Lower Home Mortgage Rates : Can You Get One?
Lower Home Mortgage Rates Colorado are not too far from our reach. According to the Commerce Department, homeownership in the United States hit a 17-1/2-year low in the second quarter as Americans continue to shift toward renting, underscoring the lingering effects of the recession on the housing market. The seasonally adjusted rate slipped to 65.1 percent, the lowest since the fourth quarter of 1995. The rate, which peaked at 69.4 percent in 2004, was 65.2 percent in the first quarter.
In the second quarter, the decline in Lower home Mortgage Rates Denver was concentrated in the 45-54 age group, where it fell four tenths of a point. It rose among people 65 years and older, in line with recent trends. Ownership among people between 55 and 64 years fell 0.3 percentage point in the second quarter.
There were small gains in the 35-44 age cohort.
And that is where opportunity exists. This group of Lower home Mortgage Rates Iowa has recently been freed up from underwater mortgages as home prices have risen well over 10% in the last 12 months. Many renters that have decided to rent have done so primarily for two reasons. First, in some cases it has been less expensive to rent and secondly, they have been worried that once they purchase a home it will decrease in value. However, the recent trend in increasing lower home mortgage rates Nebraska values have renters considering getting off of the sidelines to take advantage of a market that is on its way up.
Home Mortgage Rates 2013
Home mortgage rates Denver and home prices have recently increased, is real estate still a good investment? That is the question that many investors and those looking for home mortgage rates Colorado, clearly wanting to avoid the trap of the last housing bubble.
Jonathan Gray, Blackstone’s global head of real estate thinks it is still a great investment. And he should know, Blackstone owns over 31,000 U.S. homes and is buying more, despite the home mortgage rates Nebraska and home mortgage rates in Omaha
Though many are focused on the recent rise in home mortgage rates Iowa, prices are dramatically below 2006 levels in a number of markets, Gray said. “We think they still represent good value, and the supply-demand picture there looks pretty good. We’ve only been building at about half the rate of obsolescence and population growth in terms of new starts, and that is supporting the value.”
He also stated that the single-family housing market should remain bullish for two to four years. Blackstone Real Estate has $60 billion in total assets under management and $10 billion in capital available for investments. A portion of these assets, valued at over $5 billion, is made up of 31,000 homes in 13 U.S. markets.
Home Loans and New Home Sales Continue to Increase, Even With Increased Rates
Home Loan Colorado and the housing recovery are on a normal trajectory and gradual increases in home loan Denver interest rates won’t slow it down, according to Home Builder Lennar CEO Stuart Miller.
With home loan Iowa interest rates at historic lows, Miller expects that as home loan Nebraska and home loan Omaha rates move up, slight increases “are not going to stop the progress forward” of the housing recovery. “Housing continues to find its rebound and gain strength,” he said. “Over the past five years we have under-constructed for a growing household formation that has been stymied by economic downdrafts.”
Miller estimates that the country needed 1.25 million to 1.5 million homes per year over the past few years, but instead only about 500,000 homes were constructed. “We’re going to have to catch back up in order to serve the needs of a growing population,” he said. “We have to make up for the deficit we’ve had in the past years.”
The key force is a tight supply of housing exacerbated by a lack of land availability, he said. “What you’re seeing with the builders is an inability to really get the land that we need to be able to build the homes to meet the demand,” he said. “So you have inventories that are very, very low, and that is driving prices up.”
Miller also said that the cost of commodities for builders is a “mixed bag”
and that prices of homes are rising faster than costs. “I don’t think you can read a lot from costs,” he said, adding that although costs of raw materials are going down, other factors, like labor, are getting more expensive.
“We’re starting to see a real recovery in housing that is not likely to be pulled back,” he said.
The Commerce Department said Thursday that applications for building permits rose 14.3 percent to a rate of 1.02 million, the most since June 2008.
Builders are benefiting from a sustained rebound in housing that began a year ago. Steady job growth, rock-bottom mortgage rates and rising home values have boosted demand.
Housing starts came in at a seasonally adjusted rate of 853,000 which was a decline from last month. However, the majority of that decline was in apartment and multi-family and not in single family residences.
Confidence among builders is rising. The National Association of Home Builders says its builder confidence index rebounded in May to a reading of 44, up from 41 in April. The outlook for sales reached its highest point in more than six years.
Contracts to buy existing homes rose in March, and would have increased even more it it wasn’t for a historically low supply of for-sale listings nationwide.
The Pending Home Sales Index from the National Association of Realtors increased 1.5 percent month to month which was better than the 1.0 percent increase that economists expected. It is 7 percent higher than March of 2012.
“Contract activity has been in a narrow range in recent months, not from a pause in demand but because of limited supply,” said the Realtors’ chief economist Lawrence Yun in a release. “Little movement is expected in the near-term sales closings, but they should edge up modestly as the year progresses.
The lack of inventory is due to several factors but one of the newer trends is that many sellers are waiting to put their homes on the market because they are waiting to see how much further home prices will increase.
Regionally, the Realtors’ pending home sales index was unchanged in the Northeast from February, up 0.3 percent in the Midwest, up 2.7 percent in the South and up 1.5 percent in the West.
