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Three Reasons Now is the Time to Buy a Home

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This summer is the perfect time to consider purchasing a home.  An article published by RealtorMag details three reasons buyers should not delay a home purchase any longer.

To start, home prices are not expected to remain steady at current prices, let alone dip below current values.  In fact, home values have been increasing over the past twelve months and are expected to appreciate over the next five years at a rate of at least 3.2 percent a year.

8409972120_2f70f76af5_oFurthermore, mortgage rates are still hovering close to the record low, last week averaging 3.41 percent for a 30-year fixed rate mortgage.  However, it is predicted that these rates will rise soon.  In fact, it is expected that mortgage rates will rise an entire percentage point by next summer.

As a result, households currently renting instead of owning should consider moving forward with a home purchase.  As documented in a Harvard housing study, renting does not make financial sense for most households.  Renters miss out on not only the tax breaks that come with home ownership, but instead of paying down on their own investment, they are helping landlords pay off their investment plus a rate of return.

Read the entire article.

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Positive News about “Distressed” Home Sales

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FotoFlexer_PhotoForeclosures on homes in many U.S. cities lead to investors purchasing these “distressed” homes at deeply discounted prices.  Consequently, the value of the other homes in these cities declined as well.

However, some good news has been released about this sector of the real estate market.   According to an article published in DSNews.com by Brian Honea, there has recently been a decline in the number of distressed homes for sale.  More specifically, as of May 2016, the number of distressed homes for sale decreased by 4 percent over the year.  The lower inventory of foreclosed, REO and short sale homes has helped increase the demand for homes and, subsequently, increased the home values in those areas.

Honea quotes CoreLogic Chief Economist Frank Nothaft,  “Overall, the homes-for-sale inventory remains relatively lean, while demand to buy homes has increased because of an improving labor market, more optimistic levels of consumer confidence, and continuing low mortgage rates.”

To learn more, read the entire article.

 

Photo Credit:  Taber Andrew Bain

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Home Purchase and Closing Rates are Showing Improvement

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For the first time in the past nine months, mortgages for home purchases have accounted for more than 60 percent of all closed loans.  According to a report released by Ellie Mae, the rate of actually reached 62 percent in May.

Additionally, the rate of loans that closed improved to 70 percent.  Specifically, the rate of home purchase loans that closed was 75 percent, with the rate of refinancing closes lagging slightly at 67 percent.

The report also notes that home buyers who are financing their home purchase have seen an average of 45 days Keys and lock the door on the background of solar gardento close their loan, which is an increase of one day from last month.

The article published by REALTORMag on June 16, 2016 provides data from the Ellie Mae Report, and also discusses the percentage of home borrowers with “high” credit scores, which exceeded 80 percent for conventional loans.

Read the entire article for these details.

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Existing-Home Sales Continue to Rise

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According to an article published by the National Association of Realtors (NAR), the sale of existing homes nationwide has increased 6 percent since April 2015.  Additionally, the median home price for existing homes is up 6.3 percent since last April.   Although the total housing inventory is showing some upward movement, it is still lower than it was a year ago.FotoFlexer_Photo

Lawrence Yun, NAR chief economist, indicated “The temporary relief from mortgage rates currently near three-year lows has helped preserve housing affordability this spring, but there’s growing concern a number of buyers will be unable to find homes at affordable prices if wages don’t rise and price growth doesn’t slow.”

The supply of entry and mid-priced homes is still low and the market for these homes will likely be the most competitive in the coming summer months.  However, proposed changes to FHA condo rules could eliminate some of the obstacles that stifle condo sales.  These changes would allow more first time home buyers an opportunity to purchase a condo and enter the real estate market.

For more information, read the entire article.

 

Photo Credit: Marcel Suliman

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Mortgage Rates Drop in Response to Weak Economic Data

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25736182840_05cc495a5f_oOver the past few weeks, mortgage rate averages had increased slightly.  However, the rates actually dipped lower last week and could continue to drop further this week.   This decrease is a direct result of the release of economic data which pushed investors to purchase bonds.  Consequently, mortgage rates averages dipped in line with the long-term bond yields.

Specifically, the 30-year mortgage rate average dropped to a low 3.61 percent, hovering near the lowest rates of 2016.  Similarly, the 15-year rate average drifted down to 2.86 percent.  Freddie Mac chief economist , Sean Becketti, summarized the mortgage rate trends for the year, “…Since the start of February, mortgage rates have varied within a narrow range providing an extended period for house hunters to take advantage of historically low rates.”

An article released by the Washington Post by Kathy Orton, also noted credit availability has loosened as a result of programs from Freddie Mac and Fannie Mae which allow for a low down payment.  Read the entire article.

 

Image Credit:  Life’s A Beach Real Estate

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Will 2016 Be One of the Best Real Estate Markets this Decade?

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This year’s real estate market has the potential to be the best we have seen in ten years.  Experts from Freddie Mac have predicted that “total home sales, housing starts, and house prices will reach their highest levels since 2006…”

Several economic conditions are influencing the 2016 real estate market and are detailed in a recent article, “Is Housing Poised to Return to Pre-Crisis Glory?” published on DSNews.com by Brian Honea.  Specifically, mortgage rates continue to remain low and are predicted to stay below 4 percent for the remainder of the year.  Additionally, housing may become more affordable as the rate of home appreciation slows to a steady rate just below 5 percent. Lastly, the potential for very favorable labor conditions, such as increases in job growth and the potential for wage increases, are important factors which will also influence housing market.

For more details, read the article.

Photo Credit:  tdini1

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Refinancing a Home or Getting a Mortgage May Be Easier

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approved-160120_1280It’s easier than it has been in several years to qualify for a mortgage, thanks to eased credit score requirements.  According to a recent article in the Spring Real Estate Guide in the Money publication, there has been a 15% increase since 2014 in the number of refinance applications approved.

Impacting the approval rate is the fact that the average FICO credit score required for a 30-year mortgage has dropped 10 points.   In fact, borrowers with an average score of 695 might be able to qualify for a mortgage, which hasn’t been the case for years.

Additionally, those with a higher than average credit score (750-800) might find themselves qualifying for rates in line with borrowers with “excellent” credit (800 or above); the gap in the rate difference might now be close to zero.

More accessible mortgages, coupled with near record low mortgage rates make this an excellent time to secure a mortgage or refinance.

To learn more, read the entire article.

 

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What’s In Store for Mortgage Rates and the Spring Market?

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Despite the Federal Reserve rate increase late last year, the 30 Year Mortgage rate has continued to decrease.  It has been predicted, in fact, rates could “head lower into record territory”.  Nonetheless, Fannie Mae has just reported its worst monthly home purchase sentiment in 18 months.

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A recent article on CNBC.com’s Realty Check outlines some of the reasons home sales have been on the decline so far this spring.  For example, many buyers and sellers do not believe that this is the best time to purchase or sell a home.  Consumers are concerned about the economy and job security; to add, mortgage credit availability has tightened.

The release of key domestic economic data this week could have an impact on the direction of the mortgage rates.

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