Mortgage closing costs are up 6 percent over the past year, according to a report from Bankrate.com.
The average closing cost across the United States rose over the year to $2,402. Origination fees increased 8 percent to $1,730—accounting for the bulk of the increase in closing costs—while third-party fees rose 1 percent to $672.
In terms of highest average closing costs, Hawaii took the top spot with an average of $2,919. It was joined in the top five by Alaska ($2,675), South Carolina ($2,658), California ($2,639), and New Mexico ($2,566).
To find its results, Bankrate surveyed up to 10 lenders in all 50 states as well as the District of Columbia. Costs involved include fees charged by lenders and third-party fees for services such as appraisals; they exclude taxes, title fees, property insurance, association fees, interest, and other prepaid items.
Source: DS News
Saturday, August 10, 2013
Friday, August 9, 2013
MBA: Delinquencies, Foreclosures Recede to More 'Normal' Levels
The percentage of homeowners behind on their mortgage fell to the lowest level since 2008, with a decrease in 90-plus delinquencies driving the improvement, according to a report from the Mortgage Bankers Association (MBA).
On a seasonally adjusted basis, the national mortgage delinquency rate on one-to-four unit residences stood at 6.96 percent in the second quarter, a decrease from 7.25 percent in the first quarter and 7.58 percent a year ago. "For most of the country, delinquencies and foreclosures have returned to more normal historical levels," said Jay Brinkmann, MBA's chief economist and SVP of research and economics.
Source: DS Newa
Saturday, August 3, 2013
California Home Price Increases Expected to Slow
Home Price Increases Expected to Slow Rapid home price growth across California has called for concerns of yet another housing “bubble” on the horizon.
According to the latest C.A.R. data, median price of sold homes jumped almost 32 percent over the last year. While CAR’s median home price measure is affected by the mix of sales, other indicators which measure home price changes on the same home show similar increases. The Case-Shiller Index, for example, showed a 25 percent home price increase from the year before in the Los Angeles metropolitan area in April. The San Francisco metropolitan area had a 30 percent increase, while San Diego showed a 21 percent increase.
An increase in prices itself does not equate to a bubble. During the last boom, price appreciation was fueled by sub-prime loans that were packaged as mortgage-backed securities and increases in construction activity which was not supported by demographics.
Current price appreciation is driven by the lack of available inventory of homes for sale.
The depletion of inventory is the result of several factors:
Going forward however, the pace of house price gains is expected to slow.
There are several reasons to expect a slowdown in price growth. If prices continue rising at 12 percent year over year, housing will be overvalued relative to rents within the next few months and relative to incomes in early-2015.
In addition to increases in mortgage rates, which have been rising, mortgage servicing costs will rise by two to three percent of income each year.
Further, with increased prices and tight inventory, investors are having a harder time finding bargains. With fewer discounts available, investors are seeing their yields disappear.
Demand from traditional buyers will need some time to replace investors which will take a little of the steam out of the market. Also, sellers are starting to return to the market and putting their homes up for sale in greater numbers.
Price boosts have elevated some previously underwater homeowners and allowed them to gain back a portion of their equity.
The inventory of homes available for sale increased about 2 percent between April and May, and has shown increases since the beginning of this year. Also based on the sharp increase in the share of consumers who think that now is a good time to sell, further increases in inventory are underway.
Tight inventory has been a key driver of home price increases, but as the balance of supply and demand inches closer to equilibrium, price gains will slow and we expect home price appreciation to flatten to about a four percent annual increase in 2014.
Source: California Association of Realtors
According to the latest C.A.R. data, median price of sold homes jumped almost 32 percent over the last year. While CAR’s median home price measure is affected by the mix of sales, other indicators which measure home price changes on the same home show similar increases. The Case-Shiller Index, for example, showed a 25 percent home price increase from the year before in the Los Angeles metropolitan area in April. The San Francisco metropolitan area had a 30 percent increase, while San Diego showed a 21 percent increase.
An increase in prices itself does not equate to a bubble. During the last boom, price appreciation was fueled by sub-prime loans that were packaged as mortgage-backed securities and increases in construction activity which was not supported by demographics.
Current price appreciation is driven by the lack of available inventory of homes for sale.
The depletion of inventory is the result of several factors:
- First, distressed property (foreclosures, short sales, REOs) inventory was absorbed by investors who intend to keep the properties instead of flipping them.
- Second, there has been an influx of international buyers in the U.S. housing market, and particularly in the California markets.
- Thirdly, construction activity in California came to a halt following the housing bust.
- And lastly, nearly one in five homeowners in California is still underwater on their home mortgages.
