Freddie Mac released the results of its Primary Mortgage Market Survey, which says that mortgage rates are still below six percent for the sixth consecutive week. Frank Nothaft, Freddie Mac's vice president and chief economist says, "According to the Mortgage Bankers Association, purchase applications hit a record high last week, and this can be directly attributed to continuing low mortgage rates. We expect mortgage rates to remain relatively low for the time being."
That’s certainly good news for the housing market.
Speaking of mortgages, Realty Times columnist David Reed has posted a five-part series called Getting the Best Interest Rate . If you're planning on buying a home or helping a homebuyer in the near future, you will not want to miss this series.
Last week President Bush spoke to the National Association of Realtors. He said, "Our Realtors play a crucial role in the American experience - owning a home. One role of government is to promote ownership. Last year we set a record: 69 percent of Americans own a home. There are 74 million homeowners. The country is halfway to its goal - to increase minority home ownership; to double it by 2010."
Realtors are our heroes, too. Realty Times now has more than 7,000 of these professionals experts who are informing the public about real estate market conditions from Nova Scotia, Canada, to San Diego. Check the front page of Realty Times for Today's Market Condition Reports . For all the information you need about marketing or working with buyers and sellers, or buying or selling a home, Realty Times is the place to find the latest news and information. Realty Times is the leading publication dedicated to helping Realtors to sell more homes.
Realty Times' Market Conditions Reports
In Greenwich, Connecticut , according to our local Realtor experts, the 2005 Spring market in remains hot, despite unseasonably cool weather. Prices are still on the high side, but with over 500 new listings and single-family home prices ranging from the mid-$500,000s to the millions there is something for everyone. The demand for condominium investments is still strong with a wide selection available. Because interest rates are still low, people are continuing to look for real estate investment in Greenwich. Our Realtors there tell us that buyers and sellers are both benefiting from the strong market. The highest price reported on the market is $15,500,000 with 71 properties on the market and an average market time of 75 days.
Our Realtor reporters in Blaine, Minnesota , tell us that the market continues to be one of the widest ranging when it comes to home buying. There are currently 334 homes for sale with prices from $150,000 to $2,300,000 for luxury homes. Starter housing is available with 67 properties currently for sale under $200k. The slowest market appears to be the homes in the 300-400k market as they now have an average market time of nearly 100 days.
The Hampton Roads area in Chesapeake, Virginia , is currently experiencing a strong seller's market. Prices are continuing to increase while mortgage interest rates are staying low. Our expert Realtors tell us that the local economy continues to be bolstered by the strong military presence and company transfers. This trend shows Hampton Roads is a great investment. There are very few homes for sale and most of the listings have multiple offers within 24 hours. Homes, in most cases, are selling for thousands more than the asking price. Buyers are waiving home inspections, writing "as is" contracts, and many are offering to pay cash over the appraisal. We're told that sometimes, the buyers cry real tears! That includes the agents too!
This Week, Realty Times TV Viewers Asked
John from Florida asks: I live on a golf course. There are 20 expensive custom houses built on the greens. I am trying to get an appraisal of our house. None of the 20 golf houses have ever been sold; all of the owners are original purchasers. However, lower-priced houses not on the golf course have changed hands, and will be used to determine local values. I know that all the houses on the golf course are worth much more than what the appraisal is going to be. What is the solution if I want to be the first to sell?
Answer: You assume that appraisers will not allow extra value for your superior location. In fact, appraisers will undoubtedly give your home a higher valuation precisely because it materially differs from homes not directly on the greens. The question is how much of a differential can you expect? One general clue might be to look at percentage differences in the original sale prices between your home, and those more distant from the course.
Jane from Tulsa asks: My husband and I are building a house that is scheduled to be completed within six months. With the Federal Reserve hiking interest rates, mortgage rates are also expected to go up. Does it make sense to pay for an extended rate lock or just buy points at closing to reduce the interest rate?
Answer: No one knows where mortgage rates will be in six months -- or if your new home will be finished. Many economists and commentators, as an example, believed six months ago that today's rates would be substantially higher, but despite eight consecutive increases in the federal funds rate, interest levels today are actually lower than at the beginning of the year.
In effect, any choice you make has risk. It may be that in six months you can get financing at today's rates without paying dollars up front to buy-down the rate. Or maybe not.
Dennis from Virginia asks: We're in an obviously "hot" market. We recently accepted an offer on our house but the appraisal was $17,500 below the selling price. We just had the house appraised in December and then it was $10,000 more than the current appraisal. What happens now? Isn't there any leeway for appraisers? Just because our neighbors undervalued their properties, is there any way for us not to be penalized by their marketplace weakness?
Answer: The current appraisal is $17,000 below the selling price. The December appraisal was $10,000 more than the current valuation. That means the December appraisal was still $7,000 below the current sale price. In neither case does an appraisal support your sale price.
The problem is this: Lenders make loans on the basis of the sale price or the appraised value, whichever is less. In this situation, you could ask the buyer to put up more cash, ask the lender for a second appraisal, reduce the sale price or arrive at some compromise.
If you need funds for repairs and upgrades after purchase, then consider the FHA 203k rehab loan program. With this loan you receive money to acquire a property plus additional money for repairs. Speak with loan officers for details.
