It’s a Good Time to Lock in Mortgage Rates

“This week’s survey shows the 30-year fixed rate inching up to 3.56 percent, only 2 basis points above last week’s average. The low rates continue to be good news for the housing market, as existing home sales rose 1.8 percent to a 5.53 million seasonally adjusted annual rate in the month of May — the highest level since February 2007.”

Freddie Mac reports the following national averages for the week ending June 23:

  • 30-year fixed-rate mortgages: averaged 3.56 percent, with an average 0.6 point, rising from last week’s 3.54 percent average. A year ago, 30-year rates averaged 4.02 percent.
  • 15-year fixed-rate mortgages: averaged 2.83 percent, with an average 0.5 point, increasing from last week’s 2.81 percent average. A year ago, 15-year rates averaged 3.21 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.74 percent, with an average 0.5 point, holding the same average from a week ago. Last year at this time, 5-year ARMs averaged 2.98 percent.

Source: Freddie Mac

Home Loan Rates Plunge to 3-Year Lows

“The 30-year mortgage rate responded by falling 6 basis points for the second straight week to 3.54 percent — yet another low for 2016. Wednesday’s Fed decision to once again stand pat on rates, as well as growing anticipation of the U.K.’s upcoming European Union referendum will make it difficult for Treasury yields and — more importantly — mortgage rates to substantially rise in the upcoming weeks,” says Sean Becketti, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages for the week ending June 16:

  • 30-year fixed-rate mortgages: averaged 3.54 percent, with an average 0.5 point, falling from last week’s 3.60 percent average. Last year at this time, 30-year rates averaged 4 percent.
  • 15-year fixed-rate mortgages: averaged 2.81 percent, with an average 0.5 point, dropping from last week’s 2.87 percent average. A year ago, 15-year rates averaged 3.23 percent.

Source: Freddie Mac

How Much Will Buyers Pay for Walkable Space?

Urban development that boasts high density and walkability is in demand over life in the suburbs, according to a report by the Center for Real Estate and Urban Analysis at George Washington University School of Business and LOCUS: Responsible Real Estate Developers and Investors. In fact, such places are gaining market share against suburban areas for the first time in decades.

The report defines walkable urban areas as those with high density, more mixed-use real estate, and multiple transportation options. These areas command larger rent premiums over suburban spaces, with the ability to charge 90 percent more for office space, 71 percent for retail, and 66 percent for multifamily rentals.

But just because a place might lack a history of density and walkability doesn’t mean it’s stuck with lower rents. The study found that new development can help, with areas known for sprawl taking notice of the trend and making strides in adding more density and walkability.

Source: “Walkable Cities Gaining Ground Against Suburbs, Says Report,” Curbed.com (June 14, 2016)

Why a Weaker Economy Shouldn’t Scare You

A disappointing jobs report last week revealed that new jobs hit a five-year low in May. While that’s no reason for celebration, there is a silver-lining for the housing market.

It’s likely that the Federal Reserve will not raise interest rates later this month. In fact, the Fed may not raise rates for a while now, which could be a boon for home shoppers looking to lock in historically low mortgage rates.

“The real beneficiaries are people who are in the process of buying a home this spring or summer,” says Jonathan Smoke, realtor.com®’s chief economist. “They can buy more of a home with the same amount of payment, or they have an easier time qualifying” for a loan.

Source: “Why a Weaker Economy Could Be Good for Home Buyers and Owners,” realtor.com® (June 3, 2016)

Home Loan Interest Rates Push Upward

Averages on fixed-rate mortgages rose this week, but remain near three-year lows, Freddie Mac reports in its weekly mortgage market survey.

“Mortgage rates continue to adjust to this new level with the 30-year fixed rate inching up another 2 basis points this week to 3.66 percent. Recent statements by the Fed appear to have persuaded the market that a rate hike may come sooner than later,” says Sean Becketti, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages for the week ending June 2:

  • 30-year fixed-rate mortgages: averaged 3.66 percent, with an average 0.5 point, rising from last week’s 3.64 percent average. A year ago, 30-year rates averaged 3.87 percent.
  • 15-year fixed-rate mortgages: averaged 2.92 percent, with an average 0.5 point, increasing from last week’s 2.89 percent average. A year ago, 15-year rates averaged 3.08 percent.

Source: Freddie Mac

Home Asking Prices Zoom to Record Highs

A robust spring market is causing sellers to up their asking prices, according to a preliminary analysis of May data from realtor.com®. Great news, California has dominated the hot list for some months.

