Perhaps the most valuable lesson that real estate consumers learned from the housing crash was that home values can fall as well as rise. More than seven million families lost their homes to foreclosures and short sales; a brutal wake-up calls that though homeownership is safer than most investments it still involves risk. Today’s buyers are very aware that … Read More »
Five Good Reasons to be Cool Over Higher Interest Rates
One of strongest drivers of demand in today’s housing markets is buyers’ fear that interest rates will rise, and they will never again see rates as low as they are today. That’s one reason the first-time buyer volume of government-guaranteed mortgages, low down payment loans like FHA and Freddie Mac’s Home Possible Advantage program surged 18 percent in April. Buyers … Read More »
The Mortgage Interest Deduction: Is the Sacred Cow Worthless?
Chronically low interest rates may have accomplished something that the housing lobby has spent millions of campaign contributions and decades of political pressure to prevent. Did the mortgage interest deduction, long the holy grail of homeownership, become worthless eight years ago when low rates and falling prices so reduced the value of the interest that owners can deduct that the … Read More »
Price Realities are Blowing Away Forecasts
This was supposed to be a year of “moderating” prices and a “return to normalcy.” Instead, upward price pressures have not abated, and red-faced economists are scrambling to crank up their forecasts as price trends at the outset of the buying season knock their protections into a cocked hat. The culprit? Most forecasters predicted three years of rising prices … Read More »
Has Homeownership Become a Privilege?
During the housing boom mortgage lending was available to people with a broad range of incomes. Since the bust, first-time buyers have become a more select group, according to a new analysis of Census data by BuildZoom’s Chief Economist, Dr. Issi Rorem. “In 2005 the annual number of first time home buyers in the U.S. hit an all-time high … Read More »
Is Bad Information Keeping Potential Buyers in Apartments?
A new survey from Bankrate found that primary reason 29 percent of renters can’t buy a home is they can’t afford a down payment. However, at least one out of five of them are overestimating how much they think they will have to raise for a down payment. The more than 3250 non-homeowners participating in the survey expect that they … Read More »
Will Sellers Step up the Plate in 2016?
“It is important to recognize that 2016 is shaping up to be the best year in recent memory to sell. Supply remains very tight, so inventory is moving faster. Given the forecast that price appreciation will slow in 2016 to a more normal rate of growth, delaying will not produce substantially higher values, and will also see higher … Read More »
First-time Buyers Lose Again
‘Closed loan credit scores continued tumble, while DTI rose in October’ promised the headline from Ellie Mae this month. Eagerly I scanned through the data, hoping at last to see a relaxation of the squeaky tight lending standards for purchase loans, enough to really mean something to the millions of young buyers trying to maneuver their way through student loan … Read More »
Home Prices: The Tilting of America
The chart below from Case-Shiller’s release today of its July data says it all. Prices now are shifting a lot on a monthly basis. The range between appreciating and depreciating markets seems to be growing and no longer do the “sand” states, judicial foreclosure states or foreclosure states or cities with the best economies and most jobs. Rather, with … Read More »
The Truth about Lending Standards
Perhaps you have heard that it’s getting easier to get approved for a mortgage to buy a home. Yet the first-time buyers you work with don’t seem to be doing any better than they did six, 12 or even 24 months ago. The news reports you’ve been reading are misleading. They may accurately trends for refi mortgages or mortgages … Read More »