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The Housing Market Continues to Break Records

The U.S. Census Bureau and the U.S. Department of Housing and Urban Development recently released their new residential construction data.  It showed that Housing Starts, or the breaking of ground to build a home, increased by 1.9% in September and is up 11% year over year.  When digging deeper, we see that single-family “starts” were actually up 8.5% for the month and up 22% since last September.  Permits to build were up 5.2% for the month and up 8.1% compared to last year.  Again, taking a more granular look, single-family “permits” were up 8.0% for the month and 24% year over year.  For the real blockbuster number, orders for new homes, which are homes that were sold but not built yet are now up 69% since last year!  This certainly emphasized how strong home buying demand really is.

Another strong indicator in the housing market comes from the recent Existing Home Sales report which is released by the National Association of Realtors.  September’s report showed that existing home sales increased by 9.4% and are up almost 21% year over year.  The Northeast saw the highest increase in sales out of the four US Census regions of the US. Median home pricing on existing homes was $311,800 which is a 15% gain from last year.  Housing inventory shrunk to 1.47 million units, which is a 2.7-month supply, a record low at our current sales pace.  Lastly, 71% of homes that were sold in September were on the market for less than one month.

It is evident that the housing market is continuing to break records and is still extremely sought out by consumers.  Whether it be first-time home buyers, folks leaving urban communities or buyers who want to take advantage of future gains in appreciation, there is a true imbalance of demand versus supply which will continue to support home prices.

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources:

http://bit.ly/37qTud7

https://bit.ly/34kfRls


Conventional Loans with ONLY 3% Down

As an alternative to Federal Housing Authority’s (FHA) 3.5% down payment minimum requirement program, Fannie Mae and Freddie Mac have their own low down payment loan products requiring only a 3% down payment.  Fannie Mae’s 3% down program is called Home Ready, and Freddie Mac’s version is Home Possible.  These programs are great for first time home buyers, as well as anyone looking to purchase a home with as little as 3% down.  You do not, however, need to be a first time homebuyer to utilize these programs.  In addition, both programs allow for the possibility to refinance current mortgages with as little as 3% equity in the property.  Adding to the flexibility of minimal down payment, these products also both offer lower mortgage insurance requirements versus standard conventional products. 

To learn more about these products and the advantages they offer, please reach out to your Advisors Mortgage Group Loan Officer today!

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources:

https://bit.ly/3lR36om

https://bit.ly/3nWD8BJ


Inflation and How It Can Affect You.

According to Forbes.com, inflation occurs when prices rise, which ultimately decreases the purchasing power of your dollars.  For example, during an inflationary period, your dollar could buy you two apples today, but only one apple tomorrow. 

There are currently many ways that inflation can spike, but one that stands out more than others at the moment is the supply chain constraints due to the Covid-19 pandemic.  Some suppliers are shut down, and some are working with skeleton crews.  Because of this, inventory levels are very low and tight. Now, as demand starts to increase as the economy starts to make a comeback and reopen, this can pressure pricing and cause items and services to increase in price across the board hence causing inflation. 

The Federal Reserve analyzes inflation consistently by way of the PCE or the Personal Consumption Expenditures Price Index.  They actually focus in on the “core” components which measures prices of goods and services while stripping out the volatile pricing of food and energy.  The “core” PCE report for August was released at 1.6, which means the index is 1.6% higher than where it was in August of 2019.  This number came in higher than its last report in July which was at 1.4.  It has actually been rising since April where it was at 0.9. 

We need to keep an eye on this because inflation is the arch enemy of bonds.  As inflation increases, bonds react negatively and sell off.  As bond prices drop, long term interest rates increase.  Staying in touch with the markets and keeping an eye on inflation is always important and even more important right now.  Contact your Advisors Mortgage Specialist to help you learn more about this and how this may be the best time to obtain a low interest rate before inflation heats up. 

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources:

Forbes.com

https://bit.ly/36JOMtB


Strong Housing Market Shows No Signs of Slowing Down in the Fall!

Typically, realtors can count on the Spring and Summer months to be their busiest months of the year.  However, that isn’t the case this year with the robust summer and spring month’s home sales having now carried over into the fall season. According to the National Association of Realtors (NAR), steadily over the last four weeks, ending on September 20th, contract signings are up 23% year over year. NAR went on to report that the average time it took for a home to sell in August was only 22 days, matching the fastest time on record. Also, regionally, sales in the Northeast were by far the strongest, rising 13.8% month-to-month in August.

Overall, all signs continue to point to record-breaking months continuing throughout the fall season, with no slowing down anticipated. Mortgage rates have either hit or stayed at record lows in August, allowing for homebuyers to achieve additional purchasing power while driving up demand.  

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources: 

https://bit.ly/2Sp5t4U

https://cnb.cx/2SkB4EX


Real Estate a Continued Bright Spot

Last week the National Association of Realtors (NAR) released their Existing Home Sales Report for the month of August.  It showed that sales of existing, single family homes, townhomes, co-ops, and condominiums increased by 2.4%.  For the year, Existing Home Sales rose by 10.5% across the nation.  This demand in existing homes marks the highest level since 2006. 

NAR Chief Economist Lawrence Yun said, “Home sales continue to amaze, and there are plenty of buyers in the pipeline ready to enter the market.” He also said, “Further gains in sales are likely for the remainder of the year, with mortgage rates hovering around 3% and with continued job recovery.” 

The median price on existing homes increased 11.4% from last year from $278,800 to $310,000.  These positive numbers are occurring with housing inventories almost 20% lower than where they were last year.   Properties remained on the market for only 22 days, which is down from 31 days in August of last year.  Almost 70% of homes that were sold in August were on the market for less than one month.  First time purchasers made up a large portion of this hot demand totaling one third of the total buying. 

Real estate continues to be a bright spot in the economy, and it appears that it is not slowing down.

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources: https://bit.ly/3iWuGiU


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