Tag Archives: housing market

Housing market is showing signs of hope

If you’ve been distracted by the federal government shutdown, political dysfunction, stock-market volatility and reports of rising mortgage rates, it wouldn’t be surprising if you concluded: No way is this a good time to even think about buying a house or putting one on the market. Things are too crazy. Nobody’s paying attention to real estate anyway.

But take another look. Some of the real-estate fundamentals have been changing for the better. Take mortgages. They’ve gotten cheaper. As of last week, you could readily find conventional rates averaging 3.87 percent for five-year adjustable-rate home loans, or conventional 30-year loans at fixed rates of 4.45 percent, according to investor Freddie Mac. That compares with late last year, when they were at 5 percent or higher, depending on an applicant’s credit profile.

Sure, rates are slightly higher than they were a year ago, when the 30-year fixed rate averaged 4.2 percent. And yes, when you take out a five-year adjustable loan, your payments are fixed for the first 60 months and then are subject to adjustments — up or down — once a year. So you take on future rate risk in exchange for a super low rate the first five years.

But combined with other recent trends — growing inventories of homes available for sale, slower price inflation and even modest price reductions — the decline in mortgage rates should be encouraging for anyone seriously in the market for a home. And even for heads-up owners looking to sell.

Consider:

  • New mortgage applications of home buyers nationwide during the week that ended Jan. 11 soared to their highest level since 2010 — and were 9 percent higher than they were the week before, according to the Mortgage Bankers Association. Clearly the word is out among buyers who learned about the rate declines: They’ve been rushing to nail down financing at a brisker pace than is typical for this time of year.

read more at: https://tucson.com/business/kenneth-harney-housing-market-is-showing-signs-of-hope/article_c8e7860e-bae4-50fe-aab6-37d7b981a7af.html

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Home Financing Gets Reprieve From Surging Rates

Homebuyers are getting a break from escalating mortgage rates, a pause that may at least temporarily support a housing market that is showing signs of cooling down, according to data released Thursday.

The average rate for the popular 30-year fixed-rate mortgage has climbed about 1 percentage point since early May, recently hitting the highest level in two years, making monthly loan payments more expensive and cutting some plans to buy a home.

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But that rate dropped in the latest week, following the Federal Reserve’s decision not to start tapering its assets purchases that have kept long-term rates low. For the week that ended Sept. 26, the 30-year-mortgage rate averaged 4.32 percent, the lowest rate since late July, down from 4.5 percent in the prior week. The average 15-year rate decreased to 3.37 percent from 3.54 percent,

“These low rates should somewhat offset the house price gains seen the last number of months and keep housing affordability elevated,” said Frank Nothaft, chief economist for Freddie Mac.

The drop comes as there are signals that higher rates are taking a toll on the housing market. A gauge from the Mortgage Bankers Association shows that loan applications to purchase a home have dropped about 9 percent since early May. Data released Thursday showed that pending sales of homes — this is a forward-looking indicator for housing because sales typically close within two months — fell in August for a third straight month, thanks to higher interest rates and home prices, among other factors, according to the National Association of Realtors.

Read more at: http://www.utsandiego.com/news/2013/sep/27/tp-home-financing-gets-reprieve-from-surging-rates/

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