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Mehran Aram

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Home prices beyond affordable

Posted by Mehran Aram on Mon, Jul 8, 2019 @ 09:07 AM

The gap between what homebuyers want to pay for a home and what a home costs appears to be growing. A study conducted by Realtor.com found that, nationally, half of today’s house-hunters are looking to purchase a property for under $288,000. But that’s a 9.1 percent gap or $27,000 less than the median national home price.

Experts boil the dilemma down to the basic economic principle of supply and demand. There simply aren’t enough homes on the market that the average American can afford to buy. Although inventory is growing, it’s doing as at the top of the market – home's priced above $750,000.

“Entry-level homes continue to be difficult to come by as the inventory composition shifts more and more toward higher prices homes,” said Danielle Hale, chief economist for Realtor.com. “This is causing smaller and more affordable homes to appreciate rapidly, resulting in a mismatch between what buyers are able to spend and what sellers expect to receive.”

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: home prices, home purchase, homebuyers, Mortgage rates, Realtor.com, Realtors, median home price, Affordability, home inventory

Construction spending continues rough patch

Posted by Mehran Aram on Fri, Jul 5, 2019 @ 05:07 AM

A surge early in the year was not enough momentum to push construction spending higher in the second quarter. New figures for May released by the U.S. Census Bureau shows a 0.8 percent decline in construction spending from April. On a year-over-year basis, overall spending is off by 2.3 percent, largely due to it being dragged down by an 11.2 percent drop in residential construction.

Although new polling shows that homebuilders are optimistic about the future of the housing market, spikes in material costs and a labor scarcity is putting the brakes on increases in construction projects.

Homebuilders also appear to be focusing more on multi-unit dwellings like apartment buildings. As construction spending shrank in most other areas, multi-family spending rose 9.3 percent.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: single family homes, Mortgage rates, Homebuilders, Construction Spending, U.S. Census Bureau

Reverse mortgage changes appear to be working

Posted by Mehran Aram on Thu, Jul 4, 2019 @ 07:07 AM

As home equity levels continue to rise, the popularity of reverse mortgages is growing and because of changes implemented four years ago, the process is smoother than ever. In 2014, the Federal Housing Administration began requiring that all prospective borrowers submit to a complete financial assessment to determine if a reverse mortgage would benefit them. A new study shows that this new requirement has resulted the number of defaults dropping substantially.

The financial assessment includes reviewing a borrower’s credit history, any risks in their ability to maintain the terms of the loan and an examination of their income to make sure tax payments and insurance payments are affordable.

A reverse mortgage is a powerful financial tool that allows borrowers 62 years or older to use their home’s equity to eliminate monthly mortgage payments while also receiving supplemental income in the form of a lump sum, monthly payout or a line of credit.

Today, conventional conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: Reverse Mortgage, Mortgage rates

Low mortgage rates saving homeowners millions

Posted by Mehran Aram on Wed, Jul 3, 2019 @ 16:07 PM

With mortgage rates near their lowest point in years, millions of homeowners could benefit from refinancing their current mortgage. According to real estate analytics firm Black Knight, 8.2 million borrowers could lower their monthly mortgage payments by at least 75 basis points. That’s about $266 per month in savings.

Since mortgage rates began their steady decline last quarter, the volume of refinances has increased significantly. Mortgage applications to refinance a home loan were up 92 percent last week on a year-over-year basis.

In addition to locking in lower rates, refinance also provide the opportunity for borrowers to tap into their home’s equity. With rising home values, Black Knight has reported that the average homeowner has $136,000 in tappable equity.

Today, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: home purchase, homeowners, home equity, Mortgage applications, refinance, Mortgage rates, Mortgage Payments, Refi, Low Mortgage Rates

San Diego County property tax revenue climbs higher

Posted by Mehran Aram on Tue, Jul 2, 2019 @ 05:07 AM

When the nearly one million property tax bills get mailed to San Diego County residents later this year, it will be the fifth year in a row that the total amount due has grown by more than five percent. County Assessor Ernest Dronenburg announced last week that the expected assessed value of all taxable property in San Diego will amount to just under $575 billion. This is a six percent increase over last year.

California’s Proposition 13 however protects residents from property tax increases more than two percent in a fiscal year, so that actual revenue is expected to be $551.9 billion. The assessments are not just on homes but include parcels of land, businesses, boats and airplanes in San Diego as well.

