April Roundup: Rates Rise
In Freddie Mac's Primary Mortgage Market Survey the 30-year fixed-rate mortgage (FRM) averaged 6.58 percent, with an average 0.5 point, for the week ending April 27, 2006, up from the previous week's average of 6.53 percent. Last year at this time, the 30-year FRM averaged 5.78 percent. The 30-year FRM has not been higher since the week ending June 20, 2002, when it averaged 6.63 percent.
The average for the 15-year FRM was 6.21 percent, with an average 0.5 point, up from the previous week's average of 6.17 percent. A year ago, the 15-year FRM averaged 5.33 percent. The 15-year FRM has not been higher since the week ending May 31, 2002, when it averaged 6.22 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.21 percent, with an average 0.6 point, up from the previous week when it averaged 6.16 percent. A year ago, the five-year ARM averaged 5.20 percent.
One-year Treasury-indexed ARMs averaged 5.68 percent, with an average 0.7 point, up from the previous week when it averaged 5.63 percent. At this time last year, the one-year ARM averaged 4.21 percent.
"Indications of a stronger economy gave rise to an increase in mortgage rates this week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Consumer confidence and existing home sales unexpectedly rose. Much of this strength is attributed to a healthy labor market, which translates into greater consumer spending. This should support an active housing market over the next few months.
"We expect mortgage rates to gradually rise throughout the year. A stronger labor market, coupled with moderation in house price growth, means our outlook for overall housing conditions remains upbeat."
Housing Market to Stay on High Plateau
Home sales should generally level-out and remain at historically high levels, according to the National Association of Realtors®.
David Lereah, NAR's chief economist, said mortgage interest rates are trending up but will remain favorable. "Economic growth and job creation are providing a favorable backdrop for the housing market, but rising interest rates have an offsetting effect," Lereah said. "Home sales will move up and down somewhat over the remainder of the year but stay at a high plateau, meaning this will be the third strongest year on record." He expects the 30-year fixed-rate mortgage to rise to 6.9 percent by the end of the year.
Growth in the U.S. gross domestic product is forecast at 3.7 percent in 2006, while the unemployment rate should average 4.8 percent.
Existing-home sales are projected to drop 6.0 percent to 6.65 million this year from a record 7.08 million in 2005. New-home sales are likely to fall 10.9 percent to 1.14 million from the record 1.28 million last year - both sectors would see the third best year following 2005 and 2004. Housing starts are forecast at 2.00 million in 2006, which is 3.2 percent below the 2.07 million in total starts last year.
The national median existing-home price for all housing types is likely to increase 6.4 percent this year to $221,700, while the median new-home price is expected to rise 2.3 percent to $242,700.
Homebuyers Pick Amenities Over Space
According to a recent survey by the National Association of Home Builders, 69 percent of buyers would rather have more amenities than additional space.
Even so, the average home size has risen more than 50 percent to 2,340 square feet over the past 35 years.
The survey found that buyers prefer walk-in pantries, kitchen islands, and bathroom linen closets. Additionally, brick exteriors are popular with nearly 45 percent of respondents.
The National Association of Home Builder also reported an increase in the standard ceiling height to 9 feet from 8 feet, which makes homes appear more spacious.
Planning Your Move
Some people will move themselves. Others will hire professionals, with mixed results, depending on the reliability of the moving company and the quality of the crew. In any move, timing is essential.
With so many people moving in so short a time, moving companies can be booked so far in advance that the best you can do, might not do at all.
The experts suggests that four to six weeks in advance of the move is a good time to begin contacting companies for estimates.
First you should decide what you will be moving. That is, you should think about getting rid of the stuff you don't need, as estimates are partly based on the number of pounds they have to move.
The average for the 15-year FRM was 6.21 percent, with an average 0.5 point, up from the previous week's average of 6.17 percent. A year ago, the 15-year FRM averaged 5.33 percent. The 15-year FRM has not been higher since the week ending May 31, 2002, when it averaged 6.22 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.21 percent, with an average 0.6 point, up from the previous week when it averaged 6.16 percent. A year ago, the five-year ARM averaged 5.20 percent.
One-year Treasury-indexed ARMs averaged 5.68 percent, with an average 0.7 point, up from the previous week when it averaged 5.63 percent. At this time last year, the one-year ARM averaged 4.21 percent.
"Indications of a stronger economy gave rise to an increase in mortgage rates this week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Consumer confidence and existing home sales unexpectedly rose. Much of this strength is attributed to a healthy labor market, which translates into greater consumer spending. This should support an active housing market over the next few months.
"We expect mortgage rates to gradually rise throughout the year. A stronger labor market, coupled with moderation in house price growth, means our outlook for overall housing conditions remains upbeat."
Housing Market to Stay on High Plateau
Home sales should generally level-out and remain at historically high levels, according to the National Association of Realtors®.
David Lereah, NAR's chief economist, said mortgage interest rates are trending up but will remain favorable. "Economic growth and job creation are providing a favorable backdrop for the housing market, but rising interest rates have an offsetting effect," Lereah said. "Home sales will move up and down somewhat over the remainder of the year but stay at a high plateau, meaning this will be the third strongest year on record." He expects the 30-year fixed-rate mortgage to rise to 6.9 percent by the end of the year.
Growth in the U.S. gross domestic product is forecast at 3.7 percent in 2006, while the unemployment rate should average 4.8 percent.
Existing-home sales are projected to drop 6.0 percent to 6.65 million this year from a record 7.08 million in 2005. New-home sales are likely to fall 10.9 percent to 1.14 million from the record 1.28 million last year - both sectors would see the third best year following 2005 and 2004. Housing starts are forecast at 2.00 million in 2006, which is 3.2 percent below the 2.07 million in total starts last year.
The national median existing-home price for all housing types is likely to increase 6.4 percent this year to $221,700, while the median new-home price is expected to rise 2.3 percent to $242,700.
Homebuyers Pick Amenities Over Space
According to a recent survey by the National Association of Home Builders, 69 percent of buyers would rather have more amenities than additional space.
Even so, the average home size has risen more than 50 percent to 2,340 square feet over the past 35 years.
The survey found that buyers prefer walk-in pantries, kitchen islands, and bathroom linen closets. Additionally, brick exteriors are popular with nearly 45 percent of respondents.
The National Association of Home Builder also reported an increase in the standard ceiling height to 9 feet from 8 feet, which makes homes appear more spacious.
Planning Your Move
Some people will move themselves. Others will hire professionals, with mixed results, depending on the reliability of the moving company and the quality of the crew. In any move, timing is essential.
With so many people moving in so short a time, moving companies can be booked so far in advance that the best you can do, might not do at all.
The experts suggests that four to six weeks in advance of the move is a good time to begin contacting companies for estimates.
First you should decide what you will be moving. That is, you should think about getting rid of the stuff you don't need, as estimates are partly based on the number of pounds they have to move.
posted by Russell T. Nolting at
10:52 AM
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