PMI is a cost you have to factor into your monthly mortgage if your down-payment is less than 20%.

What is PMI?

Yikes. But an important step to understanding cell biology.

UCLA CNSI

 

Housing is definitely an excellent example of classical supply vs. demand. Just 10 years ago, the situation was reversed: there was a glut of properties and some very good buys, including foreclosed and short sale properties – but insufficient numbers of qualified purchasers.

House Prices: Simply a Matter of Supply & Demand

Why are home prices still rising? It is a simple answer. There are more purchasers in the market right now than there are available homes for them to buy. This is an example of the theory of “supply and demand” which is defined as:

“the amount of a commodity, product, or service available and the desire of buyers for it, considered as factors regulating its price.”

When demand exceeds supply, prices go up. This is currently happening in the residential real estate market.

Here are the numbers for supply and demand as compared to last year for the last three months (March numbers are not yet available):

In each of the last three months, demand (buyer traffic) has increased as compared to last year while supply (number of available listings) has decreased. If this situation persists, home values will continue to increase.

Bottom Line

The reason home prices are still rising is because there are many purchasers looking to buy, but very few homeowners ready to sell. This imbalance is the reason prices will remain on the uptick.

Housing prices are cycle up and down but in the long-run move steadily upward. Owning a home is not just the American Dream: it stabilizes your houses costs and is an investment in your future.

Some Highlights:

• Historically, the choice between renting or buying a home has been a tough decision.
• Looking at the percentage of income needed to rent a median-priced home today (28.9%) vs. the percentage needed to buy a median-priced home (15.7%), the choice becomes obvious.
• Every market is different. Before you renew your lease again, find out if you can put your housing costs to work by buying this year!

 

 

I paid 16.25% interest when I purchased my first house in 1981. Rates are awesome now.

Interest rates hovered around 4% for the majority of 2017, which gave many buyers relief from rising home prices and helped with affordability. In the first quarter of 2018, rates have increased from 3.95% up to 4.45% and experts predict that rates will increase even more by the end of the year.

The rate you secure greatly impacts your monthly mortgage payment and the amount you will ultimately pay for your home. Don’t let the prediction that rates will increase stop you from purchasing your dream home this year.

Let’s take a look at a historical view of interest rates over the last 45 years.

 

Bottom Line

Be thankful that you can still get a better interest rate than your older brother or sister did ten years ago, a lower rate than your parents did twenty years ago, and a better rate than your grandparents did forty years ago.

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Keeping Current Matters, Inc. does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

Yet, there’s still some disagreement among experts, some of whom think the new tax code and increased interest rates may dampen the real estate market.

Some believe that the combined effects of the new tax code and rising mortgage rates will have an adverse impact on residential real estate prices in 2018. However, the clear majority of recently surveyed housing experts believe that home values will continue to rise this year.

What is the Home Price Expectation Survey?

Each quarter, Pulsenomics surveys a nationwide panel of economists, real estate experts and investment & market strategists. Those surveyed include experts such as:

• Daniel Bachman, Senior Manager, U.S. Economics at Deloitte Services, LP
• Kathy Bostjancic, Head of U.S. Macro Investors Service at Oxford Economics
• David Downs, Real Estate Finance Professor at VCU
• Edward Pinto, Resident Fellow at American Enterprise Institute
• Albert Saiz, Director at MIT Center for Real Estate

Where do these experts see home values headed in 2018?

Here is a breakdown of where they see home values twelve months from now:

• 21.6% believe prices will appreciate by 6% or more
• 71.6% believe prices will appreciate between 3 and 5.99%
• 5.7% believe prices will appreciate between 0 and 2.99%
• Only 1.1% believe prices will depreciate

As has been expected, the Federal Reserve announced today that it’s hiking interest rates.

This is probably the first of three or four interest rate increases this year – so if you’re planning to purchase a home, the sooner you do so, the less you’ll be paying for that mortgage.

Fed Raises Rates, Signaling Confidence in U.S. Economy

“Located in the posh neighborhood of Bel Air, 201 Bentley Circle is an updated midcentury gem by Richard Neutra, whose influence over California modernism cannot be overstated. The home was refreshed in the early 2000s by noted Neutra scholar and architect, John Bertram, who updated the home in keeping with the architect’s original plans and expanded the residence with a second-story addition.”

Read all about it, with pictures galore, in Dwell.