Friday, July 10, 2020

Buyers are Crawling Out of the Woodwork

RMLS graphic
Things are getting rather busy in the local real estate market. I'm not sure if this is COVID-19 pent up demand or just these crazy low rates that have populated all the mortgage ads. In any case I have been rather busy running about showing homes to a frenzied crowd of buyers as well as taking offers on my listings.

Locally we are on the cusp of entering Phase 3. The local government applied for it two weeks ago but a recent mini-spike of cases has them in a holding pattern at Phase 2. What ever the reason be it cabin fever, low interest rates, or optimism about the future end of this pandemic, buyers are out in force writing offers and buying houses. If seller don't start listing more houses we could see a return to rising values. Right now it seems that prices are basically steady.

The local MLS is showing a tightening inventory but prices year over year for June in the Portland-Vancouver Metro Area were up a a few ticks at 2.7%.

As crazy as this year has been, real estate has weathered the storm pretty well, I am certainly thankful for that.

Friday, July 3, 2020

Mortgage Rates Dip to Lowest Ever!

The Associated Press released an article I found in the Columbian yesterday indicating that America's major mortgage indices had bottomed out to the lowest levels in history. 30 year fixed rates in the very low 3s and even some high 2s are available to highly qualified borrowers. This is a great time for even those with weaker credit profiles to jump in, as rates across the board should be lower. Rates that were reserved for the 750+ FICO crowd a few months ago are now garden variety rates available to average credit score individuals.

A rate change from 4% yields a principle and interest payment on a $300,000 mortgage of $1,432 versus a 3% payment on the same mortgage of $1,265 a $167 per month savings and a savings of more than $60,000 over the life of the loan! Another way to look at these low rates is the buying power. A borrower limited to a principle and interest payment of $1,432 per month can borrow $300,000 at 4% but at 3% they can borrow $339,750! Nearly $40,000 MORE house for the same payment! 

Buyers be aware that rates vary around the country and a borrowers credit and financial profile can lead to a wide range of rates spanning at least a 1/2 percent for a borrower with an average to below average score and other loan related financials. Where a "golden" borrower might get a rate at 2.875% someone with a more typical 680 score and tighter monthly budget might be at 3.375%. Always check with your trusted loan professional before making any decisions but remember even if you can't get the LOWEST rate out there the rate you CAN get now will be the best it could possibly be since rates are lower than ever before, right now!  

Buyers that have recently felt priced out of the market, may have just been priced back in. Mortgage raters can be fickle and that means buyer on the pricing bubble need to act quickly. Even a 1/4 point rate bump might price some buyers out again.

Friday, June 26, 2020

Solid News on Real Estate

Real estate activity remains positive across the broad American market. This runs in the face of a slowing economy and difficulties facing businesses as they cope with COVID -19 related restrictions. I mentioned in previous posts that pricing remains steady due largely to the fact that both buyers and sellers are in short supply and that has kept the relative inventory balance similar to conditions prior to the Corona Virus pandemic.

Real estate sales in Clark County are down but not because of a lack of demand, but rather a lack of inventory. Pricing is steady and buyers are still facing a multiple offer environment on homes priced well or nearly anything under the local median price.

This economic slowdown may go down in history as the weirdest recession ever. Buyers seem to think the slowdown has made their bargaining position stronger, but they are finding out the market is still rather tough on buyers in the sub $350,000 price range. Buyers need to be willing to lead with a strong offer when bidding for sub-median priced homes.

Meanwhile up at the other end of the pricing spectrum, buyers with more than $600,000 to spend are seeing more malleable sellers. A well priced high-end home will still attract multiple offers, but most pricing at the top of the range seems to be neutral or high and buyers can expect some room for negotiation on these types of listings.

Overall we are fortunate to have a warm market during an otherwise cool economy.