Posts Tagged: ‘housing economy’

South Bay Home Prices Higher and Inventories Still Low

July 26, 2013 Posted by Andre Hemmersbach

Sales prices in the Greater South Bay area have continued to move higher as inventories are still very low. These trends however, are rearward looking events and represent contracts that were written before the mortgage rate increases from 45 days ago. Of real interest are what the numbers will look like in August and September after homebuyers have had some time to digest and concider the higher mortgage rates and the higher monthly housing payments that corresponds with those higher rates.

Robert Dixon of RE/MAX Estate Properties in Palos Verdes thinks that the higher mortgage rates are not going to affect property prices in any substantive way. The number of borrowers who are deciding they have missed the oppurtunity to buy their first home are equal to the number of fence sitters that finally have decided “we better move now, before rates move even higher.” Robert does feel that the higher mortgage rates in conjuction with the traditional end of the summer buying season approaching will bring back a more normalized negotiation environment between buyers and sellers. “The last several months have seen a frenzy of buyers who are climbing over each other to have their offers accepted.”

Greater South Bay Listings vs Sales Prices

Greater South Bay LIstings vs Sales Prices

By Andre Hemmersbach

Market Update July 2012

July 12, 2012 Posted by Andre Hemmersbach

Ferderal Reserve Paves Way For Lower Rates

January 26, 2012 Posted by Andre Hemmersbach

Wednesday’s Federal Reserve statement made mortgage rates drop right back to the record lows from several weeks ago. Since we hit that low, traders have been looking for some sort of clear direction on where the market would move next. The lack of rate positive news had made rates steadily creep higher over the last 3 weeks. Yesterday the Fed released a statement confirming they would continue to buy bonds and keep rates low until 2014. This statement coupled with low inflation reports are starting to make Quantatative Easing #3  ( QE3 ) rumors perculate through the bond market.

The market reacted positively with mortgage rates moving all the way back down to previous records. Strange as it may seem some investors were caught off guard with the big drop in rates, as the Fed’s actions are actually inflationary. Gold prices closed up over $35 dollars an ounce yesterday confirming that some investors believe inflation will be an issue. The reason the move to lower rates  is surprising is that  inflation is the mortal enemy of low rates and usually short-term moves by the fed like the one mentioned above would be trumped by longer term inflation fears.  

What does this mean to you? Don’t fight it!  Wall Street typically trades on rumors and sells on news. So the rumor of the Fed continuing to make money easily available is good for rates today but as soon as it is confirmed look for rates to spike.

Take advantage of today’s historically great affordability and low rates. If you have been thinking of buying a home, your new mortgage payment could be lower than the going rents in your market. If you already own a home with a good mortgage or have paid on your current mortgage for a long time, please let me help you look into a shorter term mortgage. It could save you thousands of dollars over the life of you loan.

Please let me be of assistance in helping you answer questions about financing your home.

Pending Home Sales Rise in November

December 30, 2011 Posted by Andre Hemmersbach

Washington, DC, December 29, 2011

The Pending Home Sales Index (PHSI) increase 7.3 percent on a seasonally adjusted basis to reach its’ highest level in 19 months, according to the National Association of Realtors® (NAR). The PHSI is released during the first week of each month and is designed to be a leading indicator of housing activity.

The index measures housing contract activity and is based on signed real estate contracts for existing single-family homes, condos and co-ops. A signed contract is not counted as a sale until the transaction closes.

The PHSI for November stands at 100.1 up from an upwardly revised 93.3 in October and is 5.9 percent above November 2010 when it stood at 94.5. The October upward revision resulted in a 10.4 percent monthly gain.

The last time the index was higher was in April 2010 when it reached 111.5 as buyers rushed to beat the deadline for the home buyer tax credit. The data reflect contracts but not closings.

Lawrence Yun, NAR chief economist, said there were a number of reasons the report is positive.  “Housing affordability conditions are at a record high and there is a pent-up demand from buyers who’ve been on the sidelines, but contract failures have been running unusually high. Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage,” stated Yun. “November is doing reasonably well in comparison with the past year. The sustained rise in contract activity suggests that closed existing-home sales, which are the important final economic impact figures, should continue to improve in the months ahead,” Yun added.

The PHSI in the Northeast rose 8.1 percent to 77.1 in November but is 0.3 percent below November 2010. In the Midwest the index increased 3.3 percent to 91.6 in November and is 9.5 percent above a year ago. Pending home sales in the South rose 4.3 percent in November to an index of 103.8 and remain 8.7 percent above November 2010. In the West the index surged 14.9 percent to 121.2 in November and is 2.9 percent higher than a year ago.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.