August 15, 2019
A Look at Buyer’s Market Mortgage Volume
There’s increasing accord among professionals in the residential real estate market that we have passed through the decidedly seller-beneficial portion of the market cycle and moved squarely into buyer’s market territory. For one thing, there’s the much-ballyhooed decrease in the rate of price increase. Some fears arose early in 2018 that the increasing prices were pushing us into a real estate bubble zone. Those fears have largely deflated at this point. Yet we haven’t gone into the red on sales prices in most markets, either. The prices are still increasing—but more in line with a standard market growth model. Then there are the mild rises and decreases in 30-year mortgage rates, coupled with first the news of a holding-off of a planned federal funds rate increase by the Federal Reserve Board in early 2019 and now talk of a potential rate cut in the coming days. This makes housing more affordable by keeping low the cost to lenders of borrowing money, a benefit which they pass on to potential home buyers.
When did this turnover into a buyer’s market occur, exactly? According to a report by ReMax, it happened in or around February 2019. And data released by the Mortgage Bankers Association on a weekly basis would seem to point to the conclusion that buyers are seeing the benefits and acting accordingly.
Indeed, most of the indicators seem to hint that, as this buyer’s market continues, the volume of mortgages being made continues to rise in tandem. This is bolstered by the rates for 30-year fixed-rate mortgages, which dropped in June for the sixth month straight, falling to 4.40 percent. Compare that to May’s 4.52 percent. Meanwhile, the rate for FHA loans of the 30-year variety went from 4.63 percent in May to 4.49 percent in June.
This all seems to spell good news for the housing market.
Here at Topouzis & Associates, P.C., we make sure a home buyer is receiving true and unencumbered title to a home, and we provide title insurance to back our title services. Whether you’re a lender, an investor, or purchasing a new home, the policies we connect you with provide peace of mind that your new property will not bring along any nasty surprises. Whether you live in Providence, Rhode Island; Cambridge, Massachusetts; or Miami, Florida, feel free to contact us for more information.