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Determining when to buy a home is a personal decision with many variables. Some may try to pinpoint the "perfect time" and end up waiting themselves out of the market, while prices and interest rates rise. Interest rates have been at historic lows for the past several years and are still historically low, despite some recent upticks.

If you're planning to buy soon, consider these factors that may motivate you to jump in now.

  1. Interest rates are still at historic lows. The 30-year fixed has been hovering around 4.5% for the past year; it did near the 5% mark briefly before dipping back down. (As of this writing, the interest rate for a 30-year fixed is 4.5%). Most experts expect them to go into the mid- to high-5% range by the year's end. So, don't delay.
  2. Prices are still rising but not soaring. If you're waiting for home prices to start coming down before you buy, it might be a long wait. Though they're not rocketing up as they have been for the past several years (in many markets), they are still rising steadily. To avoid being left behind, consider buying sooner rather than later.

3.2% – the home-price increase year over year, according to the Vivas forecast

5.3% – What Realtor.com anticipates the 30-year fixed mortgage interest rate to be by 2019's end

  1. Increases in entry-level inventory. There has been a shortage of homes in the U.S. since 2015, forcing some buyers to settle and others to be prohibited from buying at all. This will begin to turn around with the middle and upper-tier price points recovering first.

30% – The percentage of new-home construction dedicated to first-time homebuyers, up from 20%, where it has been hovering the past few years

628,000 – The number of new-home sales predicted by the National Association of Home Builders for 2019, about even with 2018

  1. Hot markets are expected to stabilize. According to the California Association of Realtors forecast, San Francisco and the surrounding area have been at peak levels for a long time. Those prices can't be sustained indefinitely, so they'll have to level off. Southern states such as Florida and Texas are expected to see improvement, especially with affordable, new construction.
  2. Begin building equity now. Since prices are still on the rise, it's advantageous to get in now. Then, as the value of your home increases, you have the opportunity to build equity.



MBS RECAP: Bonds Cap Extraordinarily Tame Week Despite Excuses

Posted To: MBS Commentary

We've seen a whole lot more movement in the bond market for a whole lot less motivation than we had this week. Back to back econ data shockers (Philly Fed and Housing Starts) were scarcely able to get yields back up to Monday morning's highs, and yields hadn't fallen very much to begin with. In other words: "Housing Starts Surge 40% Annually to The Highest in 13 Years" isn't really a headline that jives with 10yr yields rising less than 2bps by the close of business. Oh, and stocks hit all time highs on 4 out of the 5 days. Oh, and the phase 1 trade deal signing went off without a hitch. All that to say that bonds were more than entitled to end up somewhere other than smack dab in the middle of the consolidation range that's been in effect for close to half a year...(read more)

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Mortgage Rates Off Recent Lows

Posted To: Mortgage Rate Watch

Mortgage rates moved slightly higher over the past two days as strong economic data and corporate earnings coaxed investors into riskier assets like stocks. Bonds (which dictate interest rates) are always being bought and sold, but demand varies depending on investors' risk appetite. If demand for bonds falls as it has in the 2nd half of this week, rates move higher. Fortunately, this move has been very small in the bigger picture. Mortgage rates, specifically, have moved even less than rates associated with other bonds. The average lender is still able to offer 30yr fixed rates of well under 4% on top tier scenarios. And the average borrower wouldn't see more than 0.00125% of difference from the lowest rates in more than 3 months. Bottom line, while rates are slightly higher than their best...(read more)

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