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Monthly Archives: April 2013

Gap continues to close between interest of conforming and jumbo loans

According to recent reports from the Mortgage Bankers Association (MBA), an analytics group that monitors roughly three quarters of all mortgage activity nationwide, interest rates on jumbo loans are continuing to align with those of conforming mortgage agreements.

On April 19, rates on the 30-year fixed-rate jumbo loan were 3.75 percent on average - only 0.10 percent higher than the conforming option, which had interest of 3.65 percent at that time. Only a year ago, the difference in these rates was significantly larger, with interest on jumbo mortgages roughly 0.875 percent higher than conforming loans.

Buyers scrambling to close on the few homes remaining on the market

If you are in the market for a new home, the clock may be ticking before someone else gets their hands on the property you desire, as a recent report from the U.S. Census Bureau found that the national housing stock stands at its lowest level in roughly five years.

At the current pace of sale, the number of homes that are on the market at this time will be completely absorbed within 4.4 months, the data shows. At the end of March, the Census Bureau estimated that there were only about 153,000 new homes listed for sale.

Housing market inches closer to full recovery

Trulia, a real estate industry analytics group, recently released a report that showed the United States is more than halfway near pre-recession levels when it comes to the housing market, as sales and home prices continue to improve year-over-year.

In the group's Housing Barometer for March, they determined that the country was roughly 56 percent back to normal when it came to real estate, compared to only 43 percent during the same period last year. This report shows that while there are clearly still hurdles to overcome in even the fastest-improving sector of the U.S. economy, strides continue to be made.

Home prices continue to increase as competition grows among buyers

New data released by the National Association of Realtors (NAR) showed that home sales dipped slightly in March compared to February, though figures were still more than 10 percent higher than over the same span a year ago.

The recent downtick in sales was hardly a sign that the housing market isn't experiencing a robust yet steady recovery, as the group also pointed to the fact that the average asking price for a new property continues to increase. In fact, it appears that the only thing holding back the housing market at this time is a low supply of new homes for sale.

Homeowners saving significantly when refinancing their mortgages

Over the past three weeks, reports from Freddie Mac, a government-backed mortgage insurer, and the Mortgage Bankers Association (MBA) have shown that interest rates on the most popular home loan packages have entered a downward trend. This comes on the heels of steady rises in mortgage interest throughout March, which many analysts had seen as a sign that the days of record-low rates are now behind us.

As a result, more homeowners than ever have been taking advantage of mortgage refinance over the past several months in an attempt to lower monthly loan payments and make owning a property more affordable.

Rates drop on conforming, jumbo mortgages

According to reports from government-backed mortgage securer Freddie Mac, average interest on the most popular fixed-rate home loan packages slid yet again last week.

In the group's weekly Primary Mortgage Markets Survey (PMMS), it was recorded that rates on the 30-year fixed-rate package slid to an average of 3.41 percent for the week ending April 18. This marks the third consecutive week of steady decline for mortgage rates, after tumbling below 3.5 percent earlier in the month for the first time since late January.

First-time buyers are purchasing more expensive, larger homes than their parents

A recent study conducted by the Detroit Free Press has found that first-time home buyers are purchasing significantly more expensive properties than they had been a generation ago. Specifically, young couples without children, whether they are married or not, have been gobbling up "starter homes" at a faster rate than their parents, or even the same demographic only a decade ago.

One example used by the source was a couple from Macomb Township, Michigan, who were less than three weeks away from getting married when the story was published on April 8. The pair, who are 28 and 30 years old, were able to purchase a 3,100 square foot property with luxury features like granite countertops and hardwood flooring for roughly $300,000.

Sales of vacation homes increase in 2012

With summer right around the corner, many homeowners have begun saving up for a vacation with their family. While some people will spend a large sum of money on a cruise or stay at an exotic resort, recent reports are finding that many Americans are actually investing in secondary vacation properties to spend their summer vacations at.

According to the National Association of Realtors (NAR), the number of homeowners who bought secondary vacation properties in 2012 increased markedly from the year before. In the group's 2013 Investment and Vacation Home Buyers Survey, group noted a 10 percent increase year-over-year in the sale of vacation homes.

Housing starts up markedly in April

There has been a flurry of good news recently for the national housing market, as average interest rates on seemingly all kinds of home loan packages - whether those are conforming or jumbo mortgages - have begun to descend yet again toward record lows.

Because of the favorable borrowing conditions, buyers have flooded the market and swallowed up what few properties were available on the market, causing major shrinkage in the national housing stock. As a result, what homes remain on the market are increasingly more expensive than similar properties were at the height of the Great Recession. Now, in order to finance these significantly more expensive properties, borrowers have been taking out larger, non-conforming jumbo loans in droves, with activity in this sector up markedly compared to the year earlier.

Jumbo loans lead the way in latest figures from MBA

An April 11 report from the Mortgage Bankers Association (MBA) showed that the number of mortgage applications filed over the second week of April surged compared to figures from a week earlier, although borrower interest in conforming loans showed a sharp decline.

Leading the way was a huge increase in the number of jumbo loan applications, which now account for roughly 10 percent of all new applications.