Mortgage News November 2018
Forecast: December is usally the slowest month when it comes to home sales, but unique dynamics indicate that could not be the case this year. Mortgage rates are turning into lukewarm market and this motivates the home buyers. Rates are at the moment one full percent higher than they were at the end of the 2017, howering just around 5 percent, they are projected to go higher in 2019.
This December the unique dynamics of the market indicates that the situation is good as for home sellers, the same as for home buyers. On one hand the mortgage rates are turning and this motivates the buyers. This is because of the fact that the prices run up so fast during housing shortages in the past that higher rates are having the outsized impact on the mortgage industry. Fairfield states that the currenct rise of the home buyers is due to the fact that they are affraid the rates will be much higher in 2019.
The average mortgage rate at 30 years fixed spiked this fall almost to 5% and they are expected to move even higher in 2019. Consider also the much higher appreciation for home sellers which put the prices higher, so a lot of people were pushed to their financial limits and have hit the affordability wall. Thats the reason the sales of the homes were weaker in the past few months, so that also means new opportunity for home buyers as prices are finaly starting to ease.
The market has changed. Prices are usually 18% lower in the winter months, add 5% rate on top of that and sellers will have to show much more flexibility. The sky is no longer the limit in real estate industry. The housing market usually lets up a bit in the fall and especially this year its favorable for those buyers who have struggled in the last year to get into the housing market. They are entering the market now, because the projections on rates are not very much optimistic for home buyers in 2019.
The number of the new listings of homes is the lowest in december, since a lot of families do not want to move during the school year and buying a home as a present is not traditional Christmas gift, recording to Realtor.com views per property are 21 percent lower in december. Lower supply is on the other hand an opportunity for home sellers, since they dont have much competition. Competition is low, but motivation is high.