New
home sales, which although may have slipped slightly in August by .3%, is still
headed in the right direction. Many
experts believe the reason for the drop is because house prices jumped more
than expected. The median home price for
August sales increased 11.2% to $256,900.
This is an increase of 17% from the prior year. In addition to the home price increase weighing
down sales slightly, the other factor, which only a few analysts mentioned, is
that historically in August sales do slow down.
Further
bolstering the belief that housing is on the mend, home prices continued to
trend higher in July. The S&P Case-Shiller
data show that home prices increased in all 20 major cities they follow. The adjusted increase was .4%. This is the sixth straight monthly increase
for the adjusted index though it is the slowest gain since February.
Backing up the S&P report is the FHFA house price index which posted another advance of values of 0.2 percent in July after rising 0.6 percent in June. Although the pace of rising values has slowed, it remains positive and the year on year index is up by 3.7 percent. Today's report indicates that the housing sector is on a modest uptrend. The FHFA index has risen for six consecutive months.
Mortgage rates have once again hit new record lows. This is a direct result of the government’s latest stimulus program to keep the cost of borrowing down. Applications for mortgages increased for both refinances and purchases. The increases are 3.0% for refinance and 1% for purchases. This reverses the recent trend of a slight slowdown in applications.
Backing up the S&P report is the FHFA house price index which posted another advance of values of 0.2 percent in July after rising 0.6 percent in June. Although the pace of rising values has slowed, it remains positive and the year on year index is up by 3.7 percent. Today's report indicates that the housing sector is on a modest uptrend. The FHFA index has risen for six consecutive months.
Mortgage rates have once again hit new record lows. This is a direct result of the government’s latest stimulus program to keep the cost of borrowing down. Applications for mortgages increased for both refinances and purchases. The increases are 3.0% for refinance and 1% for purchases. This reverses the recent trend of a slight slowdown in applications.
In
speaking with real estate professionals around the country I have been hearing
that there has been a significant increase in buyer activity. Prior to this week, agents had been reporting
less activity in their offices. The late
summer slowdown is common due to people being on vacation in some parts of the
country and kids returning to school in other regions. The good news is that the buyers are back!!!
One
of the challenges facing homebuyers at this time is a lack of inventory. In many neighborhoods there seems to be a
lack of quality properties for sale. The
question that keeps coming up is “where
are all the bank foreclosures?”
It
appears that the combination of banks being more cautious in the foreclosure
process as well as holding onto the properties in order to increase their
value, is creating a shortage of properties available for purchase. The banks are slowly releasing foreclosures
into the market to avoid flooding the market resulting in a decline in home
prices. The more the banks can keep the
prices higher, the better it looks on their balance sheet for regulators.
Next week’s economic reports are:
- Monday October 1st -
ISM Manufacturing Index
- Wednesday October 3rd – MBA Applications and ADP Employment
Report
- Thursday October 4th –
First Time Jobless Claims and FOMC Minutes
- Friday October 5th –
National Unemployment Report
Sincerely,
Cindy Tomlinson
Loan Officer
Loan Officer
USLending
Company
DRE
Lic # 01520422
NMLS # 214851
NMLS # 214851
PS…
FOLLOW ME
on Facebook for the latest Mortgage updates
No comments:
Post a Comment