and hit the red "Request Report" button and follow the instructions. The report is free, but you will have to pay a nominal fee to get your credit score.
• Bid low - In many of today's buyers' markets you can offer 10 to 15 percent below the list price because prices are based on contracts signed three to four months ago. List prices don't necessarily reflect the most current values, especially in markets still on the decline, according to Mermelstein.
• Consider a 'Lucky 7' loan - Take advantage of the lower interest rates available with a 7/1 adjustable rate mortgage (ARM), when compared to a fixed-rate 30 year mortgage. The interest rate on a 7/1 ARM is fixed for seven years. In the eighth year the loan resets as an ARM. Just be sure you know what the margin, life cap and periodic caps will be beginning in the eighth year to avoid surprises. Use those seven years to reduce debit and increase your income in preparation for what is likely to be a much higher rate than your starting rate.
Mermelstein also says to consider 30/15 year mortgages which are fixed for 15 years, amortized over 30 years and due in full in 15 years.
These and other mortgage options come with lower starting rates as a hedge against interest rates rising in the near future.
• Get pre-approved - Go beyond prequalifying for a mortgage, which only tells you what you can likely borrow. Get a pre-approved mortgage and you'll know your home price shopping parameters. You'll also present yourself to the seller as a serious buyer. Financing in hand will also help level the playing field with all-cash buyers and investors and it will help you negotiate a better purchase price.
• Consider a newly built home - The new home sector has been harder hit than resales. Concessions and reduced prices are the norm. The latest U.S. Census Bureau data reveal that sales of new homes fell for the fourth consecutive month in February, to a seasonally adjusted annual level of 308,000 sales - a year-over-year decline of 13 percent and the lowest level ever. Just be sure to check out the reputation of the builder.
• Inspect everything - Get a home inspection for a new home, a resale home, a nearly new home or a very old home. Always. Just because it's new doesn't mean it's defect free. Hidden problems can torpedo the value of your home.
• Read the title report - Make sure that any new additions or construction to an existing home are fully permitted and recorded with the local municipality. • Check the appraisal - Likewise check the appraisal report for any oversights, missed features or other errors that could cause the property to be undervalued.
• Negotiate - Don't be afraid to dicker. It's a buyers' market. Concessions are available from both new home builders and existing home sellers. Ask for help with the closing costs, repairs, even furnishings and other perks. Motivated sellers have much to offer.
• Don't skimp on the help - If you look for the least expensive attorney, real estate agent, inspector, etc., you will get what you pay for. Ask family, friends, co-workers, realty professionals and others you trust for referrals and then carefully vet them.
--------------------------------------------------------------------------------
Copyright © 2010 Realty Times. All Rights Reserved.
Monday, May 10, 2010
Real Estate Outlook: Experts Weigh In
Realty Times of May 10, 2010
Real Estate Outlook: Experts Weigh In by Kenneth R. Harney
Mega-investor Warren Buffett and a group of top corporate leaders are weighing in on a key issue that's crucial to a sustained real estate recovery: How long will the good economic news we've been getting lately continue?
Are we going to be let down later in the second half of the year, or is the current, slow-moving national economic growth pattern a long term trend?
Buffet told his annual stockholders gathering in Omaha that, the economy is showing "significant" and persistent improvement for the first time since the financial crisis broke in 2008.
Other top business leaders polled by the Conference Board -- and quoted last week by the Wall Street Journal - said they are now "confident that the U.S. will see sustained growth through 2010" - with moderate gains in employment, consumer spending and consumer confidence.
That's hugely important for housing of course - and offers a strong answer to economic doomsayers who predict a sharp drop in home sales and real estate activity following the expiration of the tax credits.
The latest housing and mortgage numbers certainly look encouraging:
Pending home sales jumped by more than five percent in March, according to the National Association of Realtors, and were 21 percent higher than the previous year for the same month.
Home prices are turning at least modestly positive again in the majority of large housing markets. The closely-watched PMI risk index, which looks at price decline potentials for two years out, found that 42 of the 50 largest markets in its latest survey showed diminished risk.
Another index -- from valuation data firm Clear Capital - found home prices gained by five percent nationally year over year. Prices in a handful of what Clear Capital calls "micro" markets are doing better than that. Washington DC, for example, saw an 8.4 percent increase over last year, according to the latest index.
Meanwhile, new applications for loans to purchase houses took another big jump -- up 13 percent over the previous week, according to the Mortgage Bankers Association.
MBA vice president for research, Michael Fratantoni, said that last week's FHA and VA share of home purchase applications soared above 50 percent -- the highest it's been in more than two decades.
Finally, there was some outstanding news for home buyers and sellers in high cost markets: The jumbo loan market is roaring back -- with more banks now offering big loans and cutting rates. One major lender even announced that for credit-worthy applicants, it's dropping rates on jumbos to 5.7 percent for 30 years -- the best ever.
Copyright © 2010 Realty Times. All Rights Reserved.
Real Estate Outlook: Experts Weigh In by Kenneth R. Harney
Mega-investor Warren Buffett and a group of top corporate leaders are weighing in on a key issue that's crucial to a sustained real estate recovery: How long will the good economic news we've been getting lately continue?
Are we going to be let down later in the second half of the year, or is the current, slow-moving national economic growth pattern a long term trend?
Buffet told his annual stockholders gathering in Omaha that, the economy is showing "significant" and persistent improvement for the first time since the financial crisis broke in 2008.
Other top business leaders polled by the Conference Board -- and quoted last week by the Wall Street Journal - said they are now "confident that the U.S. will see sustained growth through 2010" - with moderate gains in employment, consumer spending and consumer confidence.
That's hugely important for housing of course - and offers a strong answer to economic doomsayers who predict a sharp drop in home sales and real estate activity following the expiration of the tax credits.
The latest housing and mortgage numbers certainly look encouraging:
Pending home sales jumped by more than five percent in March, according to the National Association of Realtors, and were 21 percent higher than the previous year for the same month.
Home prices are turning at least modestly positive again in the majority of large housing markets. The closely-watched PMI risk index, which looks at price decline potentials for two years out, found that 42 of the 50 largest markets in its latest survey showed diminished risk.
Another index -- from valuation data firm Clear Capital - found home prices gained by five percent nationally year over year. Prices in a handful of what Clear Capital calls "micro" markets are doing better than that. Washington DC, for example, saw an 8.4 percent increase over last year, according to the latest index.
Meanwhile, new applications for loans to purchase houses took another big jump -- up 13 percent over the previous week, according to the Mortgage Bankers Association.
MBA vice president for research, Michael Fratantoni, said that last week's FHA and VA share of home purchase applications soared above 50 percent -- the highest it's been in more than two decades.
Finally, there was some outstanding news for home buyers and sellers in high cost markets: The jumbo loan market is roaring back -- with more banks now offering big loans and cutting rates. One major lender even announced that for credit-worthy applicants, it's dropping rates on jumbos to 5.7 percent for 30 years -- the best ever.
Copyright © 2010 Realty Times. All Rights Reserved.
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