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The FACTS About Palo Alto Short Sales and Foreclosures

Posted by Marcy Moyer on June 8, 2010 at 8:00am
There's a lot of chatter on real estate blogs about the steep increase in foreclosures and short sales in Palo Alto.Unfortunately many sites post stats from a company called Realty Trac which tracts everything from a Notice of Default through a listed bank owned property.  Many things can happen before a home with a Notice of Default actually gets to be sold by the bank, but unless you read the fine print carefully it is easy to confuse a house that is behind a few months in payments with an actual bank owned property on the market for sale.
 
Most bank owned homes as well as short sales (where the seller owes more than the home is worth and the lender/lenders have agreed to accept less than the amount of the mortgage to release the debt) are sold through the MLS.  So to see how many of these distressed sales have hit the market in the last year I went to the MLS and looked.  
 
Here is what I found for single family homes:
 
Bank owned properties sold in last year:             4
Current Pending sales of Bank owned:                2
Short Sales sold in last year:                             3
Current Pending Short Sales                              1
Current Active Short Sales                                 1
For condo/townhomes the numbers are:
Bank owned sold:                                             2
Bank owned pending sales:                               1
Short Sales sold:                                              3
Short sales pending:                                         4
Short sales active:                                            2
As you can see this is not a huge number, especially since the total number of homes sold in Palo Alto in the last year is 369, making distressed sales account for less than 2%.  There have been 97 condo/townhomes sold in the same period making the distressed sales about 5% of that market.  These numbers are not enough to have any impact on the price of homes in Palo Alto at this point.  The percentage would have to increase several fold before Palo Alto prices are affected by distressed properties.  I am not saying that this is or is not going to happen, that is a discussion for a future post, just that it has not happened yet.
Marcy Moyer
Keller Williams Realty
D.R.E.  01191194

 

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Mortgage Bankers Weekly Update: Mortgage Applications Drop

Posted by Howard Bell on May 13, 2010 at 3:14pm

Mortgage Bankers Association for the week of 5/12/2010

Market Composite Index: (loan application volume) increased 3.9 percent on a seasonally adjusted basis from one week earlier

Refinance Index: increased 14.8 percent from the previous week and the seasonally adjusted Purchase Index decreased 9.5 percent from one week earlier.

Purchase Index: decreased 8.9 percent compared with the previous week and was 0.6 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 57.7 percent of total applications from 51.9 percent the previous week

Arm Share: remained unchanged at 6.3 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

The recent plunge in rates on US Treasury securities, due to a flight to quality as investors worldwide sought shelter from the Greek debt crisis, benefited US mortgage borrowers last week. Rates on 30 year mortgages dropped to their lowest level since mid-March. As a result, refinance applications for conventional loans jumped, hitting their highest level in six weeks, said Michael Fratantoni, MBAs Vice President of Research and Economics. In contrast, purchase applications fell almost 10 percent in the first week following the expiration of the homebuyer tax credit, as the tax credit likely pulled some sales into April that would otherwise have occurred in May or later

Projections
We predict that mortgage originations will fall to $1.37 trillion in 2010 from an estimated $2.1 trillion in 2009, a 35 percent decline. Purchase originations will decline very slightly by around 3 percent to $717 billion, as home prices stabilize, and home sales increase. Refinance originations will fall by about 52 percent to $656 billion in 2010 as mortgage rates are expected to rise through the year. Refinance volumes in the first half of the year are likely to be somewhat higher than anticipated in prior forecasts as rates decreased sharply in recent weeks due to the crisis in Europe. We have adjusted our refinance forecast upwards in response.

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Freddie Mac Weekly Mortgage Update: Lowest Level Of The Year

Posted by Howard Bell on May 13, 2010 at 3:12pm


30-year fixed-rate mortgage: Averaged 4.93 percent with an average 0.7 point for the week ending May 13, 2010, down from last week when it averaged 5.00 percent. Last year at this time, the 30-year FRM averaged 4.86 percent. The 30-year FRM has not been lower since the week ending December 10, 2009, when it averaged 4.81 percent.

