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Friday, December 30, 2011
Monday, December 12, 2011
DAILY REAL ESTATE NEWS
Inman News™
December 12, 2011 From Inman News
Bank of America survey: Consumers cautious about home affordability
Most consumers still say buying a home is a good investment
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Despite continuing declines in home prices nationwide, 62 percent of surveyed consumers said buying a home in today's market is a good investment over the next 10 years, according to a survey from mortgage lender Bank of America.
Global market research firm Socratic Technologies Inc. conducted the monthly survey, called the Mortgage Index Study, on behalf of Bank of America.
Affordability did appear to be a priority for those survey respondents considering a home purchase in the next 12 months: 62 percent of those respondents had sought advice from a lender or used online tools to help them determine affordable monthly mortgage payments, Bank of America reported.
And overall, respondents' most popular piece of advice to loved ones considering buying a home? Half would warn them "to not buy more house than they can afford."
Survey respondents were more likely to have higher incomes than the general population. In 2010, the median household income was $50,046, according to the U.S. Census Bureau, while more than three out of five survey respondents (61 percent) reported a gross annual income at or above $50,000. Thirty-one percent had an income of less than $50,000 and 8 percent declined to state their income.
The firm surveyed 1,104 consumers nationwide between Sept. 1-27, 2011. To be included in the survey, respondents had to be 21 or older, a primary or joint financial decision-maker in their household, and either currently have a home loan or plan to obtain one in the next 12 months.
Respondents were about evenly split by gender; 72 percent were married; 65 percent had obtained at least a bachelor's degree; and 81 percent were white or Caucasian. Just over half, 52 percent, were employed full time; 12 percent identified as a "homemaker"; 11 percent were retired; 9 percent were employed part time; and 8 percent were self-employed. Only 6 percent were unemployed.
The vast majority of respondents (86 percent) were homeowners. Twelve percent of respondents rented and 2 percent lived with family.
Of those planning to purchase a home in the next year, 74 percent said they plan to use their personal savings for the down payment.
Contact Inman News:
Copyright 2011 Inman News
December 12, 2011 From Inman News
Bank of America survey: Consumers cautious about home affordability
Most consumers still say buying a home is a good investment
Share This
Despite continuing declines in home prices nationwide, 62 percent of surveyed consumers said buying a home in today's market is a good investment over the next 10 years, according to a survey from mortgage lender Bank of America.
Global market research firm Socratic Technologies Inc. conducted the monthly survey, called the Mortgage Index Study, on behalf of Bank of America.
Affordability did appear to be a priority for those survey respondents considering a home purchase in the next 12 months: 62 percent of those respondents had sought advice from a lender or used online tools to help them determine affordable monthly mortgage payments, Bank of America reported.
And overall, respondents' most popular piece of advice to loved ones considering buying a home? Half would warn them "to not buy more house than they can afford."
Survey respondents were more likely to have higher incomes than the general population. In 2010, the median household income was $50,046, according to the U.S. Census Bureau, while more than three out of five survey respondents (61 percent) reported a gross annual income at or above $50,000. Thirty-one percent had an income of less than $50,000 and 8 percent declined to state their income.
The firm surveyed 1,104 consumers nationwide between Sept. 1-27, 2011. To be included in the survey, respondents had to be 21 or older, a primary or joint financial decision-maker in their household, and either currently have a home loan or plan to obtain one in the next 12 months.
Respondents were about evenly split by gender; 72 percent were married; 65 percent had obtained at least a bachelor's degree; and 81 percent were white or Caucasian. Just over half, 52 percent, were employed full time; 12 percent identified as a "homemaker"; 11 percent were retired; 9 percent were employed part time; and 8 percent were self-employed. Only 6 percent were unemployed.
The vast majority of respondents (86 percent) were homeowners. Twelve percent of respondents rented and 2 percent lived with family.
Of those planning to purchase a home in the next year, 74 percent said they plan to use their personal savings for the down payment.
Contact Inman News:
Copyright 2011 Inman News
Thursday, September 15, 2011
My Regrets
All of the blog posted from May 10 through September 9 have disappeared, vanished, become lost. I am not sure I have offended, but it seems further effort may be a waste.
My Regrets,
Denis
My Regrets,
Denis
Homeowners Expect Prices to Fall
September 14, 2011 from Realty Times
Homeowners Expect Prices to Fall by Carla Hill
Has renewed concerns over the job market affected the way agents and homeowners feel about the market? HomeGain's nationwide third quarter 2011 home values survey found that forty-seven percent of surveyed real estate professionals nationwide expect home values to decrease over the next six months.
Additionally, an overwhelming majority of buyers feel that homes on the market are still overpriced, with 30 percent reporting they feel homes are overpriced by 10 to 20 percent.
Is this opportunism running rampant? Recent studies in affordability rates could lead us to believe so, as home values have plummeted across the nation and are already at generational highs.
Is the sentiment of overpriced homes a symptom of reduced consumer confidence in the market? Lynn Franco, Director of The Conference Board Consumer Research Center, reported late last month, "Consumer confidence deteriorated sharply in August, as consumers grew significantly more pessimistic about the short-term outlook. The index is now at its lowest level in more than two years. A contributing factor may have been the debt ceiling discussions since the decline in confidence was well underway before the S&P downgrade. Consumers' assessment of current conditions, on the other hand, posted only a modest decline as employment conditions continue to suppress confidence."
On top of these already dismal findings, foreclosures are still a large segment of most area markets. The largest percentage (32 percent) of those surveyed see 10 to 20 percent of the market made up of foreclosed properties.
“Homeowners have joined real estate professionals and now share their dour view on the direction of home prices. Last quarter only 30 percent of homeowners expected home prices to drop in the coming six months while 50 percent of real estate professionals expected price declines. In the current survey 45 percent of homeowners and 47 percent of real estate professionals expect home price declines in the next six months,” said Louis Cammarosano, General Manager of HomeGain.
Are you curious to know which states real estate agents and homeowners think will see price increases in the next six month? HomeGain supplies us with the list.
Arizona
Florida
Texas
California
Ohio
Tennessee
Colorado
Georgia
Virginia
Washington
On the flip side are the 10 states where agents and homeowners expect to see home price declines.
New Jersey
Pennsylvania
North Carolina
Georgia
Virginia
Illinois
Massachusetts
New York
California
Ohio
It's important to point out that several states made both lists. How can this be? It's just another clue that our market is volatile and unpredictable at this time. Too much of the housing market is tied to fluctuations in the jobs and stock market. Yet, real estate is extremely localized as well. You may have a boom market on one side of Ohio while another city across the state experiences declines.
In a down national economy, such as the one currently seen in the states, it's wise to keep an eye on national economic trends in stocks, jobs, and banking. It's also wise to take a hard look at your local economy. It may be the best future indicator of where housing will go in your community in the next six months.
Copyright © 2011 Realty Times. All Rights Reserved.
Homeowners Expect Prices to Fall by Carla Hill
Has renewed concerns over the job market affected the way agents and homeowners feel about the market? HomeGain's nationwide third quarter 2011 home values survey found that forty-seven percent of surveyed real estate professionals nationwide expect home values to decrease over the next six months.
Additionally, an overwhelming majority of buyers feel that homes on the market are still overpriced, with 30 percent reporting they feel homes are overpriced by 10 to 20 percent.
Is this opportunism running rampant? Recent studies in affordability rates could lead us to believe so, as home values have plummeted across the nation and are already at generational highs.
Is the sentiment of overpriced homes a symptom of reduced consumer confidence in the market? Lynn Franco, Director of The Conference Board Consumer Research Center, reported late last month, "Consumer confidence deteriorated sharply in August, as consumers grew significantly more pessimistic about the short-term outlook. The index is now at its lowest level in more than two years. A contributing factor may have been the debt ceiling discussions since the decline in confidence was well underway before the S&P downgrade. Consumers' assessment of current conditions, on the other hand, posted only a modest decline as employment conditions continue to suppress confidence."
On top of these already dismal findings, foreclosures are still a large segment of most area markets. The largest percentage (32 percent) of those surveyed see 10 to 20 percent of the market made up of foreclosed properties.
“Homeowners have joined real estate professionals and now share their dour view on the direction of home prices. Last quarter only 30 percent of homeowners expected home prices to drop in the coming six months while 50 percent of real estate professionals expected price declines. In the current survey 45 percent of homeowners and 47 percent of real estate professionals expect home price declines in the next six months,” said Louis Cammarosano, General Manager of HomeGain.
Are you curious to know which states real estate agents and homeowners think will see price increases in the next six month? HomeGain supplies us with the list.
Arizona
Florida
Texas
California
Ohio
Tennessee
Colorado
Georgia
Virginia
Washington
On the flip side are the 10 states where agents and homeowners expect to see home price declines.
New Jersey
Pennsylvania
North Carolina
Georgia
Virginia
Illinois
Massachusetts
New York
California
Ohio
It's important to point out that several states made both lists. How can this be? It's just another clue that our market is volatile and unpredictable at this time. Too much of the housing market is tied to fluctuations in the jobs and stock market. Yet, real estate is extremely localized as well. You may have a boom market on one side of Ohio while another city across the state experiences declines.
In a down national economy, such as the one currently seen in the states, it's wise to keep an eye on national economic trends in stocks, jobs, and banking. It's also wise to take a hard look at your local economy. It may be the best future indicator of where housing will go in your community in the next six months.
Copyright © 2011 Realty Times. All Rights Reserved.
Wednesday, May 11, 2011
Lowest Mortgage Rates
May 11, 2011 from Realty Times
Slow Economic Recovery Produces Lowest Mortgage Rates by Ed Ferrara
After releasing various reports of economic data this past week, it was evident that the economic recovery is at a slower pace than anticipated which, in turn, produced the lowest mortgage rates so far for this year 2011. Towards the end of the week, Freerateupdate.com's daily survey of wholesale and direct lenders showed that conforming 30 year fixed mortgage rates had dropped .125% to a new low of 4.375%. Remaining the same at last week's lows, 15 year fixed mortgage rates are at 3.750% and 5/1 adjustable mortgage rates are at 3.000%. Conforming fixed rate mortgage loans are popular with borrowers who want the same mortgage payment for the life of the loan. Available with 0.7 to 1% origination fee, these are the lowest mortgage rates for borrowers who have good credit and can obtain lender approval.
FHA 30 year fixed mortgage rates are at 4.250%, still lower than conforming 30 year fixed mortgage rates. FHA 15 year fixed mortgage rates are at 4.000% and FHA 5/1 adjustable mortgage rates are at 3.375%, both slightly higher than the comparable conforming mortgage rates. FHA mortgage loans are often used by borrowers, especially first time home buyers, who enjoy the benefit of low down payment requirements. Borrowers who have less than perfect credit also turn to FHA for their mortgage needs. In return for these benefits, FHA closing costs (APR) are higher because of various FHA fees and the upfront mortgage insurance premium.
Holding their own, jumbo mortgage rates are still at favorable lows which is a major benefit for high end borrowers. Current jumbo 30 year fixed mortgage rates are at 5.125%, jumbo 15 year fixed mortgage rates are at 4.500% and jumbo 5/1 adjustable rate mortgages are at 3.625%, all remaining the same this past week. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250, depending on location of the property. These are the lowest jumbo mortgage rates available with 0.7 to 1% origination fee to borrowers who have maintained outstanding credit.
MBS prices (mortgage backed securities) fluctuated over the past week. Mortgage rates move up and down in the opposite direction of MBS prices. With lower mortgage rates in the limelight, there has been an increase in both purchases and refinances as reported by the Mortgage Bankers Association. It was reported that private sector jobs increased which was positive news. On the other hand, jobless claims increased as well as the unemployment rate for the month of April. While the positive news indicates an economic recovery, the negative news reflects a weaker and slower recovery. These mixed reports have continued to create uncertainty for investors trying to determine which ones reflect the true state of the economy. At the end of last week, the price of crude oil dropped significantly bringing about more questions. Crude oil prices quickly rebounded today. In the end, negative economic news has been resulting in lower mortgage rates which is a plus for borrowers, especially as the home buying season is under way.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.
Click here for today’s new york mortgage rates.
Copyright © 2011 Realty Times. All Rights Reserved.
Slow Economic Recovery Produces Lowest Mortgage Rates by Ed Ferrara
After releasing various reports of economic data this past week, it was evident that the economic recovery is at a slower pace than anticipated which, in turn, produced the lowest mortgage rates so far for this year 2011. Towards the end of the week, Freerateupdate.com's daily survey of wholesale and direct lenders showed that conforming 30 year fixed mortgage rates had dropped .125% to a new low of 4.375%. Remaining the same at last week's lows, 15 year fixed mortgage rates are at 3.750% and 5/1 adjustable mortgage rates are at 3.000%. Conforming fixed rate mortgage loans are popular with borrowers who want the same mortgage payment for the life of the loan. Available with 0.7 to 1% origination fee, these are the lowest mortgage rates for borrowers who have good credit and can obtain lender approval.
FHA 30 year fixed mortgage rates are at 4.250%, still lower than conforming 30 year fixed mortgage rates. FHA 15 year fixed mortgage rates are at 4.000% and FHA 5/1 adjustable mortgage rates are at 3.375%, both slightly higher than the comparable conforming mortgage rates. FHA mortgage loans are often used by borrowers, especially first time home buyers, who enjoy the benefit of low down payment requirements. Borrowers who have less than perfect credit also turn to FHA for their mortgage needs. In return for these benefits, FHA closing costs (APR) are higher because of various FHA fees and the upfront mortgage insurance premium.
Holding their own, jumbo mortgage rates are still at favorable lows which is a major benefit for high end borrowers. Current jumbo 30 year fixed mortgage rates are at 5.125%, jumbo 15 year fixed mortgage rates are at 4.500% and jumbo 5/1 adjustable rate mortgages are at 3.625%, all remaining the same this past week. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250, depending on location of the property. These are the lowest jumbo mortgage rates available with 0.7 to 1% origination fee to borrowers who have maintained outstanding credit.
MBS prices (mortgage backed securities) fluctuated over the past week. Mortgage rates move up and down in the opposite direction of MBS prices. With lower mortgage rates in the limelight, there has been an increase in both purchases and refinances as reported by the Mortgage Bankers Association. It was reported that private sector jobs increased which was positive news. On the other hand, jobless claims increased as well as the unemployment rate for the month of April. While the positive news indicates an economic recovery, the negative news reflects a weaker and slower recovery. These mixed reports have continued to create uncertainty for investors trying to determine which ones reflect the true state of the economy. At the end of last week, the price of crude oil dropped significantly bringing about more questions. Crude oil prices quickly rebounded today. In the end, negative economic news has been resulting in lower mortgage rates which is a plus for borrowers, especially as the home buying season is under way.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.
Click here for today’s new york mortgage rates.
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, May 5, 2011
Affordability Reaches Generational High
May 5, 2011 from Realty Times
Affordability Reaches Generational High by Carla Hill
If you have good credit and savings, now is a great time to buy. According to Zillow.com, "Homes are more affordable than they’ve been in the past 35 years."
Not only have home values fallen in many key markets, making homeownership more accessible to the average buyer, interest rates are at historic lows, meaning that once a home is purchased, monthly payments are smaller than in our recent past.
Zillow notes that "today’s median home buyer can expect to pay about 17% of his monthly gross income on his mortgage, compared to a 25% average since 1975."
In the 1980's, when interest rates were dangerously near 20 percent, this would take up nearly 45 percent of a buyers gross monthly income. In comparison, today's rates are an extreme bargain.
The main road block to homeownership at this time is access to credit. Although nearly one-third of all home purchases in recent months have been all-cash, that leaves the majority of the market shares requiring financing.
