We've
gotten a little closer to roller coaster status this week, with markets
in Europe and Asia contributing to the highs and lows. Today's
high, (for the bond markets, and therefore slightly lower mortgage
rates), came from statements from the Fed chairman Ben Bernanke, who
back pedaled from previous statements regarding the QE2 MBS/bond buying
stimulus commitment. Ten days ago he had stated
that there were signs pointing toward a more rapid economic recovery,
so there may be a "tapering" of the stimulus. This pushed stocks much
higher as well as mortgage rates. Today he indicated that the economy
is really not recovering well after all, and
the QE2 stimulus will likely continue through the remainder of 2013.
So, rates moved back down slightly, as shown below.
Speaking of mortgage rates… I do want to caution you once again about advertised rates. My disclaimer below in green talks about the rates available to consumers. Quite often you will see the published rates from Fannie Mae or Freddie Mac, which are rates you might get if you could buy direct from the factory, but you can't! Also, rates in newspapers or magazines were obviously submitted for publication well before you see them, and are designed only to make the phone ring. Mortgage rates can change as many as four times in a day, and we've seen a lot of that lately. So, if you are inclined to talk about rates with your clients, just realize that even if you get them off a website they are most likely not accurate. They need to get their rate quotes from a mortgage professional.
The housing market is still moving forward and analysts are predicting an annual pricing increase of 8% for 2013. Along with this they are also predicting housing starts to be up 25% in 2014. So the stage is getting set for new construction to pick up the slack in inventory. I'm hoping sellers who are on the fence with existing homes are paying attention.
The supply and demand models that we learned about in economics 101, would indicate that the current low inventory in housing would make this a seller's market. But, I think you are seeing something very different out there. We'll call it a transition market. Perhaps the fact that many of the homes for sale are on the market because the seller needs to sell. That need ultimately translates to accommodating buyer's demands a little more than would otherwise be the case. So, this means you will need to market each home appropriately and independently. It's unfortunate that those particulars are not figured into comps.
Speaking of mortgage rates… I do want to caution you once again about advertised rates. My disclaimer below in green talks about the rates available to consumers. Quite often you will see the published rates from Fannie Mae or Freddie Mac, which are rates you might get if you could buy direct from the factory, but you can't! Also, rates in newspapers or magazines were obviously submitted for publication well before you see them, and are designed only to make the phone ring. Mortgage rates can change as many as four times in a day, and we've seen a lot of that lately. So, if you are inclined to talk about rates with your clients, just realize that even if you get them off a website they are most likely not accurate. They need to get their rate quotes from a mortgage professional.
The housing market is still moving forward and analysts are predicting an annual pricing increase of 8% for 2013. Along with this they are also predicting housing starts to be up 25% in 2014. So the stage is getting set for new construction to pick up the slack in inventory. I'm hoping sellers who are on the fence with existing homes are paying attention.
The supply and demand models that we learned about in economics 101, would indicate that the current low inventory in housing would make this a seller's market. But, I think you are seeing something very different out there. We'll call it a transition market. Perhaps the fact that many of the homes for sale are on the market because the seller needs to sell. That need ultimately translates to accommodating buyer's demands a little more than would otherwise be the case. So, this means you will need to market each home appropriately and independently. It's unfortunate that those particulars are not figured into comps.