Friday, March 27, 2015

Spring 2015 Los Angeles Real Estate Market is RED HOT!!


Spring has sprung and there are still no sellers

As we continue to review the Los Angeles and West Los Angeles real estate market, the unmistakable data points one inventory. 56 single family dwellings for sale in Santa Monica, 25 in Culver City, and 5 in Ladera Heights. Virtually all of these are over $1,000,000.  Super hot bedroom communities, Westchester and El Segundo have more listings and some 3 bedroom units in the $700,000 and up range.

As always, as you go inland, you will see better prices, but not necessarily many more total great opportunities for value. One home I am aware of just listed at $100,000 over the highest market estimate for that home.

The good news is that mortgage rates continue to be super low - under 4% for 30 year fixed depending on the qualifications of the buyer. One pundit mentioned the other day that this is good news now, but might cause some reduction in the home value when rates go up in the future. This might be true, but in the West Los Angeles Market there is not going to be increasing supply of single family dwellings. If anything that supply will decrease as some homes are being converted to multi-unit dwellings.

If you are contemplating purchasing a home in West LA, and would like to have a conversation about your options, call Bill Rayman at  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025


Thursday, March 19, 2015

The Fed's March Move Not Moving the Mortgage Market Much


The Washington Post provides the latest housing statistics. What do they mean?

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average fell to 3.78 percent with an average 0.6 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.86 percent a week ago and 4.32 percent a year ago.

The 15-year fixed-rate average dropped to 3.06 percent with an average 0.6 point. It was 3.1 percent a week ago and 3.32 percent a year ago.

Hybrid adjustable rate mortgages were mixed. The five-year ARM average slid to 2.97 percent with an average 0.5 point. It was 3.01 percent a week ago and 3.02 percent a year ago.

The one-year ARM average held steady at 2.46 percent with an average 0.4 point.

“Housing starts dropped 17 percent to a seasonally adjusted pace of 897,000 units, below market expectations,” Len Kiefer, Freddie Mac deputy chief economist, said in a statement. “However, housing permits increased 3 percent in February. As we head into spring, home builders remain positive about home sales in the near future although the NAHB Housing Market Index dropped another [two] points to 53 in March.”

Meanwhile rising interest rates have put the brakes on mortgage applications, according to the latest data from the Mortgage Bankers Association.

The market composite index, a measure of total loan application volume, decreased 3.9 percent. The refinance index fell 5 percent, while the purchase index dropped 2 percent.

The refinance share of mortgage activity accounted for 59 percent of all applications.
The consensus seems to be that the Fed will raise rates later this year. This is likely to be a very modest increase in the Fed rate, and doesn't mean that mortgage rates will increase at all. Mortgage rates are only somewhat influenced by the Fed rate. Supply and demand for mortgage capital and the cost of bonds to underwrite mortgages are more critical to market rates for mortgages.

As noted by The Washington Post, mortgage rates have been moving up and down in a very small range for months, even years. There is no clear evidence that a boom in housing sales is anywhere on the horizon. While a shortage of available properties, and the increases in rental prices continue to drive up housing prices in many markets, it has not taken on boom proportions.

As noted in earlier posts on this blog, this is a good time for you to purchase a home if this is a good time for you to purchase a home. In other words, don't rush out and buy to beat a market trend, and don't stay out of the market to try and take advantage of some future pricing or mortgage interest rate advantage. At this time, it seems unlikely that interest rates will go much lower than these historically low rates, but they also don't seem headed higher. Home prices seem likely to trend higher.

As with all prognostications about any market, as soon as the prediction is made, it could be dead wrong. One things we can be certain of: if you are looking for a mortgage on a home for you and your family, or for investment, we can help you find the very best options for your situation.  Call Bill Rayman at Guaranteed Rate today.  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

Thursday, March 5, 2015

Visual DNA Suggests a New Way to Test Your Credit Worthiness


Banks won't give you credit based on your credit score. Maybe this test would be better.

A company called Visual DNA claims to have developed a very short test that will give lenders a better indicator of credit worthiness than the current use of Credit Scoring based on your historic use of credit, income, expenses, and such.

The test uses a series of questions like the one above to determine your impulsiveness, conscientiousness, response to crises, and other markers they have determined point to the likelihood you will pay off your debt.

You can take the test here. 

You can read a longer article on the subject here.  The article points out that while you may think it is silly to offer such a test for this purpose, think again. It is already being used in Russia and South Africa for those who have little credit history.

If you are looking for a mortgage, and have the ability to make the payments, but your credit scores aren't what you need, give Bill Rayman a call to discuss how you might potentially resolve that and be able to buy that dream home or condo.  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025