Interesting Turn In Real Estate Market Place

Fannie Mae’s report the , “Weekly Note” which was released this past Friday (11/18/16) shows an interesting, if not fickle housing market in the single family home sector.

According to Fannie Mae, “Through the first ten months of the year, single-family starts are 10.0 percent higher than the same period a year ago”. “Single family starts” are new construction of single family dwellings and does not include existing properties.

Fannie Mae is a government sponsored enterprise that is, “a leading source of financing for mortgage lenders”.

Fannie Mae went on to report that, “Mortgage applications fell 9.2 percent for the week ending November 11, marking the largest drop since mid-July, according to the Mortgage Bankers Association”.

The Mortgage Bankers Association has shown declines in mortgage applications every week this month ranging from 1.2 percent to 9.2 percent.

Fannie Mae continued with the, “average 30-year fixed mortgage rate jumped 18 basis points to 3.95 percent, the highest level since January”.

New home construction is up by 10 percent. Applications for mortgage loans are down by over 9 percent. Mortgage interest rates are at an 11 month high.

The existing home sales market report shows the greatest strength and growth. According to the National Association of Realtors (NAR), “Existing-home sales rebounded strongly in September and were propelled by sales from first-time buyers reaching a 34 percent share, which is a high not seen in over four years”.

The October existing home report from NAR is due out 11/22/16.

So what does all of this mean? First off, please remember that all real estate is local. The findings discussed here are national averages. Our local market such as Morehead City, Beaufort, Atlantic Beach, Newport and Emerald Isle could all reflect something completely different or all together the same!

But generally speaking, as the existing inventory gets eaten away, new construction moves in to fill the void. The real issue at hand that everyone should keep an eye on is the mortgage interest rate. According to Bankrate.com, the interest rate for a 30 year fixed mortgage in mid-August was at 3.56 percent. In mid-November the rate is at 4.01 percent. Will this trend of rapidly rising rates continue?

A good first step towards any real estate purchase is to contact your lender first. Find out what rates are available and what options you may have.

Margaret Hitchcock is a Realtor with Hitchcock Realty. She is a real estate professional with many years’ experience in home buying and selling, land and waterfront properties. Contact Margaret today at (252) 269-2893.

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