A national multiple listing service run by the National Association of Realtors should be ready by late summer, the large trade association announced today. NAR has been working for the last decade to put all of the nation's agent-represented homes for sale into one database, consolidating the 800-plus multiple listing services in the U.S. in the process. Read more: National Association of Realtors to release national MLS | Inman News
Showing posts with label national association of realtors. Show all posts
Showing posts with label national association of realtors. Show all posts
Tuesday, April 2, 2013
National Association of Realtors to release national MLS | Inman News
A national multiple listing service run by the National Association of Realtors should be ready by late summer, the large trade association announced today. NAR has been working for the last decade to put all of the nation's agent-represented homes for sale into one database, consolidating the 800-plus multiple listing services in the U.S. in the process. Read more: National Association of Realtors to release national MLS | Inman News
Thursday, April 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Home Sales Contracts Rise 4.1% in March - CNBC
The Pending Home Sales Index rose 4.1 percent from February and is now 12.8 percent higher than March of 2011.
“The housing market has clearly turned the corner,” said NAR chief economist Lawrence Yun in a release. “Rising sales are bringing down inventory and creating much more balanced conditions around the country, which means home prices will be rising in more areas as the year progresses.
Contract activity was strongest out West, with the index jumping nearly nine percent.
Both the Northeast and Midwest saw declining activity.
The bulk of distressed properties are in the West, with California, Arizona and Nevada still leading the nation in foreclosure activity.
A recent spike in short sales, where the bank allows the home to be sold for less than the value of the mortgage, could be lifting the numbers in those states. Distressed sales accounted for 29 percent of all sales in March, according to the Realtors and a much higher share of sales out West.
Final sales of existing homes (closings) fell unexpectedly in March, leading many to blame the unusually warm winter for pulling demand forward. First quarter home sales saw their highest quarterly volume in five years. This bump up in new contracts, though, may be a sign that spring isn’t a complete wash. Contract cancellations, however, have been running unusually high, upwards of 30 percent, due to low appraisals and a still-tight credit market, but Realtors claim those buyers have been staying in the market, offering other contracts.
by Diana Olick CNBC Apr 26, 2012
Home Sales Contracts Rise 4.1% in March - CNBC
Saturday, October 16, 2010
Friday, August 13, 2010
High-End Home Sales Get Boost From Low 'Jumbo' Rates - CNBC
While record-low mortgage rates aren't doing much to spur regular home sales, the higher end of the housing market is getting a significant boost from the decline in so-called jumbo rates—mortgages of $417,000 and above.
 |
Source: luxuryportfolio.com Greenwich, Connecticut home |
An economy suffering from high unemployment and falling home prices has left manypotential buyers unable take advantage of the lower conventional rates.
But it's different for those seeking bigger jumbo loans for the more-expensive homes.
"Sales volume for homes worth more than $1 million across the country are up more than 35 percent from last year at this time," says Walter Maloney, spokesman for theNational Association of Realtors (NAR). "Homes between $700,000 and a million are also on the rise by some 29 percent over last year. There's no question that's because of the historic low jumbo rates."
Just how low are the current jumbo rates? Last year at this time, a 30-year fixed jumbo rate was averaging more than 6 percent. It's now at an all time low average of 5.07 percent. And the re-finance rate for a 30 year jumbo is currently at 5.30 percent. A fifteen year jumbo is at the historic low average of 4.68 percent.
The reason for the rate decline is simple, say the experts: banks, which have a part in setting jumbo rates, have money to lend and see the benefits in doing so at lower rates.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down.There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
Greg McBride
Senior Financial Analyst, Bankrate
Greg McBride
Senior Financial Analyst, Bankrate
"Lenders are getting more comfortable making high end loans these days," says Greg McBride, senior financial analyst atBankrate.com. "They're using their cash reserves to make the loans and see a profit in having rates lower right now."
Unlike conventional mortgages, jumbo loans by definition exceed the conforming loan limit of $417,000 set by Fannie Mae and Freddie Mac. Jumbo rates are loosely tied to long term treasurys but they are traditionally higher because of the risk involved for the banks in making a larger loan.
But the risk seems worth it, even in today's sluggish economy as foreclosures rise and unemployment remains high.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down." says McBride. "There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
While banks seems ready to make the bigger loans, they are putting borrowers through the same tough underwriting rules that conventional loan borrowers face.
"Banks are asking for every piece of financial information they can," says Mitchell Hochberg, a consultant and principal at Madden Real Estate Ventures. "They are being very strict on all the paperwork when it comes to home buying or re-financing."
Strict or not, the banks are lending and refinancing jumbo loans at much higher volumes than last year.
