Sunday, September 14, 2014

Low Mortgage Rates Are Lingering

The average percentage rates for fixed-rate mortgages inched up slightly this week, but continue to hover near yearly lows.
Freddie Mac reports the following national averages with mortgage rates for the week ending Sept. 11:
  • 30-year fixed-rate mortgages: averaged 4.12 percent, with an average 0.5 point, up slightly from last week’s 4.10 percent average. Last year at this time, 30-year fixed-rate mortgages averaged 4.57 percent.
  • 15-year fixed-rate mortgages: averaged 3.26 percent, with an average 0.5, rising from last week’s 3.24 percent average. A year ago, 15-year fixed-rate mortgages averaged 3.59 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.99 percent, with an average 0.5 point, rising from last week’s 2.97 percent average. Last year at this time, 5-year ARMs averaged 3.22 percent.
  • 1-year ARMs: averaged 2.45 percent, with an average 0.4 point, rising from last week’s 2.40 percent average. A year ago, 1-year ARMs averaged 2.67 percent.
Source: Freddie Mac

Wednesday, September 10, 2014

Over half of Fla.’s June sales were all-cash

Over half of Florida's June property sales (50.9 percent) were all-cash transactions, according to CoreLogic, an Irvine, California-based financial data company. Second-place Alabama had 48 percent all-cash sales.
In a comparison of large U.S. cities, Cape Coral-Fort Myers led the nation in all-cash sales at 61.2 percent, and four other Sunshine State cities followed it: West Palm Beach-Boca Raton-Delray Beach (60.6 percent), North Port-Sarasota-Bradenton (59.8 percent), Miami-Miami Beach-Kendall (58.7 percent) and Fort Lauderdale-Pompano Beach-Deerfield Beach (58.5 percent).
Other states rounding out the top spots for all cash sales are New York (44.6 percent), Kentucky (40.1 percent) and Nevada (40 percent).
Nationally, however, all-cash sales made up 33 percent of all transactions – the lowest percentage since September 2008, according to CoreLogic. The share of all-cash sales has fallen year-to-year since January 2013.
Before the housing meltdown, cash sales historically made up about 25 percent of all transactions. They reached their peak (46.2 percent) in January 2011.
The Washington, D.C. area had the lowest cash sales nationally at 15.6 percent.
Source: Florida Realtors®

Low Mortgage Rates Aren’t Budging Loan Demand

Mortgage rates continue to hover near yearly lows, but the low rates aren’t creating a rush from home buyers or home owners. The Mortgage Bankers Association reports that its seasonally adjusted index of mortgage application activity, which reflects applications for home purchases and refinances, dropped 7.2 percent for the week ending Sept. 5.
Broken out, applications for refinancings had the biggest fall at 10.7 percent last week while applications for home purchases, viewed as one of the leading indicators of future home sales, dropped 2.6 percent. (That follows another 1.5 percent drop the prior week in purchase applications.)
Mortgage rates did tick up slightly last week, but remain low by historical standards. The 30-year fixed-rate mortgage averaged 4.27 percent in the week, up from 4.25 percent the week prior. It was the first time in four weeks that interest rates had risen slightly, the MBA reports.
The MBA’s report covers more than 75 percent of the U.S. retail residential mortgage application market.
Source: “U.S. Mortgage Applications Fall in Latest Week: MBA,” Reuters (Sept. 10, 2014)

Mortgage Giant Opens Door for Earlier Return of Ex-Home Owners

Former distressed borrowers may be able to jump back into home ownership sooner than they expected. Fannie Mae officials say the organization is overhauling its policy to change the minimum waiting period following a pre-foreclosure sale or deed-in-lieu of foreclosure, taking the standard wait-out period from seven years to four years or perhaps even shorter.
To be eligible for a new mortgage loan, Fannie requires formerly distressed borrowers to show they’ve reestablished their credit after a foreclosure, bankruptcy, preforeclosure sale, or deed-in-lieu. The standard waiting period was two years with a maximum 80 percent loan-to-value ratio and four years with a maximum 90% LTV. Standard eligibility, however, is seven years. In some cases, such as extenuating circumstances where borrowers had a prolonged reduction in income that was beyond their control, they may only have to wait two years with a maximum 90% LTV to get a new mortgage again.
Under the new policy, Fannie has removed the LTV requirements. All loans with application dates on or after Aug. 16 now will have a standard waiting period of four years, and only two years under extenuating circumstances.
For example, a borrower who had a preforeclosure sale five years ago — not due to extenuating circumstances — would be eligible for a new loan with as low as a 5 percent down payment (they would not have been eligible prior to the change in the policy unless they at least had a 10 percent down payment). Also, a borrower with a deed-in-lieu two years ago that was due to extenuating circumstances would also be eligible for a new mortgage backed by Fannie with as low as a 5 percent down payment, in which they would not have been otherwise and would have needed at least a 10 percent down payment.
Other programs, such as the FHA's Back to Work program, are also available to formerly distressed borrowers and are curtailing the wait times even more, to as little as 12 months following a foreclosure or short sale.
Source: “Fannie Mae Widens Credit Box for Failed Home Owners,” HousingWire (Sept. 9, 2014)

