Where Are Mortgage Rates Heading in 2014?

Where Are Mortgage Rates Heading in 2014?

Mortgage rates will likely rise above 5 percent in 2014 and average 5.3 percent by the end of 2015, according to the Mortgage Bankers Association’s forecast. 

That would mark a big jump over where mortgage rates stand now. The MBA reported this week that the 30-year fixed-rate mortgage averaged 4.33 percent, the lowest average since June. 

“We are projecting home purchase originations will increase in 2014 due largely to gains in home sales and home prices,” says Brinkmann. “We expect to see a decline in the share of sales paid for with cash, and higher average LTVs on purchase mortgages, due to the rise in home prices.” Investors Still Flooding the National Housing Market:

Americans on the Move Again,

Americans on the Move Again,

After staying in place for years, bogged down by the financial effects of the recession, Americans are finally back on the move, according to the latest U.S. Census data.

In 2012, nearly 16.9 million people moved between counties, and 7 million made long-distance moves from one state to another. For long-distance moves, that figure was nearly 5 percent higher than 2010.

The median price of an existing-home rose to $212,100 this year compared to $166,200 in 2011, the National Association of REALTORS® reports. Many home owners “didn’t want to sell a house that they viewed as a low price,” says Jed Smith, an NAR economist. “Now that the prices are up, away we go.” Mortgage Rates Become Housing’s Thorn:

Up For Air: Big Decline In Underwater Mortgages

Up For Air: Big Decline In Underwater Mortgages

Up For Air: Big Decline In Underwater Mortgages More home owners are edging above water with their mortgages: 2.5 million U.S. properties emerged from underwater or negative equity in the second quarter. The total number of residential properties with a mortgage with equity stands at 41.5 million.  “Seeing fewer underwater mortgages is no mystery, given the continued rise in home values over the last 12 months,” credit risk practice.This is good news since these more traditional buyers will ensure the appreciation trend will continue over the near future. In addition, as long as new construction does not change the supply/demand balance in favor of excess supply, appreciation should persist until most of the underwater loans are gone.”  But 10% of Home Owners Still Underwater:

Investors Still Finding Ample Opportunities

Investors Still Finding Ample Opportunities

 In Distressed Market: Residential properties sold at a faster pace in September 

Single-family homes, condominiums, and townhomes sold at an annualized pace of 5,673,249 in September, up 2 percent from August and up 14 percent year-over-year, indicating that the market is still ripe for investors with deep pockets looking to make an imprint on regional markets. “While the institutional investors are pulling back their purchases in many of the higher-priced markets-places. They are continuing to ramp up purchases in markets where median #home prices are still below $200,000. See which states are our website.

No Federal Guarantee, No 30-Year Mortgage

No Federal Guarantee, No 30-Year Mortgage
The looming debt ceiling crisis and the federal government shutdown have pushed aside pretty much every other issue in Washington today, but it won’t be too long before one of the major real estate issues facing the federal government will be back on the agenda, and that’s reform of the secondary mortgage market. Its importance can’t be overstated, because if the government stops backing conventional, conforming loans—these are the all-important loans backed by Fannie Mae and Freddie Mac–it’s unlikely we’ll have 30-year fixed-rate mortgages in the United States anymore. Watch our video to learn more...

Freddie: Expect a Housing 'Slow Down
Not Shut Down': The pace of the housing recovery showed signs of slowing heading into the fourth quarter of the year, due to the federal government shutdown, debt ceiling issues, and the slowing economy, Freddie Mac reports in its U.S. Economic and Housing Market Outlook for October.

'The housing recovery keeps chugging along despite a constant barrage of disruptions to the broader economy,” says Frank Nothaft, Freddie Mac’s chief economist. “We're likely going to see the housing recovery slow down, but not shut down, as we close out the rest of this year due to tight inventories in many markets, rising mortgage rates, and slumping consumer confidence. Fortunately, the housing recovery should continue to absorb the economic shocks in stride and improve next year.' Read more ...

Single-Family Rentals Rising even as Price Rise

Single-Family Rentals Rising even as Price Rise

Single-family rental homes are on the rise in communities nationwide in the aftermath of the housing meltdown. 

In 32 of the country's top metropolitan regions, at least 20 percent of all occupied single-family homes were rentals in 2012. According to a USA Today analysis of U.S. Census Bureau data, that is up from just seven metros in 2006. 

Researchers say the growth reflects changes brought by the housing bust and the enduring financial hardships ushered in by the Great Recession. Nationwide last year, 18 percent of occupied single-family homes were rentals — an increase from almost 15 percent in 2006. Here are five key indicators for the housing market from the National Association of REALTORS®'latest existing-homes report, which reflects September data: