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Thomas Pasckvale President/Owner NMLS: 22859 Top Vine Mortgage Services, LLC Phone: 844-545-9251 Fax: 855-631-8856 Company NMLS: 1390034 tpasckvale@topvinemtg.com www.topvinemtg.com |
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May 2015
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Spring Buyers Get a Breather With Low Rates
Home loan applications for both purchases and refinances moved higher in early April due to consistently low rates. Home loan applications to purchase a home were 8 percent higher than the same time one year ago. Applications to refinance, which are more dependent on interest rates, rose 4 percent and were a surprising 44 percent higher than the same time one year ago. Applications for the two main types of home loans, conventional (typically 15 and 30 year fixed rate loans) and government (Federal Housing Administration and Veterans Administration loans), also moved higher. This indicates both move-up and first-time buyers are back or getting into the market. Government-insured loans tend to attract first-time buyers due to their low down payment requirements. Volume for these loans grew by an impressive 19 percent from a year ago. Fewer Homes on the Market Higher prices and tight supply continue to stifle the market. "Pending sales showed solid gains last month, driven by a steadily-improving labor market," said Lawrence Yun, the National Association of REALTORS® chief economist. "However, the underlying obstacle—especially for first-time buyers—continues to be the depressed level of homes available for sale." In a Bloomberg interview, Mortgage Bankers Association CEO David Stevens stated that home prices are rising twice as fast as wages and he expressed concern that inventory will drive up prices, discouraging many would-be homebuyers. Total housing inventory at the end of March was slightly lower than one year ago, and new listings are not coming on at nearly the pace needed to meet demand, according to an April CNBC housing report. Home builders have also not ramped up production, citing tight credit for construction loans and rising prices for land in the best locations. The coming months will show whether homebuilders can obtain permits and sufficient credit in time to build to satisfy demand. The Bottom Line Low rates make it an exciting season to become a new homeowner, or to refinance your existing home loan. If you or your friends, family or colleagues have questions, please contact me today. Sources: CNBC, Bloomberg, Realtor.com | ||||||||||||||||||||||||||||||
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