This Week in Real Estate: Feb. 22, 2016

Inventory and rates continue to dominate the headlines This Week in Real Estate. Below are a few highlights from the third week of February that influence our business:
* When Will Housing Inventory Shortages Finally End? Four years in active recovery, and the housing market can’t seem to get past the inventory shortage that penetrates into all crevasses of the industry. And while this won’t change this year, there may be hope for next year as builders start to play catch-up. The most recent existing-home sales report from NAR said the total housing inventory at the end of December dropped 12.3% to 1.79 million existing homes available for sale, and is now 3.8% lower than a year ago (1.86 million). Part of the lack of inventory is due to the limited supply of better-located lots suitable for the trade-up market. In general, broad lot development has lagged as many land developers left the industry during the downturn and those remaining were cautious or financially constrained in their subsequent development activities. However, this could finally start to change. Additional capital has been committed to land development, but the sector is still playing catch-up. Looking to 2016, at least a few public builders are opening or planning to open subdivisions in outlying communities and offering more affordable housing targeted to first-time buyers.
Full Story…
* Mortgage Rates Remain Near 10-Month Lows. Two months ago, when the Federal Reserve announced it was raising its benchmark rate, most observers expected mortgage rates to start creeping higher. Instead, for the past six weeks, the average for the 30-year fixed-rate, the most popular home loan product, has fallen 36 basis points (a basis point is 0.01 percentage point). It is now at its lowest level in 10 months. Mortgage rates are closely tied to the movement of the 10-year Treasury, and investors lately have been flooding the bond market, driving down yields, so rates on home loans have tumbled. According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average held steady at 3.65 percent with an average of 0.5 point, same as it was a week ago (points are fees paid to a lender equal to 1 percent of the loan amount). It was 3.76 percent a year ago.
Full Story…

* Homeowners: 4 Tax Deductions to Maximize Your IRS Refund. It’s tax season again. While you might not be jumping for joy at the thought of this, let’s at least make sure you’re doing your due diligence and gaining all the benefits you can from tax deductions that apply to you. The mortgage interest deduction might be one of the first ones to mind, but it’s definitely not the only one. Four tax deductions to maximize your IRS refund: (1) residential energy credits, (2) mortgage interest, mortgage insurance premiums and deductible points, (3) moving expenses and (4) home office.
Full Story…
Have a productive week!



Leave a Reply


©2016 BHH Affiliates, LLC. An independently operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate, and a franchisee of BHH Affiliates, LLC. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc. Equal Housing Opportunity.