The tightening of lending standards in recent years, though, has been in direct response to the subprime lending trend during the housing boom.
Federal Reserve research indicates that a quarter of all mortgages in 2006 were subprime. This means that these loans were made to borrowers with credit scores below 620-660 and who were unable to put down the traditional 20 percent.
Today, buyers need credit scores in the 700s, with the higher the better. According to Zillow, "Applicants with FICO scores under 620 were virtually unable to get loans at any rate, thus being effectively excluded from the home-buying market. And those with FICO scores below 620 represent almost a third of the population."
There has also been a return of the 20 percent downpayment. This is in your best interest, as it means savings when it comes to closing costs. "The difference between a 10% and 20% down payment means she now has to save up another $17,220 in addition to any closing costs." (Zillow)
So, while it is more difficult for many homeowners to get into the market in today's economy, for buyers who have good credit and adequate savings, homes may never have been more affordable.
Copyright © 2011 Realty Times. All Rights Reserved.
Affordability Reaches Generational High by Carla Hill
If you have good credit and savings, now is a great time to buy. According to Zillow.com, "Homes are more affordable than they’ve been in the past 35 years."
Not only have home values fallen in many key markets, making homeownership more accessible to the average buyer, interest rates are at historic lows, meaning that once a home is purchased, monthly payments are smaller than in our recent past.
Zillow notes that "today’s median home buyer can expect to pay about 17% of his monthly gross income on his mortgage, compared to a 25% average since 1975."
In the 1980's, when interest rates were dangerously near 20 percent, this would take up nearly 45 percent of a buyers gross monthly income. In comparison, today's rates are an extreme bargain.
The main road block to homeownership at this time is access to credit. Although nearly one-third of all home purchases in recent months have been all-cash, that leaves the majority of the market shares requiring financing.
The tightening of lending standards in recent years, though, has been in direct response to the subprime lending trend during the housing boom.
Federal Reserve research indicates that a quarter of all mortgages in 2006 were subprime. This means that these loans were made to borrowers with credit scores below 620-660 and who were unable to put down the traditional 20 percent.
Today, buyers need credit scores in the 700s, with the higher the better. According to Zillow, "Applicants with FICO scores under 620 were virtually unable to get loans at any rate, thus being effectively excluded from the home-buying market. And those with FICO scores below 620 represent almost a third of the population."
There has also been a return of the 20 percent downpayment. This is in your best interest, as it means savings when it comes to closing costs. "The difference between a 10% and 20% down payment means she now has to save up another $17,220 in addition to any closing costs." (Zillow)
So, while it is more difficult for many homeowners to get into the market in today's economy, for buyers who have good credit and adequate savings, homes may never have been more affordable.
Copyright © 2011 Realty Times. All Rights Reserved.
Wednesday, May 4, 2011
Mortgage Rates Keep Going Lower
May 4, 2011 from Realty Times
Mortgage Rates Keep Going Lower
Each time economic data is released or major events happen anywhere in the world, markets react in some sort of way. Lately, markets have been somewhat subdued as the reports have been mixed with both good and not so good data, although it has been positive for mortgage rates which keep going lower. Freerateupdate.com's daily survey of wholesale and direct lenders show that mortgage rates changed this past week for the better.
Conforming 30 year fixed mortgage rates started the week at 4.750%, dropped by .250% and now are at 4.500%. 15 year fixed mortgage rates also dropped by the same .250% and are at 3.750%. 5/1 adjustable mortgage rates are at 3.000%, a drop of .125%. These are the best mortgage rates available with 0.7 to 1% origination fee for well qualified borrowers. After remaining stable for some time, mortgage rates seem to be heading lower at what is usually one of the busiest seasons of the year.
FHA mortgage rates also repriced for the better. FHA 30 year fixed mortgage rates are at 4.250%, and FHA 15 year fixed mortgage rates are at 4.000%, both down .250%. FHA 5/1 adjustable mortgage rates are at 3.375%, down .275%. FHA mortgage loans offer a low down payment, but borrowers must be prepared to pay additional FHA fees and an upfront mortgage insurance premium which results in higher FHA closing costs (APR). FHA's recent increase in the annual mortgage insurance premium has resulted in a slow down of recent FHA mortgage applications.
Jumbo mortgage rates also did well this past week which should be a boost for high end home buyers. Jumbo 30 year fixed mortgage rates decreased by .250% and are at 5.125%. Jumbo 15 year fixed mortgage rates went from 5.000% in the early part of the week to 4.500% in the latter part of the week. Jumbo 5/1 adjustable mortgage rates are at 3.625% which is a decrease of .250%. With outstanding credit, borrowers can obtain these low jumbo mortgage rates with 0.7 to 1% origination fee. This week's economic data had mixed results on MBS prices (mortgage backed securities) as data continued to roll in. MBS prices affect mortgage rates which move in the opposite direction. While new home sales came in stronger, home prices continued to decline. Consumer sentiment increased and personal income rose at the same time that unemployment claims increased. With gas prices heading up, everyone will be watching to see what impact this is going to have on the already slow economic recovery.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.
Copyright © 2011 Realty Times. All Rights Reserved.
Mortgage Rates Keep Going Lower
Each time economic data is released or major events happen anywhere in the world, markets react in some sort of way. Lately, markets have been somewhat subdued as the reports have been mixed with both good and not so good data, although it has been positive for mortgage rates which keep going lower. Freerateupdate.com's daily survey of wholesale and direct lenders show that mortgage rates changed this past week for the better.
Conforming 30 year fixed mortgage rates started the week at 4.750%, dropped by .250% and now are at 4.500%. 15 year fixed mortgage rates also dropped by the same .250% and are at 3.750%. 5/1 adjustable mortgage rates are at 3.000%, a drop of .125%. These are the best mortgage rates available with 0.7 to 1% origination fee for well qualified borrowers. After remaining stable for some time, mortgage rates seem to be heading lower at what is usually one of the busiest seasons of the year.
FHA mortgage rates also repriced for the better. FHA 30 year fixed mortgage rates are at 4.250%, and FHA 15 year fixed mortgage rates are at 4.000%, both down .250%. FHA 5/1 adjustable mortgage rates are at 3.375%, down .275%. FHA mortgage loans offer a low down payment, but borrowers must be prepared to pay additional FHA fees and an upfront mortgage insurance premium which results in higher FHA closing costs (APR). FHA's recent increase in the annual mortgage insurance premium has resulted in a slow down of recent FHA mortgage applications.
Jumbo mortgage rates also did well this past week which should be a boost for high end home buyers. Jumbo 30 year fixed mortgage rates decreased by .250% and are at 5.125%. Jumbo 15 year fixed mortgage rates went from 5.000% in the early part of the week to 4.500% in the latter part of the week. Jumbo 5/1 adjustable mortgage rates are at 3.625% which is a decrease of .250%. With outstanding credit, borrowers can obtain these low jumbo mortgage rates with 0.7 to 1% origination fee. This week's economic data had mixed results on MBS prices (mortgage backed securities) as data continued to roll in. MBS prices affect mortgage rates which move in the opposite direction. While new home sales came in stronger, home prices continued to decline. Consumer sentiment increased and personal income rose at the same time that unemployment claims increased. With gas prices heading up, everyone will be watching to see what impact this is going to have on the already slow economic recovery.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.
Copyright © 2011 Realty Times. All Rights Reserved.
Monday, May 2, 2011
Sales Across the Nation
May 2, 2011 ON Realty Times
Real Estate Outlook: Sales Across the Nation by Carla Hill
It's all about sales this week, with the most recent reports coming out on existing-home, new home, and pending home sales.
According to the National Association of Realtors® (NAR), existing-home sales rose in March, up 3.7 percent. The NAR expects existing-home sale to rise around 5 to 10 percent this year, thanks to high levels of affordability, rising rent costs, and job growth.
In new homes, a segment of the market that took a big hit during the recession, sales were up a healthy 11.1 percent in March.
National Association of Home Builders' Chief Economist, David Crowe, reports, "The March pace of new-home sales more accurately reflects current market conditions than the extremely low pace we saw in the first two months of this year, when unusually poor weather likely kept buyers away. That said, the average sales pace for the first quarter of 2011 held at about the same level seen for the last half of 2010. A limiting factor is the extremely thin inventory of new homes for sale, which is now at its second-lowest level in history. Builders continue to confront major challenges in obtaining financing to build new homes, and the shortage of new product makes it that much tougher for them to compete with existing homes on the market. At the same time, tighter lending conditions are making it more difficult for qualified buyers to obtain a mortgage."
Regionally, all areas except the South saw a rise in sales of newly built homes. The Northeast led the way with a 66.7 percent gain. The West posted a distant second at a 25.9 percent gain, and the Midwest saw a still impressive rise of 12.9 percent.
The inventory of new homes for sale fell to 183,000 units in March, which is the second-lowest level on record. This represents a 7.3-month supply at the current sales pace.
Pending home sales were also on the rise. After an uneven recovery the past nine months, the NAR's Pending Home Sales Index saw contract signings rise 5.1 percent. This is still down over 11 percent from March 2010.
Lawrence Yun, NAR chief economist, said home sales activity has shown an uneven but notable improvement. “Since reaching a cyclical bottom last June, pending home sales have posted an overall gain of 24 percent and demonstrate the market is recovering on its own,” he said. “The index means modest near-term gains in existing-home sales are likely, which would be even stronger if tight mortgage lending criteria returned to normal, safe standards.”
Regionally, all regions except the Northeast saw rises, though every region is still below last year's levels. Most are between 10 and 20 percent below March 2010 levels.
The largest increase month over month was seen in the South, rising 10.3 percent.
Continued strides in the job market and economy will help to foster more growth in the housing sector. If recession recovery continues, the housing market should continue to post gains in the months ahead.
Copyright © 2011 Realty Times. All Rights Reserved.
Real Estate Outlook: Sales Across the Nation by Carla Hill
It's all about sales this week, with the most recent reports coming out on existing-home, new home, and pending home sales.
According to the National Association of Realtors® (NAR), existing-home sales rose in March, up 3.7 percent. The NAR expects existing-home sale to rise around 5 to 10 percent this year, thanks to high levels of affordability, rising rent costs, and job growth.
In new homes, a segment of the market that took a big hit during the recession, sales were up a healthy 11.1 percent in March.
National Association of Home Builders' Chief Economist, David Crowe, reports, "The March pace of new-home sales more accurately reflects current market conditions than the extremely low pace we saw in the first two months of this year, when unusually poor weather likely kept buyers away. That said, the average sales pace for the first quarter of 2011 held at about the same level seen for the last half of 2010. A limiting factor is the extremely thin inventory of new homes for sale, which is now at its second-lowest level in history. Builders continue to confront major challenges in obtaining financing to build new homes, and the shortage of new product makes it that much tougher for them to compete with existing homes on the market. At the same time, tighter lending conditions are making it more difficult for qualified buyers to obtain a mortgage."
Regionally, all areas except the South saw a rise in sales of newly built homes. The Northeast led the way with a 66.7 percent gain. The West posted a distant second at a 25.9 percent gain, and the Midwest saw a still impressive rise of 12.9 percent.
The inventory of new homes for sale fell to 183,000 units in March, which is the second-lowest level on record. This represents a 7.3-month supply at the current sales pace.
Pending home sales were also on the rise. After an uneven recovery the past nine months, the NAR's Pending Home Sales Index saw contract signings rise 5.1 percent. This is still down over 11 percent from March 2010.
Lawrence Yun, NAR chief economist, said home sales activity has shown an uneven but notable improvement. “Since reaching a cyclical bottom last June, pending home sales have posted an overall gain of 24 percent and demonstrate the market is recovering on its own,” he said. “The index means modest near-term gains in existing-home sales are likely, which would be even stronger if tight mortgage lending criteria returned to normal, safe standards.”
Regionally, all regions except the Northeast saw rises, though every region is still below last year's levels. Most are between 10 and 20 percent below March 2010 levels.
The largest increase month over month was seen in the South, rising 10.3 percent.
Continued strides in the job market and economy will help to foster more growth in the housing sector. If recession recovery continues, the housing market should continue to post gains in the months ahead.
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, April 28, 2011
Low Mortgage Rates
April 27, 2011 from Realty Times
Low Mortgage Rates a Plus for Improving Housing Market
by Ed Ferrara
This past week's released economic data reports came from several housing market areas, all of which showed some improvement over the past month. At the same time, Freerateupdate.com's daily survey of wholesale and direct lenders show that mortgage rates have continued to remain stable and at low levels for the past week.
Conforming 30 year fixed mortgage rates are at 4.750%, 15 year fixed mortgage rates are at 4.000% and 5/1 adjustable mortgage rates are at 3.125%. Conforming mortgage loans require good credit in order to obtain lender approval and the lowest mortgage rates with 0.7 to 1% origination fee. Conforming 30 year and 15 year fixed rate mortgages are the most popular of this group because they offer security with a consistent mortgage payment over the life of the loan.
The trend with borrowers for several years continues to be FHA mortgage loans. FHA 30 year fixed mortgage rates are at 4.500%, FHA 15 year fixed mortgage rates are at 4.250% and FHA 5/1 adjustable mortgage rates are at 3.750%. For borrowers who have a limited amount of available funds, FHA mortgage loans offer a low down payment option, as well as easier credit qualifying. FHA also accepts gifts from several sources that can be used for the down payment. These benefits often override any FHA downsides, such as higher FHA closing costs (APR) due to the upfront mortgage insurance premium and other various FHA fees.
Jumbo mortgage interest rates continue to be consistently low and beneficial for the high end borrower. Jumbo 30 year fixed mortgage rates are at 5.375%, jumbo 15 year mortgage rates are at 5.000% and jumbo 5/1 adjustable mortgage rates are at 3.875%. Borrowers need jumbo mortgage loans for mortgage financing above the conforming loan limit which is $417,000 to $729,000 depending on location. In order to obtain these low jumbo mortgage rates with 0.7 to 1% origination fee, borrowers must have outstanding credit and the ability to meet approval guidelines set by lenders.
MBS prices (also known as mortgage backed securities) are dependent upon market conditions and investor sentiment. Mortgage rates move in the opposite direction of MBS prices. Recent data released showed a very necessary improvement in the sluggish housing market. For the month of March, housing starts saw a jump, existing home sales increased and home mortgages rose. Yesterday, the Census Bureau and Department of Housing and Urban Development reported that new home sales were stronger than expected. Through all of this, MBS prices fluctuated a little in both directions, but never enough to make a change in mortgage.
Copyright © 2011 Realty Times. All Rights Reserved.
Low Mortgage Rates a Plus for Improving Housing Market
by Ed Ferrara
This past week's released economic data reports came from several housing market areas, all of which showed some improvement over the past month. At the same time, Freerateupdate.com's daily survey of wholesale and direct lenders show that mortgage rates have continued to remain stable and at low levels for the past week.
Conforming 30 year fixed mortgage rates are at 4.750%, 15 year fixed mortgage rates are at 4.000% and 5/1 adjustable mortgage rates are at 3.125%. Conforming mortgage loans require good credit in order to obtain lender approval and the lowest mortgage rates with 0.7 to 1% origination fee. Conforming 30 year and 15 year fixed rate mortgages are the most popular of this group because they offer security with a consistent mortgage payment over the life of the loan.
The trend with borrowers for several years continues to be FHA mortgage loans. FHA 30 year fixed mortgage rates are at 4.500%, FHA 15 year fixed mortgage rates are at 4.250% and FHA 5/1 adjustable mortgage rates are at 3.750%. For borrowers who have a limited amount of available funds, FHA mortgage loans offer a low down payment option, as well as easier credit qualifying. FHA also accepts gifts from several sources that can be used for the down payment. These benefits often override any FHA downsides, such as higher FHA closing costs (APR) due to the upfront mortgage insurance premium and other various FHA fees.
