Mortgage Rates Sink To Lowest Level On Record

By ALAN ZIBEL
AP Real Estate Writer
June 24, 2010
WASHINGTON (AP) — Mortgage rates fell this week to the lowest level on record, giving consumers added incentive to lock in low payments on home purchases and refinancings.

Mortgage company Freddie Mac said Thursday that the average rate for 30-year fixed loans sank to 4.69 percent, from 4.75 percent last week.

That’s the lowest since Freddie Mac began tracking rates in 1971. The previous record of 4.71 percent was set in December. Rates for 15-year and five-year mortgages also hit lows.

Mortgage rates have fallen over the past two months. Investors wary of the European debt crisis and the turbulent stock market have shifted money into the safety of Treasury bonds, driving down yields. Mortgage rates tend to track the yields on long-term Treasury debt.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

Rates on 15-year, fixed-rate mortgages fell to an average of 4.13 percent, the lowest on records dating to September 1991 and down from 4.2 percent a week earlier.

Rates on five-year, adjustable-rate mortgages averaged 3.84 percent, down from 3.89 percent a week earlier. That was also the lowest on Freddie Mac’s records, which only date back to January 2005.

Average rates on one-year, adjustable-rate mortgages fell to 3.77 percent from 3.82 percent. That was the lowest average since May 2004.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.

The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 a point for 30-year, 5-year and 1-year loans. The average fee for 15-year loans was 0.6 of a point.

Existing Home Sales Roar in April

YORK (CNNMoney.com) — Existing home sales soared in April as home buyers scrambled to claim the tax credit that expired at the end of the month, according to a real estate industry report released Monday.

The National Association of Realtors reported that existing home sales jumped 7.6% last month to a seasonally adjusted annual rate of 5.77 million units, up from the upwardly revised rate of 5.36 million in March. Sales year-over-year were up 22.8%.

The gain was widely anticipated, but still beat forecasts. Analysts surveyed by Briefing.com were looking for resales in April to rise to an annual rate of 5.65 million units.

“The upswing in April existing-home sales was expected because of the tax credit inducement, and no doubt there will be some temporary fallback in the months immediately after it expires, but other factors also are supporting the market,” said Lawrence Yun, NAR chief economist. “For people who were on the sidelines, there’s been a return of buyer confidence with stabilizing home prices, an improving economy and mortgage interest rates that remain historically low.”

The home buyer tax credit, which expired April 30, pushed sales up during the month since buyers had to sign contracts by the end of last month. First-time home buyers qualified for a tax credit up to $8,000, while those trading up could score as much as $6,500.

Despite the termination of the tax credit, NAR president Vicki Cox Golder also anticipates buyer traffic to hold up in May and June.

“Some realtors tell us they are very busy with clients who are entering the market now as a result of improved conditions, while others are welcoming a slowdown from frantic market conditions in recent months,” she said.

Price and inventory: The NAR report showed that the median price of homes sold in April was $173,100 in April, up 4% from a year ago. About a third of homes sold during the month were distressed properties.

Total housing inventory rose 11.5% to 4.04 million existing homes for sale. That represents a 8.4-month supply at the current sales pace, up from a 8.1-month supply in March.

Yun said that although inventories remain higher than normal, the house pricing correction is nearly over.

“In fact, a majority of the markets have seen price gains lately,” he added. “A return to old-fashioned responsible lending and buying will help the housing market avoid disruptive and painful bubble-bust cycles.”

Sales by property and region: Sales of single-family homes rose 7.4% in April compared to the prior month, while condominium and co-op sales spiked more than 9%.

The Northeast fared best last month, with sales surging 21.1% to an annual level of 1.09 million units in April, which was 41.6% higher than a year earlier.

Resales in the Midwest climbed nearly 10% last month, while they rose 8.6% in the South and 6.2% in the West.

Pocono Housing Market Showing Some Signs of Life

Home sales in Monroe County rose during the first quarter of 2010, the first increase in first-quarter sales since 2006.

Although the growth was just 8 percent, that compared to a 24 percent collapse last year.

The boost might be driven by a soon-to-expire tax credit for home buyers, according to Lisa Sanderson, president of the Pocono Mountains Association of Realtors and an agent with Real Living Ritter and Co. Real Estate.

