Mortgage Rates – “WASHINGTON (AP) — Average long-term U.S. mortgage rates fell this week for a fourth straight week amid persisting turmoil in stock markets and global economic worries..” …
Mortgage Rates Still In Down Trend
Freddie Mac Reports Rates Drop Once Again
Just the day before yesterday I put up a post concerning home loan rates and what we could expect in the near future. Well, we have confirmation today that the trend continues. Freddie Mac reports today that mortgage rates have fallen again. That makes the 4th consecutive week in a row. As of today, the national average for a 30-year fixed-rate home loan is 3.79 percent, down from 3.81 just a week ago.
We won’t go into a whole lot of discussion here. We talked about this and what it might mean for the future in our previous post. If you’d like a bit more background, you can read that by CLICKING HERE.
The sustained decline in mortgage rates in recent weeks has spurred prospective homebuyers. Applications for mortgages increased 8.8 percent in the week ended Jan. 22 from the previous week, according to the Mortgage Bankers Association. The number of people signing contracts to purchase homes managed to inch up last month, thanks to unseasonably warm weather in the Northeast, data issued Thursday by the National Association of Realtors showed. The tiny bump suggests that home sales may plateau this year after a solid increase in 2015.
California Mortgage Rates
All states are a bit different, and California is usually just a tad higher than the national averages. Here are the home loan rates for California as of today. Right now we are where the national average was just a couple of weeks ago.
By the way … You can see this graph updated daily in the sidebar to your right here on this web site. Where you see the little widget that tells you Mortgage Rates, simply click on the little link that says “Trends”, and you see this up-to-the-minute report.
Mortgage Rates – “Mortgage rates fell for the third week in a row, with the average 30-year, fixed-rate loan going for 3.81 percent, down from 3.92 percent last week.. …”
Low Rates Are Likely Here For The Near-Term
In Spite Of Fed Rate Hikes, Turmoil In World Markets Keeps Interest Rates Low
There was some worry that the recent rise in interest rates put in place by the Federal Reserve last month was a precursor to higher home loan rates. This may be true in the longer run, especially if the Fed continues with incremental rate increases, but, for now, home interest rates are still historically low. If they’re not actually declining, at least they’re steady. Last week the average 30-year fixed-rate mortgage fell to as low as 3.81 percent. The 30 Year Fixed Rate Today is back up to 3.84 … but that’s not a big climb.
So … what’s the deal? And, more importantly, what does it mean to the consumer?
Amid current world-stock market troubles, price-war induced low oil prices, and economic chaos going on in China, most indicators show that Mortgage Home Loan Rates should remain low for the immediate future and may even get a bit cheaper in the near-term!
“That’s (3.81 percent) the lowest they’ve been since October, according to Freddie Mac, which surveys lenders every week. And given all that’s going on in the world–stock market woes, falling oil prices, and economic unease in China–it’s a decent bet home loans will get even cheaper, at least in the near term.”
Home Loan Rates And You
What do low rates for home loans mean to you? Well, considering what the exact expectations are here, if you’re someone considering buying a home in 2016, now could be the right time to begin the process. The fact is, when financial markets are in turmoil elsewhere … as in China, for instance … and things are fairly stable here at home, it becomes less expensive for the U.S. to borrow money. That sort of action / reaction is usually transferred to the home loan market in just a short amount of time. That means we will probably see prices dip a bit further for a short period of time before they start to rise again. At any rate, they should hover near where they are for a while.
When considering whether the time is right to enter or move up in the real estate market, there are many factors to consider. But if we’re speaking simply about home loan rates, then all the factors we’ve discussed above provide the prospective buyer with a time window in which to initiate the approval, shopping, and closing process that allows them to take advantage of the current low rates. So, if you’re considering taking the plunge this year, as far as home interest rates are concerned, now is a great time to start the process.