Jumbo mortgage interest rates continue to be consistently low and beneficial for the high end borrower. Jumbo 30 year fixed mortgage rates are at 5.375%, jumbo 15 year mortgage rates are at 5.000% and jumbo 5/1 adjustable mortgage rates are at 3.875%. Borrowers need jumbo mortgage loans for mortgage financing above the conforming loan limit which is $417,000 to $729,000 depending on location. In order to obtain these low jumbo mortgage rates with 0.7 to 1% origination fee, borrowers must have outstanding credit and the ability to meet approval guidelines set by lenders.
MBS prices (also known as mortgage backed securities) are dependent upon market conditions and investor sentiment. Mortgage rates move in the opposite direction of MBS prices. Recent data released showed a very necessary improvement in the sluggish housing market. For the month of March, housing starts saw a jump, existing home sales increased and home mortgages rose. Yesterday, the Census Bureau and Department of Housing and Urban Development reported that new home sales were stronger than expected. Through all of this, MBS prices fluctuated a little in both directions, but never enough to make a change in mortgage.
Copyright © 2011 Realty Times. All Rights Reserved.
Monday, April 25, 2011
Builder Confidence and Existing-Home Sales
April 25, 2011 from Realty Times
Real Estate Outlook: Builder Confidence and Existing-Home Sales
by Carla Hill
The prevalence of short sales and foreclosures has prompted a new bill to be considered in Congress. According to the National Association of Realtors, this new bill could "improve the process for approving short sales" and "bring relief to distressed home owners who are unable to keep their homes and hope to avoid foreclosure."
The process in place now is said to be time-consuming and inefficient.
Ron Phipps, NAR President, says, "As the leading advocate for home ownership and housing issues, Realtors® want to help more home owners avoid foreclosure by facilitating a short sale when a family is absolutely unable to keep their home; however, that can only happen if lenders and servicers approve short sale offers in a reasonable amount of time. Streamlining short sales transactions will reduce the amount of time it takes to sell the property, improve the likelihood that the transaction will close and reduce the overall number of foreclosures. This benefits sellers, lenders, buyers and the entire community."
And communities need all the help they can get. Builder confidence for newly built, single-family homes fell in March, leaving the Index almost stagnant for the last 6 months. According to the National Association of Home Builders (NAHB), the South was to largely blame, dropping 4 points on the Housing Market Index scale.
"The spring home buying season is getting off to a slow start due to persistent concerns about home values as more foreclosures seem to be hitting the market, increasingly restrictive lending requirements for home buyers and builders, and the slow pace of economic recovery," acknowledged NAHB Chief Economist David Crowe. "While pockets of improving activity are appearing in some markets, the best sales activity appears to be happening in the lower price ranges, where first-time buyers have greater flexibility than repeat buyers who must sell their current home. Consumers who can take advantage of today’s low mortgage rates and very attractive pricing are finding bargains and are buying."
The good news for builders? Nationwide housing starts rose by 7.2 percent in March, according to the U.S. Commerce Department. Bob Nielsen, chairman of the National Association of Home Builders (NAHB), says, "While the overall rate of new-home production remains quite low and is still being weighed down by significant uncertainties among both home builders and buyers, this latest report is encouraging. It means that some builders are cautiously beginning to re-stock their extremely thin inventories of new homes in anticipation of gradual improvement in consumer demand as the economy slowly inches toward recovery."
All regions except the Northeast experienced gains in March. The West led the way with a 37.1 percent gain. The Midwest and South gained 6.9 and 6.3 percent, respectively.
And the sale of existing-homes rose in March, as well. This continues the uneven recovery we've been experiencing.
Lawrence Yun, NAR chief economist, expects this improving sales pattern to continue. "Existing-home sales have risen in six of the past eight months, so we’re clearly on a recovery path," he said. "With rising jobs and excellent affordability conditions, we project moderate improvements into 2012, but not every month will show a gain – primarily because some buyers are finding it too difficult to obtain a mortgage. For those fortunate enough to qualify for financing, monthly mortgage payments as a percent of income have been at record lows."
And single-family home sales rose 4.0 percent to a seasonally adjusted annual rate of 4.45 million in March from 4.28 million in February, but are 6.5 percent below the 4.76 million level in March 2010. The median existing single-family home price was $160,500 in March, down 5.3 percent from a year ago. Median prices were down in all regions, ranging from 3.0 to 11.2 percent below year ago levels.
Regionally, existing-home sales rose 3.9 percent in the Northeast, but are 12.1 percent below March 2010. The Midwest saw just a 1.0 percent gain and is still 13.1 percent below year ago levels. The West dropped a marginal 0.8 percent and the South actually rose 8.2 percent.
Buyers are expected to return to the market, though. NAR President, Ron Phipps, reports, "As buyers gain more financial security, the advantages of home ownership become more obvious."
Copyright © 2011 Realty Times. All Rights Reserved.
Real Estate Outlook: Builder Confidence and Existing-Home Sales
by Carla Hill
The prevalence of short sales and foreclosures has prompted a new bill to be considered in Congress. According to the National Association of Realtors, this new bill could "improve the process for approving short sales" and "bring relief to distressed home owners who are unable to keep their homes and hope to avoid foreclosure."
The process in place now is said to be time-consuming and inefficient.
Ron Phipps, NAR President, says, "As the leading advocate for home ownership and housing issues, Realtors® want to help more home owners avoid foreclosure by facilitating a short sale when a family is absolutely unable to keep their home; however, that can only happen if lenders and servicers approve short sale offers in a reasonable amount of time. Streamlining short sales transactions will reduce the amount of time it takes to sell the property, improve the likelihood that the transaction will close and reduce the overall number of foreclosures. This benefits sellers, lenders, buyers and the entire community."
And communities need all the help they can get. Builder confidence for newly built, single-family homes fell in March, leaving the Index almost stagnant for the last 6 months. According to the National Association of Home Builders (NAHB), the South was to largely blame, dropping 4 points on the Housing Market Index scale.
"The spring home buying season is getting off to a slow start due to persistent concerns about home values as more foreclosures seem to be hitting the market, increasingly restrictive lending requirements for home buyers and builders, and the slow pace of economic recovery," acknowledged NAHB Chief Economist David Crowe. "While pockets of improving activity are appearing in some markets, the best sales activity appears to be happening in the lower price ranges, where first-time buyers have greater flexibility than repeat buyers who must sell their current home. Consumers who can take advantage of today’s low mortgage rates and very attractive pricing are finding bargains and are buying."
The good news for builders? Nationwide housing starts rose by 7.2 percent in March, according to the U.S. Commerce Department. Bob Nielsen, chairman of the National Association of Home Builders (NAHB), says, "While the overall rate of new-home production remains quite low and is still being weighed down by significant uncertainties among both home builders and buyers, this latest report is encouraging. It means that some builders are cautiously beginning to re-stock their extremely thin inventories of new homes in anticipation of gradual improvement in consumer demand as the economy slowly inches toward recovery."
All regions except the Northeast experienced gains in March. The West led the way with a 37.1 percent gain. The Midwest and South gained 6.9 and 6.3 percent, respectively.
And the sale of existing-homes rose in March, as well. This continues the uneven recovery we've been experiencing.
Lawrence Yun, NAR chief economist, expects this improving sales pattern to continue. "Existing-home sales have risen in six of the past eight months, so we’re clearly on a recovery path," he said. "With rising jobs and excellent affordability conditions, we project moderate improvements into 2012, but not every month will show a gain – primarily because some buyers are finding it too difficult to obtain a mortgage. For those fortunate enough to qualify for financing, monthly mortgage payments as a percent of income have been at record lows."
And single-family home sales rose 4.0 percent to a seasonally adjusted annual rate of 4.45 million in March from 4.28 million in February, but are 6.5 percent below the 4.76 million level in March 2010. The median existing single-family home price was $160,500 in March, down 5.3 percent from a year ago. Median prices were down in all regions, ranging from 3.0 to 11.2 percent below year ago levels.
Regionally, existing-home sales rose 3.9 percent in the Northeast, but are 12.1 percent below March 2010. The Midwest saw just a 1.0 percent gain and is still 13.1 percent below year ago levels. The West dropped a marginal 0.8 percent and the South actually rose 8.2 percent.
Buyers are expected to return to the market, though. NAR President, Ron Phipps, reports, "As buyers gain more financial security, the advantages of home ownership become more obvious."
Copyright © 2011 Realty Times. All Rights Reserved.
Saturday, April 9, 2011
The Numbers on Buying a House
April 7, 2011 from Realty Times
The Numbers on Buying a House by Carla Hill
It can be a tricky question. How much home can you really afford? From employment status, to savings, downpayment, and even spending habits, there are a myriad of factors that come into play.
Here is a list of items to consider before settling on a budget.
1. Monthly Payment: Conventional wisdom tells us that your mortgage payment should be no more than 28 of your gross monthly income. This means that if you make $50,000 a year, the maximum amount you would safely want to pay each month is $1,166. How do you figure this for you own salary? Take ___ (salary) x .28 = total dollar amount for year. Then divide the total dollar amount by 12 (months in the year) and there you have it!
The National Association of Realtors also gives this simple equation for renters to use to figure out how much they can afford. Multiply your rent by 1.32 and that will equal your affordable mortgage payment.
2. Job Security: Have you just switched jobs? Is your company experiencing layoffs? In times of economic uncertainty, you may find it best to stay put. This is why many economic analysts keep saying that a housing recovery is dependent on a jobs recovery. When jobs return, so will the buyers.
3. Savings: The state of American savings is scary. According to Visual Economics.com, the average family has $117,951 worth of debt and only $3,800 in savings.
And a quarter of Americans have no savings at all! Half have nothing saved for retirement. Talk about crossing your fingers that social security will hold out for a while.
New grads are encountering an even scarier situation. The average college graduate has well over $20,000 in student loans to repay, and according to the New York Times, "Paying back student loans is likely to be especially difficult for recent graduates ... because the unemployment rate for college graduates ages 20 to 24 was 8.7 percent in 2009 — the highest annual rate on record and a substantial rise from 5.8 percent in 2008."
How does your debt-to-income ratio stack up? The Federal Reserve thinks debt adding up to more than 40% of your gross income could indicate financial distress.
The U.S. savings rate has risen steadily since the recession hit. It is now at 5.8 percent (American Express Spending & Saving Tracker). Hopefully, this rate will continue to be a trend.
4. Emergency Fund: Before you even begin to think about buying a house or moving, you must have an 8-month emergency fund in the bank. This means you need to add up your living expenses for a month. Include all the necessities and things that must be paid (rent or mortgage, car payments, insurance, food, gas money, electric, phone, tuition, day care, etc). Then multiply this number by 8. You must have this in case you or your spouse loses your job, gets sicks, or some other disaster hits your family.
5. Downpayment: This is savings in addition to your 8-month emergency fund. And a downpayment should be at least 20 percent of your purchase amount.
Look at it this way. If your monthly expenses are $2,000 a month and you want to buy a $100,000 house, you'll need a bare minimum of $36,000 in the bank to truly afford this move. That doesn't include cash needed for closing costs, repairs, moving expenses, and renovation.
6. Lifestyle and Extraneous Factors: Everyone has different wants and needs. You may be fine spending a little more for the house of your dreams in exchange for taking fewer vacations. Others abhor the statement, "house rich, cash poor," and instead would rather have funds for shopping, dining out, and travel. And don't forget about extraneous factors, such as aging parents, car repairs and maintenance. Things may come out of nowhere!
Buying a house is a fulfilling experience, but it comes with a lot of financial responsibility that shouldn't be taken lightly. Be sure to mull these items over when considering a buy.
Copyright © 2011 Realty Times. All Rights Reserved.
The Numbers on Buying a House by Carla Hill
It can be a tricky question. How much home can you really afford? From employment status, to savings, downpayment, and even spending habits, there are a myriad of factors that come into play.
Here is a list of items to consider before settling on a budget.
1. Monthly Payment: Conventional wisdom tells us that your mortgage payment should be no more than 28 of your gross monthly income. This means that if you make $50,000 a year, the maximum amount you would safely want to pay each month is $1,166. How do you figure this for you own salary? Take ___ (salary) x .28 = total dollar amount for year. Then divide the total dollar amount by 12 (months in the year) and there you have it!
The National Association of Realtors also gives this simple equation for renters to use to figure out how much they can afford. Multiply your rent by 1.32 and that will equal your affordable mortgage payment.
2. Job Security: Have you just switched jobs? Is your company experiencing layoffs? In times of economic uncertainty, you may find it best to stay put. This is why many economic analysts keep saying that a housing recovery is dependent on a jobs recovery. When jobs return, so will the buyers.
3. Savings: The state of American savings is scary. According to Visual Economics.com, the average family has $117,951 worth of debt and only $3,800 in savings.
And a quarter of Americans have no savings at all! Half have nothing saved for retirement. Talk about crossing your fingers that social security will hold out for a while.
New grads are encountering an even scarier situation. The average college graduate has well over $20,000 in student loans to repay, and according to the New York Times, "Paying back student loans is likely to be especially difficult for recent graduates ... because the unemployment rate for college graduates ages 20 to 24 was 8.7 percent in 2009 — the highest annual rate on record and a substantial rise from 5.8 percent in 2008."
How does your debt-to-income ratio stack up? The Federal Reserve thinks debt adding up to more than 40% of your gross income could indicate financial distress.
The U.S. savings rate has risen steadily since the recession hit. It is now at 5.8 percent (American Express Spending & Saving Tracker). Hopefully, this rate will continue to be a trend.
4. Emergency Fund: Before you even begin to think about buying a house or moving, you must have an 8-month emergency fund in the bank. This means you need to add up your living expenses for a month. Include all the necessities and things that must be paid (rent or mortgage, car payments, insurance, food, gas money, electric, phone, tuition, day care, etc). Then multiply this number by 8. You must have this in case you or your spouse loses your job, gets sicks, or some other disaster hits your family.
5. Downpayment: This is savings in addition to your 8-month emergency fund. And a downpayment should be at least 20 percent of your purchase amount.
Look at it this way. If your monthly expenses are $2,000 a month and you want to buy a $100,000 house, you'll need a bare minimum of $36,000 in the bank to truly afford this move. That doesn't include cash needed for closing costs, repairs, moving expenses, and renovation.
6. Lifestyle and Extraneous Factors: Everyone has different wants and needs. You may be fine spending a little more for the house of your dreams in exchange for taking fewer vacations. Others abhor the statement, "house rich, cash poor," and instead would rather have funds for shopping, dining out, and travel. And don't forget about extraneous factors, such as aging parents, car repairs and maintenance. Things may come out of nowhere!
Buying a house is a fulfilling experience, but it comes with a lot of financial responsibility that shouldn't be taken lightly. Be sure to mull these items over when considering a buy.
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, March 31, 2011
Discounted Home Prices
March 31, 2011 from Realty Times
Spring Market Conditions Bode Well For Discounted Home Prices by Broderick Perkins
Optimism about the housing market isn't quite sweeping the nation, but Americans remain sold on the value of home ownership at a good time to be bullish about buying a home.
With home sales and prices still falling, the spring could shape up as an opportune time to make a deal.
The housing downturn hasn't shaken consumers' resolve to consider home ownership an integral part of an American Dream, even among home owners with homes that have lost value.
The eighth quarterly "Allstate-National Journal Heartland Monitor Poll: The American Dream" revealed that nearly nine out of 10 homeowners say they would buy their same homes again.
Among those with homes with lost value, the same percentage said they would buy their home again.
Also, seven of 10 Americans say they would advise a friend or family member to buy a home as a long-term asset.
