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According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell last week from one week earlier. 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, 15-year fixed-rate loans, and 5/1 ARMs. The improvement led to a boost in refinance activity, though purchase application demand fell 4 percent week-over-week. Joel Kan, MBA’s vice president and deputy chief economist, says rates are now at a six-week low. “Mortgage rates moved lower last week, consistent with lower Treasury yields following the FOMC meeting and a volatile week for the stock market. The 30-year fixed-rate declined to its lowest level in six weeks …” Kan said. “Mortgage applications responded to these lower rates and were up for the week overall, driven by a 12 percent increase in refinance applications, which had their strongest week since December 2024.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

The housing market’s been out of balance for years. With too many interested home buyers and too few homes available to buy, prices moved higher and made it increasingly difficult for Americans to find an affordable home for sale in the areas where they’d most like to live. Fortunately, though, things have gotten better. Inventory levels improved last year and, according to new numbers from The National Association of Realtors’ consumer website, they’re off to a strong start so far this year. In fact, the number of newly listed homes increased 37.5 percent month-over-month in January, driving the number of homes actively for sale 24.6 percent higher than they were last year at the same time. Danielle Hale, the website’s chief economist, says it could be a sign of things to come. “The shift in seller activity could mark a turning point in the high mortgage rate-induced standoff between buyers and sellers,” Hale said. “The uptick is likely due to some residual benefit from fall’s lower mortgage rates, which could fade. But drivers such as the need for families to adapt to life changes and the easing of the lock-in effect, could bring more movement from sellers by year’s end.” (source)

Homeowners have had it good over the past several years and, according to ATTOM Data Solutions’ fourth quarter 2024 U.S. Home Equity & Underwater Report, they still do. The report found 47.7 percent of mortgaged residential properties in the country could be considered equity rich during the final three months of 2024. A property is equity rich when the amount owed on its mortgages is no more than half its estimated value. Rob Barber, ATTOM’s CEO, says it’s a good position to be in. “Homeowners across the country … are sitting on historically high levels of property equity thanks in large part to the endless increases in home values over more than a decade,” Barber said. “Nearly half of all residential mortgage payers in the U.S. have paid off at least half of their loans, leaving many with six-figures levels of wealth available to leverage anything from new home purchases to starting new businesses to paying off major expenses.” (source)

Budgeting is never fun. If given the choice, we’d all prefer to spend money freely and without consequence. But while it may not be as enjoyable, budgeting your money is important – especially so, when buying a house. Evidence of that can be seen in a newly released survey of homeowners. The survey found 81 percent of homeowners say their expenses are higher than they anticipated, leading 69 percent of them to have regrets about their home purchase. That’s a pretty significant share of homeowners who say owning a home is more expensive than they thought. It’s also a good bet that those homeowners were once buyers who didn’t do a thorough enough job of working out a budget and determining how much house they could comfortably afford. That means adding in costs like potential maintenance, repairs, insurance and property tax, in addition to the prospective monthly mortgage payment. Taking a real hard look at your finances and potential costs before you buy will help save you from the heartache and stress of owning a home that hurts your bottom line. (source)

When a contract to buy a home is signed, the sale isn’t yet final. But most contract signings result in closed sales a few weeks later, which is why they’re considered a good indicator of where home sales numbers may be headed. The National Association of Realtors tracks contract signings each month with its Pending Home Sales Index. According to the most recent results, the index found contract signings down in December, falling 5.5 percent month-over-month after four consecutive months of gains. Lawrence Yun, NAR’s chief economist, says the decline isn’t too surprising. “After four straight months of gains in contract signings, one step back is not welcome news, but it is not entirely surprising,” Yun said. “Economic data never moves in a straight line. High mortgage rates have not significantly dented housing demand due to greater numbers of cash transactions.” Regionally, the South saw the smallest month-over-month decline, falling just 2.7 percent, while the Midwest dropped 4.9 percent, the Northeast slipped 8.1 percent, and the West decreased 10.3 percent. (source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates were up and down last week. Rates for 30-year fixed-rate loans with conforming balances were unchanged from one week earlier, while rates for loans backed by the Federal Housing Administration and 15-year fixed-rate loans fell. Rates for jumbo loans and 5/1 ARMs both increased. With rates relatively steady, demand for loans to buy homes was also flat, though refinance activity fell 7 percent. Joel Kan, MBA’s vice president and deputy chief economist, says there’s reason for optimism. “Purchase activity decreased slightly, but applications for FHA purchase loans were a bright spot, increasing by 2 percent,” Kan said. “New and existing-home sales ended 2024 on a strong note, and if mortgage rates continue to stabilize and for-sale inventory loosens, we expect a gradual pick up in purchase activity in the coming months.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

The most recent S&P Case-Shiller U.S. National Home Price Index found prices 3.8 percent higher than last year at the same time. The year-over-year gain was slightly better than the previous month’s annual increase of 3.6 percent. But despite the bump, Brian D. Luke, CFA, head of commodities, real & digital assets, says home price increases have slowed. “With the exception of pockets of above-trend performance, national home prices are trending below historical averages,” Luke said. “Markets in New York, Washington D.C., and Chicago are well above norms, with New York leading the way. Unsurprisingly, the Northeast was the fastest growing region, averaging a 6.1 percent annual gain. However, markets out west and in once red-hot Florida are trending below average growth.” Still, despite the regional disparities, S&P’s National Index managed to hit its 18^th consecutive all-time high, according to the latest numbers. (source)

Sales of newly built, single-family homes rose 3.6 percent in December, according to new numbers from the U.S. Census Bureau and the Department of Housing and Urban Development. The improvement pushed new home sales 6.7 percent higher than they were one year earlier and comes after an upward revision of November’s results. In other words, the new home market continues to make gains despite the seasonal patterns, elevated mortgage rates, and higher home prices which should be suppressing sales. That’s good news for buyers, as a strong new home market can help alleviate some of the challenges currently plaguing the market for existing homes. How? Well, when Americans are buying new homes, builders build more, which helps the overall supply of available homes for sale. That provides choices for buyers, which reduces buyer competition, bidding wars, and price increases for homes both old and new. (source)

New numbers from the National Association of Realtors show sales of previously owned homes rose 2.2 percent in December from one month earlier. The improvement pushed sales to their strongest pace since February 2024 and led to the largest year-over-year gain since June 2021. Regionally, sales increased everywhere but the Midwest, which saw a 1 percent month-over-month decline. Lawrence Yun, NAR’s chief economist, says existing-home sales have defied typical seasonal patterns. “Home sales in the final months of the year showed solid recovery despite elevated mortgage rates,” Yun said. “Home sales during the winter are typically softer than the spring and summer, but momentum is rising with sales climbing year-over-year for three straight months.” Also in the report, total housing inventory is now up 16.2 percent from one year ago, putting current unsold inventory at a 3.3-month supply. A six-month supply is generally considered healthy for the market. (source)

The housing market is in a holding pattern, according to the latest forecast from Fannie Mae’s Economic and Strategic Research Group. Market conditions are improving – but slowly. As a result, home buyers remain hesitant even though price increases have calmed and there are more homes for sale. Mark Palim, Fannie Mae’s senior vice president and chief economist, says market conditions aren’t likely to change much this year but there is a silver lining. “Due to lock-in effect and affordability constraints, we currently expect another year of sluggish existing home sales,” Palim said. “A silver lining for affordability is that we also anticipate income growth will outpace both home price and rent growth this year – and in many markets, new homes are now priced competitively with existing homes and are far more available.” The group expects home price increases will continue to slow this year and mortgage rates will fall, though the decline will be less than previously expected. (source)