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California's housing market cools

Posted by The Aramco Group on Mon, Aug 21, 2017 @ 14:08 PM

The California housing market is expected to start cooling off despite still being in the height of the summer home buying season.

"As we enter the second half of the year, we are likely to see some slowdown in sales that extends beyond the typical seasonality change," said California Association of Realtors President Geoff McIntosh. "While the rate of closed sales indicates that California's housing market has continued to move forward, tight supply continued to push up prices and lower affordability."

Statewide sales figures declined 1.1 percent from June to July as the median home price in California came in at $553,260 during the second quarter. Currently, just 29 percent of California households can afford to purchase a median priced home.

Tight inventory is expected to continue to constrain the housing market as CAR's Unsold Inventory Index remains tight. The index, which measures the number of months needed to sell the current supply of homes on the market, was a paltry 3.2 months in July.

Today, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

San Diego home sales and affordability decline

Posted by The Aramco Group on Sun, Aug 20, 2017 @ 14:08 PM

Home sales tumbled in San Diego last month, a result of affordability struggles and inventory woes that continue to plague the region. According to the San Diego Association of Realtors, 2,011 single-family homes were sold in July, a 20 percent drop from June and 10 percent less than the same month last year. Meanwhile, prices continue to climb – median sales prices are 11 percent higher than they were a year ago.

Single-family detached homes sold for a median $620,000 in July and condominiums for $405,000. These prices have led to home affordability in the San Diego area to be near its lowest level in a decade.

"We are predominantly in a seller's market," said the Association's President, Bob Kevane. "Savvy buyers, and particularly first-time buyers, will need to scramble and be purchase-ready, as they are faced with competing offers, sometimes over the asking price."

Today, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Number of equity rich homeowners increases

Posted by The Aramco Group on Sat, Aug 19, 2017 @ 14:08 PM

Rising home prices have helped 1.6 million homeowners move out of negative equity over the last year, according to a new report from ATTOM Data Solutions. As of June, there were more than 14 million homes nationwide that are equity rich – nearly a quarter of all mortgaged properties in the U.S.

The Q2 2017 U.S. Home Equity and Underwater Report also showed that the number of homes that are seriously underwater had dropped by 1.2 million over the last year. A property is considered equity rich when the combined loan amount secured by the property is 50 percent or less than the estimated market value. Conversely, a home is generally thought of to be seriously underwater when the mortgage is at least 25 percent higher than the property's estimated market value.

In San Diego, one of the most expensive housing markets in the nation, just 3.9 percent of total properties with a mortgage are seriously underwater as of the last quarter.

Meanwhile, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Down payments shrink in 2017

Posted by The Aramco Group on Fri, Aug 18, 2017 @ 14:08 PM

Homebuyers are putting less money down when buying homes – often less than 10 percent. A new report released by Black Knight Financial Services shows that borrowers are financing more of their home purchase than at any point in the last seven years.

"The increase is primarily a function of the overall growth in purchase lending," said Ben Graboske, executive vice president at Black Night Data & Analytics. "Low down payment loans have ticked upward in market share over the past 18 months as well."

Regulations put in place after the financial crisis are designed to prevent these types of borrowers from falling so far underwater on their mortgages that it leads to another crash and endless foreclosures. The loans prior to the recession were more commonly riskier adjustable rate mortgages – these are virtually nonexistent among low down payment mortgages today.

Today, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Americans' debt level reaches record high

Posted by The Aramco Group on Thu, Aug 17, 2017 @ 14:08 PM

The amount of debt held by Americans reached a record high last quarter, after having previously surpassed its pre-crisis peak earlier in the year. According to a report released this week by the Federal Reserve Bank of New York, currently Americans collectively hold more credit card, auto and mortgage debt than at any other time in U.S. history.

Total household debt reached $12,84 in the second quarter, up $552 billion on a year-over-year basis. An increase in home prices coupled with a higher rate of home buying nationwide led to a $329 billion increase in mortgage over last year.

Mortgages account for the bulk of the debt total – 67% as of last year. Tougher qualifying standards for mortgages have led to Americans holding debt having higher credit scores than in the past. More than 40 percent of debt is held by those with a credit score of 740 or higher.

Meanwhile, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Home builder confidence rebounds in August

Posted by The Aramco Group on Wed, Aug 16, 2017 @ 14:08 PM

An index of home-builder confidence grew stronger in August after dropping slightly in July. Home-builder sentiment in both the economy and the housing market climbed to a reading of 68 points, when seasonally adjusted. Readings over 50 generally indicate that builders foresee growth in the near future. This latest information comes from a monthly survey conducted by the National Association of Home Builders.

