Home Prices Continue to Rise

U.S. home prices jumped 5 percent for the month of September when compared to this same period of time last year. This marks the largest year-over-year increase we have seen in six years according to a recent report released by CoreLogic. This is just more evidence that the housing market here in Diablo and across the nation is continuing to improve. The CoreLogic report is based off repeat sales of the same homes, and it tracks their price changes over a period of time.

On a month-to-month basis, home prices from August to September decreased by 0.3 percent. This was the first home price drop we have seen after six consecutive months of gains. CoreLogic believes that the decline can be attributed to the end of the summertime home-buying season.

Several reports recently released show that the housing market is continuing to improve. The Standard & Poor’s/Case Shiller 20-city index rose 2 percent in August compared to the same time last year. Some areas of the country experienced a lot higher home price increases over the last year. Home prices in Arizona jumped 18.7 percent over the last year, the highest increase seen. New home prices have also jumped in the last month to their highest annual pace in the last two-and-a-half years.

If you are ready to sell or buy a home, contact me by email or call me, Brad Gothberg, at (925) 648-5326. I have been a real estate professional for 23 years.

Advertisements

Mortgage Rates in Diablo May Increase in the Near Future

Recently the Federal Housing Finance Agency, which is the regulatory body for both Fannie Mae and Freddie Mac, announced that another 10 basis point increase in guarantee fees (g-fee) will go into effect between November 1 and December 1, 2012. The increase in g-fees could lead to mortgage rates for home buyers in Diablo to jump in the near future. This is the second time g-fees have increased this year, with the last being in April.

The g-fee increase will result in Fannie Mae and Freddie Mac charging lenders more to guarantee loans. The increase will result in about 40 to 50 basis points in price to the lender which, in turn, will be passed on to the home buyer. The increase you will see in interest rates will vary by lender and borrower. We could see rate increases by 0.125 to .5 percent in the very near future.

A .5 percent increase in mortgage rates could have a strong impact on what a borrower would pay on a monthly payment. For instance, if the rate would increase from 3.5 percent to 4.0 percent it would raise the rate on a $200,000 loan by $57 a month.

Take advantage of low interest rates and buy now before the rates go up. If you are ready to sell or buy a home, contact me by email or call me, Brad Gothberg, at (925) 648-5326. I have been a real estate professional for 23 years and my qualifications include the production of over $105 million in sales within the past 5 years.