Long term mortgage rates, on average, have remained below 3.0% for seventeen consecutive weeks, per a recent Black Knight report. The same report states that 19.4 million homeowners could still benefit from a home loan refinance.
Black Knight’s report views prime candidates as 30-year mortgage-holders who have at least 20% equity in their homes, credit scores of 720 or higher, are current on their payments and who stand to cut their first lien rates at least 0.75% by refinancing. – housingwire.com
How long will mortgage rates stay at near historic lows? The market is desperate for positive economic news. The announcement of multiple viable COVID-19 vaccines sent rates higher for a hot minute, but soaring COVID-19 cases and a contested election is causing market strain, keeping rates mostly flat. Once Trump concedes, and the vaccine enters wide distribution, long term interest rates are anticipated to climb.
2021 CONFORMING LOAN LIMIT INCREASE
The conforming loan limit will increase to $548,250 from $510,400. Conforming loans generally have less restrictive guidelines than homes with non-conforming loans amounts( JUMBO)
2021 FHA LOAN LIMIT INCREASE
The Federal Housing Agency (FHA) has just raised its loan limit by 7.4% to a maximum amount of $356,362 in most areas. In certain high cost areas, it’s $822,375. Limits will take effect in 2021.
DOW HITS 30,000
On November 24, 2020, the Dow Jones hit 30,000 for the first time in U.S. history. A remarkable milestone to hit during a global pandemic, a recession, as well as during a contested presidency.
The market extended its Tuesday morning gains after President Trump stated that aids would begin to work with the incoming Biden administration, easing uncertainty with the markets.
SOARING HOME PRICES
The recent S&P Case-Shiller report shows home prices rose 7% in September over the same period last year. The biggest year over year gain in six years.
“Home prices are normally sticky, meaning that they often take a while to respond to market shifts,” said Matthew Speakman, economist at Zillow. “These elevated levels of market competition have been placing upward pressure on prices for months, but home prices have just recently begun to take off in earnest. Some measures show home prices now growing at a faster pace than they ever have.” – housingwire.com
Phoenix, Arizona lead the rise in home prices posting an 11.4% gain. Seattle, Washington came in at second place with a 10.1% gain.
Home prices show no sign of slowing, despite a global pandemic, they are being fueled by historic low interest rates, diminishing inventory.
HOME SALES STAY STRONG
New home sales were down a slight 0.3% in October over September, but up a colossal 41.5% higher than the same time last year. – Department of Housing and Urban Development. The surge in home sales has left a bleak 3.3-month supply of home inventory. The average home price $386,200.
By Lisa Bell – Loan Officer
Geneva Financial, LLC