The 15-year fixed-rate mortgage: Averaged 4.30 percent with an average 0.6 point, down from last week when it averaged 4.36 percent. A year ago at this time, the 15-year FRM averaged 4.52 percent. The 15-year FRM has not been lower since the week ending December 3, 2009 when it averaged 4.27 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.95 percent this week, with an average 0.6 point, down from last week when it averaged 3.97 percent. A year ago, the 5-year ARM averaged 4.82 percent. The 5-year ARM has not been lower since Freddie Mac started tracking the 5-year ARM in January of 2005.

One-year Treasury-indexed ARMs: Averaged 4.02 percent this week with an average 0.6 point, down from last week when it averaged 4.07 percent. At this time last year, the 1-year ARM averaged 4.71 percent. The 1-year ARM has not been lower since the week ending November 4, 2004, when it averaged 4.00 percent.

Freddie Sayz

Interest rates on fixed rate mortgage declined for the 5th straight week, said Frank Nothaft, Freddie Mac vice president and chief economist. The National Association of Realtors reported that median house prices are recovering in more local areas in the latest quarter. On a year over year basis for the 152 areas the association reports on, 91 metropolitan areas had positive growth in the first quarter of this year. This compares to 67 areas showing positive annual growth in the fourth quarter of 2009 and only 30 cities in the third quarter of last year.

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Freddie Mac Weekly Update: Rates Mostly Unchanged This Week

Posted by Howard Bell on April 24, 2010 at 4:18pm
30-year fixed-rate mortgage: Averaged 5.07 percent with an average 0.7 point for the week ending April 22, 2010, unchanged from last week when it averaged 5.07 percent. Last year at this time, the 30-year FRM averaged 4.80 percent.

The 15-year fixed-rate mortgage: Averaged 4.39 percent with an average 0.6 point, down from last week when it averaged 4.40 percent. A year ago at this time, the 15-year FRM averaged 4.48 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.03 percent this week, with an average 0.6 point, down from last week when it averaged 4.08 percent. A year ago, the 5-year ARM averaged 4.85 percent.

One-year Treasury-indexed ARMs: Averaged 4.22 percent this week with an average 0.5 point, up from last week when it averaged 4.13 percent. At this time last year, the 1-year ARM averaged 4.82 percent.

Freddie Sayz

Mortgage rates on fixed loans were relatively unchanged this week while ARM rates were mixed, said Frank Nothaft, Freddie Mac vice president and chief economist. These low mortgage rates are revitalizing the home construction industry. For instance, although new building of one-family homes slowed slightly between February and March by an annualized rate of 0.9 percent, this was primarily due to a 33.7 percent drop in the Midwest.

The other three regions rose to their strongest pace since the second half of 2008. In addition, builder confidence rose more than the market consensus in April to the highest level since September 2009, according to the National Association of Home Builders/Wells Fargo index . During the same month, the builder gauge of current home sales increased to its highest since March 2008.

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Mortgage Bankers Weekly Update: Mortgage Applications Increase

Posted by Howard Bell on April 24, 2010 at 4:17pm

Market Composite Index: (loan application volume) increased 13.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 13.9 percent compared with the previous week.
Treasury rates fell last week causing a decline in mortgage rates. As a result, refinance applications picked up over the week, as some borrowers took advantage of this recent rate volatility to lock in a low fixed-rate loan said Michael Fratantoni, MBA Vice President of Research and Economics.

Refinance Index: increased 15.8 percent from the previous week and the seasonally adjusted Purchase Index increased 10.1 percent from one week earlier.

Purchase Index: increased 11.0 percent compared with the previous week and was 5.2 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 60.0 percent of total applications from 58.9 percent the previous week.

Arm Share: decreased to 6.0 percent from 6.3 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Economic growth and a recovering job market are good news for housing, but we certainly have not seen any significant improvement in housing activity to date. Existing home sales declined in February, and new home sales actually reached a new record low that month. Additionally, the number of existing homes on the market increased, as sellers began to list their properties in anticipation of the spring. Rising inventories on top of weak demand continues to put pressure on prices, with most measures showing either declines or weak gains over the winter.

