The 30-year fixed-rate mortgage is heading into the holiday weekend at its yearly low, giving home shoppers and home owners another opportunity to snag the lowest rate of the year, weekly mortgage market surveys in its weekly mortgage market survey.
“Mortgage rates were little changed following mixed housing news,” says Frank Nothaft, Freddie Mac’s chief economist. “Existing-home sales rose for the fourth consecutive month to an annualized pace of 5.15 million, the highest of the year. On the other hand, new-home sales fell for the third consecutive month to an annualized rate of 412,000 units.”
Freddie Mac reports the following national averages for the week ending Aug. 28:
- 30-year fixed-rate mortgages: averaged 4.10 percent, with an average 0.5 point, holding the same as last week’s new low for 2014. A year ago at this time, 30-year rates averaged 4.51 percent.
- 15-year fixed-rate mortgages: averaged 3.25 percent, with an average 0.6 point, rising from last week’s 3.23 percent average. Last year at this time, 15-year rates averaged 3.54 percent.
- 5-year hybrid adjustable-rate mortgages: averaged 2.97 percent, with an average 0.5 point, rising from last week’s 2.95 percent average. Last year at this time, 5-year ARMs averaged 3.24 percent.
Source: Freddie Mac
City centers and downtowns may be growing in demand among millennials and retiring baby boomers, but a new poll says residents are still happiest in the suburbs.
Americans who live in suburban areas are the most satisfied with the place they live, according to the Atlantic Media/Siemens State of City Poll. Eighty-four percent of suburbanites rated their community as “excellent” or “good” compared to 75 percent of urban dwellers and 78 percent of rural residents, according to the poll of more than 1,600 U.S. adults.
The survey revealed some racial, economic, and generational differences in community satisfaction. For example, in urban areas, whites were significantly more likely than minorities to say they were happy with their communities as places to live. Also, younger adults in general were less likely to rate their communities as “excellent” or “good” compared to their older counterparts. Older respondents tended to hold more favorable views of the place where they live.
Home ownership also appeared to be a major predictor for how satisfied residents were with their community. In urban areas, 44 percent of home owners rated their community as “excellent” compared to 22 percent of urban renters. Among non-urban home owners, 46 percent rated their community as “excellent” compared to 31 percent of non-urban renters, the poll found.
Source: “Overall, Americans in the Suburbs Are Still the Happiest,” The Atlantic CityLab (Aug. 25, 2014)
After several weeks of drops in interest rates, mortgage applications finally got a modest lift as refinancers and home buyers took advantage of the dip, CNBC reports.
The Mortgage Bankers Association’s weekly mortgage market index showed that total mortgage application volume rose 2.8 percent during the week ending Aug. 22 compared to a week earlier.
Broken out, applications for refinancings increased 3 percent last week but remain 25 percent below a year ago — even when mortgage rates were higher, MBA reports. Home-purchase mortgage applications also rose 3 percent during the week and remain 11 percent below its rate last year at this time.
The 30-year fixed-rate mortgage fell to 4.28 percent during the week from 4.29 percent the prior week, MBA reports.
Source: “U.S. Mortgage Volume Ekes Out Gain on Tiny Drop in Rates,” CNBC (Aug. 27, 2014)
About 800,000 families across the country could benefit from the Home Affordable Refinance Program by lowering their monthly mortgage payments, but fear is keeping them away from the program, said Mel Watt, director of Federal Housing Finance Agency, in remarks at a public campaign in Atlanta this week to promote HARP.
“HARP is designed to reward those borrowers who are the most committed in this country,” Watt said. “This is not a scam.”
The FHFA estimates that eligible borrowers could save nearly $2,300 per year on their mortgage payments with HARP. But Watt said too many borrowers are still not taking advantage of the program.
“As it stands now, people don’t trust their lenders, and it’s creating uncertainty,” Watt told HousingWire. “We know that there are hundreds of thousands of borrowers who can still benefit from the Home Affordable Refinance Program and are essentially leaving money on the table by not taking advantage of the program.”
FHFA released a new interactive map that reveals the number of estimated borrowers who are eligible for HARP across the country. Borrowers in Florida, Michigan, Ohio, Illinois, Georgia, and California have some of the largest number of borrowers eligible.
Source: “Watch: FHFA Director Watt Ensures HARP Is ‘Not a Scam,’” HousingWire (Aug. 25, 2014)
Both closing times and credit requirements are dropping, according to the latest report from Ellie Mae. The mortgage industry services provider states in its Origination Insight Report that the average number of days to close a loan has dropped to 37 in July, compared to 41 days in June. Ellie Mae notes that’s the the lowest average they’ve seen since they began tracking. On average, it took 38 days to close a FHA loan, 36 days to close a conventional loan, and 38 days to close a VA loan in the month of July.
The report also notes that the average FICO score fell one point to 727 in July, reversing a four-month trend of increases. Researchers also noted another “sign of easing” is that 32 percent of closed loans had an average FICO score under 700 last month, compared to only 25 percent one year ago.
Meanwhile, the purchase market climbed in July, as the share of closed purchase loans hit 67 percent, up 2 percent from June – and the highest percentage since Ellie Mae began tracking the data in 2011. Refinanced loans took up the remaining 32 percent of closed loans.
The report focuses on loans that closed or were denied over the course of a month, comparing the data to other time frames, according to Ellie Mae.
