Housing reports are showing that home prices are rising at a pretty hot pace, especially in comparison to where they were last year at this time.
Home Prices Up
The S&P/Case-Shiller Home Price Indices showed an increase in home prices in all of the 20 cities tracked. The increase was 8.1% year over year, the best since 2006. However, I question if the price increase has more to do with demand or supply.
Home Sales Down
The number of new sales has dropped in February and pending sales are also down for the month. The supply is down to approximately 4 1/2 months according to the Commerce Department.
This appears to me to be more of a supply problem since fewer homes are actually being sold. I also expect this shortage will continue until home construction catches up with demand and those wanting to sell reach a break even point on their mortgage balances.
Home Interest Rates
Mortgage interest rates remain low for now, so it is advantageous for many people to become home buyers since in most cities, buying is cheaper than renting. Many mortgage programs are available to assist the first time home buyer with the process from the FHA limited down to the USDA no down payment program.
To find out more about the home purchase programs in your area, contact an experienced loan officer to assist you. If you need a recommendation in a specific area, give me a call, I would be happy to pair you with someone to assist you.
About the author: Fred Chamberlin is a senior loan officer with Guild Mortgage Company in Oak Harbor. He has been in the mortgage origination business for over 20 years and in the lending business for over 30 and authors a number of mortgage related blogs.
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