Talking about new home sales numbers, mortgage delinquencies and foreclosure starts, mortgage rates and much more…
From HUD and the Census Bureau:
New Home Sales
Sales of new single-family houses in February 2017 were at a seasonally adjusted annual rate of 592,000. This is 6.1% above the revised January rate of 558,000 and is 12.8% above the February 2016 estimate of 525,000.
New Home Sales Price
The median sales price of new houses sold in February 2017 was $296,200. The average sales price was $390,400.
New Home For Sale Inventory and Months’ Supply
The seasonally-adjusted estimate of new houses for sale at the end of February was 266,000. This represents a supply of 5.4 months at the current sales rate.
Good and let’s hope this upward trend continue!
Will economic uncertainty resulting from the Trump administration’s policies and proposals derail the housing recovery?
An important question facing the industry, however, is whether the uncertainty related to President Trump’s economic policies – including how much time it will take to pass specific measures such as tax and healthcare reform and, further, whether those proposals are watered down or ultimately fail to pass – will begin to erode the “giddiness” consumers currently have about the economy and, more specifically, housing.
Interesting article and they go on to interview several economists who ALL say…
I can understand that people may feel uneasy since buying a home is a huge financial decision. If it makes sense, it makes sense. If your ready and financially capable, then I would not hesitate to buy a home.
From Black Knight’s First Look at February 2017 Mortgage Data:
- Prepayment speeds (historically a good indicator of refinance activity) declined 15% in February.
- Mortgage delinquencies decreased .98% from January 2017.
- Foreclosure starts fell 18% from last month to 31% below last year’s levels.
- Active U.S. foreclosure inventory is now the lowest level since June 2007
Check out the data:
In the week ending March 18, the advance figure for seasonally adjusted initial claims was 258,000, an increase of 15,000 from the previous week’s revised level. The previous week’s level was revised up by 2,000 from 241,000 to 243,000. The 4-week moving average was 240,000, an increase of 1,000 from the previous week’s revised average. The previous week’s average was revised up by 1,750 from 237,250 to 239,000.
Remain calm and look at where we were and how far we have come:
From Freddie Mac:
- 30-year fixed-rate mortgages averaged 4.23% with an average 0.5 point
- This is down from last week when it averaged 4.30%
- Last year at this time, 30-year fixed-rate mortgages averaged 3.71%
- 15-year fixed-rate mortgages averaged 3.44% with an average 0.5 point
- This is down from last week when it averaged 3.50%
- Last year at this time, the 15-year fixed-rate mortgages averaged 2.96%
Check out the chart:
Sean Becketti, chief economist, Freddie Mac:
The 10-year Treasury yield fell about 10 basis points this week. The 30-year mortgage rate moved with Treasury yields and dropped 7 basis points to 4.23 percent. This marks the greatest week-over-week decline for the 30-year mortgage rate in over two months, a stark contrast from last week’s jump following the FOMC announcement.
Interesting that rates decreased after the recent upward trend. What does the future hold for mortgage rates?
What Are the Experts Saying about Mortgage Rates?
Home loan interest rates have increased during the last couple of months plus predictions are that they can keep on increasing this year. Just what effect could that have on the real estate market? How will this affect home buyers and seller? What about the effect on home prices?
This is what some of the experts think:
In 1984, 1994, 2000, and 2013, every time we have rate increases, we have increases in nominal home prices. We expect this to be more pronounced, as there is a big demand-and-supply gap at the present time.
Scott Anderson, Chief Economist for Bank of the West:
The tightening labor market, rising wage growth, high levels of consumer confidence and a millennial generation with a pent-up demand for housing should allow the housing market to weather the storm of gradually rising interest rates.
Although we strongly believe that the housing supply-demand imbalance for single-family homes will continue to drive above-average home price appreciation, just as falling mortgage rates aided pricing power on the margin in recent months, we expect the opposite effect to become evident in the coming months. As such, we project year-end home price inflation of 4.8% for 2017 and 4.1% for 2018.
Bob Walters, President & COO of retail mortgage lender Quicken Loans:
A modest increase in mortgage rates won’t have much of an effect on home purchases. A buyer may need to slightly re-evaluate which homes they can afford, but it’s not likely to make an impact on qualifying, in most cases.
Our survey data shows that mortgage rates would have to be significantly higher to have any meaningful impact. The house buying power that borrowers have, even with rates below five percent, still remains historically strong.
I agree that a modest increase in mortgage rates will not hurt home buyers too much. But we have to be concerned that something could happen that would cause financial markets and the economy to go nuts.
Something like what happened yesterday in London. Certainly a tragic event but imagine what the effect would have been if this wasn’t a lone wolf attack but a larger attack. London is one of the centers of the world financial markets.
Just like New York…
You remember what happened when the terrorists hit New York?
We never know what the future holds. Bad things happen unexpectedly. And bad things also happen to good people.
You can’t live your life in fear.
You have to take chances and work to have a better life. Maybe a better life for you includes buying a home…
While these experts are not too concerned about rising mortgage rates and home prices, it WILL affect the bottom line for home buyers.
And the home buyer’s monthly payment
And what house that buyers will able to afford.
Waiting is only going to cost buyers more money.
My suggestion is that any serious home buyer not take a chance. With limited inventory, rising home prices and mortgage rates, waiting will prove to be a costly decision.