Minnesota Homes Today Local & National News

Home Builders Experiencing Heavy Foot Traffic And Higher Sales Volume

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Housing Market Index 2010-2011In another good sign for the housing market, today’s home builders believe that the housing market has turned a corner.

For the third straight month, the Housing Market Index — a home builder confidence survey from the National Association of Homebuilders — reported strong monthly gains.

December’s Housing Market Index climbed 2 points to 21 in December after a downward revision to last month’s results. The index is now up seven points since September 2011, and sits at a 19-month high.

When home builder confidence reads 50 or better, it reflects favorable conditions in the single-family new home market. Readings below 50 reflect unfavorable conditions.

The Housing Market Index has not crossed 50 since April 2006.

The HMI itself is actually a composite reading; the result of three related home builder surveys. The National Association of Homebuilders asks its members about their current single-family home sales volume; their projected single-family home sales volume for the next 6 months; and their current buyer “foot traffic”.

The results are compiled into the single Housing Market Index tally.

In December, builder survey responses showed strength across all 3 questions :

  • Current Single-Family Sales : 22 (+2 from November)
  • Projected Single-Family Sales : 26 (+1 from November)
  • Buyer Foot Traffic : 18 (+3 from November)

These results support the recent New Home Sales and Housing Starts data, both of which show an increase in single-family sales, and a decrease in new home housing supply.

When demand rises and supplies fall, home prices climb.

It’s also noteworthy that the Housing Market Index put buyer foot traffic at newly-built homes at its highest level since May 2008. With even more buyers expected to enter the market, new home prices are expected to rise across St Paul in 2012 — especially in the face of shrinking home supplies. 

For now, though, with home prices stable and mortgage rates low, buyers can grab “a deal”. 60 days forward, though, may be too late.

The Spring Buying Season unofficially starts February 6, 2012.

Are You Still Renting? You’re Throwing Away Money Every Month

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How much could you borrow to own your own home based on what you’re paying in rent?  

 

                                                                                

                                                                                        Interest Rate

              Current Rent                            4%               5%               6%               7%
                                                         APR 4.969   APR 5.966      APR 6.973     APR 7.988

 

                       $800                            $95,000        $84,000        $75,000         $68,000

                       $900                          $115,000      $102,000        $92,000         $83,000

                    $1,000                          $136,000      $121,000      $108,000         $98,000

                    $1,100                          $152,000      $135,000      $121,000       $109,000

                    $1,200                          $168,000      $149,000      $133,000       $120,000

                    $1,300                          $183,000      $163,000      $146,000       $132,000

                    $1,400                          $204,000      $182,000      $163,000       $147,000

                    $1,500                          $220,000      $196,000      $175,000       $158,000

Call me today for information on homes available right now in your price range!

*APR as of 11/30/11. This is not  an offer to extend credit. Rates subject to change without notice.

 For Minnesota Real Estate Properties Today

Mortgage Payments Fall 12% Since February 2011

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Mortgage payments in 2011

As mortgage rates drop, so do housing payments. It’s a good time to consider refinancing your home, or making an offer on a new one. Mortgage payment affordability has never been so high in history.

According to Freddie Mac, the average 30-year fixed rate mortgage rate is now 3.94 percent — an all-time low — with an accompanying 0.8 discount points. This means that in order to get access to the 3.94 percent rate, Minneapolis  homeowners and home buyers should expect to pay a loan fee equal to 0.8% of the borrowed amount, plus “normal” closing costs.

Last week, the average 30-year fixed rate mortgage rate was 3.99 percent with an accompanying 0.7 discount points.

Mortgage rates in Minnesota have been in decline for most of the year. Since peaking in early-February, the average home owner’s principal + interest payment on a 30-year fixed rate mortgage had now dropped by 12.2 percent.

Here is how mortgage payments compare, then and now, not accounting for your individual tax-and-insurance escrow :

  • February 10, 2011 : Payment of $539.88 per $100,000 borrowed
  • December 15, 2011 : Payment of $473.96 per $100,000 borrowed

For existing homeowners, the dramatic drop in payments is reason to reach out to your loan officer. A refinance could save you tens of thousands of dollars over the life of your loan — especially if you chose to refinance your mortgage into a 15-year program.

The 15-year mortgage, says Freddie Mac, is also at an all-time low, registering 3.21 percent with 0.8 discount points, on average.

For home buyers, today’s low rates present an interesting opportunity.

Mortgage rates are the key factor in determining your monthly housing payment so, with average mortgage rates below 4 percent, it’s no wonder home affordability is cresting. However, the housing market is showing signs of recovery. Home supplies are dwindling, buyer demand is rising, and the economy appears to be mending.

Home prices are expected to rise in 2012 and, as they do, they’ll take housing payments with them. The best time to buy a home may be now; before the recovery completes.

For Minnesota Real Estate Properties

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