Going forward however, the pace of house price gains is expected to slow.
There are several reasons to expect a slowdown in price growth. If prices continue rising at 12 percent year over year, housing will be overvalued relative to rents within the next few months and relative to incomes in early-2015.
In addition to increases in mortgage rates, which have been rising, mortgage servicing costs will rise by two to three percent of income each year.
Further, with increased prices and tight inventory, investors are having a harder time finding bargains. With fewer discounts available, investors are seeing their yields disappear.
Demand from traditional buyers will need some time to replace investors which will take a little of the steam out of the market. Also, sellers are starting to return to the market and putting their homes up for sale in greater numbers.
Price boosts have elevated some previously underwater homeowners and allowed them to gain back a portion of their equity.
The inventory of homes available for sale increased about 2 percent between April and May, and has shown increases since the beginning of this year. Also based on the sharp increase in the share of consumers who think that now is a good time to sell, further increases in inventory are underway.
Tight inventory has been a key driver of home price increases, but as the balance of supply and demand inches closer to equilibrium, price gains will slow and we expect home price appreciation to flatten to about a four percent annual increase in 2014.
Source: California Association of Realtors
Friday, August 2, 2013
Chino Hills June 2013 Market Stats
Median Home Value
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During May median
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Market Stats
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HOUSING MARKET HAS BUYERS WILLING TO USE 'AGGRESSIVE TACTICS'
The frenzied market in real estate has prospective home buyers
ready to gamble, according to a study.
Two-thirds of would-be homeowners would resort to “aggressive tactics” --
such as paying the seller’s closing costs, bidding above the asking price or
borrowing money from loved ones for a down payment -- to get the home of their
dreams, according to the survey by real estate website Trulia.
“Consumers are worried that mortgage rates and prices will keep rising before they buy, and many are willing to fight over the limited number of homes for sale,” Jed Kolko, Trulia's chief economist, said in a statement.
Trulia said young adults -- ages 18 to 34 -- are more willing to resort to
tactics the firm labels aggressive, with 30% of those respondents willing to pay
the seller’s closing costs and 31% willing to bid 1% to 5% over asking
price.
Home prices in major U.S. cities rose 12.1% in April from a year earlier, according to Standard & Poor's/Case-Shiller index of 20 large U.S. cities. Since the beginning of May, the average rate for a 30-year fixed mortgage has risen roughly one percentage point.
Source: LATimes July 28, 2013
“Consumers are worried that mortgage rates and prices will keep rising before they buy, and many are willing to fight over the limited number of homes for sale,” Jed Kolko, Trulia's chief economist, said in a statement.
According to the survey, 25% of respondents would bid 1% to 5% over a home’s
asking price, and the same percentage would offer to cover the seller’s closing
costs.
Home prices in major U.S. cities rose 12.1% in April from a year earlier, according to Standard & Poor's/Case-Shiller index of 20 large U.S. cities. Since the beginning of May, the average rate for a 30-year fixed mortgage has risen roughly one percentage point.
Source: LATimes July 28, 2013
6 Wills, Won'ts and Worries of 2013 Home Buyers
Today’s rapidly rising prices and generally volatile market does make things tough for buyers, so we thought we’d systematically explore – and then share – what’s going on inside the minds of the buyers on today’s market. Hopefully, sellers will find some insights for marketing their properties, too.
Fresh off the presses, here are some of the insights and takeaways from our latest American Dream Survey, pinpointing the things today’s buyers worry about, will and won’t do in their quest to get their own corner of the American Dream: a home.
Worry: Mortgage rates and prices will rise before I buy. Trulia’s Economist Jed Kolko reports that “the top worry among all survey respondents who might buy a home someday is that mortgage rates will rise further before they buy (41%), followed by rising prices (37%).” The worry is valid, given the fact that the market was depressed for so long and has a long recovery road ahead of it. It’s compounded by the fact that buying a home has gone from something that used to take a month or two and now routinely takes 6 months, 9 months, a year or even longer!
Here’s the deal: you can’t stop prices from rising. And fixating on this particular fear poses the potential pitfall of rushing to buy or making compromises that will turn out badly in the end. Don’t dilly dally, if you’re ready and in the market, and don’t mess around making lowball offers with no chance of success. But otherwise, don’t let this fear drive your buying and timing decisions.
Will: Be aggressive. B. E. Aggressive. Economist Kolko explained, “among survey respondents who plan to buy a home someday, 2 in 3 (66%) would use aggressive tactics such as bidding above asking, writing personal letters to the seller, or removing contingencies, to name a few.” What buyers do and don’t do in the name of aggressively pursuing their dream homes (and, consequently, what sellers expect) is slightly different in every town.