"Sales are fairly good right now," says Alan Rosenbaum, president and ceo of Guardhill Financial, a mortgage banker and brokerage company based in New York. "But what's even better this year is the refinancing. We've had significant volume there. I'd say that even getting a half a point now on a jumbo refinance is good with these rates."
Like their conventional brethren, the question over how far jumbo rates will continue to fall remains mostly unanswered. No one can say for sure whether the economy can sustain them if inflation fears force the banks and the Federal Reserve to make lending harder.
However, the question about their rising has a more definitive answer.
"There's no way to tell where rates will really go on conventional or jumbo loans," says Lawrence Yun, chief economist at the NAR. "I do expect them both to remain low. But it's clear to say that if they do go up, it will hurt housing. They aren't the only factor in the housing market. There's the jobs picture and home prices. But having the conventional or jumbo rates go up will definitely not help."
High-End Home Sales Get Boost From Low 'Jumbo' Rates - CNBC
While record-low mortgage rates aren't doing much to spur regular home sales, the higher end of the housing market is getting a significant boost from the decline in so-called jumbo rates—mortgages of $417,000 and above.
|
Source: luxuryportfolio.com Greenwich, Connecticut home |
An economy suffering from high unemployment and falling home prices has left manypotential buyers unable take advantage of the lower conventional rates.
But it's different for those seeking bigger jumbo loans for the more-expensive homes.
"Sales volume for homes worth more than $1 million across the country are up more than 35 percent from last year at this time," says Walter Maloney, spokesman for theNational Association of Realtors (NAR). "Homes between $700,000 and a million are also on the rise by some 29 percent over last year. There's no question that's because of the historic low jumbo rates."
Just how low are the current jumbo rates? Last year at this time, a 30-year fixed jumbo rate was averaging more than 6 percent. It's now at an all time low average of 5.07 percent. And the re-finance rate for a 30 year jumbo is currently at 5.30 percent. A fifteen year jumbo is at the historic low average of 4.68 percent.
The reason for the rate decline is simple, say the experts: banks, which have a part in setting jumbo rates, have money to lend and see the benefits in doing so at lower rates.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down.There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
Greg McBride
Senior Financial Analyst, Bankrate
Greg McBride
Senior Financial Analyst, Bankrate
"Lenders are getting more comfortable making high end loans these days," says Greg McBride, senior financial analyst atBankrate.com. "They're using their cash reserves to make the loans and see a profit in having rates lower right now."
Unlike conventional mortgages, jumbo loans by definition exceed the conforming loan limit of $417,000 set by Fannie Mae and Freddie Mac. Jumbo rates are loosely tied to long term treasurys but they are traditionally higher because of the risk involved for the banks in making a larger loan.
But the risk seems worth it, even in today's sluggish economy as foreclosures rise and unemployment remains high.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down." says McBride. "There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
While banks seems ready to make the bigger loans, they are putting borrowers through the same tough underwriting rules that conventional loan borrowers face.
"Banks are asking for every piece of financial information they can," says Mitchell Hochberg, a consultant and principal at Madden Real Estate Ventures. "They are being very strict on all the paperwork when it comes to home buying or re-financing."
Strict or not, the banks are lending and refinancing jumbo loans at much higher volumes than last year.
"Sales are fairly good right now," says Alan Rosenbaum, president and ceo of Guardhill Financial, a mortgage banker and brokerage company based in New York. "But what's even better this year is the refinancing. We've had significant volume there. I'd say that even getting a half a point now on a jumbo refinance is good with these rates."
Like their conventional brethren, the question over how far jumbo rates will continue to fall remains mostly unanswered. No one can say for sure whether the economy can sustain them if inflation fears force the banks and the Federal Reserve to make lending harder.
However, the question about their rising has a more definitive answer.
"There's no way to tell where rates will really go on conventional or jumbo loans," says Lawrence Yun, chief economist at the NAR. "I do expect them both to remain low. But it's clear to say that if they do go up, it will hurt housing. They aren't the only factor in the housing market. There's the jobs picture and home prices. But having the conventional or jumbo rates go up will definitely not help."
High-End Home Sales Get Boost From Low 'Jumbo' Rates - CNBC
While record-low mortgage rates aren't doing much to spur regular home sales, the higher end of the housing market is getting a significant boost from the decline in so-called jumbo rates—mortgages of $417,000 and above.
|
Source: luxuryportfolio.com Greenwich, Connecticut home |
An economy suffering from high unemployment and falling home prices has left manypotential buyers unable take advantage of the lower conventional rates.
But it's different for those seeking bigger jumbo loans for the more-expensive homes.