Income to the County from property taxes help fund public services like police and fire departments, schools and parks.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: San Diego County, San Diego, property taxes, Mortgage rates, San Diego Housing Market, Assessors Office, California Proposition 13, Prop 13, San Diego County Assessors Office, Ernest Dronenburg

Pending home sales rebound in May

Posted by Mehran Aram on Mon, Jul 1, 2019 @ 05:07 AM

The National Association of Realtors reported last week that after a setback in April, pending home sales bounced back in May, increasing 1.1 percent. The NAR’s Pending Home Sales Index is a measure of newly signed contracts for home purchases.

The increase was not enough to push home sales back to 2018 levels, making May the seventeenth consecutive month of year-over-year declines. With mortgage rates remaining low ahead of the busy summer home-buying season, some speculate that the slowing sales pace could reverse course.

“Rates of 4 percent, and in some cases even lower create extremely attractive conditions for consumers,” said Lawrence Yun, NAR’s chief economist. “Job creation and a rise in inventory will nonetheless drive more buyers to enter the market.”

Today, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: home purchase, National Association of Realtors, Mortgage rates, home purchases, Pending Home Sales

Wage struggles for Calif. renters

Posted by Mehran Aram on Sun, Jun 30, 2019 @ 08:06 AM

A worker in California will need to make nearly $35 per hour to afford to rent a two-bedroom home in the State according to a new report. This amount is three-times the current minimum wage and makes California one of the most unaffordable rental markets in the nation.

A report released by The National Low Income Housing Coalition shows that California ranked second in hourly wages required to afford median rent prices. Hawaii took the top spot. The rankings were based on the cost of a two-bedroom dwelling based on the concept that living costs should take up no more than 30 percent of monthly income.

As it is with overall housing costs, San Diego costs more for renters. A resident would have to make nearly $40 per hour to afford rent prices. The average renter in San Diego makes $20.78 per hour of work.

Today, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: San Diego County, San Diego, California, Wages, Mortgage rates, San Diego Housing Market, rental market, Wage Struggles, Minimum Wage, National Low Income Housing Coalition, Hourly Wages

‘Beverly Hillbillies’ house gets deep discount

Posted by Mehran Aram on Sat, Jun 29, 2019 @ 07:06 AM

The most expensive house for sale in the United states just got a little cheaper. The sprawling Bel-Air estate featured in the opening credits of the classic television series The Beverly Hillbillies, was discounted last week bringing its current asking price to $195 million. That’s a $50 million price cut from the $245 million price tag when it went up for sale in October 2018 and $95 million less than when the property was announced was first brought on the market in August 2017.

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.

The home was constructed in 1933 and features stunning views of Los Angeles and the Pacific Ocean. With a requisite 20 percent down, mortgage payments would shake out to be about $920,000 per month.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: Los Angeles, Mortgage rates, Beverly Hillbillies, Bel-Air, Bel-Air Estate, Classic Television, TV Show, Classic TV, Los Angeles Housing Market

Home price growth slows in April

Posted by Mehran Aram on Fri, Jun 28, 2019 @ 06:06 AM

The rate at which home prices in the U.S. continued to decline in April, the latest in a series of indicators that conditions are slowly changing to a buyers’ market. Average home prices rose 3.5 percent in April compared to the same month last year, down from 3.7 percent in March and 3.9 percent in February. This latest data comes from the S&P CoreLogic Case-Shiller National Home Price Index.

Market experts are describing the slowdown as a moderation after years of rapid acceleration in home values that priced out many would-be home buyers. The effect of the more moderate price growth coupled with low mortgage rates was seen last month in a uptick in existing home sales as reported by the National Association of Realtors.

It is expected that buyers will continue to enjoy more modest price increases and low mortgage rates for the foreseeable future.

Today, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: home prices, National Association of Realtors, Mortgage rates, S&P CoreLogic Case Shiller, Price Increases

Americans purchasing fewer new homes

Posted by Mehran Aram on Thu, Jun 27, 2019 @ 05:06 AM

The rate at which homebuyers in the U.S. are purchasing new homes is currently at its lowest pace in over six months according to new data. Purchases of newly built single-family homes fell by 7.8 percent in May to a seasonally adjusted annual rate of 626,000, acording to the U.S. Department of Commerce. This is below economists’ expectations in a survey conducted by The Wall Street Journal who forecasted new home sales to be closer to 683,000.

As they sit on the market unsold, the supply of newly built homes on the market is increasing. New home inventory was approximately 6.4 months as of May, up from 5.6 months last year.

Sales of newly built homes have flatlined for most of the past year as builders failed to focus on entry level priced homes and instead flooded the market with larger, more expensive dwellings.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 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.

Topics: homebuyers, single family homes, new home sales, U.S. Department of Commerce, Mortgage rates