2013 has seen a much welcomed relief in the Real Estate Market. The year started off with quite a boom, as inventory reduced, causing pent up demand with Buyers scrambling to find properties. It was quite common to see properties hitting the market and them having multiple offers and under contract the same day. According to National Association of Realtors data, July 2013 experienced a phenomenal 17.2% year-over-year increase in the annual pace of home sales compared to July of 2012. Accordingly, the United States is on pace for the best year in residential home sales since the housing boom occurred in 2006.
SO WHY DOES THIS MAKE IT AN IDEAL MARKET TO BUY OR SELL ??
If the recession hadn’t hit in 2008, the yellow line shows how the market should have progressed. The prices in 2013 are still below where they should be, but as the economy continues to progress, houses prices are recovering. There has been a significant rise from 2011 to 2013 and forecasters are predicting this will continue upwards.
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Here is a chart showing how mortgage rates changed since 1972. Once a 16.6% rate .. yikes! Mortgage rates have continued to fall and 2012 saw soon amazing rates. The rates today are
CONV 30 YEAR FIXED - 4.25%/ 4.42% APR
CONV 15 YEAR FIXED - 3.25% / 3.58% APR
FHA 30 YEAR FIXED - 3.75%/ 4.02% APR
FHA 15 YEAR FIXED - 3.25% / 3.59% APR
We did see them go up, and drop a little, but they are forecasting this to rise in 2014.
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(Conventional loans are based on $300,000 purchase price with 20% down with a 740 credit score and 43% debt-to-income ratio.
FHA loans are based on $300,000 purchase price with 3.5% down with a 740 credit score and 43% debt-to-income ratio.
Jumbo loans are based on $600,000 purchase price with 20% down with a 740 credit score and 43% debt-to-income ratio.)
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Only time will tell how long housing prices and interest rates will remain so attractive.
Sources : The Real Estate Word, Brian Icenhower, National Assoication of Realtors, Freddie Mac, Colorado Home Realty
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