Fourth quarter real GDP growth was revised down a bit to a 5.6% annual rate, a revision too small to be significant. Data coming in during the past month suggest a real GDP growth rate of around 3% or a little less in the first quarter of 2010, well below the fourth quarter pace. The outlook for inflation remains unusually favorable. During the past year, both headline and core inflation rates have fallen.

The dramatic turnaround in the economy during the past year, from a 5.4% annual rate of decline in real GDP in the fourth quarter of 2009 to a 5.6% increase a year later, attests to the remarkable resiliency of the U.S. economy to withstand shocks.

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Freddie Mac Weekly Update:

Posted by Howard Bell on April 3, 2010 at 11:47am

Rates at Second Highest Level This Year


30-year fixed-rate mortgage: Averaged 5.08 percent with an average 0.7 point for the week ending April 1, 2010, up from last week when it averaged 4.99 percent. Last year at this time, the 30-year FRM averaged 4.78 percent.

The 15-year fixed-rate mortgage: Averaged 4.39 percent with an average 0.6 point, up slightly from last week when it averaged 4.34 percent. A year ago at this time, the 15-year FRM averaged 4.52 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.10 percent this week, with an average 0.6 point, down from last week when it averaged 4.14 percent. A year ago, the 5-year ARM averaged 4.92 percent.

One-year Treasury-indexed ARMs: Averaged 4.05 percent this week with an average 0.6 point, down from last week when it averaged 4.20 percent. At this time last year, the 1-year ARM averaged 4.75 percent.

Freddie Sayz

Interest rates for fixed mortgages rose this week following a run up in long-term bond yields, while ARM rates eased slightly, said Frank Nothaft, Freddie Mac vice president and chief economist. Rates on 30-year fixed loans were the highest since the starting week of this year. Home-price declines continue to moderate with more metropolitan areas showing stabilizing or rising values.

Compared with one year ago, house prices were down 0.7 percent in January 2010 in the S&P/Case-Shiller 20-City Composite Index, which was the smallest 12-month decrease since January 2007. Nine of the cities experienced positive growth, led by San Franciscos 9.1 percent annual gain. Recently, the Mortgage Insurance Companies of America reported that homeowners who moved out of default outnumbered those who became newly delinquent in February, which was the first such occurrence since March 2006.

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Mortgage Bankers Association: Purchases Up!

Posted by Howard Bell on April 3, 2010 at 11:47am
Mortgage Bankers Association for the week of 3/31/2010

Market Composite Index: (loan application volume) increased 1.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1.5 percent compared with the previous week.

Refinance Index: decreased 1.3 percent from the previous week and the seasonally adjusted Purchase Index increased 6.8 percent from one week earlier. This is the highest Purchase Index since the week ending October 30, 2009.

Purchase Index: increased 6.8 percent compared with the previous week and was 9.3 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: decreased to 63.2 percent of total applications from 65.0 percent the previous week. This is the lowest refinance share recorded in the survey since the week ending October 23, 2009.

Arm Share: increased to 5.2 percent from 4.8 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Purchase applications have increased over the past month, and are now at their highest level since last October when many homebuyers were rushing to get loans closed before the expected expiration of the homebuyer tax credit, said Michael Fratantoni, MBAs Vice President of Research and Economics. We may be seeing a similar pattern now, as the extended version of the tax credit ends next month.


The housing industry faces another challenge during the spring building season stemming from the end on March 31 of the Federal Reserve’s program of buying mortgage-backed securities. The impact on mortgage interest rates that follows is not expected to be dramatic, but it will certainly act as a damper on home buying. The inventory of unsold homes has declined but remains well above normal levels, and will likely remain relatively high given pending foreclosures

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UNDISCLOSED SHORT SALE PAYMENTS MAY BE ILLEGAL

Posted by Frank G. Silveria III on March 29, 2010 at 12:15pm

UNDISCLOSED SHORT SALE PAYMENTS MAY BE ILLEGAL


Undisclosed payments in short sale transactions, especially those paid outside of escrow, may violate the law, including RESPA, laws against loan fraud, and licensing laws. Short sale agents have increasingly reported to C.A.R. about requests for agents and their clients to pay junior lienholders and others, oftentimes outside of escrow.