In the meantime, whenever you want to check the average current rate on a home loan, you can do that by visiting us right here at BrionCosta.com. There’s a great little widget right there in the sidebar to your right that provides that very information, plus a ton more. It’s updated daily, and you’re welcome to come here and use it any time you like!
Home Buyer Tips – “Buying a home is a major commitment. Here are a few important things to consider to make it a worthwhile experience. …”
Home Buyer Tips:
What You Need To Know In 2016
Some Advice For Homebuyers Buying A Home In 2016
Are you and your family thinking of taking the plunge this year? Buying a home is a big committment. Next to partnering up in a marriage and the decision to start a family, it’s probably the biggest decision we make in our lives. Knowing whether the time is right or not, and knowing the things to do to make sure your decision is the right one and that your purchase is a pleasant and positive experience is essential. Too many folks just start driving around looking at signs … without doing the research and preparation necessary to be as informed as they should be in today’s real estate market.
Do you know exactly where, in your preferred area, you might get the most “bang for your buck”? Are you aware of what areas are considered “overpriced for the market” and which might be a better buy because they are currently priced loower than what the market would bear? Do you know which amenities are available in your price range and which will move a home out of your range? Do you even know what kind of down payment or monthly payment is reasonable in your financial situation?
All of these things … and much, much more … should be looked into and understood by a Home Buyer before even looking at prospective homes. The most valuable piece of advice I could give to anyone considering buying a home in 2016 is to Be Prepared. Find a good “counselor” and learn what you need to know first. Then do your research and get your ducks in a row before you start to do all the legwork and shopping around. You can’t compare properties when you don’t know what your “yardstick” should look like. Be clear on that before you begin.
Here’s a concise and informative article that will give you a head start on learning what to know when buying a house. It’s by Jason Hall of The Motley Fool, and it just appeared there. In it, Jason lists some thing you should have on your list of things to know and do before you start looking, with a special eye to things you should be concerned about from an investment standpoint.
“In the digital age, we have access to an abundance of information – too much information, in fact. And with the advent of social media and online social networks, we now have some of the most powerful tools of publishing at our disposal for delivering information and insight to our audience – our clients and prospects and partners and peers.”
Advice For Homebuyers: Unless You’re An Expert — Work With A Realtor
The real estate market today … and the actual process of buying a home … is complicated and can be a minefield, both legal and emotional. There are just so many important things to know when buying a home! The second most important bit of advice for home buyers I can think of is simple: unless you’re an expert, work with a competent Realtor. This should be someone who understands the area you’re interested in and has been active there for at least several years. They should be someone you trust and that you’re comfortable working with.
My advice in this area is simple: Call Brion Costa. He’ll have a quick conversation with you and he’ll be completely upfront. If he doesn’t feel he’s the right agent for you, he’ll refer you to the perfect person to help you through the entire process. If you consult with Brion before you do anything else, you’ll end up working with someone that you know is competent and trustworthy. You’ll find all of Brion’s numbers on this page.
Home Buyer Tips.
California Home Sales – “Existing, single-family home sales totaled 405,530 in December on a seasonally adjusted annualized rate, up 9.6 percent from November and up 10.7 percent from December 2014.”
California Home Sales:
CAR Releases Dec Sales & Price Report
The California Associaiton of Realtors (CAR) has released its figures for home sales and prices in December. As expected, the numbers show a marked rebound from November. The December number of sales was up 9.7% over November, and also up 10.7% over December of 2014.
The increase in number of sales was made a bit more pronounced because of some closings that were slated to occur in November, but were delayed. The Consumer Financial Protection Bureau put some new disclosure requirements into effect during November, and there were a certain number of transactions delayed as some lenders needed to re-write loan documents and disclosures to comply. Most of those closed in December, and this may have skewed the numbers upwards a bit.
The CAR report also notes that the Unsold Inventory Index (UII) fell to 2.8 months from 4.2 months in December. This index reflects the amount of time necessary to sell the entire inventory of homes on the market at the current sales rate. The 2.8 months is lower than in November, and lower than December of 2014. A “normal market” is usually considered to have a UII of 6-7 months, which is an indicator that we are experiencing a lower than “normal” amount of inventory.
