| Mortgage interest rates, as reported by Freddie Mac, have increased over the last several weeks. Along with Freddie Mac, Fannie Mae, the Mortgage Bankers Association and the National Association of Realtors are all calling for mortgage rates to continue to rise over the next four quarters. This has caused some purchasers to lament the fact they may no longer be able to get a rate less than 4%. However, we must realize that current rates are still at historic lows. Here is a chart showing the average mortgage interest rate over the last several decades.
Though you may have missed getting the lowest mortgage rate ever offered, 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.
There are many people sitting on the sidelines trying to decide if they should purchase a home or sign a rental lease. Some might wonder if it makes sense to purchase a house before they are married and have a family. Others may think they are too young. And still, others might think their current income would never enable them to qualify for a mortgage. Unmarried couples jumped up to the third spot, right after their married counterparts and single women. Many couples are buying a home before spending what would be a down payment on a wedding.
National Association of REALTORS most recent Profile of Home Buyers & Sellers. Here are some interesting statistics on the first-time buyer:
Multi generational homes are coming back in a big way! In the 1950s, about 21%, or 32.2 million Americans shared a roof with their grown children or parents. According to a recent Pew Research Center report, the number of multi generational homes dropped to as low as 12% in 1980 but has shot back up to 19%, roughly 60.6 million people, as recently as 2014. Multi generational households typically occur when adult children (over the age of 25) either choose to, or need to, remain living in their parent’s home, and then have children of their own. These households also occur when grandparents join their adult children and grandchildren in their home. According to the National Association of Realtors’ (NAR) 2016 Profile of Home Buyers and Sellers, 11% of home buyers purchased multi generational homes last year. The top 3 reasons for purchasing this type of home were:
- To take care of aging parents (19%)
- Cost savings (18%, up from 15% last year)
- Children over the age of 18 moving back home (14%, up from 11% last year)
Donna Butts, Executive Director of Generations United, points out that, “As the face of America is changing, so are family structures. It shouldn’t be a taboo or looked down upon if grown children are living with their families or older adults are living with their grown children.” For a long time, nuclear families, (a couple and their dependent children), became the accepted norm, but John Graham, co-author of “Together Again: A Creative Guide to Successful Multi generational Living,” says, “We’re getting back to the way human beings have always lived in – extended families.” This shift can be attributed to several social changes over the decades. Growing racial and ethnic diversity in the U.S. population helps explain some of the rise in multi generational living. The Asian and Hispanic populations are more likely to live in multi generational family households and these two groups are growing rapidly. Additionally, women are a bit more likely to live in multi generational conditions than are their male counterparts (20% vs. 18%, respectively). Last but not least, basic economics. Carmen Multhauf, co-author of the book “Generational Housing: Myth or Mastery for Real Estate,” brings to light the fact that rents and home prices have been skyrocketing in recent years. She says that, “The younger generations have not been able to save,” and often struggle to get good-paying jobs.
Multi generational households are making a comeback. While it is a shift from the more common nuclear home, these households might be the answer that many families are looking for as home prices continue to rise in response to a lack of housing inventory.
Every year at this time, many homeowners decide to wait until after the holidays to put their homes on the market for the first time, while others who already have their homes on the market decide to take them off until after the holidays. Here are six great reasons not to wait:
- Relocation buyers are out there. Companies are not concerned with holiday time and if the buyers have kids, they want them to get into school after the holidays.
- Purchasers that are looking for a home during the holidays are serious buyers and are ready to buy.
- You can restrict the showings on your home to the times you want it shown. You will remain in control.
- Homes show better when decorated for the holidays.
- There is less competition for you as a seller right now. Let’s take a look at listing inventory as compared to the same time last year:
- The supply of listings increases substantially after the holidays. Also, in many parts of the country, new construction will continue to surge reaching new heights in 2017, which will lessen the demand for your house.
Bottom LineWaiting until after the holidays to sell your home probably doesn’t make sense.
It is tough to predict exactly where rates will be in any given day, week, or month, but the general consensus from here is that we are likely to see a gradual movement upward. Over the past 15 weeks, we’ve had seven down weeks and eight up weeks in rates. That’s why they seem unchanged. And last week saw the single biggest amount of weekly change during that time period—upward movement. So here’s the most confident forecast I can give you about mortgage rates: We’ll see many news reports on Thursday about how rates have jumped in the past week. The average for the 30-year conforming rate will likely be reported on Thursday as being up more than 10 basis points and possibly up by as much as 14 basis points. The current upward movement in rates is a reflection of financial markets globally expecting less quantitative easing from the European Central Bank and another hike by the Federal Reserve this December.
As housing becomes more expensive, and the cost of living between expensive central areas and outlying counties expands, people begin to make decisions on the trade-offs between living farther out (and in larger houses) and commuting longer to their jobs. As housing supply has not caught up with demand in central suburbs and cities, home-seekers have started going further and further away to find affordable homes to purchase in the cities where they live. (For some more in-depth reports on commuting patterns written by my colleague Jordan Levine see this report for Riverside, and the demographics section of this paper on the East Bay.) This corroborated in C.A.R’s price and sales data, and our regional Housing Affordability Index, (which is a mix of income and price data). For examples, increasing prices in the Bay Area and Los Angeles have led to relatively stagnant levels of sales in more central city areas with large price gains, and increased sales and interest in homes in outer counties. This pattern is also seen in simply the sheer amount of vehicle miles traveled by Americans, which has shot past the previous high 2008 levels. So much public data exists on people’s jobs, their commutes, and the places people live. By combining and visualizing this data in different ways, we can understand the patterns of lives, commutes, jobs and ultimately the places that people want to live in where they have to go to work. I wanted to highlight a few fun maps and tools created by the public for these purposes. The ACS Commute Map website offers interactive and animated maps and charts that show the number, distance and areas that people commute to and from their residences every day.
In this example of an animated picture captured of commuters to Los Angeles, we see the proportion and number of people moving from Kern, Orange, San Bernardino, Riverside and Ventura Counties coming to Los Angeles every day for their jobs (we can also see the flows of people within Los Angeles going from their homes to their jobs). The data is at what is called the “Census Tract Level” and the page shows people traveling between 20 to 100 miles. We can also see how commuting to Orange County, where there is a more inter-county north-south commuting (east west inter-city commuting in Los Angeles is probably suppressed from the map. For more on these maps, see this article in CityLab.
Attention, rabid “Full House” fans: The San Francisco home made famous by this ’80s hit sitcom (and, to a vastly lesser degree, the recent Netflix spinoff, “Fuller House”) is now up for rent! So if you’ve always fantasized about moving in and reliving your fave moments from the show, here’s your chance—although it doesn’t come cheap.
The three-bedroom, 3.5-bathroom Victorian home (located at 1709 Broderick St.) can be yours for a whopping $13,950 per month. The home sold for $4 million in July. The rental price may seem a bit steep, particularly when all you’re really getting is the home’sexterior (shown during the show’s opening credits); the actual show was shot on a Hollywood soundstage. Read more. #reginasingh