Saturday, September 6, 2014

Mortgage Rates Stay Near Yearly Lows

For the third consecutive week, the 30-year fixed-rate mortgage held steady, with borrowing costs for home buyers and refinancers remaining near its lows for the year.
Freddie Mac reports the following national averages with mortgage rates for the week ending Sept. 4:
  • 30-year fixed-rate mortgages: averaged 4.10 percent, with an average 0.5 point, holding the same as last week. Last year at this time, 30-year rates averaged 4.57 percent.
  • 15-year fixed-rate mortgages: averaged 3.24 percent, with an average 0.5 point, dropping from last week's 3.25 percent average. A year ago, 15-year rates averaged 3.59 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.97 percent, with an average 0.5 point, holding the same average from last week. Last year at this time, 5-year ARMs averaged 3.28 percent.
  • 1-year ARMs: averaged 2.40 percent, with an average 0.4 point, rising from last week's 2.39 percent average. A year ago, 1-year ARMs averaged 2.71 percent.
Source: Freddie Mac

The Next Big Niche Market?

Americans 55 years old and older are increasingly expected to begin trading residences as they near retirement, and that has many housing analysts and homebuilders predicting a surge in active-adult homes and communities that appeal to seniors.
Homebuilders PulteGroup, Lennar, and Toll Brothers are reporting higher sales in this segment. Builders also are trying to lure this age group with multigenerational amenities, such as a separate private entrance, bedroom, bathroom, and eat-in kitchen attached to a traditional home.
"Consistent with the overall housing market, we have seen sustained improvement in demand for our active-adult homes for the past two-plus years," says PulteGroup spokesman James Zeumer. PulteGroup builds the Del Webb brand of active-adult communities. Its active-adult sales rose from about 4,100 homes in 2011 to 5,300 in 2013. Also, sign-ups for new orders in the second quarter were up 11 percent over a year earlier, Zeumer says.
The National Association of Home Builders' 55+ Housing Market Index also reflects greater optimism in the 55-plus housing market. This year, the index reached its highest second-quarter reading since it began in 2008, and it posted its 11th consecutive quarter of year-over-year gains.
"One of the factors contributing to the positive signs in the 55+ housing market is the slow but steady increase in existing-home sales in the last three months," says NAHB Chief Economist David Crowe. "The 55+ market is strongly driven by consumers being able to sell their existing homes at a favorable price in order to buy or rent in a 55+ community."
Total existing-home sales rose 2.4 percent in July, reaching the highest pace of the year but still remaining 4.3 percent below last July, which marked the peak for 2013.
"Existing-home sales are continuing to move up," says Stephen Melman, NAHB's director of economic services. "But the one caveat is the first-time home buyers' share [of those sales] was less than 29 percent. Typically, that would be 40 percent. So existing-home sales are increasing, but the first-time buyer isn't in there full tilt. So it may be the 55-plus [group] buying homes that meet their demand."
Source: “Homebuyers Age 55+ Make Move as House Values Rise,” Investor’s Business Daily (Aug. 28, 2014)

Wednesday, September 3, 2014

Falling Rates Spur Loan Demand in Latest Week

Mortgage applications were on the rise last week as the 30-year fixed-rate mortgage sank to its lowest level of the year, the Mortgage Bankers Association reports Wednesday.
Applications for home purchases and refinancings rose 0.2 percent in the week ending Aug. 29, according to the MBA’s seasonally adjusted index of mortgage application activity. Broken out, refinancing applications increased 1.4 percent, while applications for home purchases, viewed as a leading indicator of future home sales, dropped 1.5 percent during the week.
The 30-year fixed-rate mortgage averaged 4.25 percent in the week, the lowest level since June 2013, the MBA reports.
Source: “U.S. Mortgage Applications Rise in Latest Week: MBA,” Reuters (Sept. 3, 2014)