The full report has been release on California Association of Realtors Newsstand. It contains, charts, graphs, and a complete rundown of California home Sales numbers broken down county-by-county, and you can read it here:
“In line with our forecast, California’s housing market experienced strong sales and price growth throughout last year, with the median price increasing 6.2 percent for the year as a whole to reach $474,420 in 2015,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Looking forward, we expect the foundation for the housing market to remain strong throughout the year, with moderate increases in home sales and prices, but headwinds of tight housing supply and low affordability will remain a challenge.”
Home Prices Supported By Low Inventory
Home prices are currently being buoyed by our lack of inventory. This is good for Sellers, but there are many who believe that the cost of a home in most areas of California is still a tad above the level of comfort new buyers need to enter the market. Time will tell, of course, and it may be that a bit more of a readjustment on the price side will be necessary to completely balance the market. However, activity is still strong and the market appears healthy overall, notwithstanding a few minor areas of imbalance.
California Home Sales.
San Gabriel Valley News – Metro rejected Azusa’s request to delay opening the Azusa Pacific/Citrus College Gold Line station, saying all six stations will open as planned March 5. …”
Metro Rejects Azusa Delay Request
All 6 Stations Will Open March 5
As you may or may not know, a few days ago the City of Azusa, Azusa Pacific University, and Rosedale Land Partners wrote a letter to the Los Angeles County Metropolitan Transportation Authority (METRO) requesting a delay in opening the newly completed Azusa Pacific / Citrus College Gold Line Station, scheduled to open on March 5th. Metro has just rejected that request.
Azusa and the other two entities made the request because of traffic concerns. Rosedale Land Partners is currently under construction on a 1,250 home development around the station. They expressed concern that the temporary routes to access the station might be overcome with traffic and congestion, and that pedestrian traffic to the colleges might find its way into construction zones.
Mark Ridley-Thomas, chairman of the board of directors of Metro, replied in a letter on Jan. 13 that, “Metro believes it is our duty as responsible stewards of the public trust to open the Gold Line extension with all stations, as expected, on March 5, 2016″. He also stated that Metro believes that all safety concerns have been addressed, and that the temporary access arrangements made by the City, the County, and Rosedale Land Partners are sufficient to guarantee safety.
Metro to Azusa: All Gold Line Stations Will Open March 5; Rejects Request For Delay | San Gabriel Valley Tribune
“It is not an ideal situation. But I think it can work and be safely navigated,” said Metro board member and Duarte Councilman John Fasana. He said trains would not be able to turn around at the downtown station but would still have to travel to the APU/Citrus College station to reverse course, making it confusing to riders.
“Fred Madjar, a board member on one of the Rosedale homeowners associations, said he didn’t have a problem with the temporary circulation plan. “I personally would like to see it open (on time),” he said.
“Linda Galarza, who lives in the housing tract just west of Rosedale, was walking along The Promenade on Thursday. When asked about the March 5 station opening, she said: “I really don’t see a problem.” …”
Home Values And The Metro Gold Line
The on-time opening of the Gold Line extension seems to be viewed as good news by most homeowners in the area. Along with the reactions we read in this article, I’ve personally spoken with both homeowners and Realtors who believe that having easy access to mass transit near the home will be good for home values in the area. Personally, I’m not too sure about that. At least not yet. Southern California has not yet displayed quite the level of public acceptance of our Eastern metropolis cousins when it comes to who actually uses mass transit here.
At any rate, the long awaited opening of the Metro Gold Line extension will certainly not hurt home values, and will most definitely provide more convenience for folks wanting to access other areas of the valley and the region via our light rail system.
San Gabriel Valley News
Tips for Homeowners – “People still mistakenly assume they are covered for floods under their standard homeowner policies. That might explain why only 9% of homeowners in the West have flood insurance, according to industry estimates.”