"The fact that home builder confidence has returned to the healthy levels we saw this spring is consistent with our forecast for a gradual strengthening in the housing market," said Robert Dietz, NAHB's chief economist.

Economists surveyed by The Wall Street Journal had expected an August reading of 65. Rising demand for new homes was largely behind the higher than anticipated reading. Ongoing job and economist growth, rising consumer confidence and historically low mortgage rates contributed as well. Today, conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Grocery store wars

Posted by The Aramco Group on Tue, Aug 15, 2017 @ 14:08 PM

Who knew that living near a Trader Joe's could be good for home values? But that is precisely what a new report from real estate research group ATTOM Data Solutions suggests. Homes within close proximity to a Trader Joe's grocery store saw on average, a 67 percent increase in home price appreciation over a five-year period. In comparison, homes near Whole Foods market saw a 52 percent increase in prices.  

The analysis comes from data collected by the U.S. Department of Housing and Urban Development of 1,275 zip codes nationwide. The average value of a home near a Trader Joe's was $595,288 - nearly triple the amount of the national median. This is $64,185 more than homes near Whole Foods. 

Those in the market to live near a market will find today that conforming no-point 30-year fixed mortgage rates averaging 3.875 percent while 15-year rates are near 3.125 percent. 

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Tax reform may impact homeownership

Posted by The Aramco Group on Mon, Aug 14, 2017 @ 14:08 PM

While recent headlines are focused on escalating tensions in the Korean peninsula and recent stock market records, some real estate industry groups and economists are zeroed in on Congress' proposed reforms to the personal income tax. The pending legislation essentially calls for the elimination of all tax write-offs, including items like mortgage interest. This would be offset by a doubling of the standard deduction.

Opposition to the proposal has come from real estate agents, home builders and mortgage lenders who state that the elimination of such tax benefits would create a disincentive for home buying. The National Association of Realtors has stated that "middle-income homeowners could be worse off under proposals that limit tax incentives for homeownership".

Should the standard deduction increase, most taxpayers that itemize now would no longer need to do so which could make the benefits of owning a home or giving to charities less impactful when calculating tax liability. Proponents of the bill say the elimination of various write-offs could help close tax loopholes that plague the current system.

Today, conforming no-point 30-year fixed mortgage rates averaging 4 percent while 15-year rates are near 3.25 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Apprisals, expectations gap narrows

Posted by The Aramco Group on Sun, Aug 13, 2017 @ 14:08 PM

The gap between homeowner's expectations of their home values and reality narrowed in June, according to Quicken Loans' National Home Price Perception Index. While the average homeowner is still placing too much value on their property, the difference by which homeowners overestimated their values shrank to 1.55 percent. This is down from 1.7 percent in May.

This continues a long-term trend in which homeowner expectations are growing more aligned with appraisals, largely due to consumers being more vigilant of uncertainty in the economy. According to the most recent Home Purchase Sentiment survey conducted by Fannie Mae, among the top concerns for current homeowners is the impact that an unstable economic climate could have on the housing market.

The alignment of appraisal values and individual perceptions of value is important for consumers. It helps owners understand the equity in their home when refinancing and buyers when making offers on a new home. Meanwhile, conforming no-point 30-year fixed mortgage rates averaging 4 percent while 15-year rates are near 3.25 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

'Beverly Hillbillies' house most expensive listing in U.S.

Posted by The Aramco Group on Sat, Aug 12, 2017 @ 14:08 PM

The sprawling Bel-Air estate featured in the opening credits of television series The Beverly Hillbillies, is currently the most expensive residential listing in the country. The mansion, known as Chartwell, hit the market last week with a price tag of $350 million.

Owning the iconic estate may require a rags-to-riches story as seen in the popular 1960's sitcom about the Clampett family who struck it rich in oil and moved to Beverly Hills. The property includes 10.3 acres of land and a 25,000-square foot mansion inspired by French Neoclassical design. Features include a ballroom, wine cellar, parking for 40 cars and a 75-foot pool. It was previously owned by the late Univision billionaire A. Jerrold Perenchio.

Chartwell, however, is chump-change in comparison to the 400,000-square-foot skyscraper home in Mumbai, India which Forbes has labeled the most expensive home in the world. Its value is estimated to be between $1 to 2 billion dollars.

Today, conforming no-point 30-year fixed mortgage rates averaging 4 percent while 15-year rates are near 3.25 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.