Monthly Archives: November 2023

At some point, everybody fantasizes about moving far away from home, whether to another city in the same state, a whole different state, or even to another country. It’s normal to sometimes wonder what life would be like if you packed everything up and tried something totally new. The reality, though, is we tend to stay fairly close to home when we make a move. In fact, an analysis of recent buyers found the median distance between the home they purchased and the one they moved from was 20 miles. That’s a decent distance – probably somewhere around a half-hour drive – but not so far that your life would be completely altered. It’s also a distance closer to the long-term norm than it’s been in recent years, as the trend begins to return to normal after the pandemic had Americans moving farther away than normal. The previous norm was about 15 miles but, as recently as 2022, the median moving distance was closer to 50 miles. (source)

When you see a home for sale that looks great, has all the right updates, and is in an desirable neighborhood, chances are you aren’t the only one excited about the prospect of living in it. Especially in a market short of available homes, good ones are going to attract buyers, and that means competition, bidding wars, and quick sales. It can also mean heartbreak, if you’ve grown attached to a home that eventually sells to another buyer. Fortunately for today’s home buyer, competition has eased a bit from its height. But while there’s evidence that higher rates have slowed buyers, homes for sale are still going quickly. How quickly? Well, according to one new analysis of market conditions, homes sold in October typically accepted an offer within 16 days. That’s a day longer than they lasted in September but is a whole two weeks faster than they did in 2019. That means buyers still need to be ready to move fast, especially if the home you’re looking at seems move-in ready. (source)

Housing market conditions can vary from one location to the next. What’s true in one area may not be in another. That’s certainly the case when looking at home price trends in different cities across the country. The trend in Los Angeles, for example, can be very different from what’s happening in Louisville. So while home prices have been increasing recently, not every metro area has seen the same gains and some may not even have seen gains at all. A new report from the National Association of Realtors addresses these differences in an effort to determine how many metros saw prices up during the third quarter. So what did the report find? Well, according to the NAR, 182 of the 221 cities measured saw increases. That’s 80 percent of the included metros. Additionally, 11 percent saw double-digit increases. Regionally, prices were up most in the Northeast and Midwest. In both regions, prices were up just over 5 percent year-over-year. The South, on the other hand, saw a 1.7 percent increase and the West was up just 0.6 percent. (source)

Current housing market conditions present some challenges for prospective home buyers. Elevated mortgage rates and home prices – combined with a lower than normal number of homes for sale – have made it more difficult for buyers looking for a home that fits both their needs and their budget. But housing market conditions are never perfect and, despite the ups-and-downs, Americans have consistently expressed a desire to own their own home. That remains true today, according to the latest Housing Trends Report from the National Association of Home Builders. The report found the share of adults who say they plan to purchase a home in the next year climbed 2 percent quarter-over-quarter, rising to 17 percent in the third quarter from 15 percent in the previous quarter. What’s behind the gains? Well, demographics play a part. Most of us buy a house based on what’s happening in our lives, rather than what’s happening in the market. That means the sheer number of Americans who are at a point in their lives when they’re looking to buy their first home, or a larger one to accommodate a growing family, will push demand higher regardless of current affordability trends. (source)

Fannie Mae’s monthly Home Purchase Sentiment Index measures how Americans feel about the housing market and overall economy. Based on a survey that asks participants for their view of buying and selling a home, home prices, mortgage rates, their income and job, the survey provides a look into what Americans are thinking and how willing they may be to get into the market. According to the most recent results, Fannie Mae’s survey shows a large majority of respondents feel now is a good time to sell a house. In fact, 63 percent of survey participants said they think it’s time to sell. But while Americans think selling a house is a good idea, they’re still cautious overall. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says inflation has affected sentiment . “Consumers expressed even greater pessimism toward the larger economy this month, in addition to their ongoing frustration with the housing market,” Duncan said. “Via our October National Housing Survey, 78 percent of respondents told us the economy is on the ‘wrong track’ – up from 71 percent last month – and they overwhelmingly cited inflation as the primary reason why.” (source)

As home prices have increased, so has the share of homeowners who can consider themselves equity rich – meaning the combined amount of loan balances secured by their home is no more than half the home’s value. That’s a good position to be in as a homeowner and its one in which a significant share of homeowners find themselves, according to a new report from ATTOM Data Solutions. ATTOM’s third-quarter U.S. Home Equity & Underwater Report shows 47.4 percent of mortgaged homes in the country were equity rich in the third quarter. That’s down slightly from the second quarter but only by a little. Rob Barber, ATTOM’s CEO, says homeowner equity is still strong. “By all measures, homeowner equity around the country remained strong during the third quarter as millions of households kept benefitting from the nation’s extended runup in home values,” Barber said. Equity levels rose in 21 states during the third quarter, with the biggest improvements seen in the Northeast, including Connecticut, New Jersey, and New Hampshire. (source)

October is the first full of month of fall and a time when more than just the weather cools off. Typically, the housing market does too. Summer shoppers have settled in and the number of active buyers and homes for sale both tend to decline as winter approaches. This year, however, the typical seasonal slowdown in homes for sale has reversed, according to the National Association of Realtors’ consumer website. The site’s October Monthly Housing Trends Report found that, in October, the number of homes for sale actually rose, with inventory up 5.1 percent month-over-month. Still, it’s down from last year at the same time and nearly 42 percent lower than what was normal in the three years before the pandemic. But Danielle Hale, chief economist for the site, says there are signs the market is beginning to adjust. “The current housing market continues to challenge home buyers and sellers alike, but we do see signs of adjustment,” Hale said. “Buyers did see some measure of relief in stable home prices this month and we’ll be watching the rising share of listings with reduced prices to see how that impacts prices in the near future.” (source)

There are a lot of numbers to keep track of when you’re a home buyer trying to figure out how much you can afford. There’s the price of the home, your prospective mortgage rate, your down payment, closing costs, and moving expenses. It can be dizzying. In the end, though, after all the upfront costs are paid for, what you’ll be left with is your monthly mortgage payment. So how much can you expect to pay each month after the dust settles? Well the Mortgage Bankers Association tracks median mortgage payments with their monthly Purchase Applications Payment Index. It’s a good gauge of what today’s buyers are paying each month. According to the most recent results, payments have gotten slightly more affordable. In fact, the median payment in September fell to $2,155 from $2,170 in August. Similarly, borrowers applying for lower-payment mortgages also saw improvement, with payments decreasing to $1,437 from $1,444. Edward Seiler, MBA’s associate vice president of housing economics and executive director of the Research Institute for Housing America, says more improvement may be on the way. “Challenges remain as 2023 comes to an end, but MBA is forecasting for a slight rebound in originations and a moderation in mortgage rates in 2024,” Seiler said. (source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, the average mortgage rate for 30-year fixed-rate loans with conforming loan balances fell last week for the first time in more than a month. The decline is encouraging news for prospective borrowers but Joel Kan, MBA’s vice president and deputy chief economist, warns rates are still high. “Mortgage applications declined for the third straight week as mortgage rates remained elevated, with all rates around 30 basis points higher than they were a month ago,” Kan said. “The impact of higher rates continued to be felt across both purchase and refinance markets.” With rates still high, demand for loans to buy homes fell 1 percent from the previous week while refinance activity was down 4 percent. The survey found rates were also down for 5/1 ARMs, though up slightly for jumbo loans, 15-year fixed-rate loans, and FHA loans. Conducted since 1990, the MBA’s weekly survey covers 75 percent of all retail residential mortgage applications. (source)