Seasons Market Shift: What You Should Know for the New Year

Friday, December 16th, 2016

The New Year is often the best time to start new ventures. If one of your resolutions this year is to sell your home or property, here are some market shifts you will want to be aware of before contacting a listing agent.

2017 real estate trends, market, prediction, new year

  1.   Analysts see a recession occurring in 2017

According to Yahoo Finance,  a group of surveyed market analysts agreed that the real estate sector should be a little pessimistic about the economy in the near future. They say this is primarily caused by global uncertainty, leading investors to turn away from U.S. real estate. In this tricky environment, it’s important to know exactly how to approach the market; Alaris Properties would be happy to help you navigate stormy waters.

  1.   Housing market is already near pre-recession peak

Home prices have continuously posted steady year-over-year gains, accumulating into near pre-recession highs over a 53 month period. The median price for single-family homes is around $226,000—a 7% increase from 2015. This will eventually cause market normalization and stagnate price growth.

Using a Reverse Mortgage to Purchase a Home

Tuesday, July 5th, 2016

The other day, a client came into my office and asked me about a using a reverse mortgage to purchase a property. They said they had heard some negative things from relatives but had recently seen articles that painted a very different picture.  They asked for my opinion. I told them that it is critically important to hire a trusted mortgage advisor. We set about to get the facts and become educated on using a reverse mortgage for purchase.

reverse mortgage

We made contact with Reverse Mortgage Planner Kent Montavon from Fairway Independent Mortgage Corporation. He and his business partner Bill Niehus help buyers and homeowners exclusively with reverse mortgages. They arrange reverse mortgages that are called Home Equity Conversion Mortgages (HECM). It turns out that, for folks over 62 years of age, reverse mortgages could become a “go to” product for purchasing or refinancing a home. Here is what I learned:

Mortgage Rates Down 1 Percent In One Year

Wednesday, July 25th, 2012

Freddie Mac Mortgage Rates

Another week, another new low for mortgage rates.

According to Freddie Mac’s weekly Primary Mortgage Market Survey, the 30-year fixed rate mortgage rate fell 3 basis points to 3.53% last week nationwide.  The 3.53% mortgage rate is available to mortgage applicants who are willing to pay 0.7 discount points, on average, plus a full set of closing costs.  One year ago, the 30-year fixed rate mortgage rate was 4.52%.  Today, it’s nearly one percent lower.  For every $100,000 borrowed at today’s rates as compared to July 2011, a mortgage applicant will save $57 per $100,000 borrowed, or $684 per year.  Over 30 years of a loan, those savings add up.

30-year fixed rate mortgage rates have now dropped through 5 consecutive weeks, and in 11 of the last 12 weeks, a streak dating back to late-April.  Depending where you live, you may not get access to 3.53% mortgage rates.  As Freddie Mac’s survey reveals, mortgage rates vary by region.

Mortgage Payments Fall To All-Time Lows

Monday, June 25th, 2012

Mortgage payments

It’s a money-saving time to be a Denver area home buyer.  Historically, mortgage rates of all types — conventional, FHA, VA and USDA — have never been lower and low mortgage rates make for low monthly payments.

According to Freddie Mac’s weekly mortgage rate survey, the average 30-year fixed rate mortgage fell to 3.67% nationwide earlier this month for borrowers willing to pay 0.7 discount points at closing, plus a full set of closing costs.  0.7 discount points is a one-time closing cost equal to 0.7 percent of your loan size, or $700 per $100,000 borrowed.  Today’s mortgage rates are a bargain as compared to just 1 year ago.

In early-June 2011, the average 30-year fixed rate mortgage nationwide was higher by 88 basis points, or 0.88%.  If you are among the many U.S. homeowners who bought or refinanced a home around that time, refinancing to today’s mortgage rates could save you 10% or more on your payment.  Home buyers have measurably more buying power, too.

Mortgage Guidelines Resume Tightening Nationwide

Thursday, May 3rd, 2012

Senior Loan Officer SurveyDespite an improving U.S. economy, the nation’s banks remain cautious about what they will lend, and to whom.  Last quarter, by a margin of 3-to-2, more banks tightened residential mortgage lending standards for “prime borrowers” than did loosen them.

A “prime borrower” is defined as one with a well-documented credit history, high credit scores, and a low debt-to-income ratio.  The insight comes from the Federal Reserve’s quarterly survey of its member banks.

Last quarter, of the 54 responding banks :

  • 0 banks tightened mortgage guidelines considerably
  • 3 banks tightened mortgage guidelines somewhat
  • 49 banks left guidelines basically unchanged
  • 2 banks eased mortgage guidelines somewhat
  • 0 banks eased mortgage guidelines considerably

By contrast, in the quarter prior, not a single surveyed bank reported tighter residential mortgage guidelines.  The period from January-March was a step backwards, therefore, for the fledgling U.S. housing market.  Overall, getting approved for a mortgage is tougher than it used to be. Banks enforce higher minimum credit score standards; ask for larger downpayment/equity positions; and require higher monthly income relative to monthly debt obligations.  It’s one reason why the homeownership rate is at its lowest point since 1997.

Mortgage Rates Fall Back Below 4%

Friday, March 30th, 2012

Freddie Mac Weekly Mortgage Rates

After a brief run-up two weeks ago, mortgage rates are back below 4 percent. It’s good news for home buyers and mortgage rate shoppers because, with lower mortgage rates, we can lower the amount of mortgage payments.   According to Freddie Mac’s weekly Primary Mortgage Market Survey, the national average 30-year fixed rate mortgage rate fell to 3.99 percent this week from last week’s 4.08 percent.

Last week had marked the first time since December 2011 that the benchmark rate crossed north of 4 percent — a span of 16 weeks.  And, it wasn’t just rates that got cheaper this week — closing costs dropped too.  Freddie Mac’s survey showed that the average number of discount points to accompany a 30-year fixed rate mortgage fell one-tenth of a percent this week to 0.7, where one discount point is equal to one percent of your loan size.

Mortgage Payments Fall 12% Since February 2011

Wednesday, February 29th, 2012

Mortgage payments in 2011

As mortgage rates drop, so do housing payments.  It’s a good time to consider refinancing your home, or making an offer on a new one.  Mortgage payment affordability has never been so high in history.  According to Freddie Mac, the average 30-year fixed rate mortgage rate is now 3.94 percent — an all-time low — with an accompanying 0.8 discount points.  This means that in order to get access to the 3.94 percent rate, Denver area homeowners and home buyers should expect to pay a loan fee equal to 0.8% of the borrowed amount, plus “normal” closing costs.

Last week, the average 30-year fixed rate mortgage rate was 3.99 percent with an accompanying 0.7 discount points.

Mortgage rates in Colorado have been in decline for most of the year.  Since peaking in early-February, the average home owner’s principal + interest payment on a 30-year fixed rate mortgage had now dropped by 12.2 percent.