The spring could be a good time to take that advice.
Existing-home sales, completed transactions that include single-family, townhomes, condominiums and co-ops, dropped 9.6 percent to a seasonally adjusted annual rate of 4.88 million in February from 5.40 million in January. February 2010 sales were 2.8 percent below the pace in February 2010, according to the National Association of Realtors (NAR).
The slow sales pushed the median price down to $156,100, the lowest level since February 2002, setting the stage for spring bargains.
Some experts say the housing market is years away from a full blown recovery and the home buyer tax credit is kaput. However, improvements in employment and manufacturing and other economic sectors, bargain home prices and affordable interest rates could light a fire under buyers who've been sitting on the fence.
"Housing affordability conditions have been at record levels and the economy has been improving, but home sales are being constrained by the twin problems of unnecessarily tight credit, and a measurable level of contract cancellations from some appraisals not supporting prices negotiated between buyers and sellers," said Lawrence Yun NAR chief economist.
The Allstate survey of 1,000 Americans also found.
• Buying a home was the best investment among 24 percent, behind "investing in retirement savings" (38 percent), but ahead of "saving money in the bank" (20 percent), and "investing in the stock market" (6 percent).
• A majority, 58 percent of those who believe the housing crisis will remain a serious problem would still recommend buying a home.
• Americans are evenly split on whether the federal government should continue policies to encourage home ownership at the same level (46 percent) or scale them back because they cost too much (46 percent).
• More than half of Americans (52 percent) blame the housing crisis on banks and lending institutions for misleading borrowers and approving bad loans, while 32 percent blame people who bought homes and took out mortgages they couldn't afford, and only 12 percent blame government policies that encouraged too many people to try to own their own homes.
"Owning a home continues to be the bedrock of the American Dream – even as incomes are down, jobs are scarce and families struggle to make ends meet," said Thomas J. Wilson , Allstate chairman, president and chief executive officer.
"Homeownership is viewed positively by the vast majority of Americans as both a place to raise a family and a sound investment," he added.
Copyright © 2011 Realty Times. All Rights Reserved.
Spring Market Conditions Bode Well For Discounted Home Prices by Broderick Perkins
Optimism about the housing market isn't quite sweeping the nation, but Americans remain sold on the value of home ownership at a good time to be bullish about buying a home.
With home sales and prices still falling, the spring could shape up as an opportune time to make a deal.
The housing downturn hasn't shaken consumers' resolve to consider home ownership an integral part of an American Dream, even among home owners with homes that have lost value.
The eighth quarterly "Allstate-National Journal Heartland Monitor Poll: The American Dream" revealed that nearly nine out of 10 homeowners say they would buy their same homes again.
Among those with homes with lost value, the same percentage said they would buy their home again.
Also, seven of 10 Americans say they would advise a friend or family member to buy a home as a long-term asset.
The spring could be a good time to take that advice.
Existing-home sales, completed transactions that include single-family, townhomes, condominiums and co-ops, dropped 9.6 percent to a seasonally adjusted annual rate of 4.88 million in February from 5.40 million in January. February 2010 sales were 2.8 percent below the pace in February 2010, according to the National Association of Realtors (NAR).
The slow sales pushed the median price down to $156,100, the lowest level since February 2002, setting the stage for spring bargains.
Some experts say the housing market is years away from a full blown recovery and the home buyer tax credit is kaput. However, improvements in employment and manufacturing and other economic sectors, bargain home prices and affordable interest rates could light a fire under buyers who've been sitting on the fence.
"Housing affordability conditions have been at record levels and the economy has been improving, but home sales are being constrained by the twin problems of unnecessarily tight credit, and a measurable level of contract cancellations from some appraisals not supporting prices negotiated between buyers and sellers," said Lawrence Yun NAR chief economist.
The Allstate survey of 1,000 Americans also found.
• Buying a home was the best investment among 24 percent, behind "investing in retirement savings" (38 percent), but ahead of "saving money in the bank" (20 percent), and "investing in the stock market" (6 percent).
• A majority, 58 percent of those who believe the housing crisis will remain a serious problem would still recommend buying a home.
• Americans are evenly split on whether the federal government should continue policies to encourage home ownership at the same level (46 percent) or scale them back because they cost too much (46 percent).
• More than half of Americans (52 percent) blame the housing crisis on banks and lending institutions for misleading borrowers and approving bad loans, while 32 percent blame people who bought homes and took out mortgages they couldn't afford, and only 12 percent blame government policies that encouraged too many people to try to own their own homes.
"Owning a home continues to be the bedrock of the American Dream – even as incomes are down, jobs are scarce and families struggle to make ends meet," said Thomas J. Wilson , Allstate chairman, president and chief executive officer.
"Homeownership is viewed positively by the vast majority of Americans as both a place to raise a family and a sound investment," he added.
Copyright © 2011 Realty Times. All Rights Reserved.
Sunday, March 20, 2011
Fixed-Rate Mortgage Drops
March 18, 2011 from Realty Times
30-Year Fixed-Rate Mortgage Drops Amid Japan Crisis
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey (PMMS), which shows the 30-year fixed-rate dropping to 4.76 percent while the 15-year fixed-rate hit its lowest rate at 3.97 percent since December 2010.
30-year fixed-rate mortgage (FRM) averaged 4.76 percent with an average 0.7 point for the week ending March 17, 2011, down from last week when it averaged 4.88 percent. Last year at this time, the 30-year FRM averaged 4.96 percent.
15-year FRM this week averaged 3.97 percent with an average 0.7 point, down from last week when it averaged 4.15 percent. A year ago at this time, the 15-year FRM averaged 4.33 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.57 percent this week, with an average 0.6 point, down from last week when it averaged 3.73 percent. A year ago, the 5-year ARM averaged 4.09 percent.
1-year Treasury-indexed ARM averaged 3.17 percent this week with an average 0.6 point, down from last week when it averaged 3.21 percent. At this time last year, the 1-year ARM averaged 4.12 percent.
Frank Nothaft, vice president and chief economist of Freddie Mac, reports, "With the crisis in Japan, investors rushed to buy the security of U.S. Treasury bonds , which lowered its yields and other interest rates as well. This allowed fixed mortgage rates to drift lower this week."
"In aggregate, families have been strengthening their balance sheets. In the fourth quarter of 2010, household net worth rose by $2.1 trillion, boosted by gains in the stock market. This helped lower their financial obligation ratio (debt payments relative to disposable income) to the lowest level since the first quarter of 1995."
Copyright © 2011 Realty Times. All Rights Reserved.
30-Year Fixed-Rate Mortgage Drops Amid Japan Crisis
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey (PMMS), which shows the 30-year fixed-rate dropping to 4.76 percent while the 15-year fixed-rate hit its lowest rate at 3.97 percent since December 2010.
30-year fixed-rate mortgage (FRM) averaged 4.76 percent with an average 0.7 point for the week ending March 17, 2011, down from last week when it averaged 4.88 percent. Last year at this time, the 30-year FRM averaged 4.96 percent.
15-year FRM this week averaged 3.97 percent with an average 0.7 point, down from last week when it averaged 4.15 percent. A year ago at this time, the 15-year FRM averaged 4.33 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.57 percent this week, with an average 0.6 point, down from last week when it averaged 3.73 percent. A year ago, the 5-year ARM averaged 4.09 percent.
1-year Treasury-indexed ARM averaged 3.17 percent this week with an average 0.6 point, down from last week when it averaged 3.21 percent. At this time last year, the 1-year ARM averaged 4.12 percent.
Frank Nothaft, vice president and chief economist of Freddie Mac, reports, "With the crisis in Japan, investors rushed to buy the security of U.S. Treasury bonds , which lowered its yields and other interest rates as well. This allowed fixed mortgage rates to drift lower this week."
"In aggregate, families have been strengthening their balance sheets. In the fourth quarter of 2010, household net worth rose by $2.1 trillion, boosted by gains in the stock market. This helped lower their financial obligation ratio (debt payments relative to disposable income) to the lowest level since the first quarter of 1995."
Copyright © 2011 Realty Times. All Rights Reserved.
Wednesday, March 16, 2011
Mortgage Rates Continue Downward Trend
March 16, 2011 from Realty Times
Mortgage Rates Continue Downward Trend by Ed Ferrara
After seeing no movement for most of last week, mortgage rates declined today continuing a three week downward trend. Freerateupdate.com's daily survey of wholesale and direct lenders show that conforming mortgage rates all declined by .125%. Conforming 30 year fixed rate mortgages are at 4.625%, 15 year fixed rate mortgages are at 3.750% and 5/1 adjustable mortgage rates are at 3.000%. These are the best conforming mortgage rates available with 0.7 to 1% to borrowers with good credit and the ability to meet lender approval. The most popular of these are the fixed rate mortgage loans which offer borrowers the security of monthly mortgage payments that remain the same throughout the life of the loan.
FHA mortgage rates had mixed results this week. FHA 30 year fixed mortgage rates saw a decrease of .125% and are at 4.375%, FHA 15 year fixed mortgage rates remain unchanged and are at 4.000% and FHA 5/1 adjustable rate mortgages are at 3.750% which is an increase of .250%. FHA mortgage loans continue to be popular with borrowers, especially first time home buyers due to FHA low down payment requirements and easier credit qualifying guidelines. On the other hand, borrowers must pay higher FHA closing costs (APR) because FHA charges various fees and an upfront mortgage insurance premium.
Jumbo mortgage rates saw the same downward slide as conforming mortgage rates. Jumbo 30 year fixed mortgage rates are at 5.250% which is a decrease of .125%. Jumbo 15 year fixed mortgage rates are at 5.000% and Jumbo 5/1 adjustable mortgage rates are at 3.625%, both down .250%. These low jumbo mortgage rates are available to well qualified borrowers with 0.7 to 1% origination fee. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the location of the property.
Mortgage rates move up and down and in the opposite direction of MBS prices (mortgage backed securities). This past week, economic data released included the increase in unemployment claims, the rise of wholesale inventories and sales and the increase in retail trade sales. While responding lightly to these reports, the most movement for MBS prices came from the continued unrest in the Middle East. In addition, the recent earthquake and tsunami in Japan has investors concerned about the economic recovery on a worldwide scale which has had the strongest affect on MBS prices that ultimately resulted in the reduction of almost all mortgage rates.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Copyright © 2011 Realty Times. All Rights Reserved.
Mortgage Rates Continue Downward Trend by Ed Ferrara
After seeing no movement for most of last week, mortgage rates declined today continuing a three week downward trend. Freerateupdate.com's daily survey of wholesale and direct lenders show that conforming mortgage rates all declined by .125%. Conforming 30 year fixed rate mortgages are at 4.625%, 15 year fixed rate mortgages are at 3.750% and 5/1 adjustable mortgage rates are at 3.000%. These are the best conforming mortgage rates available with 0.7 to 1% to borrowers with good credit and the ability to meet lender approval. The most popular of these are the fixed rate mortgage loans which offer borrowers the security of monthly mortgage payments that remain the same throughout the life of the loan.
FHA mortgage rates had mixed results this week. FHA 30 year fixed mortgage rates saw a decrease of .125% and are at 4.375%, FHA 15 year fixed mortgage rates remain unchanged and are at 4.000% and FHA 5/1 adjustable rate mortgages are at 3.750% which is an increase of .250%. FHA mortgage loans continue to be popular with borrowers, especially first time home buyers due to FHA low down payment requirements and easier credit qualifying guidelines. On the other hand, borrowers must pay higher FHA closing costs (APR) because FHA charges various fees and an upfront mortgage insurance premium.
Jumbo mortgage rates saw the same downward slide as conforming mortgage rates. Jumbo 30 year fixed mortgage rates are at 5.250% which is a decrease of .125%. Jumbo 15 year fixed mortgage rates are at 5.000% and Jumbo 5/1 adjustable mortgage rates are at 3.625%, both down .250%. These low jumbo mortgage rates are available to well qualified borrowers with 0.7 to 1% origination fee. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the location of the property.
Mortgage rates move up and down and in the opposite direction of MBS prices (mortgage backed securities). This past week, economic data released included the increase in unemployment claims, the rise of wholesale inventories and sales and the increase in retail trade sales. While responding lightly to these reports, the most movement for MBS prices came from the continued unrest in the Middle East. In addition, the recent earthquake and tsunami in Japan has investors concerned about the economic recovery on a worldwide scale which has had the strongest affect on MBS prices that ultimately resulted in the reduction of almost all mortgage rates.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Copyright © 2011 Realty Times. All Rights Reserved.
Wednesday, March 9, 2011
Mortgage Rates ...Show Improvement
March 9, 2011 from Realty Times
Mortgage Rates Today: Home Mortgage Rates Continue to Show Improvement by Ed Ferrara
Over the past week, mortgage rates continued to show improvement with a decrease of .125% for conforming 15 year fixed mortgage rates and 5/1 ARM loan rates. Freerateupdate.com's daily survey of wholesale and direct lenders show that 30 year fixed mortgage rates are at 4.750%, 15 year fixed mortgage rates are at 3.875% and 5/1 adjustable mortgage rates are at 3.125%. Conforming fixed rate mortgage loans continue to be popular with borrowers who want the security of a set monthly mortgage payment for the life of loan and are available with 0.7 to 1% origination fee to those with good credit.
Remaining unchanged, FHA 30 year fixed mortgage rates are at 4.500% and FHA 15 year fixed mortgage rates are at 4.000%. FHA 5/1 ARM loan rates are at 3.500% which is a decrease of .125%. FHA fixed mortgage rates continue to be competitive with conforming fixed mortgage rates, although FHA mortgage loans offer several benefits to borrowers including a low down payment requirement and easier credit qualifying. Borrowers must pay higher FHA closing costs (APR) because FHA charges an upfront mortgage insurance premium and other various fees. Jumbo mortgage rates saw no changes over the past week.
Jumbo 30 year fixed mortgage rates are at 5.375%, jumbo 15 year fixed mortgage rates are at 5.250% and jumbo 5/1 ARM loan rates are at 3.875%. Jumbo mortgage loans are required for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the property location. Available with 0.7 to 1% origination point, these are the best jumbo mortgage rates offered to well qualified borrowers.
MBS prices (mortgage backed prices) affect mortgage rates which move in the opposite direction. MBS price movements continue to be unpredictable and not necessarily dependent on the economic data reported. This past week's reports included an increase in private sector jobs, a decrease in weekly jobless claims and a lower unemployment rate. Although mortgage rates are down, MBA reported weekly purchase and refinance activity down. Regardless of economic reports released, the tensions in the Middle East continue to be driving the emotions of investors and causing market volatility.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Current California Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Mortgage Rates Today: Home Mortgage Rates Continue to Show Improvement by Ed Ferrara
Over the past week, mortgage rates continued to show improvement with a decrease of .125% for conforming 15 year fixed mortgage rates and 5/1 ARM loan rates. Freerateupdate.com's daily survey of wholesale and direct lenders show that 30 year fixed mortgage rates are at 4.750%, 15 year fixed mortgage rates are at 3.875% and 5/1 adjustable mortgage rates are at 3.125%. Conforming fixed rate mortgage loans continue to be popular with borrowers who want the security of a set monthly mortgage payment for the life of loan and are available with 0.7 to 1% origination fee to those with good credit.
Remaining unchanged, FHA 30 year fixed mortgage rates are at 4.500% and FHA 15 year fixed mortgage rates are at 4.000%. FHA 5/1 ARM loan rates are at 3.500% which is a decrease of .125%. FHA fixed mortgage rates continue to be competitive with conforming fixed mortgage rates, although FHA mortgage loans offer several benefits to borrowers including a low down payment requirement and easier credit qualifying. Borrowers must pay higher FHA closing costs (APR) because FHA charges an upfront mortgage insurance premium and other various fees. Jumbo mortgage rates saw no changes over the past week.