"Sales volume for homes worth more than $1 million across the country are up more than 35 percent from last year at this time," says Walter Maloney, spokesman for theNational Association of Realtors (NAR). "Homes between $700,000 and a million are also on the rise by some 29 percent over last year. There's no question that's because of the historic low jumbo rates."
Just how low are the current jumbo rates? Last year at this time, a 30-year fixed jumbo rate was averaging more than 6 percent. It's now at an all time low average of 5.07 percent. And the re-finance rate for a 30 year jumbo is currently at 5.30 percent. A fifteen year jumbo is at the historic low average of 4.68 percent.
The reason for the rate decline is simple, say the experts: banks, which have a part in setting jumbo rates, have money to lend and see the benefits in doing so at lower rates.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down.There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
Greg McBride
Senior Financial Analyst, Bankrate
Greg McBride
Senior Financial Analyst, Bankrate
"Lenders are getting more comfortable making high end loans these days," says Greg McBride, senior financial analyst atBankrate.com. "They're using their cash reserves to make the loans and see a profit in having rates lower right now."
Unlike conventional mortgages, jumbo loans by definition exceed the conforming loan limit of $417,000 set by Fannie Mae and Freddie Mac. Jumbo rates are loosely tied to long term treasurys but they are traditionally higher because of the risk involved for the banks in making a larger loan.
But the risk seems worth it, even in today's sluggish economy as foreclosures rise and unemployment remains high.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down." says McBride. "There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
While banks seems ready to make the bigger loans, they are putting borrowers through the same tough underwriting rules that conventional loan borrowers face.
"Banks are asking for every piece of financial information they can," says Mitchell Hochberg, a consultant and principal at Madden Real Estate Ventures. "They are being very strict on all the paperwork when it comes to home buying or re-financing."
Strict or not, the banks are lending and refinancing jumbo loans at much higher volumes than last year.
"Sales are fairly good right now," says Alan Rosenbaum, president and ceo of Guardhill Financial, a mortgage banker and brokerage company based in New York. "But what's even better this year is the refinancing. We've had significant volume there. I'd say that even getting a half a point now on a jumbo refinance is good with these rates."
Like their conventional brethren, the question over how far jumbo rates will continue to fall remains mostly unanswered. No one can say for sure whether the economy can sustain them if inflation fears force the banks and the Federal Reserve to make lending harder.
However, the question about their rising has a more definitive answer.
"There's no way to tell where rates will really go on conventional or jumbo loans," says Lawrence Yun, chief economist at the NAR. "I do expect them both to remain low. But it's clear to say that if they do go up, it will hurt housing. They aren't the only factor in the housing market. There's the jobs picture and home prices. But having the conventional or jumbo rates go up will definitely not help."
High-End Home Sales Get Boost From Low 'Jumbo' Rates - CNBC
While record-low mortgage rates aren't doing much to spur regular home sales, the higher end of the housing market is getting a significant boost from the decline in so-called jumbo rates—mortgages of $417,000 and above.
|
Source: luxuryportfolio.com Greenwich, Connecticut home |
An economy suffering from high unemployment and falling home prices has left manypotential buyers unable take advantage of the lower conventional rates.
But it's different for those seeking bigger jumbo loans for the more-expensive homes.
"Sales volume for homes worth more than $1 million across the country are up more than 35 percent from last year at this time," says Walter Maloney, spokesman for theNational Association of Realtors (NAR). "Homes between $700,000 and a million are also on the rise by some 29 percent over last year. There's no question that's because of the historic low jumbo rates."
Just how low are the current jumbo rates? Last year at this time, a 30-year fixed jumbo rate was averaging more than 6 percent. It's now at an all time low average of 5.07 percent. And the re-finance rate for a 30 year jumbo is currently at 5.30 percent. A fifteen year jumbo is at the historic low average of 4.68 percent.
The reason for the rate decline is simple, say the experts: banks, which have a part in setting jumbo rates, have money to lend and see the benefits in doing so at lower rates.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down.There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
Greg McBride
Senior Financial Analyst, Bankrate
Greg McBride
Senior Financial Analyst, Bankrate
"Lenders are getting more comfortable making high end loans these days," says Greg McBride, senior financial analyst atBankrate.com. "They're using their cash reserves to make the loans and see a profit in having rates lower right now."
Unlike conventional mortgages, jumbo loans by definition exceed the conforming loan limit of $417,000 set by Fannie Mae and Freddie Mac. Jumbo rates are loosely tied to long term treasurys but they are traditionally higher because of the risk involved for the banks in making a larger loan.
But the risk seems worth it, even in today's sluggish economy as foreclosures rise and unemployment remains high.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down." says McBride. "There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
While banks seems ready to make the bigger loans, they are putting borrowers through the same tough underwriting rules that conventional loan borrowers face.
