Friday, February 19, 2010

Buyers, Look at these Mortgage Rates!!

Amid stabilization within the housing market, Freddie Mac reported Thursday that mortgage rates continued to inch down this week, hovering near record lows.

“Mortgage rates eased for the second week, while economic data releases suggest that the housing market may be in a slow state of recovery,” said Frank Nothaft, Freddie Mac VP and chief economist.
For the week ending February 18, 2010, the average rate for 30-year fixed mortgages dropped to 4.93 percent with an average 0.7 point, Freddie Mac’s Primary Mortgage Market Survey (PMMS) found. This week’s average marked a 0.04 percent decline from last week and a year-over-year reduction of 0.11 percent.

In addition, Freddie Mac reported a dip in the average rate for 15-year fixed mortgages. Coming in at 4.33 percent with an average 0.6 point, rates for 15-year fixed mortgages fell 0.01 percent from week-to-week and decreased 0.35 percent from the same week in 2009.

According to the PMMS, adjustable-rate mortgages (ARMs) also followed the overall trend of declining rates. The 5-year Treasury-indexed ARM averaged 4.12 percent with an average 0.5 point this week, down 0.07 percent from last week and 0.92 percent year-over-year. The 1-year Treasury-indexed ARM averaged 4.23 percent with an average 0.6 point, marking a 0.1 percent drop from week-to-week and a 0.57 percent decline from last year at this time.

Article by Brittany Dunn/

Wednesday, February 3, 2010

Sales Stablize in December

Following a market swing driven by response to the homebuyer tax credit, pending home sales in December have leveled off, according to a report Tuesday by the National Association of Realtors (NAR).

In November, the Pending Home Sales Index (PHSI), a forward-looking indicator based on contracts signed during the month, fell to 95.6, a 16.4 percent decrease from surging activity in preceding months due to the anticipated expiration of the homebuyer tax credit. Following the extension and expansion of the credit, though, the PHSI in December jumped 1 percent to 96.6 and remained 10.9 percent above December 2008 when it was 87.1.

December’s PHSI varied from region to region. Compared to November, the PHSI in the Northeast jumped 2.3
percent to 76.1 and was 14.9 percent higher than December 2008. The Midwest’s index of 86.9 was 5.2 percent higher than November and 8.7 percent above a year earlier.

In the South, pending home sales in December rose 2.2 percent from November to an index of 98.4, a 5.5 percent surge year-over-year. However, the index in the West fell 3.8 percent in December to 119.9 but was still 18.6 percent higher than the index one year earlier.

Lawrence Yun, NAR chief economist, said it is important to recognize how the tax credit is skewing market data.

“There are easily understood swings in contract activity as buyers respond to a tax credit that was expiring and was then extended and expanded,” he explained. “These swings are masking the underlying trend, which is a broad improvement over year-ago levels. December activity was the fifth highest monthly tally in two years.”

Yun projects 2.4 million households will take advantage of the extended and expanded tax credit. While new-home sales will remain low due to a lack of construction, Yun expects existing-home sales to rise to around 5.6 million this year, up from 5.16 million in 2009. He said one of the greatest benefits of rising sales will be firming home prices.

“For several months now we’ve been seeing stabilization in all of the home price measures as inventory is pulled down,” Yun said. “As a result, the housing wealth for many middle class families has begun to stabilize.”

Author: Brittany Dunn • Date: 02/02/2010 • Category: Market Studies • Users: Agents & Brokers, Attorneys & Title Companies, Investors, Lenders & Servicers, Service Providers