Tag Archives: interest rates

Spring Selling Season Predicted To Start Early

18 Feb

from The Motley Fool  at fool.com February 15, 2014

If you’re considering selling your home in 2014, now is the time to get ready. Not next month, not next week, not tomorrow. Right now.

Why? Because buyers are already on the hunt.
The Internet is the new curb appeal

Last month will likely be remembered for polar vortexes, widespread snow, and historic traffic jams. Lost in the shuffle is that while American’s were sitting inside trying to stay warm, they were looking at houses for sale on the Internet.
Experian Marketing Services released its monthly most visited real estate website rankings earlier this week for web traffic in January. The results are eye popping.
Web traffic to real estate websites was up 25% from December to 364 million visits. Zillow (NASDAQ: Z ) led the way with over 57 million visits and Trulia (NYSE: TRLA ) limped into second at over 30 million visits.
If you’re considering selling and your home is not yet online, then every day you’re missing out on thousands (or even millions) of potential buyers viewing your home.
Even more incentive for buyers Spring is coming, and that is certainly driving a lot of the interest in homes currently listed for sale. But there are other factors at play.
Mortgage rates have declined over the past month and are currently trending back toward 4% for traditionally structured, well qualified loans. This is a significant development for buyers, as interest rates are a huge driver of home affordability.
For example, a traditional 30 year, $150,000 mortgage at 4.5% would have a monthly payment of $760. If rates declined to 4.25%, the payment would change to $738.
For borrowers on the edge of qualifying for a mortgage, that $22 per month savings could make the difference between getting a loan approval or not. Over the life of the loan, that 0.25% difference saves the borrower $7,963!
For buyers, the time is now! Buy low and sell high, right? For buyers, the time to buy low is quickly ending, creating a sense of urgency to buy now before prices rise too high or interest rates return to more historically normal levels.
According to CoreLogic and reported by Realtor.org, home prices in 2013 saw the largest percentage increase across the board since 2005, north of 11% as of December. The appreciation was most pronounced in the states that were hit hardest in the real estate collapse: Nevada rose 23.9%, California 19.7%, and Michigan 14% rounding out the top three.
Buyers are ready. Are you?

 

Mortgage Rates Continue Downward Trend

11 Feb
weekly mortgage rates freddie mac
Daniel Acker/Bloomberg via Getty Images

WASHINGTON — Average U.S. rates for fixed mortgages fell this week as the latest data continued to indicate a pause in the housing market’s recovery.

Mortgage buyer Freddie Mac said Thursday the average rate for the 30-year loan declined to 4.23 percent from 4.32 percent last week. The average for the 15-year loan slipped to 3.33 percent from 3.40 percent.

Mortgage rates have risen about a full percentage point since hitting record lows roughly a year ago. The increase was driven by speculation that the Federal Reserve would reduce its $85 billion a month in bond purchases. Saying the economy was gaining strength, the Fed pushed ahead last week with a plan to reduce the bond purchases, which have kept long-term interest rates low.

Data released Tuesday by real estate specialist CoreLogic (CLGX) showed that U.S. home prices slipped from November to December, and the year-over-year increase slowed, likely a result of weaker sales at the end of last year.

The December decline was the third straight month-to-month drop.

Home prices had risen for eight straight months through September. For all of 2013, prices rose a healthy 11 percent.

The Commerce Department reported Monday that U.S. construction spending rose modestly in December, slowing from healthy gains a month earlier.

Most economists expect home sales and prices to keep rising this year, but at a slower pace. They forecast that both will likely rise around 5 percent, down from double-digit gains in 2013.

Steady job gains are putting more people to work and enabling them to buy a home. And rising prices should encourage more owners to sell their homes. A larger supply of available homes would likely boost sales.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country Monday through Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

  • The average fee for a 30-year mortgage was unchanged at 0.7 point. The fee for a 15-year loan rose to 0.7 point from 0.6 point.
  • The average rate on a one-year adjustable-rate mortgage fell to 2.51 percent from 2.55 percent. The fee increased to 0.5 point from 0.4 point.
  • The average rate on a five-year adjustable mortgage slipped to 3.08 percent from 3.12 percent. The fee held at 0.5 point.

Here’s a look at rates for fixed and adjustable mortgages this week and over the past year. (All values in percentage points):

Loan type Current avg. Last week 52-week high 52-week low
30-year fixed 4.23 4.32 4.58 3.35
15-year fixed 3.33 3.40 3.60 2.56
5-year adjustable 3.08 3.12 3.28 2.56
1-year adjustable 2.51 2.55 2.71 2.51
Source: Freddie Mac Primary Mortgage Market Survey