Jumbo 30 year fixed mortgage rates are at 5.375%, jumbo 15 year fixed mortgage rates are at 5.250% and jumbo 5/1 ARM loan rates are at 3.875%. Jumbo mortgage loans are required for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the property location. Available with 0.7 to 1% origination point, these are the best jumbo mortgage rates offered to well qualified borrowers.
MBS prices (mortgage backed prices) affect mortgage rates which move in the opposite direction. MBS price movements continue to be unpredictable and not necessarily dependent on the economic data reported. This past week's reports included an increase in private sector jobs, a decrease in weekly jobless claims and a lower unemployment rate. Although mortgage rates are down, MBA reported weekly purchase and refinance activity down. Regardless of economic reports released, the tensions in the Middle East continue to be driving the emotions of investors and causing market volatility.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Current California Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Saturday, March 5, 2011
Mortgage Rates Ease Down
March 2, 2011 in Realty Times
Mortgage Rates Ease Down to Better Pricing by Ed Ferrara
This past week mortgage rates eased down to better pricing which is positive news for borrowers. Freerateupdate.com's daily survey of wholesale and direct lenders show that current 15 year fixed mortgage rates are at 3.875% after two decreases over the past week while 30 year fixed mortgage rates remain the same at 4.750%. 5/1 ARM loans rates also decreased .125% to the current 3.125%. Available with 0.7 to 1% origination fee, these are the best mortgage rates available to borrowers who have good credit and the ability to meet lender guidelines.
FHA 30 year fixed mortgage rates decreased .125% and are at 4.500% while FHA 15year fixed mortgage rates remain the same at 4.000%. FHA 5/1 adjustable mortgage rates also decreased .125% and are at 3.500%. Offering the benefit of a low down payment, FHA mortgage loans continue to be popular with borrowers even though FHA closing costs (APR) are higher due to various FHA fees and the upfront mortgage insurance premium.
Jumbo mortgage loans also saw improvement this week. Jumbo 30 year fixed mortgage rates are at 5.375% and jumbo adjustable mortgage rates are at 3.875%, both decreasing .125%. Jumbo 15 year fixed mortgage rates remain the same at 5.250%. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the area. For well qualified borrowers, these are the best jumbo mortgage rates available with 0.7 to 1% origination point.
MBS prices (mortgage backed securities) saw the highest jump last Tuesday which resulted in the decline of mortgage rates. Mortgage rates move in the opposite direction of MBS prices. The current unrest in the Middle East has caused investors to move money into safe investments this past week. Although pending home sales was below expectation, other economic data releases included higher consumer confidence, increased existing home sales, lower jobless claims and an increase in personal income, all of which point to a slow but steady economic recovery.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
California Mortgage Rates
Massachusetts Mortgage Rates
Texas Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Mortgage Rates Ease Down to Better Pricing by Ed Ferrara
This past week mortgage rates eased down to better pricing which is positive news for borrowers. Freerateupdate.com's daily survey of wholesale and direct lenders show that current 15 year fixed mortgage rates are at 3.875% after two decreases over the past week while 30 year fixed mortgage rates remain the same at 4.750%. 5/1 ARM loans rates also decreased .125% to the current 3.125%. Available with 0.7 to 1% origination fee, these are the best mortgage rates available to borrowers who have good credit and the ability to meet lender guidelines.
FHA 30 year fixed mortgage rates decreased .125% and are at 4.500% while FHA 15year fixed mortgage rates remain the same at 4.000%. FHA 5/1 adjustable mortgage rates also decreased .125% and are at 3.500%. Offering the benefit of a low down payment, FHA mortgage loans continue to be popular with borrowers even though FHA closing costs (APR) are higher due to various FHA fees and the upfront mortgage insurance premium.
Jumbo mortgage loans also saw improvement this week. Jumbo 30 year fixed mortgage rates are at 5.375% and jumbo adjustable mortgage rates are at 3.875%, both decreasing .125%. Jumbo 15 year fixed mortgage rates remain the same at 5.250%. Jumbo mortgage loans are necessary for mortgage financing above the conforming loan limit which is $417,000 to $729,250 depending on the area. For well qualified borrowers, these are the best jumbo mortgage rates available with 0.7 to 1% origination point.
MBS prices (mortgage backed securities) saw the highest jump last Tuesday which resulted in the decline of mortgage rates. Mortgage rates move in the opposite direction of MBS prices. The current unrest in the Middle East has caused investors to move money into safe investments this past week. Although pending home sales was below expectation, other economic data releases included higher consumer confidence, increased existing home sales, lower jobless claims and an increase in personal income, all of which point to a slow but steady economic recovery.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
California Mortgage Rates
Massachusetts Mortgage Rates
Texas Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Monday, February 28, 2011
Existing-Home Sales Rise
February 28, 2011 from Realty Times
Real Estate Outlook: Existing-Home Sales Rise by Carla Hill
The housing market continues to keep experts and analysts on their toes.
While existing-home sales rose again in January and are outpacing year-ago levels, we are still seeing a drop in home prices across much the country.
Existing-home sales increased 2.7 percent in January and are 5.3 percent above January of 2010.
Lawrence Yun, NAR chief economist, sees the rise as positive, but with room for improvement. "The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence," Yun said. "The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity."
Regionally, the West saw the largest existing-home sales increase. In the West they rose 7.9 percent and are 7.0 percent above January 2010. The Midwest and South also saw monthly rises -- up 1.8 and 3.6 percent respectively.
The Northeast didn't fare as well. The Northeastern region is down 4.6 from December and down 1.2 from year ago levels.
The most recent reports from the Case-Shiller Index have brought on a slew of comments from the experts. The Case-Shiller quarterly index showed prices fell 3.9 percent in the fourth quarter and 4.1 percent for all of 2010.
Karl Case reports that the housing market is "a rocky bottom with a down trend." And, unfortunately, he was the optimist!
Mr. Robert Shiller, on the other hand, reported that the increased precedence of foreclosures, as well as the impending decisions over the future of Freddie Mac and Fannie Mae, leaves risk of future declines at 15 to 25 percent.
Realty Trac reports that 26 percent of all homes sold in 2010 were foreclosures and short sales. The states with the largest percent of distressed sales were Nevada, at 57 percent of all sales; Arizona, at 49 percent; California, 44 percent; and Florida 36 percent.
It's the slow jobs recovery that is partially to blame for this second hit on the housing market, however, new reports from the Labor Department indicate that jobless claims fells again last week. It is now at the lowest levels since late July 2008.
This is a bit of welcome news for a market that is yearning for a bright spot.
Copyright © 2011 Realty Times. All Rights Reserved.
Real Estate Outlook: Existing-Home Sales Rise by Carla Hill
The housing market continues to keep experts and analysts on their toes.
While existing-home sales rose again in January and are outpacing year-ago levels, we are still seeing a drop in home prices across much the country.
Existing-home sales increased 2.7 percent in January and are 5.3 percent above January of 2010.
Lawrence Yun, NAR chief economist, sees the rise as positive, but with room for improvement. "The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence," Yun said. "The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity."
Regionally, the West saw the largest existing-home sales increase. In the West they rose 7.9 percent and are 7.0 percent above January 2010. The Midwest and South also saw monthly rises -- up 1.8 and 3.6 percent respectively.
The Northeast didn't fare as well. The Northeastern region is down 4.6 from December and down 1.2 from year ago levels.
The most recent reports from the Case-Shiller Index have brought on a slew of comments from the experts. The Case-Shiller quarterly index showed prices fell 3.9 percent in the fourth quarter and 4.1 percent for all of 2010.
Karl Case reports that the housing market is "a rocky bottom with a down trend." And, unfortunately, he was the optimist!
Mr. Robert Shiller, on the other hand, reported that the increased precedence of foreclosures, as well as the impending decisions over the future of Freddie Mac and Fannie Mae, leaves risk of future declines at 15 to 25 percent.
Realty Trac reports that 26 percent of all homes sold in 2010 were foreclosures and short sales. The states with the largest percent of distressed sales were Nevada, at 57 percent of all sales; Arizona, at 49 percent; California, 44 percent; and Florida 36 percent.
It's the slow jobs recovery that is partially to blame for this second hit on the housing market, however, new reports from the Labor Department indicate that jobless claims fells again last week. It is now at the lowest levels since late July 2008.
This is a bit of welcome news for a market that is yearning for a bright spot.
Copyright © 2011 Realty Times. All Rights Reserved.
Sunday, February 27, 2011
Mortgage Rates This Week Better
February 24, 2011 from Realty Times
Fixed Mortgage Rates This Week Better For Borrowers by Ed Ferrara
After slight movement early last week, mortgage rates ended up looking better for borrowers with a decrease of .125% for conforming 30 year and 15 year mortgage interest rates making them more competitive with FHA mortgage rates.
FreeRateUpdate.com's daily survey of wholesale and direct lenders show that current 30 year fixed mortgage rates are at 4.750% and 15 year fixed mortgage rates are at 4.125%. 5/1 adjustable mortgage rates are at 3.250%. Still remaining below 5%, these are the best mortgage rates available with 0.7 to 1% origination fee to well qualified borrowers who can also meet lender approval.
FHA 5/1 adjustable mortgage rates increased .125% and are at 3.625%. >FHA 30 year fixed mortgage interest rates are at 4.625% and FHA 15 year fixed mortgage interest rates are at 4.000%, both remaining the same.
FHA mortgage loans continue to attract borrowers for the benefits they offer such as the low down payment requirement although FHA closing costs (APR) are higher due to the upfront mortgage insurance premium and other applicable FHA fees. Coming April 18th, FHA is increasing the annual mortgage insurance premium by .25% for FHA 30 year and FHA 15 year fixed rate mortgage loans.
Jumbo 15 year fixed mortgage rates saw the biggest jump increasing .250% and are at 5.250%. Jumbo 30 year fixed mortgage rates are at 5.500% and jumbo 5/1 ARM loan rates are at 4.125%, both remaining the same. Jumbo mortgage loans are available for borrowers in need of financing above the conforming loan limit which is $417,000 to $729,250 depending on location. Available with 0.7 to 1% origination fee, these low jumbo mortgage rates can still be obtained by borrowers who have outstanding credit.
MBS prices (mortgage backed securities) have fluctuated each day this past week depending on the news and investor reaction. Mortgage rates increase and decrease in the opposite direction of MBS prices. After Tuesday's mixed results, mortgage rates stabilized for the rest of the week upon the release of the producer price index,, the consumer price index and housing starts which all came in better than expected.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Today’s New York Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Fixed Mortgage Rates This Week Better For Borrowers by Ed Ferrara
After slight movement early last week, mortgage rates ended up looking better for borrowers with a decrease of .125% for conforming 30 year and 15 year mortgage interest rates making them more competitive with FHA mortgage rates.
FreeRateUpdate.com's daily survey of wholesale and direct lenders show that current 30 year fixed mortgage rates are at 4.750% and 15 year fixed mortgage rates are at 4.125%. 5/1 adjustable mortgage rates are at 3.250%. Still remaining below 5%, these are the best mortgage rates available with 0.7 to 1% origination fee to well qualified borrowers who can also meet lender approval.
FHA 5/1 adjustable mortgage rates increased .125% and are at 3.625%. >FHA 30 year fixed mortgage interest rates are at 4.625% and FHA 15 year fixed mortgage interest rates are at 4.000%, both remaining the same.
FHA mortgage loans continue to attract borrowers for the benefits they offer such as the low down payment requirement although FHA closing costs (APR) are higher due to the upfront mortgage insurance premium and other applicable FHA fees. Coming April 18th, FHA is increasing the annual mortgage insurance premium by .25% for FHA 30 year and FHA 15 year fixed rate mortgage loans.
Jumbo 15 year fixed mortgage rates saw the biggest jump increasing .250% and are at 5.250%. Jumbo 30 year fixed mortgage rates are at 5.500% and jumbo 5/1 ARM loan rates are at 4.125%, both remaining the same. Jumbo mortgage loans are available for borrowers in need of financing above the conforming loan limit which is $417,000 to $729,250 depending on location. Available with 0.7 to 1% origination fee, these low jumbo mortgage rates can still be obtained by borrowers who have outstanding credit.
MBS prices (mortgage backed securities) have fluctuated each day this past week depending on the news and investor reaction. Mortgage rates increase and decrease in the opposite direction of MBS prices. After Tuesday's mixed results, mortgage rates stabilized for the rest of the week upon the release of the producer price index,, the consumer price index and housing starts which all came in better than expected.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders' rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1 point origination.
Today’s New York Mortgage Rates
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, February 24, 2011
When will it end
Taken from responses to the question "When will it end?" by other Realtors.
1) As long as the banks are involved in real estate transactions which they know nothing about, it probably won't end for years to come. These banks are unbelievable. They just sent us a short sale package back saying that the word "Phoenix" was abbreviated "Phx" and it need to be spelling out on the listing contract. Once it was corrected, it took them two weeks to come back and demand that all parties sign the listing contract. Say what? Since when does a buyer get to look at listing contracts between the seller and broker?
Problems like this one are occurring every day. Yes, I wonder too, when will it end?
2) It will end when the large prevelent foreclosures and short sales end. I agree with (above), each bank/company has their own rules for these properties. It is not a matter of understanding how to deal with the foreclosure, because it is almost impossible to learn all the different rules.
3) Good question! I definitely agree with both (of the above), but would add that until unemployment abates and jobs open up or are created, we will continue to have issues.
4) There is also the perception by consumers that the market is in complete disarray and they are waiting for it to return to "normal." There are almost no buyers in the market because they think prices will continue to drop. Potential sellers know they are going to take a beating if they try to sell. They all think that, at some point, the market will return to where it was. Until consumers realize that this, in many ways, is the new normal, buyers and sellers will continue to sit on the sidelines.
Then there is the issue of financing. But I'll leave that for another commenter.
ED Comment: These are the views of four Realtors that offer reflection of where the market is and when will we see some stability return. "Normal" is not a return to our past, it is where we are today and for the foreseeable future. If you are sitting on the fence, waiting will not provide a better time to act for several years to come.
Denis
1) As long as the banks are involved in real estate transactions which they know nothing about, it probably won't end for years to come. These banks are unbelievable. They just sent us a short sale package back saying that the word "Phoenix" was abbreviated "Phx" and it need to be spelling out on the listing contract. Once it was corrected, it took them two weeks to come back and demand that all parties sign the listing contract. Say what? Since when does a buyer get to look at listing contracts between the seller and broker?
Problems like this one are occurring every day. Yes, I wonder too, when will it end?
2) It will end when the large prevelent foreclosures and short sales end. I agree with (above), each bank/company has their own rules for these properties. It is not a matter of understanding how to deal with the foreclosure, because it is almost impossible to learn all the different rules.
3) Good question! I definitely agree with both (of the above), but would add that until unemployment abates and jobs open up or are created, we will continue to have issues.
4) There is also the perception by consumers that the market is in complete disarray and they are waiting for it to return to "normal." There are almost no buyers in the market because they think prices will continue to drop. Potential sellers know they are going to take a beating if they try to sell. They all think that, at some point, the market will return to where it was. Until consumers realize that this, in many ways, is the new normal, buyers and sellers will continue to sit on the sidelines.
Then there is the issue of financing. But I'll leave that for another commenter.
ED Comment: These are the views of four Realtors that offer reflection of where the market is and when will we see some stability return. "Normal" is not a return to our past, it is where we are today and for the foreseeable future. If you are sitting on the fence, waiting will not provide a better time to act for several years to come.