Tips For Homeowners:
Flood Insurance, El Nino, & You
As El Nino Continues, Do You Know What You’re Insured For?
As we move deeper into winter, we’ve had one hit from El Nino so far and are expecting more. At this time, no one knows the current status of El Nino, but we’re all looking for the latest El Nino update, that’s for sure. All over Southern California and the San Gabriel Valley, people are preparing as best they can for the possibility that we might face some of the El Nino conditions that have led to property damage and even loss of life during previous El Nino years. We all want to be prepared as best we can.
It’s times like this that people start to think about flood insurance. Sad to say, it’s times like this that are among the only times people actually do think about this kind of coverage. Worse still, when people do think about it, most discover that they really have no idea what type of damage they are covered for and what type they would have to handle on their own. Believe it or not, most homeowners still operate under the incorrect impression that their Homeowner’s Insurance policy covers them for flood. They are sadly mistaken.
When a home is purchased using a federally insured loan, such as a VA or FHA loan, the lender will require a flood insurance policy if the property is situated within a federally mapped flood area. These areas are mapped by the Federal Emergency Management Agency (FEMA), and there are about 236,000 policies inforce in California today. Most of these were purchased through the National Flood Insurance Program which was established by Congress in 1968. The huge majority of the homes insured for flood are within these FEMA mapped districts. However, as we learned in our last El Nino, you don’t need to be in a FEMA flood zone to suffer severe flood damage.
Even with flood insurance, there are caveats to be aware of. Most policies may cover flood but, at the same time, may not cover mud flows. When investigating what a policy covers and what it doesn’t, it’s possible to get all fouled up and lost in the weeds trying to decide the definition of “flood”, “mud flow”, “dirty water intrusion” … the nomenclature seems endless.
The bottom line here is that most folks don’t know enough about their own coverage or about flood insurance in general. FEMA has been running a publicity campaign urging homeowners at risk to purchase flood insurance policies. There has been a recent surge in policies sold in California. Still, as a group, homeowners are woefully uninformed on the subject.
“Experts have warned that this winter’s El Niño could generate flooding, mudflows and landslides. But the entire spectrum of storm-related damage is not covered by homeowner insurance or even flood insurance. In general, experts say damage from falling water is covered by homeowner insurance whereas damage from rising water requires flood insurance. The National Flood Insurance Program says it covers “direct physical loss” caused by “flood,” which it defines as “an excess of water on land that is normally dry.” Damage from what FEMA calls “mudflows” — rivers of liquid and flowing mud — is also covered by flood insurance. But FEMA distinguishes between mudflows and what the agency calls “moving saturated soil masses” that go down a slope without “a flowing characteristic.”
“Some things are very straightforward,” said Ahsha Tribble, a regional FEMA administrator. “Some things have a bit of a gray area.” …”
Tips For Homeowners – Talk To Your Agent
The best advice we can give you, if you’re concerned about possible damage to your property from flood-related events during this El Nino season is to talk to your insurance agent and get a real rundown on just what you’re covered for and what you’re not. Flood insurance is not necessary for everyone, and there are many holes in coverage if you do have it. However, not knowing if you need it or what you’re covered for if you get it is a prescription for disaster. As in all things: do your due diligency. Don’t guess at your situation. Take the time to know where you stand, so you can protect your home, your investment, yourself, and your family.
Tips for Homeowners
Meet Our New
Managing Editor & Market Analyst
BrionCosta.com Welcomes Steve Gaghagen To The Website
To start the year off right, we are going to put into practice something I’ve been discussing with other folks for a while now. As of today, my good friend Steve Gaghagen will be taking over operations here at BrionCosta.com as Managing Editor and Market Analyst.
I’ve known Steve for over 40 years and, as I say, we have been discussing this move for some time. Steve has been active in the creation of this website, but now I’ve asked him to come in as our blog and website manager, and he’s agreed.