One common scenario is when a short sale seller's senior lender authorizes a payment of $3,000, for example, to extinguish a junior lien, but the junior lender demands that the buyer pays an additional $9,000 outside of escrow. Not only would it be risky for a buyer to pay outside of escrow, but concealing this additional payment from a federally-insured senior lender may constitute loan fraud, which is a crime punishable by 30 years imprisonment plus a $1 million fine (18 U.S.C. section 1014). Furthermore, omitting from the HUD-1 Statement any charges paid at settlement by either a buyer or seller may violate the Real Estate Settlement Procedures Act (RESPA) (Appendix A to 24 C.F.R. Part 3500). Depending on the specific circumstances, carrying out these payment requests may also violate other laws and regulations, and an agent's participation in the scheme may be subject to license revocation by the Department of Real Estate or other disciplinary action.

Agents and their clients are encouraged to file any complaints regarding fraudulent activities to the proper authorities, including the following agencies:


Attorney General's Office

California Department of Justice

800-952-5225 Phone

http://ag.ca.gov/consumers/mailform.htm


Department of Housing and Urban Development (HUD)

HUD Office of Inspector General Hotline (GFI)

800-347-3735 Phone

http://www.hud.gov/offices/oig/hotline


Federal Bureau of Investigation (FBI)

202-324-3000 Phone

https://tips.fbi.gov


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Freddie Mac Weekly Update: Rates Flat

Posted by Howard Bell on March 18, 2010 at 12:46pm



30-year fixed-rate mortgage: Averaged 4.96 percent with an average 0.7 point for the week ending March 18, 2010, up slightly from last week when it averaged 4.95 percent. Last year at this time, the 30-year FRM averaged 4.98 percent.

The 15-year fixed-rate mortgage: Averaged 4.33 percent with an average 0.6 point, up slightly from last week when it averaged 4.32 percent. A year ago at this time, the 15-year FRM averaged 4.61 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.09 percent this week, with an average 0.6 point, up from last week when it averaged 4.05 percent. A year ago, the 5-year ARM averaged 4.98 percent.

One-year Treasury-indexed ARMs: Averaged 4.12 percent this week with an average 0.6 point, down from last week when it averaged 4.22 percent. At this time last year, the 1-year ARM averaged 4.91 percent.

Freddie Sayz

Mortgage rates for fixed-rate mortgages were virtually unchanged this week as the effects of the prior storms emerged in recent housing data, said Frank Nothaft, Freddie Mac vice president and chief economist. New construction slowed by 5.9 percent in February to 575,000 homes. Both the South and Northeast regions had all the declines due to the snow storms. In addition, homebuilder confidence unexpectedly dipped in March according to the NAHB/Wells Fargo Housing Market Index .

With house prices starting to stabilize and even rise, homeowners on aggregate are slowly building back equity in their homes based on figures from the Federal Reserve Board . After losing almost $7.9 trillion in home equity since the end of 2006, homeowners regained almost $1.1 trillion over the past three quarters ending in 2009.

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Mortgage Bankers Weekly Update

Posted by Howard Bell on March 18, 2010 at 12:46pm


Mortgage Bankers Association for the week of 3/17/2010

Market Composite Index: (loan application volume) decreased 1.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 1.7 percent compared with the previous week. .

Refinance Index: decreased 1.7 percent from the previous week and the seasonally adjusted Purchase Index decreased 2.3 percent from one week earlier.

Purchase Index: decreased 1.8 percent compared with the previous week and was 13.9 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 67.3 percent of total applications from 67.2 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 4.6 percent from 5.1 percent of total applications from the previous week.

Arm Share: decreased to 4.6 percent from 5.1 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

The most recent data on the housing market continues to show profound weakness .

Inventories of unsold homes have declined, but remain elevated. Expect further additions to the supply of homes on the market due to the still growing number of homes in or potentially in foreclosure. We expect that home prices may stabilize in 2010, but wont begin to grow appreciably until late 2011 or early 2012.

