Where Are Mortgage Interest Rates Headed In 2014

Mortgage rates will likely rise above 5% in 2014 and average 5.3% by the end of 2015, this according to the Mortgage Bankers Association’s forecast. 

This would mark a significant increase over where mortgage rates stand now. The MBA reported this week that the 30-year fixed-rate mortgage averaged 4.33 percent, the lowest average since June. 

The Federal Reserve has decided to taper its $85-billion per month bond-purchasing program in early 2014 and to end it altogether before the start of 2015. The Fed’s bond buying program has held mortgage interest rates low. The Fed has hinted in recent months that it will continue to monitor the economy and has no immediate plans to terminate the program but may soon begin winding it down. This taper will start in January with a $10-billion dollar reduction reducing purchases to $75-billion.  

“As a result, mortgage refinancing will continue to drop, and borrowers seeking to tap the equity in their homes will be more likely to rely on home equity seconds rather than cash-out refinances,” says Jay Brinkmann, the MBA’s chief economist.

The MBA indicated in it's forecast that it expects home purchase applications for mortgages to rise 9% next year, as home sales and prices continue to post gains. 

However, the MBA projects that overall mortgage originations will drop 32% in 2014, this as the number of refinancing applications post a large declines due to rising interest rates. 

While refinancings make up the bulk of home applications today, that trend is expected to reverse next year. Purchase loans are expected to make up 60% of originations next year compared to about 38% this year. 

“We are projecting home purchase originations will increase in 2014 due largely to gains in home sales and home prices,” says Brinkmann. “We expect to see a decline in the share of sales paid for with cash, and higher average LTVs on purchase mortgages, due to the rise in home prices.”

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in; Bexley Columbus Delaware Downtown Dublin Gahanna Grandview Heights Granville Grove City Groveport Hilliard Lewis Center New Albany Pickerington Polaris Powell Upper Arlington Westerville Worthington

Many Homeowners Stay Put After Foreclosure

Nearly half of the nation’s foreclosed homes are still occupied, according to a new study by RealtyTrac. That percentage is even higher in some markets: 60% of foreclosed homes in Miami and Los Angeles are occupied. Because the owners or renters of these homes aren't being evicted until months or even years after the homes go into foreclosure, they continue to live in them without paying a mortgage or rent.

To reach its findings, RealtyTrac used its database of foreclosed homes and compared it with postal records to see which addresses were still receiving mail and which had a change-of-address filed. The study found that people who rented a home that went into foreclosure often stay for a year or more afterward.

“If someone has a bona fide rental agreement, we have to abide by that,” explains Amy Bonitatibus, spokesperson for JPMorgan Chase. 

Banks say that evicting a person after foreclosure is often a slow legal process. Some banks try to speed up the eviction process by offering cash to get occupants to leave. However, other banks actually prefer that home owners stay in a home after foreclosure, even if they are not paying the mortgage. 

Although one thinks lenders take losses by not moving evictions forward, they're still faring better by keeping the properties occupied, Many foreclosed homes get vandalized or squatters move in. 

Distressed homes — including foreclosures and short sales — accounted for 14% of existing-home sales in September, the National Association of REALTORS® reported this week. That percentage is down from 24% in September 2012. On average, foreclosures sold for a discount of 16% below market value in September. 

If you’re facing foreclosure you’re facing some very important decisions. We want you know you’re not alone and we are here to help with any questions you may have to assist you in making the best decisions for your situation. There is no charge for this service and we are happy to help! We offer confidential and professional real estate advice.

The Opland Group  Specializes in  Real Estate Sales, Luxury Home Sales, Short Sales  in;    Bexley    Columbus    Delaware    Downtown    Dublin    Gahanna    Grandview Heights    Granville    Grove City    Groveport    Hilliard   Lewis Center    New Albany    Pickerington    Polaris    Powell      Upper Arlington    Westerville    Worthington

Divorce Rates on the Rise as Home Values Continue to Improve

A new poll reveals more unhappy couples are now calling it quits and divorce rates are on the rise. Divorce attorneys and real estate agents indicate a significant factor affecting this trend: Home prices have been rising, which means couples can finally sell homes that used to be underwater, and in many cases even have some equity remaining to be used as start over cash.

So many couples have been biding their time and continuing to live together in unhappy relationships. We have clients who have put up with each other over the past few years, checking in with us periodically to determine if their home values have recovered to a level that would allow them to sell their homes and walk free and clear, or with a prescribed amount of sales proceeds.

Before the 2007-09 recession, most couples who divorced vied first for the children, and then for the real estate assets. However, after the economic downturn stripped homes of 30-50% their value, the one-time happy abode shifted from an asset to a liability and becoming something that no one wanted in the divorce because it came with a mountain of mortgage debt. For better, for worse - or until the house can sell for a profit?

Exactly how the housing market might be affecting the divorce rate is uncertain. In many states including Ohio, divorces were on the downslide from 2007 to 2008, heading into the recession, but the per-capita rates for the state have increased since then. Meanwhile, home values have had a bumpy ride over the same stretch, bottoming out in 2011 before rallying in the past 2.5 years.

To local divorce attorneys and real estate agents specializing in assisting sellers during a divorce, what's happening is clear: after years of putting up with each other, unhappy couples are moving forward with divorces that were put on hold while the couples waited for home values to improve.

