With such a high-pace, fast-changing industry like real estate, at times it becomes difficult to get caught up with the comings and goings of what’s going on with the market. And in the spirit of being succinct yet informed, I compiled a list of newsworthy events in real estate for the past week:
- Mortgage rates are the lowest they have been in the past 6 weeks. A 30 year fixed rate mortgage averaged at 5.00, down from last week’s 5.06. And 15 year fixed rate mortgages also saw a decrease, from 4.51 the previous week to 4.36. What does this mean to to buyers? A reprieve in mortgage rates for potential buyers, with the inevitable rate increases coming in the foreseeable future.
- Mortgage delinquencies (not including foreclosures) see a sharp drop from February to March. Data for April will be available in the coming week and will be updated accordingly. The effect of the Home Affordable Modification Plan is noticeable, as more and more delinquent borrowers are able to ‘cure’ their loan status. The theory is that by reducing the number of foreclosures, the level of distressed properties in the market will be lessened and long-term stability (and possible appreciation) will begin. This is a key factor to keep your eyes on.
- April saw an increase in the unemployment rate, from 9.7 percent in the first quarter of the year, to 9.9 in April. However, job gains were experienced in manufacturing, business and professional services. Obviously this affects real estate as employment rates must increase in order for stability to be restored in the real estate market (less distressed properties, more home purchases).
- April also saw many cities experience a slight increase in housing inventory. The report includes information on 27 metropolitan areas throughout the US and the increase is of 2.6% over the previous month. However, one must keep in mind this time of year normally sees increases in inventory (average of 5% over the past 27 years) to prepare for the busy home buying spring season.
Obviously there are many more factors that influence the national real estate market and we will further explore the status when the April statistics are released later this month. All in all, there is a glimmer of hope in the horizon.