40% of 226 economists surveyed in July 2019 believe the United States will fall into a recession by the end of 2020, while the remaining 60% believe our nation’s next recession will begin in 2021 or later (source: National Association for Business Economics).

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The average interest rate nationwide on a 30-year fixed rate mortgage has dropped from 4.51% on 1/03/19 to 3.58% on Thursday 8/29/19 (source: FreddieMac).

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Between 6/30/18 and 6/30/19, average home prices increased in all 50 US states.  Idaho’s +11.4% average home price gain led the nation over the last year while Delaware’s +1.2% growth rate was the nation’s smallest (source: Federal Housing Finance Agency).

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The last recession in the United States began in December 2007 and lasted 18 months.  The nation’s unemployment rate in December 2007 was 5.0%, on its way to a peak jobless rate of 10.0% by October 2009. The unemployment rate nationwide in July 2019 was 3.7% (source: Department of Labor).

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.

 

 

A 65-year old spending $100,000 per year (after-tax) would need $128,008 per year (after-tax) by age 75 and $163,862 per year (after-tax) by age 85 if his/her cost of living was increasing by +2.5% per year due to inflation.

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Stocks gained +6.9% (total return) during the 3 summers months (June-July-August) while bonds gained +4.1% (total return).  The S&P 500 was used for the stock calculation, while the Bloomberg Barclays Aggregate bond index, calculated using 6,000 publicly traded government and corporate bonds with an average maturity of 5 years, was used as the bond measurement (source: Bloomberg).

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Today is the 8-year anniversary since the USA was downgraded on 8/05/11 by S&P from a top credit rating.  Since 8/05/11, the yield on the US 10-year Treasury note has fallen from 2.57% to 1.85% and the S&P 500 has gained +189% (total return), equal to +14.2% per year.  The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation.  It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: BTN Research).
*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.

08-09-2019

ASCENDING AFFORDABILITY

Housing affordability has reached an 18-month high. Commenting on the release of the latest Mortgage Monitor Report, Black Knight Financial Services Data & Analytics President Ben Graboske said, “The decline in 30-year rates has been equivalent to a 15% increase in buying power, meaning that prospective homebuyers shopping for the average-priced home could now purchase $45,000 more than last fall while keeping monthly payments the same.”

STILL STEADY

Mortgage interest rates remained stable according to Freddie Mac’s Primary Mortgage Market Survey for the week ending August 1. Regarding the absence of movement, Freddie analysts said, “The combination of low mortgage rates, tight labor market and high consumer confidence should set up the housing market for continued improvement in home sales heading into the late summer and early fall.”

MONITORING VS. MONEY

Data breach victims hoping to get a $125 check from Equifax will be disappointed. Equifax’s settlement with the Federal Trade Commission for the security breach that exposed private information of nearly half the U.S. population included a choice between cash and a combination of free credit monitoring and identity theft insurance for affected consumers. So many people have chosen the cash option that the anticipated $125 amount will be drastically lower. The FTC says the monitoring and other protections are a far better value.

CAMARADERIE COST?

What would you pay for the ability to choose your neighbors? Quite a bit according to a survey by rent.com. Single-family home dwellers are willing to pay an additional $157/month for the privilege of choosing their neighbors, while those in multi-family properties would go to $179/month. The “neighbor premium” also varies by area. Urban residents are willing to pay an extra $187/month to select neighbors, while those in rural and suburban communities said they would pay $161 and $158/month respectively.

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.

08-02-2019

DECREASED INCREASES

There’s been a dip in home price gains. The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 3.4% annual gain in May, down from 3.5% in the previous month. S&P Dow Jones Indices’ Philip Murphy said, “Nationally, year-over-year home price gains were lower in May than in April, but not dramatically so. Among 20 major U.S. city home price indices, the average YOY gain has been declining for the past year or so and now stands at the moderate nominal YOY rate of 3.1%.”

LONGER LISTINGS?

It took longer to sell a home in June than it did in May. The National Association of Realtors® (NAR) reported that the average time on market in June was 27 days, up from 26 in May and June of 2018. More than half of homes sold in June (56%) were on the market for less than a month.

PURCHASE POWER

Mortgage interest rates took a slight downward turn, giving a boost to home buyers’ purchasing power. Rates for a 30-year fixed rate mortgage are still hovering near three-year lows according to Freddie Mac’s Primary Mortgage Market Survey for the week ending July 25. NAR® President John Smaby said, “Securing and locking in on a mortgage now – given the current, favorable conditions – is a decision that will pay off for years to come.”

FIN FEARS

A national real estate brand is trying to ride the Discovery Channel’s wave. Century 21 is hitting social media to promote “Shark-free Listings” as Discovery kicked off its 31st season of Shark Week. All week, Century 21 will be responding in real-time to anyone on social media that expresses their fear of sharks with home listings located in the farthest spot from the coasts: Northern Kansas.

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07-26-2019

OWNER ACCUMULATION

Equity news keeps getting better: Average profit margins for homeowners who sold in the second quarter rose to nearly 34%, up from 31% in Q1 according to ATTOM Data Solutions. ATTOM’s Q2 2019 U.S. Home Sales Report (HSR) also showed average dollar gains over purchase price reached $67,500 during the same time period. The HSR also reported that the median sales price for homes sold in Q2 was up 10.8% from Q1 and 6.4% year-over-year.

AGENT ANGLES

The National Association of Realtors® (NAR) reports that the median existing-home price for all housing types in June reached an all-time high of $285,700, up 4.3% from June 2018 ($273,800). June’s price increase marks the 88th straight month of year-over-year gains, according to NAR’s latest Existing Home Sales report.

RATE RETURN

Mortgage interest rates trended upward after hovering at nearly the same levels for three weeks according to Freddie Mac’s Primary Mortgage Market Survey (PMMS) for the week ending July 18. Freddie Mac attributes the uptick to increased consumer spending in the wake of hints that the Fed may cut short term interest rates.

COLLECTIVE DEBT?

One in four Americans with a credit report has at least one debt in collection according to the Consumer Financial Protection Bureau. The information is from the CFPB’s Market Snapshot: Third-Party Debt Collections Tradeline Reporting, which covered 2004-18. The majority of collections were for medical and telecommunications/utilities debt, at 58% and 20% respectively.

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.