Stan Humphries, chief economist for the real estate-research firm Zillow Inc., said a decrease in the percentage of underwater homes has allowed more homeowners to sell at a profit, so they can finally relocate to other parts of the country, and has allowed more couples to make marital decisions without worrying about a distress sale ruining their credit.

These individuals can now sell, liquidate their assets and go their separate ways without the baggage or need to fight over who is responsible for the debt associated with the home.

According to Zillow, the number of "underwater homes" - properties worth less than their mortgage balance - has declined from 54% of all mortgaged homes in the fall of 2011 to 41% as of July 2013.

Many real estate agents, especially those who specialize in assisting divorce attorneys, and their clients, report an increase in the number of divorcing couples and divorcees they've assisted in recent months and as the housing market has continued it's recovery and home values have increased.

For many, getting even a little equity out of the sale of the home means not only that they needn't worry about covering the costs associated with the sale, but also the additional funds can help these folks to get restarted with a new downpayment or apartment deposits.

Home-sale profits may not be the only real estate transaction affecting couple's relationships.

A woman recently commented that she was able to transition out of a marriage that no longer made sense when Bank of America agreed to modify her monthly mortgage payment from a high of $2,200 a month to about $1,400, which was an amount she could begin to afford on her own.

Many lawyers assert that the main issue is that couples sometimes stay together simply because they don't have enough money to leave each other.

The recent surge in divorces, although an unhappy experience, is yet another indication that home values across the nation continue to improve.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio  please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group  Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;    Bexley    Columbus    Delaware    Downtown    Dublin    Gahanna    Grandview Heights   Granville   Grove City   Groveport    Hilliard   Lewis Center    New Albany   Pickerington    Polaris    Powell      Upper Arlington    Westerville    Worthington

More Renters Say They Want to Own a Home

The majority of renters say home ownership is one of their highest priorities for their future, and as the housing market improves and rents continue to rise, more renters are saying they want to buy a home soon, according to the 2013 National Housing Pulse Survey, conducted by the National Association of REALTORS.

Renters are showing stronger desires for home ownership compared to recent years, according to the survey.

Home ownership matters to Americans who consistently realize the many benefits it provides to communities, families, and the nation’s economy. Due to high housing affordability and today’s interest rates it makes sense for people to consider home ownership over renting. In fact, in many parts of the country it’s cheaper to own a home than to rent and this trend is expected to continue as rents are on the rise. Therefore, it’s no surprise that renters recognize that owning a home offers tremendous long-term benefits, and is an investment in their future.

Fifty one percent of renters say that eventually owning a home is one of their highest personal priorities, up from 42 percent in the 2011 survey.

The survey found that 80 percent of the 2,000 Americans surveyed say they believe buying a home is a good financial decision. 68 percent said now is a good time to buy a home, too.

The survey found Buyers main motivations to home ownership included: building equity (and locking in a monthly payment), wanting a stable and safe environment, and the freedom to choose where to live, the survey found.

Meanwhile, the main obstacles to home ownership have remained the same over the years: saving for the down payment, closing costs, low wages, and student loan debt.

“Student loan debt is a concern for many consumers in today’s market, especially first-time buyers,” Thomas says. Buyers with student loan debt may find it difficult to access mortgage credit, as well as save for a down payment. Pending mortgage finance regulations requiring higher down payments could also contribute to the already tight lending environment however, lenders have begun ease their requirements in recent months as interest rates rise and they are forced to complete for a larger share of the purchase business. That said, REALTORS are working with regulators to address this issue and are committed to making sure those who are willing and able to own a home have the opportunity to pursue that dream.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in; Bexley ColumbusDelaware Downtown Dublin GahannaGrandview Heights GranvilleGrove City GroveportHilliard Lewis Center New Albany Pickerington Polaris Powell Upper Arlington WestervilleWorthington

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US Housing Market is in Phase Three of Recovery

The US housing market is in full recovery mode at this time. In analyzing the market we focus on three key housing market indicators: construction starts (Census), existing home sales (NAR), and the delinquency-plus-foreclosure rate (LPS First Look). For each indicator, the data is compared to (1) how bad the numbers got at their worst and (2) their pre-bubble “normal” levels.
In July 2013, all three measures improved: construction starts and existing home sales rose, while the delinquency + foreclosure rate notched downward:

• Construction starts increased but still have a long way to go. Starts were at an 896,000 seasonally adjusted annualized rate – up 6% from June but slightly below the average rate from the first six months of 2013. Year to date, single-family and multi-family starts rose 20% and 33%, respectively, above last year’s levels. Construction starts are 41% of the way back to normal.
• Existing home sales leapt to their second-highest level in six years. Sales jumped in July to a seasonally adjusted annualized rate of 5.39 million – that’s up 17% year-over-year, and up 31% year-over-year when excluding foreclosures and short sales are excluded. For the sixth straight month, inventory expanded, even after taking seasonality into account. Overall, existing home sales are 94% back to normal.
• The delinquency + foreclosure rate continued its retreat. The share of mortgages in delinquency or foreclosure dropped to 9.23% in July, the second-lowest level in almost 5 years. The combined delinquency + foreclosure rate is 56% back to normal.