29
Nov
By support
Home Values

Case-Shiller: Home Prices Grow at Fastest Rate Since June 2014

Home prices continued to rise in September according to Case-Shiller National and 20-City home price index reports. According to the National Home Price Index, national home prices rose 0.70 percent month for the three months ending in September. The National Index regained its pre-housing bubble peak and surpassed it by 5.90 percent as of September.

The 20-City Home Price Index rose 0.50 percent from August’s reading. Analysts forecast a growth rate of 0.40 percent month-to-month. The 20-City Home Price Index indicates a home price growth rate 0f 6.20 percent year-over-year. The 20-City Index remained 1.50 percent below its peak in 2006.

The 20-City Home Price Index showed 16 of 20 cities posted gains in home price growth. Seattle, Washington, which has consistently held the top spot for year-over-year home price growth, posted slower growth for September. Seattle held on to its lead for year-over-year home price growth with a reading of 12.90 percent. Las Vegas Nevada held second place in the 20-City Index with a year-over-year home price growth of 9.00 percent. San Diego, California held third place with a year-over-year reading of 8.20 percent appreciation in home prices.

Case–Shiller Home Prices: Not the Whole Story

Analysts caution that while Case-Shiller Home Price Index reports are intended as a tool for real estate investors, they may not reflect all factors impacting U.S. housing markets. An analysis published in May by Trulia indicated that only 38 percent of U.S, homes have recovered their post-recession values. Some analysts say that methodology used for calculating the Case-Shiller home price index readings does not reflect individual or local factors impacting home prices.

In an unrelated report, the Federal Housing Finance Agency reported that home prices for properties with mortgages sold to or guaranteed by Fannie Mae and Freddie Mac were up 6.50 percent from the third quarter of 2016 to the third quarter of 2017.

FHFA reported that the District of Columbia and all 50 states posted higher home price gains for the period between Q3 2016 and Q3 2017. The top three year-over-year home price gains were held by Washington, D.C at 11.60 percent; the state of Washington held second place with a gain of 11.50 percent and Hawaii and Arizona tied for third place with year-over-year home price gains of 10.00 percent.

FHFA reported home price growth in all 100 areas it tracks and said that the Seattle, Washington region held the highest year-over-year growth rate of 14.60 percent.

28
Nov
By support
Home Mortgage Tips

Graduating With Student Loan Debt and Worried About Your Mortgage Prospects? You’re Not Alone

Graduating With Student Loan Debt and Worried About Your Mortgage Prospects? You're Not AloneDid you recently graduate from college or university? If so, you may still be dealing with a financial hangover in the form of student loan debt. The vast majority of today’s students have to borrow to invest in their education, which can affect financial plans once school is finished. In today’s post, we will explore buying a home with a mortgage when still dealing with outstanding student loan debt.

Your Situation Is Common, But Unique To You

First, try to keep in mind that you are not alone. Many former students are moving on with life, working hard to build a career and a life while juggling past student loans. However, your situation is unique, and thus, you need to plan it that way. For example, are you single or married? Are you in a stable career or are you potentially shifting jobs? Do you have children or are you planning to in the near future? Your financial needs are unique and need to be prepared and budgeted accordingly.

Understand Your DTI Ratio

Have you heard of the debt-to-income or ‘DTI’ ratio? When you take out a mortgage to buy a home, this ratio is one factor in determining how much you can borrow. In essence, it is a ratio of your monthly debt payments versus your monthly income. As you are paying off student loan debt, that will increase your DTI ratio. Adding a mortgage, car or other monthly payments on here will as well. You will want to ensure that you maintain a healthy debt-to-income ratio or it can be challenging to stay solvent.

Balancing Your Mortgage With Your Other Loans

You may have heard this saying: “life happens.” It is rare that anyone can spend years with everything going according to plan. If you run into a temporary health or job-related issue, you may need to do some juggling to keep your mortgage and other payments fully managed. For this reason, it is worth trying to save at least a few months of your monthly expenses in a ‘rainy day’ fund. Just in case of an emergency.

Challenging, But Not Impossible

Balancing a monthly mortgage payment with student loan repayment can be challenging, but it’s not impossible. If you would like to learn more about mortgage products that are perfect for recent graduates, contact us today. Our professional team is happy to share how we have helped others with student loans realize their dream of homeownership.

27
Nov
By support
Mortgage Rates

What’s Ahead For Mortgage Rates This Week – November 27, 2017

Last week’s economic reports included readings on pre-owned home sales, weekly reports on mortgage rates and new jobless claims and consumer sentiment. The weekly news cycle was shorter due to the Thanksgiving holidays on Thursday and Friday.

Sales of Previously–Owned Homes Jump in October

Sales of previously owned homes grew by 1.20 percent in October as compared to September’s reading of 0.10 percent growth month-to-month and indicated a seasonally adjusted annual rate of 5.48 million sales. October home sales increased as inventories of available homes declined. There was a 3.90 months supply of homes in October as compared to a 4.40 months supply of available homes in September. Real estate pros typically consider a six-month supply of homes a healthy balance between homes available and potential home buyers.

Analysts said that October’s inventory of homes for sale was the second lowest on record from 1999 to present. The National Association of Realtors®, which produces the Existing Home Sales report, said that sales to date were 4.60 percent higher year-to-date.

All regions tracked by the National Association of Realtors® reported increased sales of previously owned homes. The Northeast posted a 4.20 percent gain; the Midwest posted a gain of 0.80 percent and the South posted a gain of 1.90 percent. The West posted the highest gain in pre-owned home sales with 2.40 percent growth rate.

Analysts expect sales of pre-owned homes to rise by 3.70 percent in 2018; proposed revisions to tax laws could sideline home buyers if homeownership is “dis-incentivized” by tax reforms.

Mortgage Rates Mixed, New Jobless Claims Lower

Freddie Mac reported mixed results for average mortgage rates. The rate for 30-year fixed rate mortgages fell three basis points to 3.92 percent. Average rates for 15-year fixed rate mortgages and 5/1 adjustable rate mortgages each rose by one basis point to 3.32 percent and 3.22 percent respectively. Discount points averaged 0.50 percent for 30-year fixed rate mortgages and 0.40 percent for 15-year fixed rate mortgages and 5/1 adjustable rate mortgages.

New jobless claims were lower last week with 239,000 new claims filed. Analysts expected 240.000 new claims as compared to the prior week’s reading of 252,000 new claims.

The University of Michigan’s Consumer Sentiment Index fell from an index reading of 100.7 in October to 98.5 in November.  This was the second highest reading in thirteen years. Consumer sentiment remains high despite headwinds including potential tax reform.

What‘s Ahead

This week’s scheduled economic readings include reports on new and pending home sales, Case-Shiller Home Price Indices and inflation will be released. Weekly readings on mortgage rates and new jobless claims will also be released.