Although the Fed has reaffirmed plans to end the MBS purchase program by the end of March, mortgage rates havent budged to this point. We still anticipate that mortgage rates will likely rise by about half a percentage point in the second quarter, and then another half a percentage point through the remainder of the year, as the economic recovery continues. Mortgage rates at 6 percent should significantly slow refinance activity, but should not slow the modest housing market recovery we are forecasting.

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Freddie Mac Weekly Update: Rates Flat

Posted by Howard Bell on March 18, 2010 at 12:45pm



30-year fixed-rate mortgage: Averaged 4.96 percent with an average 0.7 point for the week ending March 18, 2010, up slightly from last week when it averaged 4.95 percent. Last year at this time, the 30-year FRM averaged 4.98 percent.

The 15-year fixed-rate mortgage: Averaged 4.33 percent with an average 0.6 point, up slightly from last week when it averaged 4.32 percent. A year ago at this time, the 15-year FRM averaged 4.61 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.09 percent this week, with an average 0.6 point, up from last week when it averaged 4.05 percent. A year ago, the 5-year ARM averaged 4.98 percent.

One-year Treasury-indexed ARMs: Averaged 4.12 percent this week with an average 0.6 point, down from last week when it averaged 4.22 percent. At this time last year, the 1-year ARM averaged 4.91 percent.

Freddie Sayz

Mortgage rates for fixed-rate mortgages were virtually unchanged this week as the effects of the prior storms emerged in recent housing data, said Frank Nothaft, Freddie Mac vice president and chief economist. New construction slowed by 5.9 percent in February to 575,000 homes. Both the South and Northeast regions had all the declines due to the snow storms. In addition, homebuilder confidence unexpectedly dipped in March according to the NAHB/Wells Fargo Housing Market Index .

With house prices starting to stabilize and even rise, homeowners on aggregate are slowly building back equity in their homes based on figures from the Federal Reserve Board . After losing almost $7.9 trillion in home equity since the end of 2006, homeowners regained almost $1.1 trillion over the past three quarters ending in 2009.

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Mortgage Bankers Weekly Update

Posted by Howard Bell on March 18, 2010 at 12:45pm


Mortgage Bankers Association for the week of 3/17/2010

Market Composite Index: (loan application volume) decreased 1.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 1.7 percent compared with the previous week. .

Refinance Index: decreased 1.7 percent from the previous week and the seasonally adjusted Purchase Index decreased 2.3 percent from one week earlier.

Purchase Index: decreased 1.8 percent compared with the previous week and was 13.9 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 67.3 percent of total applications from 67.2 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 4.6 percent from 5.1 percent of total applications from the previous week.

Arm Share: decreased to 4.6 percent from 5.1 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

The most recent data on the housing market continues to show profound weakness .

Inventories of unsold homes have declined, but remain elevated. Expect further additions to the supply of homes on the market due to the still growing number of homes in or potentially in foreclosure. We expect that home prices may stabilize in 2010, but wont begin to grow appreciably until late 2011 or early 2012.

Although the Fed has reaffirmed plans to end the MBS purchase program by the end of March, mortgage rates havent budged to this point. We still anticipate that mortgage rates will likely rise by about half a percentage point in the second quarter, and then another half a percentage point through the remainder of the year, as the economic recovery continues. Mortgage rates at 6 percent should significantly slow refinance activity, but should not slow the modest housing market recovery we are forecasting.

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Freddie Mac: 30-Year Fixed-Rate Mortgage Drops Slightly

Posted by Howard Bell on March 11, 2010 at 4:46pm
30-year fixed-rate mortgage: Averaged 4.95 percent with an average 0.7 point for the week ending March 11, 2010, down from last week when it averaged 4.97 percent. Last year at this time, the 30-year FRM averaged 5.03 percent.

The 15-year fixed-rate mortgage: Averaged 4.32 percent with an average 0.7 point, down from last week when it averaged 4.33 percent. A year ago at this time, the 15-year FRM averaged 4.64 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.05 percent this week, with an average 0.6 point, down from last week when it averaged 4.11 percent. A year ago, the 5-year ARM averaged 4.99 percent. Averaged 4.11 percent this week, with an average 0.6 point, down from last week when it averaged 4.16 percent. A year ago, the 5-year ARM averaged 5.08 percent.

