The red-hot real estate market is getting hotter

According to Niche Report., the red-hot real estate market is getting even hotter thanks to regional property appreciation. This situation was recently reported by online real estate market analysis site Trulia, and it is bound to attract more real estate investors to some metropolitan areas where urban dwellers are taking a break from the American Dream of home ownership in favor of lease agreements.

According to the figures released by Trulia, monthly rents in the United States climbed by 5.4 percent on an average basis since June 30th of the previous year. This increase is not surprising given the pace of foreclosures over the last few years, as well as the incredibly strict credit and lending guidelines imposed on mortgage applicants.

In some metropolitan areas like San Francisco, renters are now paying almost 15 percent more than in 2011. This has had a positive, yet disproportionate, effect on real estate values in the San Francisco market, where residential properties are now priced 2.5 percent higher than they a year ago. A similar situation can be observed in nearby Oakland, where rents went up by 10 percent, although home purchase prices barely inched up compared to twelve months ago.

Refinancing Applications Spike by 13%

A 13% increase in refinance applications led to a 9.2% seasonally adjusted increase in overall application volume for the week ended May 11, according to the Mortgage Bankers Association. As in the previous week, the activity was spurred by record low rates for all four categories of fixed-rate loans the trade group tracks.

The one thing that the rise in refi apps cannot be attributed to is the Home Affordable Refinance Program, said Michael Fratantoni, MBA's vice president of research and economics.

"A flare-up of the sovereign debt troubles in Europe once again led investors to flee to the safety of U.S. Treasury securities last week. As a result, mortgage rates have reached new lows in our survey, and refinancing application volumes picked up substantially as a result.

"Survey participants indicated that this was not due primarily to HARP volume—the HARP share of refinances fell to 28% of refinance applications, down relative to last week and last month, when the share was just above 30% in April. The increase in refinance activity last week was concentrated in the conventional sector, which was up around 14% for the week, while government refinance applications were up only 4%," Fratantoni explained.

The Purchase Index decreased 2.4% compared with the previous week and was 1% lower on an unadjusted basis than the same week one year ago. The refi share of apps increased to 74.9% from 72.1% in last week's survey.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased by five basis points from the previous week to 3.96%. The average contract interest rate for 30-year Federal Housing Administration-insured loans declined by six basis points to 3.75%.

The rate for 30-year FRMs with jumbo loan balances fell by nine basis points to 4.2%. The average contract interest rate for 15-year FRMs declined three basis points to 3.26%.

For more details on this and other mortgage related information visit www.mbaa.org

Thirty-Year Rate Holds Fast to Its Record Low

As per Origination news..The average weekly rate for a 30-year fixed-rate mortgage in Freddie Mac’s primary market survey held steady at its record low of 3.78% during the week ending May 24.

The average rate for a 15-year FRM, at 3.04%, also remained unchanged week to week. Similarly, the five-year Treasury-indexed hybrid stayed put at 2.83%.
The average rate for a one-year Treasury adjustable-rate mortgage slid three basis points to 2.78% and carried an average of just 0.4 of a point.
The 30-year, in contrast, came with an average of 0.8 of a point in the most recent week, while the 15-year carried an average of 0.7 of a point and the five-year Treasury hybrid included on average 0.6 of a point.
The plateau in most rates came during a week when there were several indicators suggesting relative improvement in the housing market, said Freddie Mac chief economist Frank Nothaft in his weekly report. He said rate-driven affordability contributed to this.
Nothaft also noted in his monthly economic and housing outlook issued Wednesday that there have been some encouraging signals, although residential fixed investment is still weak.
A Mortgage Bankers Association report adjusting the group’s origination estimates upward Thursday did so on the strength of higher-than-expected refinancing that government programs as well as rates have contributed to.
But it also suggested that purchase volumes look weaker than they had.

Home prices rise for first time in 8 months

As per The Niche Report Home prices rose in March for the first time since last July, helped by tighter housing inventory, data analysis firm CoreLogic said on Tuesday.

CoreLogic’s home price index gained 0.6 percent from February, but was still down 0.6 percent compared with March a year ago.
Excluding sales of distressed properties, prices climbed 0.9 percent on a yearly basis. Homeowners in danger of foreclosure, or in “distress”, often sell their homes at significantly reduced prices.
“This spring, the housing market is responding to an improving balance between real estate supply and demand, which is causing stabilization in house prices”, Mark Fleming, chief economist at CoreLogic, said in a statement.
Of the top 100 statistical areas measured by population, 57 showed year-over-year declines, down from 65.
The closely watched S&P/Case Shiller index released in late April showed a rise in U.S. single-family home prices in February for the first time in 10 months, with a gain of 0.2 percent on a seasonally adjusted basis.

15 Year Fixed Rate Mortgage Hits New All-Time Record Low

 released the results of its Primary Mortgage Market Survey® (PMMS®) on the 12th of April 2012, showing average fixed mortgage rates declining for the third consecutive week on the heels of a weaker than expected employment report. The 30-year fixed averaged just above its record low while the 15-year fixed averaged a new all-time record low of 3.11 percent breaking its previous low of 3.13 percent on March 8, 2012.

News Facts

• 30-year fixed-rate mortgage (FRM) averaged 3.88 percent with an average 0.7 point for the week ending April 12, 2012, down from last week when it averaged 3.98 percent. Last year at this time, the 30-year FRM averaged 4.91 percent.
• 15-year FRM this week averaged 3.11 percent with an average 0.7 point, down from last week when it averaged 3.21 percent. A year ago at this time, the 15-year FRM averaged 4.13 percent.
• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.85 percent this week, with an average 0.7 point, down from last week when it averaged 2.86 percent. A year ago, the 5-year ARM averaged 3.78 percent.
• 1-year Treasury-indexed ARM averaged 2.80 percent this week with an average 0.6 point, up from last week when it averaged 2.78 percent. At this time last year, the 1-year ARM averaged 3.25 percent. 

This report follows the weaker than expected unemployment report from March. A good way to get updates from FreddieMac would be to follow the Office of the Chief Economist Follow @FreddieMac