Denis
Wednesday, February 23, 2011
Buy and Bail
Advice from Craig Bohall, Mortgage Lender.
Buy and Bail = Buy a new house and Bail (walk) on the one you are currently living in!
or
Bail and Buy = Bail or walk on a home that 1 spouse was obligated on and then buy a new home using only the 2nd spouses credit.
This has become a huge issue in the country as there were rules a few years ago that allowed you to buy a home and not have some things checked out . Not any more. Fannie, Freddie and the Govt have closed every loophole they could find to stop all related tactics.
These situations have become more prevalent with the decline in market values.
Buy and Bail - They are usually at a high risk of occurrence when:
1. A borrower is moving to a new home in the same market and keeping current residence, especially when they owe more on their current home than its current value and they can purchase a similar property or larger size home for less. This risk still exists when a borrower is not purchasing in the same market.
Investors are cracking down hard on mortgage companies that don’t sniff this out ahead of time and there are huge penalties for lenders who loan money to people and then those people bail on another home!
Bail and Buy – These are at a high risk of occurrence when:
1 A non-purchasing spouse (#1)is in default/foreclosure/short sale on the property currently serving as the primary residence of the purchasing spouse (#2).
These transactions also show up when the non-purchasing spouse has had a previous foreclosure/short sale/deed-in-lieu within the last 12 months on any property that our borrower was party to either due to occupancy of the property or by marital knowledge (borrower was married to non-purchasing spouse at the time of event, property was indicated on joint tax returns, etc.)
So just because your spouse is not on this new loan but he/she had a foreclosure/short sale / deed-in-lieu recently does not mean that “nobody will find out” - TRUST ME they find out everything!
Without getting into the 50 new guidelines and rules and ways that information can be gathered on your residence, home, mortgage, history, tax records, IRS files etc……. just pleeeeeeeeeese believe that trying to buy and bail or bail and buy will likely not work because there are thousands of underwriters, guideline writers, govt officials and bank auditors, and govt policy writers who all combined have thought of all the ways you can possibly think of to sneak past the system and they have 20 systems that you don’t even know about.
Don’t do it!
Craig Bohall
Your “Safe Harbor” Lender
480-344-2852 – office
480-374-6946 - e-fax
craig@myazmp.com
www.myazmp.com
5304 E Southern Ave #101
Mesa AZ 85206
NMLS 233903
MB-0904081
Buy and Bail = Buy a new house and Bail (walk) on the one you are currently living in!
or
Bail and Buy = Bail or walk on a home that 1 spouse was obligated on and then buy a new home using only the 2nd spouses credit.
This has become a huge issue in the country as there were rules a few years ago that allowed you to buy a home and not have some things checked out . Not any more. Fannie, Freddie and the Govt have closed every loophole they could find to stop all related tactics.
These situations have become more prevalent with the decline in market values.
Buy and Bail - They are usually at a high risk of occurrence when:
1. A borrower is moving to a new home in the same market and keeping current residence, especially when they owe more on their current home than its current value and they can purchase a similar property or larger size home for less. This risk still exists when a borrower is not purchasing in the same market.
Investors are cracking down hard on mortgage companies that don’t sniff this out ahead of time and there are huge penalties for lenders who loan money to people and then those people bail on another home!
Bail and Buy – These are at a high risk of occurrence when:
1 A non-purchasing spouse (#1)is in default/foreclosure/short sale on the property currently serving as the primary residence of the purchasing spouse (#2).
These transactions also show up when the non-purchasing spouse has had a previous foreclosure/short sale/deed-in-lieu within the last 12 months on any property that our borrower was party to either due to occupancy of the property or by marital knowledge (borrower was married to non-purchasing spouse at the time of event, property was indicated on joint tax returns, etc.)
So just because your spouse is not on this new loan but he/she had a foreclosure/short sale / deed-in-lieu recently does not mean that “nobody will find out” - TRUST ME they find out everything!
Without getting into the 50 new guidelines and rules and ways that information can be gathered on your residence, home, mortgage, history, tax records, IRS files etc……. just pleeeeeeeeeese believe that trying to buy and bail or bail and buy will likely not work because there are thousands of underwriters, guideline writers, govt officials and bank auditors, and govt policy writers who all combined have thought of all the ways you can possibly think of to sneak past the system and they have 20 systems that you don’t even know about.
Don’t do it!
Craig Bohall
Your “Safe Harbor” Lender
480-344-2852 – office
480-374-6946 - e-fax
craig@myazmp.com
www.myazmp.com
5304 E Southern Ave #101
Mesa AZ 85206
NMLS 233903
MB-0904081
Housing Affordability Reaches 20 Year High
Realty Times February 23, 2011
Housing Affordability Reaches 20 Year High
by Carla Hill
Housing affordability is higher today than it has been for decades. What does this mean for today's buyer? It means now is the time to buy.
According to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) data, "73.9 percent of all new and existing homes sold in the fourth quarter of 2010 were affordable to families earning the national median income of $64,400."
"Today's report shows that housing affordability at the end of 2010 was at its highest level since we started computing the HOI," said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. "However, while this is good news for consumers, both home buyers and builders continue to confront extremely tight credit conditions, and this remains a significant obstacle to many potential home sales."
Are you looking for the best of the best when it comes to affordable markets? Indianpolois-Carmel, Indiana, is a great place to start. It was ranked as the most affordable housing market in the entire country. Ninety-three percent of homes sold in the city were affordable to households earning to area median of $68,700.
On the opposite end of the spectrum, Santa Cruz-Watsonville, CA, was ranked as the least affordable city in the country. Only 45 percent of homes were affordable to families making the median household income of $84,200.
Also near the bottom of the list, according to the NAHB, were: Ocean City, N.J; San Luis Obispo-Paso Robles, Calif.; Laredo, Texas; and Santa Barbara-Santa Maria-Goleta, Calif.
Nearly all of the lowest range major metrol areas were in California, which is not surprisingly considering the housing bubble that formed in the early 2000s.
Copyright © 2011 Realty Times. All Rights Reserved.
Housing Affordability Reaches 20 Year High
by Carla Hill
Housing affordability is higher today than it has been for decades. What does this mean for today's buyer? It means now is the time to buy.
According to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) data, "73.9 percent of all new and existing homes sold in the fourth quarter of 2010 were affordable to families earning the national median income of $64,400."
"Today's report shows that housing affordability at the end of 2010 was at its highest level since we started computing the HOI," said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. "However, while this is good news for consumers, both home buyers and builders continue to confront extremely tight credit conditions, and this remains a significant obstacle to many potential home sales."
Are you looking for the best of the best when it comes to affordable markets? Indianpolois-Carmel, Indiana, is a great place to start. It was ranked as the most affordable housing market in the entire country. Ninety-three percent of homes sold in the city were affordable to households earning to area median of $68,700.
On the opposite end of the spectrum, Santa Cruz-Watsonville, CA, was ranked as the least affordable city in the country. Only 45 percent of homes were affordable to families making the median household income of $84,200.
Also near the bottom of the list, according to the NAHB, were: Ocean City, N.J; San Luis Obispo-Paso Robles, Calif.; Laredo, Texas; and Santa Barbara-Santa Maria-Goleta, Calif.
Nearly all of the lowest range major metrol areas were in California, which is not surprisingly considering the housing bubble that formed in the early 2000s.
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, February 17, 2011
Don't Be Mystified By The Mortgage Maze
February 17, 2011 - Realty Times
Don't Be Mystified By The Mortgage Maze by Broderick Perkins
Years after the housing market tanked and sank the economy, more than 70 percent of Americans say getting a mortgage today is a serious national problem, according to a new study by MortgageMatch.com, a home loan and information site operated by Move, Inc.
According to the MortgageMatch.com survey, today's lending environment is so confusing many borrowers are experiencing high levels of stress and frustration.
More than one in five recent home buyers (20.9 percent) told MortgageMatch.com, waiting to hear if they were approved for a mortgage was more stressful than waiting to hear if they got a job.
MortgageMatch.com says home buyers can significantly improve their chances of getting a mortgage application approved on the best possible terms in today's tough lending marketplace by taking the following steps.
• Pay down your debt as much as you can before applying for a mortgage.
Lenders calculate the ratio of your debt to your income to determine how much you can afford to borrow. Your total debt-to-income is based on how much of your gross income would go toward all of your debt obligations, including mortgage, car loans, child support and alimony, credit card bills, student loans and condominium fees.
By reducing your debt as much as you can, you will improve your debt-to-income ratio and your credit score.
• Clean up your credit long before you apply for a mortgage.
Credit is critical today, not just to get a mortgage but to get the best terms. A marginal credit score can cost you tens of thousands of dollars over the life of the loan. Your score on the 850-point FICO credit rating scale must be 680 today to qualify for a prime loan and at least 720 to get the best rates.
Pull one or all of your three annual credit reports from AnnualCreditReport.com and check yourself, before you wreck yourself.
You'll have to pay a nominal fee of $10 to $15 to each credit bureau -- Equifax, Experian and TransUnion -- to get your credit score. Review your report for errors and omissions.
• Don't make a major purchase on credit and don't apply for new credit before you apply for a mortgage or at any point before your mortgage closes. Purchases and credit accounts increase your debt and hurt your debt-to-income ratio.
• Increase your down payment. The more you put down the better your rate and your chances at scoring on that loan application. If you can't increase your money down, buy a cheaper home. Now is not the time to stretch.
• Get all your docs in a row before you apply for a mortgage. Don't waste time or raise the ire of lenders who are tougher than ever on documentation for income, assets, financial obligations and more. When you apply, have your paperwork ready.
• Know and prepare for your cash requirements. Cash expenses, beyond the down payment can crush you. Closings costs are on the rise. They can include transfer taxes, lenders fees, title insurance, escrow, settlement and home inspection costs. Also upfront property taxes, homeowner association dues homeowner insurance and other costs could come due before you close.
• Larger loans raise your costs. So called "jumbo mortgages" exceed the $417,000 "conforming loan level" in most parts of the country. In high cost areas like New York City, Washington D.C., Miami, and many parts of California, jumbos begin at $729,750. Larger mortgages are more risky so they cost more, require better credit and demand larger down payments.
• Negotiate tough. Ask for a purchase price lower than the value. A lower price serves both you by lowering your loan-to-value ratio and your lender, by reducing its risk. In today's marketplace, many sellers are willing to deal. Go for it.
• Don't get taken. When you see rates attractive rates advertised on the Internet or TV don't froth. They could be come-on or teaser rates with lots of strings attached. In addition, rates change several times during the day and differ by locale, by borrower, by loan-to-value ratio and due to a host of other factors. Advertised rates maybe be what you see, but they are often not what you get.
Copyright © 2011 Realty Times. All Rights Reserved.
Don't Be Mystified By The Mortgage Maze by Broderick Perkins
Years after the housing market tanked and sank the economy, more than 70 percent of Americans say getting a mortgage today is a serious national problem, according to a new study by MortgageMatch.com, a home loan and information site operated by Move, Inc.
According to the MortgageMatch.com survey, today's lending environment is so confusing many borrowers are experiencing high levels of stress and frustration.
More than one in five recent home buyers (20.9 percent) told MortgageMatch.com, waiting to hear if they were approved for a mortgage was more stressful than waiting to hear if they got a job.
MortgageMatch.com says home buyers can significantly improve their chances of getting a mortgage application approved on the best possible terms in today's tough lending marketplace by taking the following steps.
• Pay down your debt as much as you can before applying for a mortgage.
Lenders calculate the ratio of your debt to your income to determine how much you can afford to borrow. Your total debt-to-income is based on how much of your gross income would go toward all of your debt obligations, including mortgage, car loans, child support and alimony, credit card bills, student loans and condominium fees.
By reducing your debt as much as you can, you will improve your debt-to-income ratio and your credit score.
• Clean up your credit long before you apply for a mortgage.
Credit is critical today, not just to get a mortgage but to get the best terms. A marginal credit score can cost you tens of thousands of dollars over the life of the loan. Your score on the 850-point FICO credit rating scale must be 680 today to qualify for a prime loan and at least 720 to get the best rates.
Pull one or all of your three annual credit reports from AnnualCreditReport.com and check yourself, before you wreck yourself.
You'll have to pay a nominal fee of $10 to $15 to each credit bureau -- Equifax, Experian and TransUnion -- to get your credit score. Review your report for errors and omissions.
• Don't make a major purchase on credit and don't apply for new credit before you apply for a mortgage or at any point before your mortgage closes. Purchases and credit accounts increase your debt and hurt your debt-to-income ratio.
• Increase your down payment. The more you put down the better your rate and your chances at scoring on that loan application. If you can't increase your money down, buy a cheaper home. Now is not the time to stretch.
• Get all your docs in a row before you apply for a mortgage. Don't waste time or raise the ire of lenders who are tougher than ever on documentation for income, assets, financial obligations and more. When you apply, have your paperwork ready.
• Know and prepare for your cash requirements. Cash expenses, beyond the down payment can crush you. Closings costs are on the rise. They can include transfer taxes, lenders fees, title insurance, escrow, settlement and home inspection costs. Also upfront property taxes, homeowner association dues homeowner insurance and other costs could come due before you close.
• Larger loans raise your costs. So called "jumbo mortgages" exceed the $417,000 "conforming loan level" in most parts of the country. In high cost areas like New York City, Washington D.C., Miami, and many parts of California, jumbos begin at $729,750. Larger mortgages are more risky so they cost more, require better credit and demand larger down payments.
• Negotiate tough. Ask for a purchase price lower than the value. A lower price serves both you by lowering your loan-to-value ratio and your lender, by reducing its risk. In today's marketplace, many sellers are willing to deal. Go for it.
• Don't get taken. When you see rates attractive rates advertised on the Internet or TV don't froth. They could be come-on or teaser rates with lots of strings attached. In addition, rates change several times during the day and differ by locale, by borrower, by loan-to-value ratio and due to a host of other factors. Advertised rates maybe be what you see, but they are often not what you get.
Copyright © 2011 Realty Times. All Rights Reserved.
Friday, February 11, 2011
Why Hire a Real Estate Agent or REALTOR?
From Realty Times on 12 February
Why Hire a Real Estate Agent or REALTOR? by Phoebe Chongchua
As spring rolls in, many people start listing their home for sale. The weather warms up and buyers, having recovered from the holidays, begin to house hunt.
Many buyers will go it alone. They hit the Internet for their first line of attack in house hunting. They peruse magazines and open houses. But they miss an important key player in their house-hunting mission–the real estate agent.
The real estate agent is not a go-between paper shuffler. Your real estate agent is the connection to the inside world of real estate. Yes, the Internet can provide you with lots of information, but it can't replace a knowledgeable real estate agent.
Finding the best agent who meets your needs is like finding a good friend. I'm not kidding. Having to work with an agent that doesn't understand your needs for housing can result in endless headaches, but working with an expert in the industry takes away the worry and stress, and streamlines the process.
It can be a jungle out there. Navigating through the foreclosures, short sales, and excessive inventory can make some buyers feel overwhelmed. The result? They continue to rent!
If you have the right team of experts surrounding you and looking out for your best interest, you're not afraid to aim high and go after exactly what you want. An agent isn't your cheerleader but is there to help you get precisely what you want and the best deal possible.
The agent has a fiduciary duty to you–to provide trust and confidence. Up to now, we've talked mostly about an agent–a person licensed to sell real estate but is that the same as a REALTOR®? The answer is no. And since the terms are often confused, it's worth taking a moment to explain how the National Association of REALTORS® (NAR) defines them.
Both are licensed to sell real estate but REALTORS® are members of the National Association of REALTORS® and are required to follow the REALTOR® Code of Ethics. According to NAR, there are 17 articles in the Code of Ethics and they are strictly enforced.