One-year Treasury-indexed ARMs: Averaged 4.22 percent this week with an average 0.6 point, down from last week when it averaged 4.27 percent. At this time last year, the 1-year ARM averaged 4.80 percent.

Freddie Sayz

During a light week of mixed economic reports, mortgage rates eased somewhat, said Frank Nothaft, Freddie Mac vice president and chief economist. Pending existing home sales fell 7.6 percent in January, well below the market consensus of a 1 percent gain. Meanwhile, the economy lost only 36,000 jobs in February, fewer than market forecasts, and the unemployment rate held steady at 9.7 percent. In addition, revisions added a net 35,000 workers to January and December combined.

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nations residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.

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Mortgage Bankers Association for the week of 3/10/2010

Posted by Howard Bell on March 11, 2010 at 4:45pm

Market Composite Index: (loan application volume) increased 0.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1.2 percent compared with the previous week.

Refinance Index: decreased 1.5 percent the previous week and the seasonally adjusted Purchase Index increased 5.7 percent from one week earlier.

Purchase Index: increased 7.2 percent compared with the previous week and was 10.7 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: decreased to 67.2 percent of total applications from 69.1 percent the previous week. The refinance share is at its lowest level since it was 66.1 percent in October 2009.

Arm Share: increased to 4.8 percent from 4.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

The economy is growing again. 4Q growth of 2009 exceeded expectations due to strong growth in business inventories. However inventory replacement is a short lived spurt, unless consumers buy. Weakness in the job market and a fragile recovery are likely to keep consumers from spending on big ticket items like houses and cars.

Existing home sales fell back in December and new home builders are not upbeat. The Fed remains unlikely to raise rates, however, they are going to end their MBS purchase program. This will certainly cause a rise in interest rates as the marketplace demands higher rates to compensate for risk.

Read more…

Freddie Mac Weekly Mortgage Rate Commentary:

Posted by Howard Bell on February 27, 2010 at 4:59pm
30-Year Fixed-Rate Mortgage Over 5 Percent

30-year fixed-rate mortgage: Averaged 5.05 percent with an average 0.7 point for the week ending February 25, 2010, up from last week when it averaged 4.93 percent. Last year at this time, the 30-year FRM averaged 5.07 percent.

The 15-year fixed-rate mortgage: Averaged 4.40 percent with an average 0.7 point , up from last week when it averaged 4.33 percent. A year ago at this time, the 15-year FRM averaged 4.68 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.16 percent this week, with an average 0.6 point, up from last week when it averaged 4.12 percent. A year ago, the 5-year ARM averaged 5.06 percent.

One-year Treasury-indexed ARMs: Averaged 4.15 percent this week with an average 0.6 point, down from last week when it averaged 4.23 percent. At this time last year, the 1-year ARM averaged 4.81 percent.

Freddie Sayz

Interest rates for 30-year fixed mortgages followed long-term bond yields higher and rose above 5 percent this week amid a mixed set of economic data reports said Frank Nothaft, Freddie Mac vice president and chief economist. For instance, the January producer price index jumped well above the market consensus, but the consumer price index remained subdued and consumer confidence declined to the lowest level since April 2009, according to the Conference Board .

There were also varying reports as to the current state of the housing market. The S&P/Case-Shiller national home price index rose for the third consecutive quarter in the fourth quarter, albeit at a slower rate, and the 20 city composite index showed an increase in December 2009 for the seventh month in a row; six metropolitan areas experienced positive year over year growth, compared to four in November. New home sales, however, unexpectedly slowed in January to the smallest pace since records began in 1963, and the supply of homes at the current sales rate rose to 9.1 months, the most since May 2009.

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Mortgage Bankers Association Weekly Update

Posted by Howard Bell on February 27, 2010 at 4:58pm

Mortgage Bankers Association for the week of 2/24/2010

Market Composite Index: (loan application volume) decreased 8.5 percent on a seasonally adjusted basis from one week earlier

Refinance Index: decreased 8.9 percent from the previous week. The seasonally adjusted Purchase Index decreased 7.3 percent from one week earlier, putting the index at its lowest level since May 1997.