I first met Steve in the 1970’s through music. He was the vocalist in a great band I was in called “The Cyclones”. If you were around the Arcadia / Pasadena or the Hollywood areas in 1975 to about 1979 you might have heard us at places like The Starwood or Gazzarris. At that time, Steve was concentrating on being an accomplished vocalist, actor, and director. He spent a couple of decades pursuing those endeavors, but eventually branched out.
In the late 1980’s, Steve moved to Big Bear Lake, California, and became a Realtor. He also became an accomplished market analyst and futures trader, as well as branching out into Internet Marketing and blogging. In 2006, Steve left the active practice of real estate itself to focus on blogging, and teaching othrs to use a blog to build their reputations online. He now teaches Content Curation to bloggers at his “Curation-Works” program.
All of these things, along with the fact that I’ve known him forever and trust him like you trust an old, old friend, makes Steve the perfect person to take over daily operations here at BrionCosta.com. Don’t worry … you’ll still be hearing from me. It’s just that I won’t have to do everythinng around here anymore.
That’s it! A new year and a new face to add to the roster! I’m very excited about welcoming my old friend on board, and I know you’ll enjoy the fresh new energy around here.
Welcome to the website, Steve! Glad to have you here!
Real Estate News – “Millennials appear to be in no rush to ditch their parents’ homes. Perhaps they should be. …”
Millennials Should Consider Leaving The Nest
As we begin the new year, one of the things we need to be aware of is the fact that there are many potential real estate owners still sitting on the sidelines in our current market. A great many of those folks are members of the generation known as “Millennials”. Just as this generation hit the age where most people are beginning to buy homes and real estate, the real estate news all turned sour and the market crashed. Everyone was scared off except for the most savvy and liquid investors. All the real estate news was about foreclosures and most traditional buyers were simply firghtened away.
Many millennials are still living with parents or have taken to renting while they watch the real estate news and market conditions, trying to decide when is the best time to enter the market. Well, the truth is … that time is most probably right now. No timing is perfect, and no market is ever perfect. The fact is there are always ways in which conditions could be better. But the cold , hard fact is that they may not be better in the foreseeable future than they are right now.
The housing market has rebounded over the last few years. Yes, prices are rising. However, interest rates are still relatively low. The Federal Reserve has just instituted a 1/4 percent rate hike for the first time in years, and we expect it to continue this type of small periodical interest hike over the coming year. This action will eventually be felt in mortgage interest rates.
A condition of steadily rising prices … and steadily rising interest rates … clearly indicates that right now is probably the best time for anyone considering entering the real estate market as a homebuyer for the first time to get down to it and take action.
Here is an article by Steven Russolillo of the Wall Street Journal about this very concept. The WSJ requires registration for you to view the articles, so we’ll share it with you as it appeared in the Real Estate News section of Realtor.com.
“If, for instance, 30-year mortgage rates rise by one percentage point a year from now and home prices rise by another 5%, a monthly mortgage payment could jump by around 18%. Rising prices and interest rates may please the older generation, but not the one that hasn’t yet begun climbing the property ladder. The fear of missing out—or FOMO, as the kids say these days—should prompt millennials to act now.”
Any Real Estate Market Is A Double-Edged Sword
As usual, there are two sides to every story. In real estate there is the Buyer’s side and the Seller’s side. They are not always in alignment. Right now, Sellers are enjoying rising prices. Those rising prices can be intimidating to Millennials thinking of entering the market. The fact is, however, that they will probably only get higher over the next few years. The same is true of interest rates. On the other hand, many millenials are also made “gun shy” by student loan debt.
The bottom line here is this: trying to perfectly “time” a market is a receipe for getting left behind. Real estate markets and cycles take time to develop, and millennials who could dive in now but who sit out our current market waiting for “better conditions” could very well find themselves waiting a decade or so for things to turn more favorable than they are now.
Real Estate News.