With mortgage rates holding at below 4 percent for the past few months, it’s no wonder home buyers are seeing the opportunities available to them in the form of greater purchasing power.
According to the Mortgage Banker’s Association, nationwide mortgage applications were up 49 percent as of the week ending January 9th 2015, which is the largest increase since 2008. What’s interesting about this phenomenon is that it flies in the face of predictions made by some financial analysts who predicted mortgage rates would rise.
So why have mortgage rates remained low despite predictions?
We’ve seen the foundations of not just an economic recovery, but a true rebound in the past 12 months. Nationally, unemployment rates have dropped, while the GDP (Gross Domestic Product) surpassed expectations in the latter part of 2014. Stocks have been strong, as have Mortgage-Backed Securities. Strong investment in the stock side of real estate has helped maintain low rates as well. Consumer confidence has also soared in the wake of lower gasoline prices, putting more money into peoples’ pockets.
Lastly, the Federal Reserve announced late last Fall that they have no immediate plans to raise interest rates.
What this means for home buyers.
Of course, the most obvious would be that with lower interest rates, qualified buyers may be able to afford a larger home, or have a lower mortgage payment. These options provide them with tremendous purchasing power.
What this means for home sellers.
Lower interest rates plus higher mortgage loan applications equals incredible opportunities for homeowners looking to sell. There are more buyers out there, and inventory is still only nominal here in the Santa Clarita Valley. This means more competition for your home, which can give you leverage when it comes to terms and pricing.
Team Avalos is here to help you realize all of your real estate goals!
Is this YOUR year to make a home purchase happen? Don’t overlook the opportunities that are presenting themselves to you to get into your dream home. Contact Team Avalos to find out how we can make this happen for you.
Team Avalos Real Estate
Keller Williams VIP Properties
25124 Springfield Court, Suite 100
Valencia, CA 91355
Office: (661) 290-3743
Carlos direct: (818) 399-4093
Rose direct: (818) 590-2077