As we have been reporting for over a year, home prices are rising. That is
the good news. The bad news is that wages are not.
While historically low mortgage rates are translating into big savings for
homeowners, those same low monthly payments are masking a troubling trend.
While home values have been on the rise for the past year – in some areas
appreciating by 15 percent or more annually – median wages haven’t kept
pace. As a result, home price-to-income ratios in many areas are climbing.
By looking at two metrics – an affordability index and a price-to-income
ratio – Zillow researchers have determined that low mortgage rates that make
homes appear incredibly affordable are overshadowing a bigger overall trend
in which the overall prices of homes are actually significantly more
expensive than historic norms relative to annual incomes.
Homeowners in 24 of the 30 largest metros covered by Zillow were paying more
for homes in the fourth quarter of 2012 relative to their region’s median
income than they were from 1985 through 1999. Metros with the largest
difference between their pre-bubble and fourth quarter 2012 price-to-income
ratios included San Jose (52.1 percent more), Los Angeles (48.8 percent
more), Portland, (45.4 percent more), San Diego (44.6 percent more) and
Denver (40.8 percent more).
The National Association of Realtors reported that their index of Pending Home Sales rose 8.4% from February 2012 and was constrained only by the lack of inventory available for sale. Thinking about buying a home in 2013? This is not the same market where you can take your time and view many different homes. Home prices are moving up and the number of available homes for sale that are in good condition are moving fast.
Lawrence Yun, NAR chief economist, said limited inventory is holding back the market in many areas. “Only new home construction can genuinely help relieve the inventory shortage, and housing starts need to rise at least 50 percent from current levels,” he said. “Most local home builders are small businesses and simply don’t have access to capital on Wall Street. Clearer regulatory rules, applied to construction loans for smaller community banks and credit unions, could bring many small-sized builders back into the market.”U.S. home resales (the largest segment of the housing market) hit a three-year high in February and prices jumped, adding to signs of an acceleration in the housing market recovery.
More good news: Yun projects existing-home sales to rise about 7 percent in 2013 to approximately 5 million sales, which is near the current level of activity and the national median existing-home price is forecast to rise nearly 7 percent this year, while mortgage interest rates should remain historically low, but trend up slowly.
So, the industry experts are saying: 1) Good quality Inventory is moving fast and at 2) higher prices and 3) with mortgage lenders rates rising throughout the year. What does this tell you?
Even as mortgage rates begin to rise, the difference between conforming and jumbo loan rates is shrinking, and that is good news for buyers of higher-priced homes. Conforming loans are largely financed by Fannie Mae and Freddie Mac, and are valued at up to $417,000 – although they can be as high as $625,000 in some of the nation’s pricier markets. Mortgage loans in Denver certainly fall in this category.
Jumbo Loans are anything above that and are funded by banks or private investors. Rates used to be far higher for jumbo loans, but that is changing fast. As reported by the Mortgage Bankers Association, The spread between a jumbo and a conforming mortgage rate was as wide as 0.875 percent last summer. It has now dropped to between 0 and 0.25 percent as of Monday.
The jumbo market has heated up, as tight lending guidelines have drastically reduced consumer late payments, strategic defaults, and foreclosures, this gives investors confidence to buy jumbos again, which means lower rates for consumer borrowers.
The rebirth of jumbo securitization is being driven not just by investor confidence, but by growth in jumbo origination, which increased after the conforming loan limit was lowered. Origination of non-agency jumbo mortgages jumped by over 19 percent in 2012 from 2011, according to Inside Mortgage Finance.
During the housing boom of the last decade Americans withdrew over $1 trillion in home equity. They did it through cash-out refinances, home equity loans, and home equity lines of credit. The latter allowed them to use their homes like an ATM. They spent the money on cars, televisions, vacations and fancy home upgrades. It was seemingly endless equity, until suddenly that equity was gone.
But the Home Equity Line of Credit (HELOC) is back and millions of homeowners are tapping into their equity to put it back to work. Nationally there has been a 31 percent increase in HELOC’s year-over-year.
With home prices up 8 percent year-over-year in December, according to the latest reading from CoreLogic, homeowners are regaining home equity at a fast clip-1.4 million borrowers rose above water on their home mortgages through the end of September. That number likely increased as price appreciation accelerated toward the end of the year.
Unlike the equity grab during the housing boom, this is real equity that borrowers are tapping into. During the housing boom, banks were relaxed in their valuation processes, often times only requiring a statistical valuation or at the most a drive-by-appraisal. But not this time. After getting burned by their second lien positions, banks are making sure that the equity is really there and are using very strict underwriting guidelines. The fact that under these new strict guidelines and appraisal scrutiny more and more HELOCs are being approved is another sign that the housing market has some real strength.
The S&P/Case-Shiller 20-city composite posted that home prices were 5.5% higher than during the same period in the prior year, for the strongest year-over-year growth since August 2006, with increases in 19 of 20 cities.
Housing is clearly recovering, with positive trends for new- and existing-home sales. However, prices remain 30% below a bubble peak in 2006, according to Case-Shiller data. This, coupled with favorable rates from mortgage lenders in Nebraska means that there is still an excellent opportunity to select your next home while home prices still have room to move upward.