The Day After . . . Let's Talk Mortgage Rates!

This information was released yesterday by the Mortgage Bankers Association (MBA) and was reported in an article by MarketWatch. As Realtors we are often asked where we think mortgage rates are headed. The best people we think we can look to is the MBA. Here is their take on what to expect:

"After reaching record lows in 2012, mortgage rates are expected to creep up slowly in the year ahead, the Mortgage Bankers Association predicted. Rates on the 30-year fixed-rate mortgage are expected to average 3.8% in the fourth quarter of 2012, rising to 3.9% in the first quarter of 2013 and eventually rising to an average 4.4% by the fourth quarter of next year.”



Any questions, about if now is the time to make a 'move' in real estate just may make sense! For specific information about market trends for specific neighborhoods in Edmond, Deer Creek, Oklahoma City, Piedmont, Yukon, Mustang and other Oklahoma City metro communities, please give us a call 330-2777!

Right now the price points below $150K in Edmond/Deer Creek are showing less than 3 months of inventory. A clean, well-priced home is getting multiple offers and selling quickly. Also $275K to $300K are also showing a lighter inventory. Call us for more information. If you need specifics on marketing your home in today's market, call to talk to Gary 216-9600!

Is The Housing Market Actually Recovering?

Everyone wants to know if the housing market is truly showing signs of a recovery. There are conflicting headlines every day. One day, we hear sales are up. The next day it is reported that prices are down. Is the real estate market coming back? The answer is ‘yes’ and ‘no’.

There are two aspects that must be evaluated: house sales and house prices. They will not recover at the same time. Sales are already increasing rather nicely while prices will still soften in many markets through 2012.

Home Sales

The National Association of Realtors (NAR) issues a Pending Home Sales Report each month. We can see by the graph below that sales have been increasing nicely over the last twelve months. Real estate professionals across the country are reporting that activity has increased compared to last year. The sales side of the recovery is starting to show great promise.

Home Prices

Many price indices have shown that national home prices are continuing to stumble. Even with demand increasing, we must look at where the supply of housing stock stands. Though ‘visible’ inventory (homes currently on the market) is shrinking, there is still a large overhang of ‘shadow’ inventory (Foreclosures about to come on the market as a result of the National Mortgage Settlement). This increase in inventory will outpace the increase in demand and thereby cause prices to continue to soften in many parts of the country.

Bottom Line

Housing is coming back. However, sales will come back before prices. We will not see prices appreciate until we work through the oversupply of homes on the market.