“This spring real estate market is coming in strong, just as we expected,”says Jonathan Smoke, realtor.com®’s chief economist. “Pent-up demand and low mortgage rates are driving consumers into the market with urgency. However, the recurring issue of limited supply is leading to higher prices.”

Source: “America’s 20 Hottest Real Estate Markets for May 2016,” realtor.com® (May 26, 2016)

Cash Home Sales Lowest Since 2008

The number of home buyers bringing all-cash to a transaction this year is on track to be the lowest since 2008, according to new findings from CoreLogic, a real estate data firm. For the first two months of this year, the share of cash sales averaged 35.6 percent.

In January 2011, cash sales peaked at 46.6 percent of total home sales nationally. Cash sales comprised 35.7 percent of all home sales in February, down 2.5 percentage points from a year ago.

Prior to the housing crisis, the share of cash sales averaged about 25 percent. CoreLogic analysts predict that if cash sales continue on current trends, all-cash sales should reach the 25 percent mark by mid-2018.

Real estate-owned (REO) sales continue to have the largest share of cash sales at 59.2 percent. Resales followed at a 35.6 percent share of cash sales, and then short sales at 32.6 percent and new-home construction homes at 15.2 percent.

Source: “Cash Sales in 2016 on Track to Be Lowest Since 2008,” CoreLogic Insights Blog (May 19, 2016)

Kitchen Makeover Ideas for Under $1,000

Kitchen remodels can cost your clients upwards to $20,000 or more. But there are a few simple and inexpensive tweaks that can give a dated kitchen a more modern edge. Here are some ideas:

  • Hardware: Replacing current hardware can really modernize the kitchen, but make sure it compliments the kitchen’s existing décor. Hardware can make a big difference in the look of a kitchen.
  • Faucet: Make a new faucet the focal point in the kitchen that can offer an eye-catching makeover.
  • Backsplash: A backsplash can be an instant way to dress up a kitchen. A stainless steel laminate backsplash can work with most kitchen styles and is known as being a more affordable option.
  • Paint: Repaint or refinish old cabinets for a dramatic update. White kitchen cabinets are among the most popular trends right now, according to the National Kitchen & Bath Association’s trend reports.
  • Lighting: Swap out the lighting for more updated models, such as pendant lights over a kitchen island or add under-cabinet lighting to highlight the countertops.

Source: “Redoing Your Kitchen on a Budget of $1,000 or Less,” RISMedia (May 18, 2016)

Home Loan Interest Rates at 3-Year Lows

“Disappointing April employment data once again kept a lid on Treasury yields, which have struggled to stay above 1.8 percent since late March,” says Sean Becketti, Freddie Mac’s chief economist. “As a result, the 30-year mortgage rate fell 4 basis points to 3.57 percent, a new low for 2016 and the lowest mark in 3 years. Prospective home buyers will continue to take advantage of a falling rate environment that has seen mortgage rates drop in 14 of the previous 19 weeks.”

Freddie Mac reports the following national averages for the week ending May 12:

  • 30-year fixed-rate mortgages: averaged 3.57 percent, with an average 0.5 point, dropping from last week’s 3.61 percent average. Last year at this time, 30-year rates averaged 3.85 percent.
  • 15-year fixed-rate mortgages: averaged 2.81 percent, with an average 0.5 point, falling from last week’s 2.86 percent average. A year ago, 15-year rates averaged 3.07 percent.

Source: Freddie Mac

Sellers Happy, But Home Buyers Are Frustrated

The number of home buyers who say now is a good time to buy dipped to an all-time survey low in Fannie Mae’s latest Home Purchase Sentiment Index. Meanwhile, home owners who say now is a good time to sell soared to an all-time survey high.

Some highlights from Fannie Mae’s latest Home Purchase Sentiment Index:

  • 30% of Americans say now is a good time to purchase a home, a drop of 3 percentage points from the previous month and now at an all-time survey low.
  • 15% of Americans say now is a good time to sell a home, now at an all-time survey high.
  • More consumers think home prices will rise over the next 12 months compared to March, and slightly fewer consumers also expect mortgage rates to go up over the next year.
  • The percentage of respondents who say they are not concerned with losing their job increased 6 percentage points to 74%, nearly a 7 percentage point decrease in March.
  • The percentage of respondents who say their household income is higher than it was 12 months ago held at 11%.

Source: Fannie Mae