"Banks are asking for every piece of financial information they can," says Mitchell Hochberg, a consultant and principal at Madden Real Estate Ventures. "They are being very strict on all the paperwork when it comes to home buying or re-financing."
Strict or not, the banks are lending and refinancing jumbo loans at much higher volumes than last year.
"Sales are fairly good right now," says Alan Rosenbaum, president and ceo of Guardhill Financial, a mortgage banker and brokerage company based in New York. "But what's even better this year is the refinancing. We've had significant volume there. I'd say that even getting a half a point now on a jumbo refinance is good with these rates."
Like their conventional brethren, the question over how far jumbo rates will continue to fall remains mostly unanswered. No one can say for sure whether the economy can sustain them if inflation fears force the banks and the Federal Reserve to make lending harder.
However, the question about their rising has a more definitive answer.
"There's no way to tell where rates will really go on conventional or jumbo loans," says Lawrence Yun, chief economist at the NAR. "I do expect them both to remain low. But it's clear to say that if they do go up, it will hurt housing. They aren't the only factor in the housing market. There's the jobs picture and home prices. But having the conventional or jumbo rates go up will definitely not help."
High-End Home Sales Get Boost From Low 'Jumbo' Rates - CNBC
While record-low mortgage rates aren't doing much to spur regular home sales, the higher end of the housing market is getting a significant boost from the decline in so-called jumbo rates—mortgages of $417,000 and above.
|
Source: luxuryportfolio.com Greenwich, Connecticut home |
An economy suffering from high unemployment and falling home prices has left manypotential buyers unable take advantage of the lower conventional rates.
But it's different for those seeking bigger jumbo loans for the more-expensive homes.
"Sales volume for homes worth more than $1 million across the country are up more than 35 percent from last year at this time," says Walter Maloney, spokesman for theNational Association of Realtors (NAR). "Homes between $700,000 and a million are also on the rise by some 29 percent over last year. There's no question that's because of the historic low jumbo rates."
Just how low are the current jumbo rates? Last year at this time, a 30-year fixed jumbo rate was averaging more than 6 percent. It's now at an all time low average of 5.07 percent. And the re-finance rate for a 30 year jumbo is currently at 5.30 percent. A fifteen year jumbo is at the historic low average of 4.68 percent.
The reason for the rate decline is simple, say the experts: banks, which have a part in setting jumbo rates, have money to lend and see the benefits in doing so at lower rates.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down.There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
Greg McBride
Senior Financial Analyst, Bankrate
Greg McBride
Senior Financial Analyst, Bankrate
"Lenders are getting more comfortable making high end loans these days," says Greg McBride, senior financial analyst atBankrate.com. "They're using their cash reserves to make the loans and see a profit in having rates lower right now."
Unlike conventional mortgages, jumbo loans by definition exceed the conforming loan limit of $417,000 set by Fannie Mae and Freddie Mac. Jumbo rates are loosely tied to long term treasurys but they are traditionally higher because of the risk involved for the banks in making a larger loan.
But the risk seems worth it, even in today's sluggish economy as foreclosures rise and unemployment remains high.
"People at the higher incomes are not so much worried about their jobs as others might be. And they have the money to come up with 30 percent down." says McBride. "There is some pent up demand for the more expensive homes. The lower rates are helping release that demand."
While banks seems ready to make the bigger loans, they are putting borrowers through the same tough underwriting rules that conventional loan borrowers face.
"Banks are asking for every piece of financial information they can," says Mitchell Hochberg, a consultant and principal at Madden Real Estate Ventures. "They are being very strict on all the paperwork when it comes to home buying or re-financing."
Strict or not, the banks are lending and refinancing jumbo loans at much higher volumes than last year.
"Sales are fairly good right now," says Alan Rosenbaum, president and ceo of Guardhill Financial, a mortgage banker and brokerage company based in New York. "But what's even better this year is the refinancing. We've had significant volume there. I'd say that even getting a half a point now on a jumbo refinance is good with these rates."
Like their conventional brethren, the question over how far jumbo rates will continue to fall remains mostly unanswered. No one can say for sure whether the economy can sustain them if inflation fears force the banks and the Federal Reserve to make lending harder.
However, the question about their rising has a more definitive answer.
"There's no way to tell where rates will really go on conventional or jumbo loans," says Lawrence Yun, chief economist at the NAR. "I do expect them both to remain low. But it's clear to say that if they do go up, it will hurt housing. They aren't the only factor in the housing market. There's the jobs picture and home prices. But having the conventional or jumbo rates go up will definitely not help."
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