Purchase Index: decreased 3.6 percent compared with the previous week and was 13.4 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: decreased to 68.1 percent of total applications from 69.3 percent the previous week.

Arm Share: increased to 4.7 percent from 4.4 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

The economy is growing again. 4Q growth of 2009 exceeded expectations due to strong growth in business inventories. However inventory replacement is a short lived spurt, unless consumers buy. Weakness in the job market and a fragile recovery are likely to keep consumers from spending on big ticket items like houses and cars.

Existing home sales fell back in December and new home builders are not upbeat. The Fed remains unlikely to raise rates, however, they are going to end their MBS purchase program. This will certainly cause a rise in interest rates as the marketplace demands higher rates to compensate for risk.

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Mortgage Bankers Association for the week of 1/6/2010

Posted by Howard Bell on January 15, 2010 at 4:21pm
Market Composite Index: (loan application volume) increased 14.3 percent on a seasonally adjusted basis from one week earlierRefinance Index: increased 21.8 percent from last week’s holiday adjusted index and increased 73.9 percent from last week’s unadjusted indexPurchase Index: increased 0.8 percent from one week earlier.Refinance Share of Mortgage Activity: increased to 71.5 percent of total applications from 68.2 percent the previous week unchanged at 4.0 percent of total applications from the previous week.Arm Share:: unchanged at 4.0 percent of total applications from the previous week.MBA outlook: (Excerpted from mbaa.org)The December jobs report was indicates a slow recovery. 85,000 jobs lost and an unemployment holding at 10 percent.Bloated inventories of unsold homes, buoyed by continued inflows of foreclosed properties, will keep a lid on home prices for some time. We do not expect more typical rates of home price appreciation until 2012. The Federal Reserve is unlikely to raise rates in 2010, but they will meet their commitment to purchase $1.25 trillion in agency MBS by the end of the first quarter.The MBAA anticipates that mortgage rates will rise by about a percentage point through the year, to end at 6.1 percent. Eye-popping federal budget deficits and positive economic growth will put upward pressure on Treasuries. Yields on mortgage securities will need to increase to get private investors back into the market once the Fed stops its purchases.Thanks for Readingwww.yourpropertypath.comRelated ArticlesThe Coming Mortgage Debt Reduction Programs FHA and Fannie Mae Propose Rule ChangeCitigroup Suggests Mortgage Debt Forgiveness
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Freddie Mac Weekly Mortgage Rate Commentary:

Posted by Howard Bell on January 15, 2010 at 4:21pm
Fixed-Rates Down Slightly While ARMs Are Mixed30-year fixed-rate mortgage: Averaged 5.06 percent with an average 0.7 point for the week ending January 14, 2010, down from last week when it averaged 5.09 percent. Last year at this time, the 30-year FRM averaged 4.96 percent.The 15-year fixed-rate mortgage: Averaged 4.45 percent with an average 0.6 point , down from last week when it averaged 4.50 percent. A year ago at this time, the 15-year FRM averaged 4.65 percent.Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.32 percent this week, with an average 0.6 point, down from last week when it averaged 4.44 percent. A year ago, the 5-year ARM averaged 5.25 percent.One-year Treasury-indexed ARMs: Averaged 4.39 percent this week with an average 0.5 point, up from last week when it averaged 4.31 percent. At this time last year, the 1-year ARM averaged 4.89 percent.Freddie SayzInterest rates for fixed rate mortgages eased a little further this week, while ARM rates were mixed, said Frank Nothaft, Freddie Mac vice president and chief economist. With fixed mortgage rates staying near a record low, many homeowners are taking the opportunity to refinance. For instance, over the past three-and-a-half months, on average more than 75 percent of conventional mortgage applications were for refinance transactions, according to the Mortgage Bankers Association.The Federal Reserve recently reported positive news in both the housing market and the overall state of the economy in its January 13th regional economic report, which spanned the last few months of 2009. Economic activity improved in 10 of its 12 districts. Home sales, especially for lower-priced homes, increased due in part to the homebuyer tax credit and house prices appeared to have changed little since its last reportThanks for Readingwww.yourpropertypath.comRelated ArticlesFHA and Fannie Mae Propose Rule ChangeFHA Losses: What it MeansFHA Has New Rules
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Freddie Mac Weekly Mortgage Rate Commentary:

Posted by Howard Bell on January 9, 2010 at 4:57pm
30-year fixed-rate mortgage: Averaged 5.09 percent with an average 0.7 point for the week ending January 7, 2009, down from last week when it averaged 5.14 percent. Last year at this time, the 30-year FRM averaged 5.01 percent.The 15-year fixed-rate mortgage: Averaged 4.50 percent with an average 0.7 point, down from last week when it averaged 4.54 percent. A year ago at this time, the 15-year FRM averaged 4.62 percent.Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.44 percent this week, with an average 0.6 point, unchanged from last week when it averaged 4.44 percent. A year ago, the 5-year ARM averaged 5.49 percent.One-year Treasury-indexed ARMs: Averaged 4.31 percent this week with an average 0.6 point, down from last week when it averaged 4.33 percent. At this time last year, the 1-year ARM averaged 4.95 percent.Freddie SayzMortgage rates eased slightly this week after rising consecutively through December, said Frank Nothaft, Freddie Mac vice president and chief economist. Current interest rates for fixed rate mortgages are just about at their annual average for 2009, while ARM rates are considerably below their averages for last year. As the economy strengthens further and the Federal Reserve (Fed) decides to raise its overnight target rate, ARM rates will follow suit because they are typically tied to shorter-term interest rates. However, the federal funds futures market does not anticipate any Fed action until the second half of 2010Thanks for Readingwww.yourpropertypath.comRelated ArticlesThe Politics Of Home Ownership and How It Became Too Easy To OwnHousings Weak Recovery: Lets Follow The MoneyNAR: Existing Home Sales Report
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Mortgage Bankers Association: Weekly Mortgage Survey

Posted by Howard Bell on January 9, 2010 at 4:30pm
Market Composite Index: (loan application volume) decreased 22.8 percent on a seasonally adjusted basis from the prior week.Refinance Index: decreased 30.5 percent from the previous week and the seasonally adjusted Purchase Index decreased 4.0 percent from one week earlier. The following week, the Refinance Index decreased 1.6 percent and the seasonally adjusted Purchase Index increased 3.6 percent.Purchase Index: decreased 33.1 percent the week of Christmas and increased 5.0 percent the week following. This measure was 26.2 percent and 28.2 percent lower, respectively, than the same period a year ago.Refinance Share of Mortgage Activity: mortgage activity for the week ending January 1, 2010 is 68.2 percent, a decrease from 69.6 percent for the week ending December 25, 2009.MBA outlook: (Excerpted from mbaa.org)In summary the MBAA sees another year of high employment, rising home sales and prices beginning to stabilize. But continued weakness in the job market and excess supply and shadow inventory will slow any recovery in the housing market.The MBAA sees unemployment rate at about 10% at the end of 2010, and core inflation rates of below 2%. Fed rate is expected to remain at its current level throughout 2010.But, property values will not recover until unsold inventory returns to normal levels. Affordability is at record levels, yet there is no strong indication that the demand recovering. People do not yet seem to trust the recovery and many do not have the necessary down payment or can clear tighter loan qualificationsThe MBAA site economic report indicates a fragile recovery, but makes note that without credit the recovery remains tepid at best. The site makes note: Smaller businesses and consumers are heavily dependent on banks for obtaining credit, and there is little evidence that, as yet, banks have loosened the purse strings.Bank loans to businesses and consumers are still falling with few signs of stopping or slowing down. Part of the decline is declining demand, but the fall is too large to be explained by weakness in demand alone. The banks are simply not yet stepping up to fill the vacuum.Thanks for Readingwww.yourpropertypath.comRelated ArticlesFHA and Fannie Mae Propose Rule ChangeFHA Losses: What it MeansFHA Has New Rules
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