Knowing that other buyers are facing down the same challenges you are and coming up with similar, aggressive solutions can help you feel a little less crazy about your thought processes and emotions and the desperate measures that come to mind when you hear how many others think “your” home is their dream home. And that puts you back in control of what can sometimes feel like an out-of-control situation. Reality check: you are 100% in the driver’s seat when it comes to how aggressive you want to be in your pursuit of any given home, and which specific tactics you leverage in the course of that pursuit.
Worry: I won’t find a home I like. Forty-three percent of people who plan to buy a home in the next 12 months expressed the concern that they might not be able to even find a property they like. Perhaps these people were just seriously persnickety, but I suspect there’s a bigger issue at play here. All of us can find a home we like, but whether there’s anything we like enough to buy in our price range is a completely separate issue.
This worry, then, seems to be closely related to the fear of rising prices - buyers are rightfully fearful that home value increases will put their personal dream homes out of their price range. This is why it’s super important to:
The sooner you put yourself seriously in the game and make reality-based offers, the more likely you’ll be able to score a home you like in your price range.
Worry: I will have to compete with other buyers for the home I like. Twenty-seven percent of those who plan to buy at some point in the future and 32% of those who plan to buy in the next year said they feared the prospect of facing a bidding war. This worry is well-grounded. In California, the average property receives four offers – but stories of dozens of offers abound. And it’s not just a West Coast phenomenon: buyers from coast to coast trade tales of getting outbid and having to throw in their firstborn child, lastborn puppy and most precious earthly possessions just to get into contract.
Truth is, market dynamics vary from town to town, and even neighborhood to neighborhood, but if you’re buying on today’s market or planning to buy anytime soon, bidding wars, multiple offers and over-asking sales prices are a reality you will probably have to factor into your house hunt.
Won’t: Bid way more than asking. Only 9 percent of wanna-be buyers said they would bid between 6 and 10 percent over the asking price for a property. This finding surfaces the uber-importance of checking in with an experienced local agent to get a briefing on precisely how much over asking homes are selling for in your area. This empowers you to tweak your online house hunting price range low enough that you can make an over-asking offer and be successful without breaking the bank. And once you’ve gotten a reality-based estimate of the over-asking norm, it will loom less ominously in your mind’s eye as a potential American Dream-killer.
Worry: I won’t qualify for a mortgage. Thirty percent of all people who identified themselves as planning to buy a home in the future said they were worried they might not be able to qualify for a home loan. (Interestingly, only 25 percent of buyers in hot markets like Oakland and Las Vegas expressed this concern – rapidly rising prices and knowing lots of other buyers are closing transactions in your town seems to ease this fear.)
Of all the worries on the list, this is the one over which a smart buyer has the most power. So exercise it! Work with a mortgage broker who was referred by friends, family members or an agent you trust. And ideally, work with them months – even a year or more – before you plan to buy. They can help you put an action plan in place around boosting your savings and credit score, and minimize your debt and credit dings, that you can work to minimize mortgage qualifying dramas when the time is right. They can also help give you a stronger sense of what you can afford vis-a-vis your income, to help you anticipate any challenges related to what sort of home your dollar will buy in your market.
Source: Trulia Article by By Tara-Nicholle Nelson | Broker in San Francisco, CA // July 30, 2013
Fresh off the presses, here are some of the insights and takeaways from our latest American Dream Survey, pinpointing the things today’s buyers worry about, will and won’t do in their quest to get their own corner of the American Dream: a home.
Worry: Mortgage rates and prices will rise before I buy. Trulia’s Economist Jed Kolko reports that “the top worry among all survey respondents who might buy a home someday is that mortgage rates will rise further before they buy (41%), followed by rising prices (37%).” The worry is valid, given the fact that the market was depressed for so long and has a long recovery road ahead of it. It’s compounded by the fact that buying a home has gone from something that used to take a month or two and now routinely takes 6 months, 9 months, a year or even longer!
Here’s the deal: you can’t stop prices from rising. And fixating on this particular fear poses the potential pitfall of rushing to buy or making compromises that will turn out badly in the end. Don’t dilly dally, if you’re ready and in the market, and don’t mess around making lowball offers with no chance of success. But otherwise, don’t let this fear drive your buying and timing decisions.
Will: Be aggressive. B. E. Aggressive. Economist Kolko explained, “among survey respondents who plan to buy a home someday, 2 in 3 (66%) would use aggressive tactics such as bidding above asking, writing personal letters to the seller, or removing contingencies, to name a few.” What buyers do and don’t do in the name of aggressively pursuing their dream homes (and, consequently, what sellers expect) is slightly different in every town.
