Real estate housing and economic news round up for March 31 2012…
Well it is Saturday so that means it is time to check in on the average mortgage rates reported by Freddie Mac and the Mortgage Bankers Association.
Freddie Mac reported:
- 30-year fixed-rate mortgages averaged 3.99% with an average 0.7 point
- This is down from last week when it averaged 4.08%
- Last year at this time, the 30-year fixed rate mortgage averaged 4.86%
- 15-year fixed rate mortgage this week averaged 3.23% with an average 0.8 point
- This is down from last week when it averaged 3.30%
- A year ago at this time, the 15-year fixed rate mortgage averaged 4.09%
The Mortgage Bankers Association reported:
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 4.23%, the highest rate since November 2011, from 4.19%, with points decreasing to 0.45 from 0.47 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 4.54%, the highest since rate December 2011, from 4.49%, with points increasing to 0.46 from 0.38 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.96% from 3.93%, with points increasing to 0.52 from 0.48 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.50%, the highest rate since December 2011, from 3.47%, with points increasing to 0.42 from 0.40 (including the origination fee) for 80 percent LTV loans.
The Take Away:
Yes, the average mortgage rates did go up. But as always, this is just the average rates and you may be able to get a better rate or you may have to pay more than the average. The only way to find out exactly what is possible for you is by talking to a lender!
This information is provided to you for informational purposes only! We are not a mortgage lender and you should contact the lender of your choice directly to learn more about its mortgage products and your eligibility for such products.
Choosing the Road to Prosperity
The Federal Reserve Bank of Dallas has just released a report that talks about why we must end the reign of the TBTF banks:
As a nation, we face a distinct choice. We can perpetuate too big to fail, with its inequities and dangers, or we can end it. Eliminating TBTF won’t be easy, but the vitality of our capitalist system and the long-term prosperity it produces hang in the balance.
While it sounds great, what will happen to mortgage lending? Would this force more competition that would benefit consumers? Would this actually encourage free market capitalism instead of the current system of crony capitalism that we are suffering under today?
Improvements for the Real Estate Through 2014
For all the negative people out there, you just might want to scroll past this. The Urban Land Institute just released a survey of 38 leading real estate economists and analysts that is projecting broad improvements for the nation’s economy and housing market through 2014.
- Housing starts will nearly double by 2014
- Home prices will begin to rise in 2013, with prices increasing by 3.5% in 2014
- Rents are expected to increase for all property types
- GDP is expected to rise steadily from 2.5% in 2012 to 3% in 2013 to 3.2% by 2014
- Unemployment is expected to fall to 8.0% in 2012
- The improving economy may lead to higher inflation and interest rates
- The national average home price is expected to stop declining in 2012
- The national average home price is expected to rise by 2% in 2013
- The national average home price is expected to rise by 3.5% in 2014
Sounds great but they point out that there are many risk factors that could throw a monkey wrench into any recovery for real estate and the economy. Such as the upcoming election…
ULI Chief Executive Officer Patrick L. Phillips:
While geopolitical and global economic events could change the forecast going forward, what we see in this survey is confidence that the U.S. real estate economy has weathered the brunt of the recent financial storm and is poised for significant improvement over the next three years. These results hold much promise for the real estate industry.
Don’t get too excited yet. We are not out of the woods but it seems that we are starting to see more and more predictions of recovery. And remember that when talking about real estate, you must always think about the long term. If the housing bubble should have taught people anything it is that real estate is NOT a get rich quick scheme and that house prices can go down.
Freddie Mac March 2012 US Economic and Housing Market Outlook
Earlier this week Freddie Mac released their latest Economic and Housing Market Outlook. Let’s look at some of the highlights:
- Median Home prices moved up 0.3% on a year-over-year basis
- Freddie is predicting that unemployment will go below 8.3% in 2012
- Freddie says that 30-year fixed rate mortgages will increase in 2012 to about 4.5%
- Freddie is predicting more home sales in 2012
I wonder if all the predictions by Freddie Mac will come true? Only time will tell…