Monthly Archives: November 2024

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell last week for the first time in two months. Rates were down across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. Joel Kan, MBA’s vice president and deputy chief economist, says home buyer activity rose as a result. “Purchase activity drove overall applications higher last week, as conventional purchase applications picked up pace and mortgage rates declined for the first time in over two months …,” Kan said. “With the growth in for-sale inventory and signs that the economy remains strong, buyers have remained in the market even though rates have increased recently.” The MBA’s Purchase Index increased 12 percent last week from the week before, helping to push overall mortgage application demand 6.3 percent higher week-over-week. (source)

The S&P Case-Shiller U.S. National Home Price Index is among the leading measures of U.S. home prices. The Index has been collecting data for more than 27 years and covers all nine U.S. census divisions. According to the most recently released results, home prices rose 3.9 percent year-over-year through the end of September. That’s down from the 4.3 percent annual gain seen in the previous month’s report. But while home prices are decelerating nationally, Brian Luke, CFA, Head of commodities, Real & Digital Assets, says some parts of the country continue to see above-trend growth. “We continue to see above-trend price growth in the Northeast and Midwest, growing 5.7 percent and 5.4 percent respectively, led by New York, Cleveland, and Chicago,” Luke says. “The Big Apple has taken the top spot for five consecutive months, pushing the region ahead of all others since August 2023.” Regionally, the South reported the slowest year-over-year price growth, at 2.8 percent. Denver was the slowest growing metro area, up 0.2 percent from last year. (source)

It’s been a while since home buyers had the upper hand. In recent years, sellers have held all the power, while home buyers competed against each other to get an offer accepted. Too few homes for sale meant bidding wars, rising home prices, fast sales, and frustrated home shoppers. But this year things started to change. The inventory of homes for sale has been improving, and it’s led to an increasing number of metro areas where buyers are having better luck. In fact, according to one new analysis, home buyers now have the upper hand in 13 major metropolitan areas, with an increasing number of buyer’s markets expected in the new year. Currently, most of the buyer’s markets are located in the Southeast – where new home construction has helped the supply of available homes – but gains are expected to spread to the Southwest in 2025, as inventory continues to improve and more housing markets find balance. (source)

Fannie Mae’s Economic and Strategic Research Group releases an updated outlook each month covering what it believes is ahead for the housing market and economy. In its November commentary, the group says continued economic strength may keep housing market conditions static for longer than previously thought. In other words, the economy didn’t slow as much as expected and it’s keeping mortgage rates from falling further. “Long-run interest rates have moved upward over the past couple months following a string of continued strong economic data and disappointing inflation readings,” Mark Palim, Fannie Mae’s senior vice president and chief economist, said. “To the extent that the recent run-up in rates has been driven by market expectations of stronger economic growth, we think this bodes well for the labor market outlook and home purchase demand. However, we expect inventories of homes added to the market, and therefore sales of existing homes, to remain subdued through next year, as the higher mortgage rate environment is likely to strengthen the ongoing lock-in effect.” (source)

Sales of previously owned homes rose 3.4 percent in October, according to new numbers from the National Association of Realtors. The monthly gain helped push sales 2.9 percent higher than they were at the same time last year, marking the first year-over-year increase in more than three years. Lawrence Yun, NAR’s chief economist, says the worst of the housing market’s downturn may be over. “The worst of the downturn in home sales could be over, with increasing inventory leading to more transactions,” Yun said. “Additional job gains and continued economic growth appear assured, resulting in growing housing demand.” The increasing number of available homes for sale should also help slow future price increases. Combined with the expected stabilization of mortgage rates, moderating price increases will give home buyers more affordable options in the months ahead – especially during the winter, when the market slows and fewer buyers are competing for available listings. (source)

Average mortgage rates moved higher again last week, according to the Mortgage Bankers Association’s Weekly Application Survey. Rates were up week-over-week for 30-year fixed-rate loans with both conforming and jumbo balances, 15-year fixed-rate loans, and 5/1 ARMs. Only loans backed by the Federal Housing Administration saw a decline. Joel Kan, MBA’s vice president and deputy chief economist, says rates increased but so did mortgage demand. “Mortgage rates moved higher for the fourth consecutive week, with the 30-year fixed rate increasing … to its highest level since July 2024,” Kan said. “However, even with the uptick in rates, overall mortgage applications increased. The pickup in purchase applications was driven by conventional and FHA loans, with FHA purchase applications seeing a 7 percent increase.” Overall, demand from home buyers was up 2 percent week-over-week. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of retail residential mortgage applications. (source)

Whether or not a borrower is approved for a loan depends on a number of factors, including current lending standards and the availability of loan programs. Because they aren’t fixed, these factors can affect how easy or difficult it is for a borrower to get a mortgage at any given time. That’s why the Mortgage Bankers Association tracks credit availability each month with its Mortgage Credit Availability Index. When the index increases, it means lending standards have loosened, and when it falls, standards have tightened. Fortunately for borrowers, the latest results show credit availability improved in October, with the index rising 0.7 percent. Joel Kan, MBA’s vice president and deputy chief economist, says access to credit has improved but remains tight overall. “Mortgage credit availability increased to its highest level since April 2023, driven by gains across all loan categories,” Kan said. “However, despite the across-the-board increases, overall credit supply remains tight, with the index still near the very low levels of 2011-2013.” (source)

The National Association of Home Builders keeps a monthly measure of how confident home builders are in the market for newly built single-family homes. Its Housing Market Index is a closely followed market barometer, scored on a scale where any number above 50 means more surveyed builders feel conditions are good than poor. In November, the index hit 46, the third consecutive monthly gain and three points higher than the month before. The improvement was attributed to post-election expectations that regulatory relief may be on the way. Nevertheless, Robert Dietz, NAHB’s chief economist, says challenges remain. “While builder confidence is improving, the industry still faces many headwinds such as an ongoing shortage of labor and buildable lots along with elevated building material prices,” Dietz says. Still, the index component measuring sales expectations for the next six months moved seven points higher to 64, an indication that home builders see brighter days ahead. (source)

Negotiation is an important part of the home buying process. In fact, you can negotiate just about anything when buying a home, from the price of the house to any conditions, contingencies, and concessions you’d like. But while you’ll have an opportunity to negotiate, you won’t necessarily succeed. Market conditions will often be the determiner of whether or not the home’s seller accepts your offer. When homes for sale are scarce and buyers are fighting for available options, a seller is less likely to agree to your terms than at a time when there are more homes than buyers. Fortunately for today’s home shopper, it looks like buyers are finally regaining some negotiating power. According to newly released data, 52 percent of recent home buyers negotiated with the home’s seller and 94 percent succeeded. Additionally, 34 percent of buyers were able to pay below asking price – a significant improvement from a couple of years ago when only 27 percent of buyers successfully negotiated a lower price. (source)

Everybody always wants to get the best deal – on everything. Anytime you make a purchase, you hope to get the best price. This certainly applies to buying a home. It’s a big financial commitment, so it’s natural that buyers hope to find a great home at a great value. Fortunately, this is the time of year when they get the most bang for their buck and, according to ATTOM Data Solutions, the absolute best day to buy is approaching. ATTOM calculates the day buyers get the best deal by comparing the median sales price for homes sold on each calendar day with the median automated valuation model for those same homes. According to this year’s results, 2024’s best day to buy is December 4. On that day, buyers pay the lowest premium above value at 4.8 percent – a great deal compared to the 14.6 percent premium buyers pay on May 27, the year’s most expensive date. (source)