First-time home buyers and those trading up for a more expensive home are eligible for tax credits of up to $8,000, but that is set to expire soon. To take advantage of the incentive, you have to be under contract by the end of April and close by the end of June.

Although there’s been speculation about whether the tax credit would be extended, Sanderson said, “We don’t usually know until the last minute.”

While home sales climbed, prices continued to fall.

The average price of a Monroe County home sold in the first quarter of 2010 was $145,449, down 5 percent over the same period last year.

“There probably won’t be any increases in prices for a while. But having more houses sell is probably the first thing to getting things back on track,” Sanderson said.

Home sales continued to fall for the year in 2009. A total of 1,828 homes sold all of last year, according to Pocono Mountains Realtors Association statistics. That was 7 percent less than 2008.

Sales of foreclosed homes jumped 27 percent last year, following the trend of rising foreclosures. It also is a reflection that the market is clearing out many of those distressed homes from the local inventory.

First-quarter sales in Monroe reached its peak in 2006 with 950 homes sold. That figure has been declining over the past three years, as the economy began to slow and the sub-prime mess threw the housing market into chaos.

Pike and Wayne counties also saw home sales rise during the first quarter. Sales in those two counties are combined by the Pike-Wayne Association of Realtors.

Combined sales in the two counties increased 19 percent, to 232 homes sold in the first quarter. Sales fell 26 percent last year in the same period, to 209.

But the residential real estate market in the Pike Wayne Association of Realtors coverage area had a smaller foreclosure problem, with 19 percent of all homes sold having been foreclosures in each of the first quarters of 2009 and 2010.

The average price of a home sold in that period was $179,893, or about 24 percent higher than in Monroe.

Lehman Joins PA First

Lorie Lehman has joined Pennsylvania First Settlement Services II, LP, a full service title and settlement company, as a Settlement Officer/Account Manager.

Lehman comes to Pennsylvania First after being in the Pocono title industry for the past 24 years.  During that time, Lehman served in the positions of Escrow Officer, Closing & Settlement Manager and Partner for Investor’s Abstract, Inc. and New Millennium Settlement Agency, Inc., both local well established title and settlement businesses.

Lehman, as Account Manger, will be responsible for developing new business not only in Monroe County, but also in Pike, Carbon and the Lake Wallenpaupack areas.  Lehman’s office will be located at the 553 Main Street, 3^rd floor corporate office of Pennsylvania First Settlement Services.

Pennsylvania First Settlement Services is a full service title and settlement company that caters to the Realtors, mortgage bankers, mortgage companies, banks and investors throughout Northeast Pennsylvania.  Offices are open Monday – Friday.

PA First can be found at www.pafirstsettlement.com.

First Time Home Buyers Could Rake In $10,000

Income eligible first-time homebuyers might qualify for $5,000 interest-free loans toward closing costs and another $5,000 to help with repairs.

The two programs are administered by the Monroe County Affordable Housing Board. The loans are due whenever the buyer sells the home, refinances or transfers title.

The board has $100,000 available for closing costs, meaning the agency can assist 20 buyers this year, says Realtor and housing board member Tom Wilkins. Those who receive the closing help might qualify for additional money to make needed repairs.

The Affordable Housing Board wants to make potential first-time buyers aware of the loan program, as an additional incentive to seek an $8,000 federal tax deduction on a home purchase. The tax break expires April 30.

To qualify for the Affordable Housing loans, first-time buyers must be Monroe County residents for at least one year and make less than the county’s median income.

A single person could qualify if he or she makes less than $46,800. A couple must make less than $53,500, a three-person household must earn less than $60,200 and a family of four must have income below $66,900.

More information is available from local Realtors and lenders or by contacting the Monroe County Redevelopment Authority at 570-421-4300.

Governer Rendell says $1.2 billion available to help homebuyers

Homebuyers in the Commonwealth will benefit from more than $1.2 billion being made available through the PA Housing Finance Agency (PHFA), according to Gov. Ed Rendell. He announced at a press conference Tuesday that Pennsylvania is “fighting back” against the effects of Wall Street greed by helping homebuyers with low-interest, fixed-rate mortgages offered through PHFA.  Read More…

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