Here's what is stated in the 2011, Code of Ethics and Standards of Practice from NAR, "The term Realtor® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal."
Whether you hire a real estate agent or a REALTOR®, the most important thing you can do is research their background, reputation in the market, and get references. This is likely the biggest financial move you'll make, so taking the time to find information about the agent or REALTOR® you're about to hire is a wise investment.
Visiting real estate offices and meeting with their staff is another good way to explore who will fit with your personality and match your needs. Contacting friends for referrals is a good start, but don't just hire your friend's agent or REALTOR® because the real estate transaction worked out for your friend. Spend a little time to effectively communicate your needs, goals, and desires, and then listen carefully to how the agent or REALTOR® responds.
It may not be a marriage but it's certainly a relationship that could last a lifetime, creating a successful financial situation for all.
Copyright © 2011 Realty Times. All Rights Reserved.
Follow the note "View my complete profile" in the right column to "My Webpage" for references.
Why Hire a Real Estate Agent or REALTOR? by Phoebe Chongchua
As spring rolls in, many people start listing their home for sale. The weather warms up and buyers, having recovered from the holidays, begin to house hunt.
Many buyers will go it alone. They hit the Internet for their first line of attack in house hunting. They peruse magazines and open houses. But they miss an important key player in their house-hunting mission–the real estate agent.
The real estate agent is not a go-between paper shuffler. Your real estate agent is the connection to the inside world of real estate. Yes, the Internet can provide you with lots of information, but it can't replace a knowledgeable real estate agent.
Finding the best agent who meets your needs is like finding a good friend. I'm not kidding. Having to work with an agent that doesn't understand your needs for housing can result in endless headaches, but working with an expert in the industry takes away the worry and stress, and streamlines the process.
It can be a jungle out there. Navigating through the foreclosures, short sales, and excessive inventory can make some buyers feel overwhelmed. The result? They continue to rent!
If you have the right team of experts surrounding you and looking out for your best interest, you're not afraid to aim high and go after exactly what you want. An agent isn't your cheerleader but is there to help you get precisely what you want and the best deal possible.
The agent has a fiduciary duty to you–to provide trust and confidence. Up to now, we've talked mostly about an agent–a person licensed to sell real estate but is that the same as a REALTOR®? The answer is no. And since the terms are often confused, it's worth taking a moment to explain how the National Association of REALTORS® (NAR) defines them.
Both are licensed to sell real estate but REALTORS® are members of the National Association of REALTORS® and are required to follow the REALTOR® Code of Ethics. According to NAR, there are 17 articles in the Code of Ethics and they are strictly enforced.
Here's what is stated in the 2011, Code of Ethics and Standards of Practice from NAR, "The term Realtor® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal."
Whether you hire a real estate agent or a REALTOR®, the most important thing you can do is research their background, reputation in the market, and get references. This is likely the biggest financial move you'll make, so taking the time to find information about the agent or REALTOR® you're about to hire is a wise investment.
Visiting real estate offices and meeting with their staff is another good way to explore who will fit with your personality and match your needs. Contacting friends for referrals is a good start, but don't just hire your friend's agent or REALTOR® because the real estate transaction worked out for your friend. Spend a little time to effectively communicate your needs, goals, and desires, and then listen carefully to how the agent or REALTOR® responds.
It may not be a marriage but it's certainly a relationship that could last a lifetime, creating a successful financial situation for all.
Copyright © 2011 Realty Times. All Rights Reserved.
Follow the note "View my complete profile" in the right column to "My Webpage" for references.
Mortgage Rates Rise to 5.05 Percent
February 11, 2011
From Realty Times: 30-Year Fixed-Rate Mortgage Rates Rise to 5.05 Percent
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®) which shows long- and short-term rates rising this week.
30-year fixed-rate mortgage (FRM) averaged 5.05 percent with an average 0.7 point for the week ending February 10, 2011, up from last week when it averaged 4.81 percent. Last year at this time, the 30-year FRM averaged 4.97 percent. Interest rates on a 30-year fixed-rate mortgage rose to the highest level since the last week in April 2010.
15-year FRM this week averaged 4.29 percent with an average 0.7 point, up from last week when it averaged 4.08 percent. A year ago at this time, the 15-year FRM averaged 4.34 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.92 percent this week, with an average 0.6 point, up from last week when it averaged 3.69 percent. A year ago, the 5-year ARM averaged 4.19 percent.
1-year Treasury-indexed ARM averaged 3.35 percent this week with an average 0.6 point, up from last week when it averaged 3.26 percent. At this time last year, the 1-year ARM averaged 4.33 percent.
Frank Nothaft, vice president and chief economist at Freddie Mac, reports, "Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week. For all of 2010, nonfarm productivity rose 3.6 percent, the most since 2002, while January’s unemployment rate unexpectedly fell from 9.4 percent to 9.0 percent. Moreover, the service industry expanded in January at the fastest pace since August 2005."
Copyright © 2011 Realty Times. All Rights Reserved.
From Realty Times: 30-Year Fixed-Rate Mortgage Rates Rise to 5.05 Percent
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®) which shows long- and short-term rates rising this week.
30-year fixed-rate mortgage (FRM) averaged 5.05 percent with an average 0.7 point for the week ending February 10, 2011, up from last week when it averaged 4.81 percent. Last year at this time, the 30-year FRM averaged 4.97 percent. Interest rates on a 30-year fixed-rate mortgage rose to the highest level since the last week in April 2010.
15-year FRM this week averaged 4.29 percent with an average 0.7 point, up from last week when it averaged 4.08 percent. A year ago at this time, the 15-year FRM averaged 4.34 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.92 percent this week, with an average 0.6 point, up from last week when it averaged 3.69 percent. A year ago, the 5-year ARM averaged 4.19 percent.
1-year Treasury-indexed ARM averaged 3.35 percent this week with an average 0.6 point, up from last week when it averaged 3.26 percent. At this time last year, the 1-year ARM averaged 4.33 percent.
Frank Nothaft, vice president and chief economist at Freddie Mac, reports, "Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week. For all of 2010, nonfarm productivity rose 3.6 percent, the most since 2002, while January’s unemployment rate unexpectedly fell from 9.4 percent to 9.0 percent. Moreover, the service industry expanded in January at the fastest pace since August 2005."
Copyright © 2011 Realty Times. All Rights Reserved.
Tuesday, January 25, 2011
Changing World of Mortgages
January 25, 2011 from Realty Times
Successfully Navigating The Changing World of Mortgages by PJ Wade
The world of mortgages is changing. To paraphrase the old Joni Mitchell song, most consumers will not know what they’ve got until it’s gone.
They won’t realize that by the time a mortgage is paid off, borrowers have paid two or three times the original amount borrowed—the mortgage principal—to buy real estate they originally bargained hard for to cut costs.
They won’t understand what they could have done to increase their real estate holdings and improve their profits until the legal and tax advantages that support investment and individual creativity disappear.
The real estate and banking sectors are set up to facilitate their deal making and profit taking with a measure of consumer protection added to keep things from becoming noticeably one sided. Too many buyers and sellers further stack the deck against themselves by not digging deeper than fads, marketing, and salesmanship. Most real estate buyers and sellers invest more time learning about their latest mobile device and its apps than exploring ownership and financial strategies for buying residential and recreational property.
Therefore, they may not miss what they did not understand, and would have appreciated, in the first place. Have you heard about a great government program or a tax advantage only when the media lament its end? How do you make sure you are taking advantage of all the options open to you to reduce the cost of the money you borrow to purchase real estate—your mortgage?
Real estate buyers and owners who want to achieve more for less should start this new year by learning what the latest round of mortgage resets mean to their specific real estate goals and opportunities. We always advocate going to the source, so dive into the detail announced by the Federal Ministry of Finance January 17, 2011: http://www.fin.gc.ca/n11/11-003-eng.asp
Here are a few perspectives to start you off.
Just remember, that what is relevant to you and your specific situation may not be on this list, hence the value of going to source:
Motives and motivation: The title, “The Harper Government Takes Prudent Action to Support the Long-Term Stability of Canada’s Housing Market,” has an election ring to it. Either the federal government is positive there won’t be more negatives ahead for housing, so it wants to appear to have created the soft landing, or it is bailing out before problems hit, so it can point fingers at others while patting itself on the back. What’s your opinion?
Reduce amortization: Cutting the maximum amortization period down 5 years to 30 years is not the across-the-board measure it has been presented as. This restriction applies only to new government-backed insured mortgages with loan-to-value ratios of more than 80 per cent. The 35-year amortization may be available for mortgages outside these restrictions for borrowers that lenders feel suit this repayment method. The amortization period is the number of years, at a specific payment amount, that it will take to pay the mortgage principal and interest to zero.
Buyers’ advantage: The longer the amortization period the smaller the monthly payment of principal and interest, and the greater the mortgage principal a buyer will qualify to borrow. Buyers could opt for the longest amortization possible—which used to be 40 years, then 35 and now 30—and then, down the road, decrease the amortization period on renewal to cut total interest costs.
Owners’ advantage: The shorter the amortization period, the lower the total amount of interest paid on a mortgage. The common 25-year period provides a hefty profit for lenders. Pop your original mortgage principal into a mortgage calculator, and see how much you have paid for this borrowed money in the first 10 years. Compare this with how much is left to pay on the mortgage. Shorten the amortization period as much as possible when you renew. Even one year can make a difference in the total interest paid.
Equity building: The government reports the latest restrictions will “allow Canadian families to build up equity in their homes more quickly, and help Canadians pay off their mortgages before they retire”. Home equity management is an ongoing topic in this column, but if these changes represent the government’s best shot at facilitating equity building, they need input from consumers on what would really aid in accumulating value and repaying mortgage debt.
Taking taxpayers off the hook for lenders: The government backs mortgages arranged to buy real estate, so if the borrower defaults and can’t make payments, the government (that’s taxpayers) cover losses for lenders (that’s largely the big banks). Those same lenders promote refinancing for a range of home improvement and lifestyle uses, the government is letting it be known that this lender-promoted debt should not be as risk-free for lenders as arranging the original mortgage. Lender reactions to the government taking taxpayers off the hook for mortgage default or lack of repayment may not be pleasant for homeowners.
Restricting access to equity: By lowering the maximum amount Canadians can borrow when refinancing their mortgages the government says it’s promoting savings. The drop from 90 per cent to 85 may not seem significant until you want that 5 per cent in your pocket. This change means the only way to access that 15 per cent is to sell. When so many want to stay in their own homes as they age, does this move seem in synch with consumers goals?
Withdrawing government insurance on lines of credit: Lenders who issue lines of credit secured by real estate, including home equity lines of credit, will no longer have government insurance to cover them against losses. The government believes its move will ensure that risks associated with consumer-debt products used to borrow funds unrelated to real estate purchases are managed by the financial institutions and not borne by taxpayers. Will lenders demand a premium for their additional risk?
Note: The adjustments to the mortgage insurance guarantee framework will come into force on March 18, 2011. The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011.
Government intervention: The government’s paternalistic approach with this “for their own good” set of financial rewrites opens the door to many considerations. Do you want the government deciding what’s best for you and your real estate, or would you prefer to deal with lenders who set standards and criteria for lending on a case-by-case basis? What may not be prudent for one borrower may be calculated risk for another.
The Honourable Jim Flaherty, Minister of Finance, was said to make “prudent adjustments to the rules” to “support hard-working Canadian families saving through home ownership”. Does their definition of “saving” properly describe your intentions in owning real estate?
If you need help understanding finance and planning for your future, is the government your preferred source and resource? Maybe the wrong level of government and the wrong ministry are involved. Wouldn’t it be more practical to teach money management and real estate investment in public school, so we all become our own experts?
Copyright © 2011 Realty Times. All Rights Reserved.
Successfully Navigating The Changing World of Mortgages by PJ Wade
The world of mortgages is changing. To paraphrase the old Joni Mitchell song, most consumers will not know what they’ve got until it’s gone.
They won’t realize that by the time a mortgage is paid off, borrowers have paid two or three times the original amount borrowed—the mortgage principal—to buy real estate they originally bargained hard for to cut costs.
They won’t understand what they could have done to increase their real estate holdings and improve their profits until the legal and tax advantages that support investment and individual creativity disappear.
The real estate and banking sectors are set up to facilitate their deal making and profit taking with a measure of consumer protection added to keep things from becoming noticeably one sided. Too many buyers and sellers further stack the deck against themselves by not digging deeper than fads, marketing, and salesmanship. Most real estate buyers and sellers invest more time learning about their latest mobile device and its apps than exploring ownership and financial strategies for buying residential and recreational property.
Therefore, they may not miss what they did not understand, and would have appreciated, in the first place. Have you heard about a great government program or a tax advantage only when the media lament its end? How do you make sure you are taking advantage of all the options open to you to reduce the cost of the money you borrow to purchase real estate—your mortgage?
Real estate buyers and owners who want to achieve more for less should start this new year by learning what the latest round of mortgage resets mean to their specific real estate goals and opportunities. We always advocate going to the source, so dive into the detail announced by the Federal Ministry of Finance January 17, 2011: http://www.fin.gc.ca/n11/11-003-eng.asp
Here are a few perspectives to start you off.
Just remember, that what is relevant to you and your specific situation may not be on this list, hence the value of going to source:
Motives and motivation: The title, “The Harper Government Takes Prudent Action to Support the Long-Term Stability of Canada’s Housing Market,” has an election ring to it. Either the federal government is positive there won’t be more negatives ahead for housing, so it wants to appear to have created the soft landing, or it is bailing out before problems hit, so it can point fingers at others while patting itself on the back. What’s your opinion?
Reduce amortization: Cutting the maximum amortization period down 5 years to 30 years is not the across-the-board measure it has been presented as. This restriction applies only to new government-backed insured mortgages with loan-to-value ratios of more than 80 per cent. The 35-year amortization may be available for mortgages outside these restrictions for borrowers that lenders feel suit this repayment method. The amortization period is the number of years, at a specific payment amount, that it will take to pay the mortgage principal and interest to zero.
Buyers’ advantage: The longer the amortization period the smaller the monthly payment of principal and interest, and the greater the mortgage principal a buyer will qualify to borrow. Buyers could opt for the longest amortization possible—which used to be 40 years, then 35 and now 30—and then, down the road, decrease the amortization period on renewal to cut total interest costs.
Owners’ advantage: The shorter the amortization period, the lower the total amount of interest paid on a mortgage. The common 25-year period provides a hefty profit for lenders. Pop your original mortgage principal into a mortgage calculator, and see how much you have paid for this borrowed money in the first 10 years. Compare this with how much is left to pay on the mortgage. Shorten the amortization period as much as possible when you renew. Even one year can make a difference in the total interest paid.
Equity building: The government reports the latest restrictions will “allow Canadian families to build up equity in their homes more quickly, and help Canadians pay off their mortgages before they retire”. Home equity management is an ongoing topic in this column, but if these changes represent the government’s best shot at facilitating equity building, they need input from consumers on what would really aid in accumulating value and repaying mortgage debt.
Taking taxpayers off the hook for lenders: The government backs mortgages arranged to buy real estate, so if the borrower defaults and can’t make payments, the government (that’s taxpayers) cover losses for lenders (that’s largely the big banks). Those same lenders promote refinancing for a range of home improvement and lifestyle uses, the government is letting it be known that this lender-promoted debt should not be as risk-free for lenders as arranging the original mortgage. Lender reactions to the government taking taxpayers off the hook for mortgage default or lack of repayment may not be pleasant for homeowners.
Restricting access to equity: By lowering the maximum amount Canadians can borrow when refinancing their mortgages the government says it’s promoting savings. The drop from 90 per cent to 85 may not seem significant until you want that 5 per cent in your pocket. This change means the only way to access that 15 per cent is to sell. When so many want to stay in their own homes as they age, does this move seem in synch with consumers goals?
