Daily Archives: September 20, 2018

Mortgage rates average 4.65% | Katonah Real Estate

MCLEAN, Va., Sept. 20, 2018 (GLOBE NEWSWIRE) — Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing that mortgage rates rose for the fourth consecutive week.

Sam Khater, Freddie Mac’s chief economist, says the 30-year fixed-rate mortgage increased once again to its highest level since May. “Mortgage rates are drifting upward again and represent continued affordability challenges for prospective buyers – especially first-time buyers,” he said. “Borrowing costs are moving right now for three main reasons: the very strong economy, higher U.S. government debt issuances and global trade tensions.”

Added Khater, “Amidst this four-week climb in mortgage rates, the welcoming news is that purchase applications have risen on an annual basis for five consecutive weeks. However, given the widespread damage caused by Hurricane Florence in the Carolinas, the next few months of housing activity will likely be somewhat volatile.”

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 4.65 percent with an average 0.5 point for the week ending September 20, 2018, up from last week when it averaged 4.60 percent. A year ago at this time, the 30-year FRM averaged 3.83 percent. 
  • 15-year FRM this week averaged 4.11 percent with an average 0.5 point, up from last week when it averaged 4.06 percent. A year ago at this time, the 15-year FRM averaged 3.13 percent. 
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.92 percent with an average 0.4 point, up from last week when it averaged 3.93 percent. A year ago at this time, the 5-year ARM averaged 3.17 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

Housing Inventory Tracking | Bedford Hills Real Estate

I love Bill McBride’s Calculated Risk blog

Update: Watching existing home “for sale” inventory is very helpful. As an example, the increase in inventory in late 2005 helped me call the top for housing.

And the decrease in inventory eventually helped me correctly call the bottom for house prices in early 2012, see: The Housing Bottom is Here.

And in 2015, it appeared the inventory build in several markets was ending, and that boosted price increases.

I don’t have a crystal ball, but watching inventory helps understand the housing market.

Inventory, on a national basis, was unchanged year-over-year (YoY) in July, this followed 37 consecutive months with a YoY decline.

The graph below shows the YoY change for non-contingent inventory in Houston, Las Vegas, Sacramento (through August) and also Phoenix (through July) and total existing home inventory as reported by the NAR (through July).

image: https://4.bp.blogspot.com/-q5HBzFd0njM/W5q8p0StEDI/AAAAAAAAwAU/rQCgnKAobAsQ2a5xzlfVUzGANmCIoFzDgCLcBGAs/s320/InventoryPreAug2018.PNG

Click on graph for larger image.

This shows the YoY change in inventory for Houston, Las Vegas, Phoenix, and Sacramento.  The black line is the year-over-year change in inventory as reported by the NAR.

Note that inventory in Sacramento was up 22% year-over-year in July (inventory was still very low), and has increased YoY for eleven consecutive months.

Also note that inventory was up 20% YoY in Las Vegas in August (red), the second consecutive month with a YoY increase.

Houston is a special case, and inventory was up for several years due to lower oil prices, but declined YoY recently as oil prices increased.  Inventory was up slightly in Houston in August (but the YoY change might be distorted by Hurricane Harvey last year).

Inventory is a key for the housing market, and I am watching inventory for the impact of the new tax law and higher mortgage rates on housing.   I expect national inventory will be up YoY at the end of 2018 (but still be low).

This is not comparable to late 2005 when inventory increased sharply signaling the end of the housing bubble, but it does appear that inventory is bottoming nationally (but still very low).

 

Read more at https://www.calculatedriskblog.com/#DgT40fTJtpLyGmFz.99