Mortgage interest rates are down again, while mortgage applications are increasing. And now, banks are loosening their requirements for a mortgage. With foreclosures and delinquent payments down banks are feeling better about giving out mortgages. Applications for new mortgages are up 11.5% this year to a 3 year high. Part of this is because investors keep buying 10 year U.S. Treasuries which pushes mortgage rates lower. There are still problems with mortgage lending. There are too many people with solid credit getting turned down for loans due to various factors. But with 30 year rates at under 3.5% and 15 year rates at 2.8% and prices not yet recovered, the cost of homeownership is so cheap it’s still a great time to be buying.
Home prices continue to climb as this article from Reuters explains;
Single-family home prices rose more than expected in February, posting their best annual rise since May 2006 in a fresh sign the housing recovery remains on track, a closely watched survey showed on Tuesday.
The S&P/Case Shiller composite index of 20 metropolitan areas gained 1.2 percent on a seasonally adjusted basis compared to January, topping forecasts for 0.9 percent.
“Despite some recent mixed economic reports for March, housing continues to be one of the brighter spots in the economy,” David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.
Prices in the 20 cities gained 9.3 percent year-over-year, also beating expectations for 9 percent and the biggest increase since May 2006.
On a non-adjusted basis, prices rose 0.3 percent.
Adjusted prices have been rising since last February, the first year of gains since before the housing market’s collapse. The sector started to turn the corner in 2012, helped by tighter inventories and improved sales.
Higher prices are here and they’re moving higher. Better not wait to buy!
Things are moving fast in real estate these days. And the new factors are changing the way homes are being marketed and sold. For instance, the available inventory is really drying up. One of the reasons is that big investment firms are buying up single family homes and renting them out. This has been done for years but it has really accelerated recently. When will that slow down? Not until rental vacancy rates start climbing. This could happen fairly soon (like in the next two to three years) because there has also been an explosion in apartment construction. As the economy improves more of those renters will become owners. But for the near time this demand for rentals will continue to push prices up.
Prices are also continuing to climb because houses are still so cheap. Today’s house prices are incredibly low compared to income and the money needed to borrow is incredibly cheap as well. The problem for most buyers recently has been an inability to get a loan but banks are loosening their restrictions and more people are able to get loans. Again, this is not going to change anytime soon.
So here’s your near future housing market. Very, very little inventory to choose from. Many buyers chasing fewer homes. Prices increasing. This is the time you need to be talking to your trusted real estate adviser to find out what your best move is to take advantage of this market.
Bank of America has come out with a revised edition of their forecast for real estate this year. In a report titled ‘Someone Say House Party?’ the BofA economists now predict home prices to increase 8% this year even after prices increased over 7% last year. Several factors are causing this. Lending standards are easing. Pent up demand is finally hitting the market as more households (that were renting) are formed. Another factor is psychology. So many people hold back when prices are down because ‘no one is buying’. (hint, that’s a great time to buy). But once these same buyers see prices increase and interest rates tick up they tend to feel pressure to move into the market. You haven’t missed the boat yet. Prices and rates are still super low. But you’re running out of time. Give us a call today.
Here at the HomesInAtlanta blog we follow Metrostudy closely. They have some of the best and most up to date analysis available for the real estate market. Now they’ve come out with a new prediction. They’re expecting new home prices to increase almost 10% this year and another 6% in 2014. We’ve been seeing prices inch up and expect more but Metrostudy is predicting a more robust market than most. We tend to agree. When the market falls prices tend to trail and so lower prices take a while to work into the market. It’s the same with an increasing market. People tend to price their homes a little low in this type of market and it takes a while to see the increases. Well we’re seeing them now. The lack of supply available for sale has really pushed up the prices of prime lots and builders will pass along that increase to the buyers. Tell us you’re not still sitting on the fence….waiting on that bottom. Because, brother, it has come and gone. And while interest rates tracked down this week, don’t expect that to continue. You need to be moving quickly and have a good strategy and a good agent. Call us today to get the advice you need.
It’s happening. We’ve been predicting that once some things changed in the market first time buyers would increase. Now we’re seeing the double-whammy. Mortgage rates have started inching up and sales are up at the same time. So buyers that have been on the sidelines are now getting antsy and are pushing their way in. Increased demand is now pushing prices higher. So many buyers are jumping in before the higher prices and rates get worse. Mix that with the fact that FHA loan fees are going higher and there’s no reason to wait. In February first time home buyers were more than a third of the total market. It’s the third straight month they’ve increased. And the Spring/Summer season will only bring more.
So what does this mean for you? Two things. As a first time home buyer you DO NOT NEED TO WAIT. It’s only going to get worse. Second, make sure you have an agent that is familiar with low down payment loans. You don’t have to go FHA (did you know Wells Fargo has a 2% down, no PMI loan ?) and FHA can be and is getting more expensive. Don’t delay. You need to be formulating your strategy now! Call us today and we can help.
According to the NAtional Association of Realtors, existing home sales in February were at their highest level in 3 years. We’ve been watching (and participating in) this new hot market for some time in Atlanta. Nearly five million homes were sold which is a ten percent increase just over the previous month. Home sale haven’t been this high since November 2009. Strap in. It’s looking like a wild ride. If you been thinking of selling but have been putting it off maybe it’s time you gave us a call.
According to the latest report by Zillow.com available homes for sale in Atlanta were down 32% today versus 1 year ago. (inventor was down 16% nationwide. The reasons? There are several. Number one is that many people are not in a position to sell. They may still have negative equity or the may have missed a payment or two during the recession and now they’re afraid they won’t qualify for a new mortgage. Also, foreclosures are drying up and investors have stepped into the market, increasing demand. Home prices are moving up now as a result. If you’ve thought about selling but weren’t sure fell free to give us a call and we can give you a free, no obligation Comparative Market Analysis to see how much your home is worth.
We’ve been watching real estate in Atlanta turn around over the past year. Less inventory, more buyers and an improving employment situation are all changing the market. Now today we have a new report from Metrostudy that predicts home prices in Atlanta will increase as much as 10% in 2013. It’s a great article and has more details if you want to read it but the story here is Atlanta is back and if you were waiting for the bottom it’s easy to see. The bottom happened a year ago.
Now we’re seeing the same dynamics working on new home sales that we’ve been seeing on existing homes. Sales were down from projections slightly due to a lack of inventory but prices are up 8.8% year over year and the median sales price is up 13.9%. The median price increase reflects higher income buyers now moving into the market which means a smaller percent are first time buyers. And while sales numbers were down in December last months numbers were adjusted up so the sales are a wash. For all of 2012 we sold 20% more homes and the most new homes since 2009! Waiting for the bottom? You missed it! It’s already come and gone.