Still Cheaper to Purchase

Trulia has released its latest Rent vs. Buy Report, revealing whether buying a home is more affordable than renting in America's 100 largest metropolitan areas.  Looking at homes for sale and for rent on Trulia between June 1 and August 31, 2013, this study compares the average cost of renting and owning for all homes on the market in a metro area, factoring in all cost components including transaction costs, taxes, and opportunity costs.

In the last year, the rate for a 30-year fixed-rate loan rose from 3.75% to more than 4.50%, raising the cost of buying home relative to renting.  Homeownership is now 35% cheaper than renting nationally, down from being 45% cheaper one year ago.

"While it's hard to believe after the recent spike in rates, it's still more than one-third cheaper to buy a home than to rent," said Jed Kolko, Trulia's chief economist.  "Recent rate and home price increases have made buying significantly more expensive than last year, but not enough to tip the math in favor of renting.  This is because rates remain well below historical norms, and prices are still slightly undervalued, too."

Source: NAMP Daily 

Compliments of Suzanne Smith

HNB Mortgage

Move Up Buyers - Join The Party!

Housing demand from move-up buyers selling their current properties to replace them with a more expensive home is on the rise as home equity levels improve.  As home prices continue to increase, so does demand from move-up buyers, who are now able to provide a substantial down payment on a new home after gaining value on rising equity, the latest report from real estate data firm FNC revealed.  "An important sign of a healthy and sustainable recovery is increased housing turnover driven by trade-up buying, which is more or less discretionary spending," FNC Director of Research Yanling Mayer said.

Much of the desire for move-up buyers lies behind rising rates.  "They know if they don't move now, they might be kicking themselves all over again in three months," said Redfin real estate agent Eric Tan.  According to Daren Blomquist, VP of RealtyTrac, 18.5 million homeowners have at least 20% equity or more, putting them in a prime position to sell and 8.3 million owners should have at least 20% equity in the near future if prices continue to appreciate.  "This reflects a market that is transitioning from investor purchases of distressed homes to primary home purchases," said CAR economist Leslie Appleton-Young.

Source: HousingWire 

Compliments of Suzanne Smith

HNB Mortgage

The Forecast For Real Estate in 2011

Freddie Mac analysts point to five features that they believe will likely characterize the 2011 real estate markets:



*Advantageous home loan rates. With Fed observers expecting the central bank to keep the federal funds rate its current target range of 0% to 0.25% for most or all of 2011, advantageous rates will be a feature of the 2011 market. Thirty-year fixed-rate loans are likely to remain below 5.0% throughout the year, and initial rates of 5/1 hybrid adjustable -rate loans will likely remain below 4.0% in 2011.



*House prices have hit bottom. Prices are likely to begin a gradual, but sustained recovery in the second half of 2011.



*Housing will remain affordable. With affordability high, many first-time buyers will be attracted to the housing market next year, likely translating into more home sales in 2011 than in 2010.



*Refinances will dwindle. Many eligible borrowers have already refinanced. While fixed-rates are likely to remain low, they will move up gradually.

*Delinquency rates will decline. Based on the last several business cycles, the share of loans that are 90 or more days delinquent or in foreclosure proceedings generally crests within a year of the start of the recovery in payroll employment. Payrolls began to rise last January, and by the spring delinquency rates had begun to fall.



Source: Freddie Mac

Compliments of Suzanne Smith

HNB Mortgage

Homeowners Are Richer

The average homeowner has a net worth that is about 41 times greater than that of a renter, according to a report from the National Association of Realtors. Homeowners net worth averaged between $150,000 and $200,000 this year, according to the NAR.
The trade group for Realtors said homeowner equity accounts are a substantial part of that net worth. NAR based its research on results from a 2007 Federal Reserve Survey that provides a snapshot of family income and net worth in conjunction with basic demographic makeup. The Fed survey is conducted once every three years. Homeowner net worth back in 2007 was 46 times greater than that of renters, reflecting the economic conditions before housing price declines and a decreasing equities market. The average net worth of a homeowner was above $200,000, while the average net worth of a renter in 2007 was $5,000. It is interesting to see that while many media outlets have questioned the advantages of purchasing in today's markets, the numbers supporting owning are quite clear.

Source: Housing Wire

Compliments of Suzanne Smith

HNB Mortgage

How About Some Ice Cream

They keep talking about the "double dip" in the news and just in case you hear that expression, a double dip is not what you do to an ice cream cone! Well, these days, it is always good to introduce some humor when the news is not always great. However, there is some really good news right now. Rates are the lowest they have been all year. That is really saying something, because rates have been very low ALL year. As a matter of fact, rates on home loans are the lowest they have been in our generation. That is pretty low. Why is that good news? If someone is thinking about purchasing a home or a car or refinancing, it is a great time to move now. Prices are low and rates are ridiculously low, thus the time is right. We need more people to buy homes and cars over the next few months so we can avoid a double dip recession. And that would be a very good thing.
What is the bad news? Rates as low as these are indicative of a slow economy. We just need to see one number from this week to demonstrate how slow things are: first-time claims for unemployment insurance went over the 500,000 mark in the past week. While still lower than the heights of the recession, it was the first time we had crossed the 500,000 barrier since late last year. Once people step up their purchases of homes and cars, this will prompt companies to hire more employees. In turn, this will make consumers more confident to purchase more homes and cars. Then the cycle of economic growth will start back up and talk of a double dip will quiet down. And when that happens, we promise rates will go up. We just can't say when. So, for those who are waiting for the economy to get better, it will cost more for you to purchase if you are behind this curve. The trend setters will just buy their ice cream now while there are enough sprinkles to double dip....
Compliments of Suzanne Smith, HNB Mortgage.

What do you Want and Need in a Home?

Here are many of the considerations you'll want to discuss before searching for home:
* Desired number of bedrooms and baths
*Preferences regarding kitchen, dining, family rooms, etc. and preferred home layout
*Need for a garage or parking space, and if so, for how many cars?
*How important is energy efficiency or other green home features?
* Commuting considerations.
*Landscaping considerations-the need for open play areas, privacy, patio space, decking, ect.
*Related costs such as homeowner association fees and property taxes.
*How much do you want to invest in a home beyond the purchase price, either financially or in terms of sweat equity, if you can't find exactly what you want?
* How long do you plan to live in this home? How does this impact the type of home you will buy, how much you'll spend, and your choice of location?

These are just a few tips before you get started on your new home search. Call Sandy and Sara today with any questions you may have!

Meet Sara Vestal

Meet Sara, Agent for Sandy and Bill Scott.

Raised in a family of Residential and Commercial Realtors, Sara was destined to hold a real estate license. She graduated from Texas Tech University where she received a Bachelor of Science in Human Development and Family Studies. After graduation, she headed to Dallas and served as Development Coordinator for the American Heart Association. Soon after, Texas Tech University employed her to help recruit and advise incoming students from the Forth Worth area. Her husband brought her back to West Texas after receiving employement with Warren Caterpillar. She is now a licensed Real Estate Agent working with Sandy and Bill Scott. Sara is active in the Midland community through The Junior League of Midland, Inc. She spends her time volunteering through the League in varous family education projects. Sara loves West Texas and would be happy to find you a place to call HOME!