Shaun Hamman

According to recent data from the National Association of Realtors (NAR), affordability conditions are improving, as housing markets across the country are beginning to make a comeback.

This trend is thought to be bolstered by lower existing home prices as well as record low interest rates. According to a recent market trend publication distributed by the NAR, median prices for existing single-family homes lowered in 118 metro areas and as a result, reflected greater homes sales activity at lower price points.

Sales of lower-priced homes showed a strong increase compared to one year ago, providing a good market environment for affordable housing. In the fourth quarter of 2011, the median existing single-family home price was $163,500 - down 4.2 percent from $170,600 in Q4 2010. Basically, the data indicated that home buyers are getting more home for their money than they would have a year ago.

Could this be the spark that ignites a full-blown market comeback? Perhaps. As affordability continues to increase, so may purchase activity. And if a home is purchased at an affordable price, it stands to reason that when it comes time to sell, homeowners won't feel as pressured to sell at a higher price point to pay off their debt. Despite this possibility, market analysts aren't quick to begin celebrating. Most experts agree that there is still room for improvement and a true market resurgence could take some time.

Mortgage application activity declined slightly in the week ending March 2, despite home purchases picking up,an industry group said recently.

The MBA's seasonally adjusted index of refinancing applications was down 2.0 percent that week; however, loan requests for home purchases rose 2.1 percent.

According to the MBA, the 1.2 percent drop in mortgage application activity is due to a slowing demand for refinancing, which is included in the industry group's calculations. Low interest rates could also be attracting new buyers to the market, as 30 year fixed rate mortgages averaged 4.06 percent that same week.

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Below are last week's mortgage rate averages according to Freddie Mac's market survey:

• 30 year average: 3.88% (w/ .8 pts)
• 15 year average: 3.13% ( w/ .8 pts)
• 5/1 Treasury Indexed ARM average: 2.81% ( w/ .7 pts)

Despite the fact that California saw an overall drop in home sales last year, the number of homes that sold for $1 million or more increased for the first time since 2005.

According to the report conducted by DataQuick Information Systems, a real estate information service, the number of million-dollar home sales peaked in 2005, with 54,773 sales in California. Since then, the number continued to decline. That is, until last year's jump to 22,529 sales - showing a 21.0 percent increase from 18,621 sales in 2009.

What does this mean for the California real estate industry? Well, if you're like most people, a million dollar home just isn't in the cards; however, the report's findings could hint at a steadily growing buyer's market. Even if you can't afford a million-dollar mansion, with home prices moving downward, it could be easier than ever to find a bargain.

Curious to see just how many high-end California homes sold last year, and for how much? Here's a peek at the breakdown...

$1-$2 million - 8,747 homes(about 79% of homes)
$2-$3 million - 2,333 homes
$3-$4 million - 782 homes
$4-$5 million - 304 homes
More than $5 million - 463 homes

For more information, you can read a full article on the report here: http://dqnews.com/Articles/2011/News/California/HighEndSales/MDCA110211.aspx

Related Posts:
Real Estate Market Shows Lower Home Values
Existing Home Sales Show Signs of Life in December

Related Mortgage Resources:
Jumbo Loans
California Mortgage Rates

Existing-home sales continued on an upward trend in December, marking three consecutive months of rising numbers. According to a recent press release from the National Association of Realtors®, December 2011 showed a 5.0 percent increase in existing-home sales and were 3.6 percent higher than those from December 2010.

“The American dream of homeownership is alive and well. We have a large pent-up demand, and household formation is likely to return to normal as the job market steadily improves,” said NAR President Moe Veissi. “More buyers coming into the market mean additional benefits for the overall economy. When people buy homes, they stimulate a lot of related goods and services.” The information, which was released on January 20, 2012, showed the following data, based on seasonally-adjusted annual rates:

* December 2011 EHS – 4.61 million * November 2011 EHS – 4.45 million * October 2011 EHS – 4.25 million
* Total EHS inventory by the end of December 2011 – 2.38 million (Represents a 6.2 month supply based on current sales pace, down from a 7.2 month supply in November 2011)

* National median existing-home price in December 2011 - $164,500 (Down 2.5% from December 2010)

* All-cash sales in December 2011 – 31% of purchases (Up from 28% in November and up from 29% in December 2010)

The available inventory data represents the lowest level since March 2005 when there were 2.30 million homes on the market.

This data represents estimates that are based on completed transactions on single-family homes, townhomes, condominiums and co-ops. Visit www.realtor.org/research/research/ehsdata to read the full press release.

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On a side note...the AFR team was privileged to assist 926 families with their home financing needs in December, funding152 million dollars. 2011 has come and gone...What was a special year. AFR was able to assist over 8900 families with home financing. Funding over 1.47 BILLION dollars in 2011 for a new record. Congrats to all those families and to the hard working AFR team. On to a bigger and better 2012!

30 year and 15 year fixed mortgage rate averages fell to record lows according to Freddie Mac's market survey which came out earlier this morning. The 30 year average came in at 3.91% with 0.7 points. This was down 0.03% from last week's all-time low. The 15 year fixed rate average tied last week's number at 3.21% with 0.8 points. Last year at this same period the 30 year average was 4.87% and the 15 year average was 4.15%. The survey also highlighted the 5/1 treasury indexed ARM average at 2.85% with 0.6 points.

Freddie Mac's Chief economist, Frank Nothaft noted that "Rates on 30-year fixed mortgages have been at or below 4 percent for the last eight weeks and now are almost 0.9 percentage points below where they were at the beginning of the year, which means that today's homebuyers are paying over $1,200 less per year on a $200,000 loan."

Below is a sampling of current interest rates from American Financial Resources listed today on Bankrate.com. Please vist Bankrate.com for the criteria used in the survey. Rates are subject to change without notice.

NJ Refinance rates from American Financial Resources*.

30 Year Mortgage Rates:
3.794% APR, 3.750% Note Rate, 0 Points, $895 Fees in APR, 30 Day Lock

20 Year Mortgage Rates:
3.750% APR, 3.750% Note Rate, 0 Points, $0 Fees in APR, 30 Day Lock

15 Year Mortgage Rates:
3.168% APR, 3.125% Note Rate, 0 Points, $495 Fees in APR, 30 Day Lock

10 Year Mortgage Rates:
3.188% APR, 3.125% Note Rate, 0 Points, $495 Fees in APR, 30 Day Lock

For more information on current mortgage pricing or to discuss home financing solutions, please contact American Financial Resources at 800-634-8616.

Company NLMS #2826

*The rates below are for: rate and term refinances, single family homes, detached properties, stick built construction, primary residences, $185-$417 loan amounts, and for consumers with 740+ credit scores.