Mortgage Rates and Our Economy

Dear friends and clients,Mortgage rates have again done the incredible by dropping close to their recent records lows. Rates have fallen partly due to the government's announcement that they’re ending a widely-loathed fee. The Federal Housing Finance Agency is abandoning its 0.5% fee on refinances. Zillow economist Matthew Speakman said the fee "artificially increased the average mortgage rate."The average 30-year fixed-rate mortgage is currently at 2.78%, which is cheaper than it’s been since February 18, when the average was 2.81%. The average rate on 15-year fixed-rate mortgages also dropped from 2.22% to 2.12%.The recent decline in rates is also partly due to the economic uncertainty created by the again growing COVID-19 infections. According to Sam Khater, Freddie Mac’s chief economist, concerns about the COVID-19 Delta variant and the recovery from the pandemic are taking their toll on economic growth.Economists and investors are closely monitoring any indication from the Federal Reserve that it may begin tapering mortgage-backed securities and bond purchases. In a conference in July, President Biden said his administration would “remain vigilant about any response that is needed” concerning threats to our economy.“It remains to be seen how long we'll be able to enjoy these rates," says Matthew Graham of Mortgage News Daily. The craziness we’ve seen in the real estate market for the last few months seems to be waning a bit.  New single-family home sales decreased 5% to 704,000 units from 741,000 from May to June, the Mortgage Bankers Association found.All this means it’s an excellent time to buy a house if you’ve been considering it. These fantastic rates may not last very long, and you don’t want to miss them. Additionally, with some buyers leaving the market, that means less competition for properties.If you’re a homeowner who hasn’t refinanced your mortgage yet, it’s time to get it done. Start by taking a free peek at your credit score to see where it stands. Then when it’s time to approach lenders, don’t just speak to one. Reach out to at least a few to compare rates and programs.Remember that late summer and autumn are still great times to buy a home. If you’re interested, click here to see all current local and surrounding homes for sale.If you’re considering buying a house or have any questions about real estate, feel free to reach out to us at 252-360-1130 or reply to this email. Don’t let the amazing opportunities in our present market pass.We’re here for whatever you need,Jason Walters

August 2021 Home Price Update

Dear friends and clients, Home price growth has accelerated in the past year as buyers frantically competed for a limited number of houses on the market. Prices continue to increase and break records as strong demand collides with low supply. Sales of new and existing homes have declined somewhat in the past few months, mainly due to those sky-high prices.  Peter Boockvar, chief investment officer at Bleakley Advisory Group said, “We have a major affordability issue, especially for the first-time buyer, that is only partly mitigated by low mortgage rates.” About half of houses sold are still closing above the original listing price. The median existing home sales price in June rose 23.4% from June 2020, the National Association of Realtors reported.  “There’s probably some sticker shock happening out there,” said Hilla Sferruzza, chief financial officer at Home Builder Meritage Homes Corp. However, experts predict home price growth to slow by the end of the summer, as the availability of new listings helps relieve some of the pressure brought by competing buyers. In June, Lawrence Yun, NAR’s chief economist said, “Home price growth will steadily moderate with increased supply, but a broad and prolonged decline in prices is unlikely.” With home supply slowly improving, those considering selling may want to get their houses on the market sooner rather than later to get the best price.  The current housing market is being driven by three main factors. First, millennials are now the largest generation in the country, and they’re enlarging their families and buying homes. “We anticipate that millennials will continue to lead homeownership demand,” said Odeta Kushi, deputy chief economist at First American Financial Corp. Second, mortgage interest rates have been falling again the past few weeks, and low rates also continue to drive vigorous home-buying demand. Third, May’s data shows that the U.S. real estate market is also still being driven in part by reactions to the pandemic, as many buyers move from urban apartments to suburban houses.  In the homebuilding sphere, many builders are capping sales to manage their costs and make sure they don’t sell more homes than they can build as high demand persists. If you’re interested in knowing your home’s value in the present market based on recent local and surrounding area sales, enter your address here to find out what your home is worth right now. If you have any questions about our market or are thinking about buying or selling, don’t hesitate to call us at 252-360-1130 or reply to this email. We're out in the market every day helping clients to buy and sell, and we do research so we have the best advice to give you, no matter your situation. We look forward to hearing from you, Jason Walters .