This is Not 2008 All Over Again: The Mortgage Lending Factor
Some are afraid the real estate market may be looking a lot like it did prior to the housing crash in 2008. One of the factors they’re pointing at is the availability of mortgage money. Recent articles about the availability of low-down payment loans and down payment assistance programs are causing concern that we’re returning to the bad habits of a decade ago. Let’s alleviate the fears about the current mortgage market.
The Mortgage Bankers’ Association releases an index several times a year titled: The Mortgage Credit Availability Index (MCAI). According to their website:
“The MCAI provides the only standardized quantitative index that is solely focused on
Buyer demand growing in every region. Buyers are out in full force this fall, increasing the demand for homebuying in all four regions of the country.
According to the latest ShowingTime Showing Index,
“Home showing activity was up again nationwide with a 4.6 percent rise in traffic, as the traditionally slow fall season began with a marked boost in buyer interest.”
Buyers clearly have the right idea, as mortgage rates have dropped over a full percentage point since the fall of 2018. They’ve hovered in a historically low range since this summer, making the overall cost of homeownership significantly more attractive and affordable.
Here’s the breakdown of how ShowingTime reports current buyer traffic patterns across
Homeownership rate remains on the rise. In the third quarter of 2019, the U.S. homeownership rate rose again, signaling another strong indicator of the current housing market.
The U.S. Census Bureau announced,
“The homeownership rate of 64.8 percent was not statistically different from the rate in the third quarter 2018 (64.4 percent), but was 0.7 percentage points higher than the rate in the second quarter 2019 (64.1 percent).”
Today there is still a lack of inventory, particularly at the entry and middle-level segments of the market, but that is not stopping buyers from making every effort to pursue homeownership. The many financial and non-financial benefits continue to drive the American Dream and will likely do so
Today, on Veterans Day, we salute those who have served our country in war or peace, and we thank them for their sacrifice.
This year marks the 75th anniversary of VA Home Loan Benefit offerings through the Servicemen’s Readjustment Act, also known as the GI Bill. Since 1944, this law has created opportunities for those who have served our country, ranging from vocational training to home loans.
Facts About VA Home Loans:
Nearly 24 million home loans have been guaranteed by the Veterans Administration.
Nearly 82% of VA home loans are made with no down payment.
The VA also provides grants to help seriously disabled Veterans purchase, modify, or construct a home to meet their needs. Last year the VA provided 2,000
Forget the Price of the Home. The Cost is What Matters.
Home buying activity (demand) is up, and the number of available listings (supply) is down. When demand outpaces supply, prices appreciate. That’s why firms are beginning to increase their projections for home price appreciation going forward. As an example, CoreLogic increased their 12-month projection for home values from 4.5% to 5.6% over the last few months.
The reacceleration of home values will cause some to again voice concerns about affordability. Just last week, however, First American came out with a data analysis that explains how price is not the only market factor that impacts affordability. They studied prices, mortgage rates, and wages from January through
Millennials: Here’s Why the Process is Well Worth It.
Millennials have waited longer than any other generation to become homeowners, but the wait for this cohort is just about over.
According to National Mortgage News,
“Millennials, those young adults now aged 23 to 38, are now entering their peak household formation and homebuying years.”
If you’re a Millennial, you’re already well aware that you’re among a generation of those who favor fast-paced, real-time answers – and results. When you’re ready to make a decision, it’s go-time, and you probably want the latest technology at your fingertips to make it happen.
National Mortgage News agrees, stating,
“Millennials are different than previous generations—not
Planning on Buying a Home? Be Sure You Know Your Options.
When you’re ready to buy, you’ll need to determine if you prefer the charm of an existing home or the look and feel of a newer build. With limited existing home inventory available today, especially in the starter and middle-level markets, many buyers are considering a new home that’s recently been constructed, or they’re building the home of their dreams.
According to Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB),
“The second half of 2019 has seen steady gains in single-family construction, and this is mirrored by the gradual uptick in builder sentiment over the past few months.”
Many sellers believe spring is the best time to put their homes on the market because buyer demand traditionally increases at that time of year. What they don’t realize is if every homeowner believes the same thing, then that’s when they’ll have the most competition.
So, what’s the #1 reason to list your house in the winter? Less competition.
Housing supply traditionally shrinks at this time of year, so the choices buyers have will be limited. The chart below was created using the months supply of listings from the National Association of Realtors.As you can see, the ‘sweet spot’ to list your house for the most exposure naturally occurs in the late fall and winter