Knowing that other buyers are facing down the same challenges you are and coming up with similar, aggressive solutions can help you feel a little less crazy about your thought processes and emotions and the desperate measures that come to mind when you hear how many others think “your” home is their dream home. And that puts you back in control of what can sometimes feel like an out-of-control situation. Reality check: you are 100% in the driver’s seat when it comes to how aggressive you want to be in your pursuit of any given home, and which specific tactics you leverage in the course of that pursuit.
Worry: I won’t find a home I like. Forty-three percent of people who plan to buy a home in the next 12 months expressed the concern that they might not be able to even find a property they like. Perhaps these people were just seriously persnickety, but I suspect there’s a bigger issue at play here. All of us can find a home we like, but whether there’s anything we like enough to buy in our price range is a completely separate issue.
This worry, then, seems to be closely related to the fear of rising prices - buyers are rightfully fearful that home value increases will put their personal dream homes out of their price range. This is why it’s super important to:
- be aggressive about seeing suitable properties as soon as they come onto the market
- work with an agent whose offer pricing advice you trust
- adjust your house hunt downward in price range if the market dynamics include lots of over-asking sales prices, and
- not to let months and months go by while you make lowball offers or otherwise be slow to come to the reality of what homes are actually selling for in your area.
The sooner you put yourself seriously in the game and make reality-based offers, the more likely you’ll be able to score a home you like in your price range.
Worry: I will have to compete with other buyers for the home I like. Twenty-seven percent of those who plan to buy at some point in the future and 32% of those who plan to buy in the next year said they feared the prospect of facing a bidding war. This worry is well-grounded. In California, the average property receives four offers – but stories of dozens of offers abound. And it’s not just a West Coast phenomenon: buyers from coast to coast trade tales of getting outbid and having to throw in their firstborn child, lastborn puppy and most precious earthly possessions just to get into contract.
Truth is, market dynamics vary from town to town, and even neighborhood to neighborhood, but if you’re buying on today’s market or planning to buy anytime soon, bidding wars, multiple offers and over-asking sales prices are a reality you will probably have to factor into your house hunt.
Won’t: Bid way more than asking. Only 9 percent of wanna-be buyers said they would bid between 6 and 10 percent over the asking price for a property. This finding surfaces the uber-importance of checking in with an experienced local agent to get a briefing on precisely how much over asking homes are selling for in your area. This empowers you to tweak your online house hunting price range low enough that you can make an over-asking offer and be successful without breaking the bank. And once you’ve gotten a reality-based estimate of the over-asking norm, it will loom less ominously in your mind’s eye as a potential American Dream-killer.
Worry: I won’t qualify for a mortgage. Thirty percent of all people who identified themselves as planning to buy a home in the future said they were worried they might not be able to qualify for a home loan. (Interestingly, only 25 percent of buyers in hot markets like Oakland and Las Vegas expressed this concern – rapidly rising prices and knowing lots of other buyers are closing transactions in your town seems to ease this fear.)
Of all the worries on the list, this is the one over which a smart buyer has the most power. So exercise it! Work with a mortgage broker who was referred by friends, family members or an agent you trust. And ideally, work with them months – even a year or more – before you plan to buy. They can help you put an action plan in place around boosting your savings and credit score, and minimize your debt and credit dings, that you can work to minimize mortgage qualifying dramas when the time is right. They can also help give you a stronger sense of what you can afford vis-a-vis your income, to help you anticipate any challenges related to what sort of home your dollar will buy in your market.
Source: Trulia Article by By Tara-Nicholle Nelson | Broker in San Francisco, CA // July 30, 2013
Thursday, August 1, 2013
Foreclosures Rise in June, But See Big Drop for Year
-(See my July 11th posting which highlights falling foreclosures for May)-
Completed foreclosures rose 2.5 percent in June from May, CoreLogic reported Tuesday. Its report follows another recent one from Lending Processing Services that showed nearly a 10 percent rise in the national delinquency rate in June compared to May.
About 1 million homes are in the foreclosure inventory as of June, CoreLogic reports. That does mark a 28 percent decrease in the foreclosure inventory compared to last year.
Forty-nine states reported a year-over-year decline in foreclosure rates in June.
"The housing market is clearly on the mend, but we expect the ultimate conclusion of the present housing down cycle to be another several years away,” says Anand Nallathambi, president and CEO of CoreLogic.
CoreLogic reports the five states with the largest foreclosure inventories -- as a percentage of mortgaged homes -- in June were:
- Florida: 8.6%
- New Jersey: 6%
- New York: 4.8%
- Connecticut: 4.2%
- Maine: 4.1%
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