The Markets. Fixed rates on home loans fell sharply in the past week to their lowest levels since May of last year, in response to the markets — especially the continued drop in oil prices. Freddie Mac announced that for the week ending January 8, 30-year fixed rates decreased to 3.73% from 3.88% the week before. The average for 15-year loans fell to 3.05%. Adjustables were down slightly, with the average for one-year adjustables decreasing one tick to 2.39% and five-year adjustables down to 2.98%. A year ago, 30-year fixed rates were at 4.51%, which is over 0.75% higher than today’s levels. Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac — “Rates on home loans fell to begin the year as 10-year Treasury yields slid beneath 2.0% for the first time in three months. Meanwhile, the Fed minutes indicated ongoing discussion regarding the timing of the first rate hike. Of the few economic releases this week, ADP Research Institute reports the private sector added an estimated 241,000 jobs in December, which exceeded market expectations and followed an upward revision of 19,000 jobs in November.” Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.
Current Indices For Adjustable Rate Mortgages
Updated January 9, 2014
|Daily Value||Monthly Value|
|6-month Treasury Security||0.08%||0.11%|
|1-year Treasury Security||0.23%||0.21%|
|3-year Treasury Security||1.00%||1.06%|
|5-year Treasury Security||1.50%||1.64%|
|10-year Treasury Security||2.03%||2.21%|
|12-month LIBOR||0.602% (Dec)|
|12-month MTA||0.121% (Dec)|
|11th District Cost of Funds||0.686% (Nov)|
Oct. 2, 2014 10:17 a.m. ET What’s the greatest thing since indoor plumbing? His-and-hers shower stalls. But say bye-bye to the bidet.
Luxury bathrooms have undergone some notable changes since 2008, considered the peak of the real-estate bubble, according to a survey by the Home Innovation Research Labs (HIRL). The biggest casualties are whirlpool bathtubs and stand-alone bidets, down 9.4% and 34.9%, respectively, over the six-year period. [WSJ]
Rent or Buy? The Math Is Changing
Billy Gasparino and Jenna Dillon-Gasparino were savvy enough to wait out the housing boom of a decade ago as renters. Not until 2010, well into the bust, did they buy a house in the Venice neighborhood of Los Angeles, less than a mile from the beach, for $810,000. [NYT]
Cramped city dwellers often want to buy the apartment next door and combine units, but the borrowing process can get complicated
When it comes to combining dwelling units, two really are better than one. But expect higher fees and more paperwork.
Mortgages for connecting two condos or co-ops, or converting a multifamily to a single-family house, can be complicated. “It’s not the kind of thing that you take off the shelf,” says Mike McPartland, head of investment finance for North America at Citi Private Bank. [WSJ]
Banks are looking to expand their programs aimed at helping doctors, lawyers and others in well-paid professions qualify for large mortgages
The rise of the jumbo-loan market has some lenders stepping up efforts to attract lawyers and doctors as borrowers.
So-called specialty-profession loans, designed to ease the qualification process for people in certain professions, may offer lures such as low—or no—down payments or no mortgage-insurance requirement. “Historically, these loans perform very well and have low default rates,” says Michael Zimov, a physician-specialist officer at Ohio-based Fifth Third Bank. [WSJ]
Contact me to discuss assisting with the pricing, sale, or purchase of a home.
- Average condo prices climbed considerably since last year, with a 35% increase in average price and a 30% increase in average price per square foot. Median price only saw a 2% increase. These figures were supported by growth in the number of sales over $5M.
- Average discount from last asking price to last sale price for condos also tightened to just 1.7%.
- Co-op average price per square foot was up 8% year-over-year and average days on the market decreased by 36% from last year, down to an average of 90 days. Listed inventory also dropped 21% since Jan 2013 to just 2,463 co-op units on the market.
- Average price per square foot saw double-digit gains in the one and two bedroom categories and single-digit gains in the studios and three bedrooms.
- Average days on market decreased by 38% year-over-year, the lowest average since August 2010, further indicating the tightening of the Brooklyn market.
The full reports are available at the links below.
With inventory tight these days, don’t leave anything to chance
By Gary Malin / NEW YORK DAILY NEWS
Thursday, October 10, 2013, 6:27 PM
Jeff Bachner/for New York Daily News
Citi Habitats president Gary Malin.
The Money Pros are standing by to take your questions.
Q. With inventory very tight right now, I want to do everything I can to make sure my apartment deal goes smoothly. What are some tips for aceing the co-op approval process?
A. The co-op board approval process can be nerve-racking, and it’s important to know what the process will entail before placing an offer.
Co-op buildings are run by a co-op board, just like a company has a board of directors. This group of building residents reigns supreme, and has the right to approve or reject all potential buyers, and for any reason – as long as it is not in violation of fair housing laws.
Boards want to see that would-be residents are financially qualified to purchase the apartment in question (by examining pay stubs, tax returns, etc.), and that they will make good, quiet neighbors.
Financial qualification requirements vary from building to building. Typically though, most boards like applicants to have a monthly income that is four times greater than their total monthly housing expenditure (mortgage payment, plus maintenance fees/taxes and insurance), and in addition, have a full 12 months of housing costs available in liquid assets (cash, money market accounts, bonds etc.).
If you are working with a real estate agent, ask him or her to give you as much information as possible about the approval process for the board in question. It helps to know what you are walking into beforehand.
Meeting with the board is the most important step in the process. Remember that first impressions count. Be on time, be friendly, and be prepared.
Understand the ins-and-outs of all your required financial documentation, and be sure you can answer questions about it quickly and accurately. Be sure to dress appropriately, as you would for an important business function.
When in doubt, err on the conservative side.
Let the board ask the questions, and answer only what is asked of you. Volunteering additional information only increases the chance they will find something you say unacceptable. In most cases, a short interview is a good sign you will be approved.
Always have a positive attitude about the apartment and the building. Act like you wouldn’t change a thing about both.
Now is not the time to discuss your plans to knock down walls and gut the apartment. While renovating your unit is your right as an owner, its best to avoid bringing it up during the interview.
The goal is to act like you love the building and will be a no-hassle neighbor.
Keep in mind, co-op boards are allowed to ask personal questions. Asking what you do on the weekends and if you have frequent guests are common questions. While it’s okay to spin the answers a little, reply to them honestly.
While the co-op approval process can be a challenge, remember the payoff of a home you love is worth the short-term inconvenience. Keep the tips above in mind, and you should be in great shape.
Malin is the president of Citi Habitats.
Do you have a question for the Money Pros? Send it to firstname.lastname@example.org.