Withdrawing government insurance on lines of credit: Lenders who issue lines of credit secured by real estate, including home equity lines of credit, will no longer have government insurance to cover them against losses. The government believes its move will ensure that risks associated with consumer-debt products used to borrow funds unrelated to real estate purchases are managed by the financial institutions and not borne by taxpayers. Will lenders demand a premium for their additional risk?
Note: The adjustments to the mortgage insurance guarantee framework will come into force on March 18, 2011. The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011.
Government intervention: The government’s paternalistic approach with this “for their own good” set of financial rewrites opens the door to many considerations. Do you want the government deciding what’s best for you and your real estate, or would you prefer to deal with lenders who set standards and criteria for lending on a case-by-case basis? What may not be prudent for one borrower may be calculated risk for another.
The Honourable Jim Flaherty, Minister of Finance, was said to make “prudent adjustments to the rules” to “support hard-working Canadian families saving through home ownership”. Does their definition of “saving” properly describe your intentions in owning real estate?
If you need help understanding finance and planning for your future, is the government your preferred source and resource? Maybe the wrong level of government and the wrong ministry are involved. Wouldn’t it be more practical to teach money management and real estate investment in public school, so we all become our own experts?
Copyright © 2011 Realty Times. All Rights Reserved.
Monday, January 17, 2011
Double-Dip on the Horizon?
January 17, 2011
Real Estate Outlook: Double-Dip on the Horizon? by Carla Hill
Is the housing market poised for a double dip in house values? Corelogic reports that as of November, home values were down 5 percent from the same time the year before.
CoreLogic Chief Economist Mark Fleming says, "We're continuing to see the influence of seasonal declines that typically depress home prices during the latter part of the year, but the fact that the rate of decline increased for November is indicative of the uphill battle we're facing with the housing recovery."
Steep declines were seen in multiple locales across the nation. Idaho saw home values fall 13.5 percent.
Zillow.com reports that the "decline in home values from the national peak in June 2006 officially surpassed the magnitude of declines experienced during the Great Depression, falling 26 percent from peak levels."
Also troublesome is the monthly pace at which homes values are now declining. In November the rate rose to 0.78 percent.
According to Zillow, "We're still seeing significant weakness in the lowest home value tier, particularly with the expiration of the Federal home buyer tax credits. ... Weakness in the bottom tier of homes naturally translate into the higher tiers as these homeowners become exposed to negative equity (and thus are removed from the demand equation altogether) or have less money to spend buying their next home."
Economists say that for at least the next 2 quarters we'll see larger factors -- such as unemployment -- producing more home value declines.
The New York Times reported last week that we could see new job growth thanks in part to the Federal Reserve's plan to buy up $600 billion worth of Treasury securities.
Janet L. Yellen, Fed vice chairwoman, noted, “It will not be a panacea, but I believe it will be effective in fostering maximum employment and price stability."
There are those, however, that criticize the Fed's move, saying it could instead create future financial imbalances.
Time will tell, but for now, most are hoping for the best.
The Mortgage Banker Association, the national association representing the real estate finance industry, is reporting in their latest findings that mortgage applications rose. The Refinance Index rose 4.9 in just one week. This is welcome news, as the unadjusted Purchase Index increased 41.9 percent compared with the previous week, but was still 10.5 percent lower than the same week one year ago.
Copyright © 2011 Realty Times. All Rights Reserved.
Real Estate Outlook: Double-Dip on the Horizon? by Carla Hill
Is the housing market poised for a double dip in house values? Corelogic reports that as of November, home values were down 5 percent from the same time the year before.
CoreLogic Chief Economist Mark Fleming says, "We're continuing to see the influence of seasonal declines that typically depress home prices during the latter part of the year, but the fact that the rate of decline increased for November is indicative of the uphill battle we're facing with the housing recovery."
Steep declines were seen in multiple locales across the nation. Idaho saw home values fall 13.5 percent.
Zillow.com reports that the "decline in home values from the national peak in June 2006 officially surpassed the magnitude of declines experienced during the Great Depression, falling 26 percent from peak levels."
Also troublesome is the monthly pace at which homes values are now declining. In November the rate rose to 0.78 percent.
According to Zillow, "We're still seeing significant weakness in the lowest home value tier, particularly with the expiration of the Federal home buyer tax credits. ... Weakness in the bottom tier of homes naturally translate into the higher tiers as these homeowners become exposed to negative equity (and thus are removed from the demand equation altogether) or have less money to spend buying their next home."
Economists say that for at least the next 2 quarters we'll see larger factors -- such as unemployment -- producing more home value declines.
The New York Times reported last week that we could see new job growth thanks in part to the Federal Reserve's plan to buy up $600 billion worth of Treasury securities.
Janet L. Yellen, Fed vice chairwoman, noted, “It will not be a panacea, but I believe it will be effective in fostering maximum employment and price stability."
There are those, however, that criticize the Fed's move, saying it could instead create future financial imbalances.
Time will tell, but for now, most are hoping for the best.
The Mortgage Banker Association, the national association representing the real estate finance industry, is reporting in their latest findings that mortgage applications rose. The Refinance Index rose 4.9 in just one week. This is welcome news, as the unadjusted Purchase Index increased 41.9 percent compared with the previous week, but was still 10.5 percent lower than the same week one year ago.
Copyright © 2011 Realty Times. All Rights Reserved.
Friday, January 14, 2011
Mortgage Rates Down for Second Week
January 14, 2011
Mortgage Rates Down for Second Week
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®). The survey results showed lower mortgage rates for both long- and short-term rates, with the 30-year reaching a four-week low.
30-year fixed-rate mortgage (FRM) averaged 4.71 percent with an average 0.8 point for the week ending January 13, 2011, down from last week when it averaged 4.77 percent. Last year at this time, the 30-year FRM averaged 5.06 percent.
15-year FRM this week averaged 4.08 percent with an average 0.7 point, down from last week when it averaged 4.13 percent. A year ago at this time, the 15-year FRM averaged 4.45 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.72 percent this week, with an average 0.7 point, down from last week when it averaged 3.75 percent. A year ago, the 5-year ARM averaged 4.32 percent.
1-year Treasury-indexed ARM averaged 3.23 percent this week with an average 0.6 point, down from last week when it averaged 3.24 percent. At this time last year, the 1-year ARM averaged 4.39 percent.
Frank Nothaft, vice president and chief economist of Freddie Mac, reports, "Bond yields drifted lower following the release of the December employment report , which was weaker than the market consensus forecast and implied that the labor market is still in a sluggish recovery. Fixed mortgage rates followed bond yields lower for a second consecutive week, bringing them to a four-week low."
"In its January 12th regional economic review, the Federal Reserve noted that activity in residential real estate and new home construction remained slow across all Districts over the last two months of 2010 due to concerns about the pace of economic recovery, especially in employment. In addition, the outlooks for residential real estate were mixed, with contacts in most Districts described as expecting continued weak conditions."
Copyright © 2011 Realty Times. All Rights Reserved.
Mortgage Rates Down for Second Week
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®). The survey results showed lower mortgage rates for both long- and short-term rates, with the 30-year reaching a four-week low.
30-year fixed-rate mortgage (FRM) averaged 4.71 percent with an average 0.8 point for the week ending January 13, 2011, down from last week when it averaged 4.77 percent. Last year at this time, the 30-year FRM averaged 5.06 percent.
15-year FRM this week averaged 4.08 percent with an average 0.7 point, down from last week when it averaged 4.13 percent. A year ago at this time, the 15-year FRM averaged 4.45 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.72 percent this week, with an average 0.7 point, down from last week when it averaged 3.75 percent. A year ago, the 5-year ARM averaged 4.32 percent.
1-year Treasury-indexed ARM averaged 3.23 percent this week with an average 0.6 point, down from last week when it averaged 3.24 percent. At this time last year, the 1-year ARM averaged 4.39 percent.
Frank Nothaft, vice president and chief economist of Freddie Mac, reports, "Bond yields drifted lower following the release of the December employment report , which was weaker than the market consensus forecast and implied that the labor market is still in a sluggish recovery. Fixed mortgage rates followed bond yields lower for a second consecutive week, bringing them to a four-week low."
"In its January 12th regional economic review, the Federal Reserve noted that activity in residential real estate and new home construction remained slow across all Districts over the last two months of 2010 due to concerns about the pace of economic recovery, especially in employment. In addition, the outlooks for residential real estate were mixed, with contacts in most Districts described as expecting continued weak conditions."
Copyright © 2011 Realty Times. All Rights Reserved.
Thursday, January 13, 2011
Tips for Appraisals
January 13, 2011
Tips for Appraisals by Carla Hill
Appraisals allow for homeowners and buyers to establish what is fair market value of a property. In addition, an appraisal allows a lender to know how much they can safely lend.
According to The Appraisal Institute, a global membership association of professional real estate appraisers, "Appraisals are especially important because they are an objective and unbiased source of information. Unlike others involved in real estate transactions, the appraiser is an independent professional who performs a service for a fee rather than for a commission."
This process, however, can be trying and even frustrating. Recent declines in the housing markets have spawned scapegoats across the industry, including appraisers. And increased caution from lenders has slowed the buying process.
"Too many consumers in this struggling real estate market face problems with appraisals when attempting to buy or sell a home," said Appraisal Institute President Joseph C. Magdziarz, MAI, SRA. "But rather than passively endure delays in closing a sale, homeowners and buyers can take proactive steps to avoid pitfalls."
To reduce your stress during this time, consider these simple tips from the AI®.
Understand the role of appraisals. It is neither in your interest nor the interest of your lender for you to purchase a property that is over-priced for its value.
Make sure the lender hires a qualified appraiser (such as a designated SRA, SRPA or MAI member of the Appraisal Institute). The lowest priced appraiser does not necessarily equate with the most qualified. This is a time to get the numbers right.
Accompany the appraiser during the inspection of the property if possible. The more active of a participant you are in the process, the more you will understand it, and be able to catch any errors.
Request a copy of the appraisal report from the lender. Federal law requires that you receive a copy of the appraisal within 30 days.
Examine the appraisal report and ask questions. Be sure to examine the report for errors. According to "Appraising the Appraisal: The Art of Appraisal Review," 2nd edition, common errors in appraisals include: misuse of adjustments to comparables, disregarding special financing and concessions, or miscalculation of gross living area.
Appeal the appraisal if appropriate. Market conditions do change, especially in these economic times. If you feel that new information may change the appraisal, be sure to contact them!
Ask the lender to order a second appraisal by a qualified and designated appraiser.
File legitimate complaints with appropriate state board or professional appraisal organizations.
For more information on appraisals, you may wish to visit The Appraisal Institute's website at www.appraisalinstitute.org.
--------------------------------------------------------------------------------
Copyright © 2011 Realty Times. All Rights Reserved.
Tips for Appraisals by Carla Hill
Appraisals allow for homeowners and buyers to establish what is fair market value of a property. In addition, an appraisal allows a lender to know how much they can safely lend.
According to The Appraisal Institute, a global membership association of professional real estate appraisers, "Appraisals are especially important because they are an objective and unbiased source of information. Unlike others involved in real estate transactions, the appraiser is an independent professional who performs a service for a fee rather than for a commission."
This process, however, can be trying and even frustrating. Recent declines in the housing markets have spawned scapegoats across the industry, including appraisers. And increased caution from lenders has slowed the buying process.
"Too many consumers in this struggling real estate market face problems with appraisals when attempting to buy or sell a home," said Appraisal Institute President Joseph C. Magdziarz, MAI, SRA. "But rather than passively endure delays in closing a sale, homeowners and buyers can take proactive steps to avoid pitfalls."
To reduce your stress during this time, consider these simple tips from the AI®.
Understand the role of appraisals. It is neither in your interest nor the interest of your lender for you to purchase a property that is over-priced for its value.
Make sure the lender hires a qualified appraiser (such as a designated SRA, SRPA or MAI member of the Appraisal Institute). The lowest priced appraiser does not necessarily equate with the most qualified. This is a time to get the numbers right.
Accompany the appraiser during the inspection of the property if possible. The more active of a participant you are in the process, the more you will understand it, and be able to catch any errors.
Request a copy of the appraisal report from the lender. Federal law requires that you receive a copy of the appraisal within 30 days.
Examine the appraisal report and ask questions. Be sure to examine the report for errors. According to "Appraising the Appraisal: The Art of Appraisal Review," 2nd edition, common errors in appraisals include: misuse of adjustments to comparables, disregarding special financing and concessions, or miscalculation of gross living area.
Appeal the appraisal if appropriate. Market conditions do change, especially in these economic times. If you feel that new information may change the appraisal, be sure to contact them!
Ask the lender to order a second appraisal by a qualified and designated appraiser.
File legitimate complaints with appropriate state board or professional appraisal organizations.
For more information on appraisals, you may wish to visit The Appraisal Institute's website at www.appraisalinstitute.org.
--------------------------------------------------------------------------------
Copyright © 2011 Realty Times. All Rights Reserved.
Wednesday, January 5, 2011
Pending Homes Sales Rise
January 4, 2011
Pending Homes Sales Rise by Carla Hill
While credit remains tight as we move forward into 2011, top economists expect that if the job market revives this year, and interest rates rise only moderately, the housing market could experience a boost.
Pending homes sales are already on the rise. The National Association of Realtors' Pending Home Sales Index reports that pending homes sales rose in November by 3.5 percent.
Lawrence Yun, NAR chief economist, said historically high housing affordability is boosting sales activity. "In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market," he said. "But further gains are needed to reach normal levels of sales activity."
Across the nation, we see regionally diverse markets, however. The Northeast saw pending home sales rise by 1.8 percent, but this figure is still 6.2 percent below November 2009. The West also saw a stunning 18.2 percent jump. This jump leaves it within 0.4 percent of year ago levels.
Both the Midwest and South saw declines, though, in pending sales. The Midwest declined 4.2 percent and is still 7.7 percent below year ago levels. The South fell only 1.8 percent.
"As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2 to 3 percent in 2012," Yun said.
For now, the 30-year fixed rate mortgage remains in the low five percent range, which is near a historical low. The extension of Bush-era tax credits, as well as renewed hopes of job growth could very easily translate into more sales on the housing market horizon.
--------------------------------------------------------------------------------
Copyright © 2011 Realty Times. All Rights Reserved.
Pending Homes Sales Rise by Carla Hill
While credit remains tight as we move forward into 2011, top economists expect that if the job market revives this year, and interest rates rise only moderately, the housing market could experience a boost.
Pending homes sales are already on the rise. The National Association of Realtors' Pending Home Sales Index reports that pending homes sales rose in November by 3.5 percent.
Lawrence Yun, NAR chief economist, said historically high housing affordability is boosting sales activity. "In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market," he said. "But further gains are needed to reach normal levels of sales activity."
Across the nation, we see regionally diverse markets, however. The Northeast saw pending home sales rise by 1.8 percent, but this figure is still 6.2 percent below November 2009. The West also saw a stunning 18.2 percent jump. This jump leaves it within 0.4 percent of year ago levels.
Both the Midwest and South saw declines, though, in pending sales. The Midwest declined 4.2 percent and is still 7.7 percent below year ago levels. The South fell only 1.8 percent.
"As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2 to 3 percent in 2012," Yun said.
For now, the 30-year fixed rate mortgage remains in the low five percent range, which is near a historical low. The extension of Bush-era tax credits, as well as renewed hopes of job growth could very easily translate into more sales on the housing market horizon.
--------------------------------------------------------------------------------
Copyright © 2011 Realty Times. All Rights Reserved.
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