Talking Points Bulletin

Continuing to Pick Up Steam

Richard Hiers — Mon, 29 Jun 2009 00:22:58 +0000

The local housing market continues to pick up steam with open houses being quite busy and multiple offers being made on the best properties. An obstacle once again (read 2000-2005) facing buyers’ agents is getting their offer accepted in the face of competition for the home.

Next time I blog, we will have ended the month of June so, at that time, I’ll be able to post “months of inventory” through the complete month. This data is critical because it tell us if we are in a buyer’s market, a neutral market, or a seller’s market.

Much of the rise in interest rates in late May and early June was due to concerns about the government’s enormous accumulation of stimulous debt. Didn’t seem to be a problem with both domestic and foreign investors who showed a strong demand for Treasury purchases last week … which reversed some of the recent rate increases.

Click Here to see all rates as we begin the week of June 29.

You are reading my blog on real estate market trends. Go to my Main Page to search for properties.

Prices Edge Up, Rates Turn Downward

Richard Hiers — Mon, 22 Jun 2009 18:52:05 +0000

Home prices edged up for the first time in nearly two years in May, but it’s not because the mainstream market is improving: it’s because higher-end home have begun to sell and are edging up the median price. The higher end has been nearly frozen for two years.

California’s economic recovery is now expected to begin in the second half of 2009, but we will continue to shed jobs through 2010. Even so, after 21 weeks of increasing job losses, the biggest decrease in job losses in more than seven years took place the week ending June 6.

Mortgage rates decreased sharply last week. The week ended at 5.38% for 30-year-fixed mortgages, down from 5.59% the previous week. Seven weeks earlier the 30-year-fixed was 4.78%, a record low since it has been tracked starting in 1971. Click here to see all rates as we begin the week of June 22.

You are reading my blog on real estate market trends. Go to my Main Page.

Rates Continue Moving Upward

Richard Hiers — Tue, 16 Jun 2009 18:04:23 +0000

One in every 389 U.S. households received a foreclosure filling in May of 2009, but foreclosure fillings fell 6 percent in May from April and was the smallest annual gain since June 2006.

Mortgage rates marched upward last week, fueled by continued optimism that an economic recover will be sooner rather than later. Click here to see all rates as we begin the week of June 15.

Interest Rates Climb above 5%

Richard Hiers — Sun, 07 Jun 2009 01:10:01 +0000

Here’s a development that will probably surprise most people: Taking Long Beach as a whole, there is slightly more than 6 months of inventory (explanation of “months of inventory”) on the market, placing Long Beach at the weak end of a buyer’s market. Looking just at the east side of Long Beach (pretty much 90808 and 90815), there is 3.8 months of inventory on the market, placing this area just .8 months of inventory away from being a seller’s market.

The forecasting firm IHS Global Insight reported last week that Los Angeles County home prices are now 6% undervalued. Orange County is 11% undervalued. Calculations are based on home prices, interest rates, area incomes, population density in given markets.

Average rates on 30-year fixed-rate mortgages rose to 5.29% this week from 4.91% a week earlier.It was the highest weekly average in nearly six months and the first time rates were above 5% since the week of March 12. Click here to see all rates as we begin the week of June 8.

Move-Up Buyers Entering Market

Richard Hiers — Sat, 30 May 2009 19:56:14 +0000

It’s almost official: the $8,000 first-time buyer tax credit can soon be used to increase an FHA loan down payment beyond the required 3.5%, and the credit may be applied towards closing costs as well. HUD has approved it, and lenders are working on how to implement it.
Home sales are up 2.9% in April from March 2009. First-time buyers accounted for 40% of sales in April, down from 53% in March. This tells us that there is rising interest in buying among current home owners.

Click here to see all rates as we begin the week of June 1.

Housing Affordability Best in 18 Years

Richard Hiers — Wed, 27 May 2009 19:23:47 +0000

Mortgage rates have had a very slight increase in the past week, as we begin to enter the “moving season.” The reasons for the slight increase are signs of the economy turning a corner and the stock market at higher levels. While there is pressure for interest rates to edge up, 5% is still incredibly low and it may be decades before we see anything like it again.

Last week, the Wells Fargo Housing Opportunity Index (HOI) reported that nationwide housing affordability jumped 10 percentage points during the first quarter of 2009. This movement placed housing affordability at the highest level since the HOI was created 18 years ago. Of course, the Los Angeles area remains one of the most expensive in the country.

Click here to see all rates as we began the week of May 26.

$8,000 Tax Credit Used toward Down Payment

Richard Hiers — Tue, 19 May 2009 19:41:47 +0000

Here is some great news for buyers, and few of them know about it: the $8,000 tax credit may, in the near future, be used toward a down payment! The way it will work is that the money is given to the buyer by the lender up front, before the transaction is even complete. Can the market do ANYTHING else to encourage buyers to take advantage of depressed home values and amazingly low interest rates?!?

Last week, more evidence showed that the economy is slowing its downward descent. The biggest risk to send mortgage rates upward is a Fed perception that a near-term economic recovery could begin. The brighter the outlook, the greater the potential for rates to start moving upward.

Click here to see all rates as they began the week of May 16.

Good News for Homeowners

Richard Hiers — Wed, 13 May 2009 19:45:02 +0000

Home owners, instead of just home buyers, are finally getting some good news out of the media: the Fed thinks we are about to move out of the recession (see article). home prices have stabilized in our area (see article). and the number of home sales has increased dramatically (see article). These things probably mean we are at the bottom of the housing cycle.

When we take a look at what has happened in the housing market in Long Beach (for example) over the past twelve months, we find that the number of homes for sale has decreased radically while the number of pending/closed sales has increased significantly. I have summarized this reduced supply and increased demand using a chart built from MLS data.

The single most important result of all this data is that buyers who want to take advantage of bottom-of-the-cycle prices and incredible low interest rates are beginning to run out of time.

As of May 7, 30-year fixed was at 4.84%, and the 15-year fixed was at 4.51%.

$8,000 Tax Credit to Buyers!

Richard Hiers — Mon, 09 Feb 2009 23:14:29 +0000

When Stimulus Bill details are released a $8,000 tax credit to first time buyers will probably be included. Opinion about the effect of the tax credit among real estate professionals is pretty much unanimous: it should push a big wave of buyers off the fence to take advantage of not only the tax credit, but low prices and low interest rates as well.

The housing market led us into the recession, and the government is doing what it can to have housing lead us back out.

Click here to see all mortgage rates as they began the week of February 9.

Rates Hold Steady

Richard Hiers — Thu, 22 Jan 2009 01:48:56 +0000

Interest rates held fairly steady at their low levels last week. Inflation core readings also held steady, calming fears that a deflationary environment could develop.

The inaugral address, with its ringing call for hope, left many people feeling better about things. However, the Dow reacted to a plunge in banking stocks with a sell-off that tumbled the market 330 points.

Click here to see all rates as they began the week of January 19.