Since my last post in mid-March we’ve seen some interesting developments in the mortgage market, namely that since the Fed raised its key interest rate, mortgage rates actually improved some, dropping to the lowest levels all month. It was certainly a nice gift!
Let’s recap what’s been happening. So, back on March 15th the Federal Reserve voted to raise the Fed Funds Rate by .25 percent. Right away mortgage rates began dropping at their fastest pace of the year. Why, you ask? Well, some of the comments made by the Fed gave the impression to markets that they perhaps wouldn’t be hiking rates as rapidly as had been feared. This sigh of relief translated into lower mortgage rates. So, yippee!
What Fed Chair Janet Yellen also said is that the economy is doing well. I would add to her comments that our economy here in SoCal is doing well too, and so is the housing market. We’ve been watching housing reports come out over the past few weeks and one after the other is showing strength in housing…and we haven’t even hit the peak spring/summer home buying season! Here are a couple highlights:
New Home Sales shot up 6.1 percent in February!
Existing Home Sales are up 5.4 percent year-over-year, although low inventory is holding back sales.
Building permits for single-family homes were up 3.1 percent, so good news for those tight supply issues!
Home prices have been appreciating a healthy 5.7 percent, year-over-year.
So, what does this all mean for you? Well, for starters, if you have been considering purchasing or refinancing your home, now is a really great time as rates have pulled back some. Of course, rates change continually, so there’s no guarantee they will stay at current levels, and in fact most experts say rates will drift higher throughout the year. This year also looks to be a particularly great time to sell your home and by the looks of our local market with tight inventory, it’s probably going to sell pretty quickly.
Bottom line, it’s a great time to buy or sell if that’s in your plan this year. And, if and when you’re ready to discuss your next purchase or refinance, give me a call. I’m happy to discuss your specific scenario and see what we can figure out for you.