Source: “Ellie Mae Releases July 2014 Origination Insight Report,” (August 20, 2014)
Property managers take note: online peer ratings and reviews matter. According to ApartmentFinder.com’s recent survey of more than 5,000 apartment seekers, nearly all – 96 percent – said online reviews influence their decision of choosing an apartment.
Is your rental site mobile friendly? Are you listing rental properties on mobile-friendly portals? Property managers should factor mobile into their marketing strategy as nearly half (49 percent) of apartment hunters prefer to use their mobile device, according to the survey. And those mobile property hunters will take action: 45 percent will call and 42 percent will e-mail the rental office immediately from their mobile device. Of respondents who use their mobile device to shop for rentals, 49 percent will call the apartment community directly from the listing.
When it comes to making the final rental decision, cost was the biggest influencer, swaying 63 percent of respondents. Location was the deciding factor for 24 percent of renters, followed by neighborhood crime statistics at 7.3 percent, school system at 3 percent, and community amenities at 2.6 percent.
Giving context to why renters are moving, the top three reasons listed by survey respondents included a current lease expiring (42 percent), job relocation or a new job (22 percent), and moving out of parents’ home (18 percent).
Source: “New ApartmentFinder.com Survey Reveals Apartment Shoppers’ Search Behavior and Lease Decision-Making Influencers,” Apartment Finder (Aug. 13, 2014)
Despite predictions that mortgage rates were to inch up in the second half of this year, fixed-rate mortgages continue to tumble.
Borrowing costs moved lower this week, as the 30-year fixed-rate mortgage dipped to a 4.10 percent average, Freddie Mac reports in its weekly mortgage market survey. The 30-year fixed-rate mortgages previous low average for the year was 4.12 percent.
Freddie Mac reports the following average mortgage rates for the week ending Aug. 21:
- 30-year fixed-rate mortgages: averaged 4.10 percent, with an average 0.5 point, dropping from last week’s 4.12 percent. Last year at this time, 30-year rates averaged 4.58 percent.
- 15-year fixed-rate mortgages: averaged 3.23 percent, with an average 0.6 point, dropping from last week’s 3.24 percent average. A year ago, 15-year rates averaged 3.60 percent.
- 5-year hybrid adjustable-rate mortgages: averaged 2.95 percent, with an average 0.5 point, dropping from last week’s 2.97 percent average. Last year at this time, 5-year ARMs averaged 3.21 percent.
Source: Freddie Mac
July housing data shows that price appreciation and inventory increases during the peak home-buying season helped the market to post the largest spring gains in three years, realtor.com® reports in its National Housing Trend Report.
“In July 2012 and 2013, we saw external economic factors overwhelm the healthy gains established in the housing market during the spring home-buying season,” says Jonathan Smoke, chief economist for realtor.com®. “This year, we’re ending the traditional season with high buyer and seller confidence demonstrated by price appreciation, increases in inventory, and quick home sales.”
In July, housing inventories rose 2.3 percent year-over-year, as the median list price posted a 7.5 percent increase year-over-year, realtor.com® reports. The median list price was $214,900 nationwide in July.
“This is the first time since the beginning of the recovery that we expect to see positive momentum throughout the second half of the year,” Smoke says. “While seasonal patterns are emerging in July month-to-month comparisons, all other metrics point to fundamental market health and a build-up of momentum.”
A drop in mortgage rates renew home owners’ interest in refinancing their mortgage.
The rise in refinancing applications helped to give overall loan demand a boost for the week ending Aug. 15, the Mortgage Bankers Association reports in its weekly mortgage market survey, which reflects 75 percent of the residential mortgage market.
Mortgage application activity, including both loans for refinancings and home purchases, increased 1.4 percent during the week.
Broken out, refinancing applications increased 2.7 percent, while loans for home purchases, viewed as a leading indicator of future home sales, fell 0.4 percent.
The 30-year fixed-rate mortgage averaged 4.29 percent during the week, down 6 basis points from the prior week, the MBA reports.
Source: “U.S. Mortgage Applications Rise in Latest Week: MBA,” Reuters (Aug. 20, 2014)
Home owners who have poor credit pay 91 percent more for homeowners insurance than those who have stellar credit, according to a new report from Brankrate.com and insuranceQuotes.com.
Home owners with a fair or median credit score may pay 29 percent more for homeowners insurance than someone with stellar credit, according to the report.
“This is another example of why credit is such an important part of your financial life,” Laura Adams, senior analyst with insuranceQuotes.com, told CNBC. “Maintaining a good credit history suggests that you’re a less risky customer and can lead to several hundred dollars in annual homeowner’s insurance savings.”
How insurance companies weigh a person’s credit score can vary greatly from company to company and even state to state. There is no standard for how insurers figure credit into insurance costs, per the report. (California bans the use of credit in setting rates.)
“I’m pretty shocked that even with a so-called fair credit score, you could still wind up paying 50 percent more than someone in the excellent category,” says Bob Hunter, former Texas insurance commissioner and current director of insurance at the Washington, D.C.-based Consumer Federation of America. Your comments?
Source: “If You Have Poor Credit, You May Pay Nearly Double for Home Insurance,” InsuranceQuotes.com (Aug. 14, 2014) and “How Poor Credit Costs You on Homeowners Insurance,” CNBC (Aug. 14, 2014)