Mortgage insurance premiums are coming down
The Federal Housing Administration is reducing its premiums for mortgage insurance from 0.85 per cent to 0.60 per cent, a move which real estate professionals have been quick to welcome.
“The high cost of mortgage insurance has unfortunately put those opportunities out of reach for many young, first-time- and lower-income borrowers. Now, we have a real opportunity to get back on track,” commented William E. Brown, president of the National Association of Realtors.
Brown thanked the FHA
and HUD leadership for the move but added that there was still more to be done including cutting the requirement for borrowers to maintain FHA insurance even when their equity position has improved.
He also said that the move announced this week will help boost the market by bringing an increase in eligible mortgage borrowers.
California Association of Realtors has also reacted to the premium decrease with president Geoff McIntosh saying that the move will increase housing affordability.
"With recent hikes in interest rates, the expected average savings of $500 this year will help offset the higher cost of homeownership for many prospective homebuyers and put them on the path to achieving the American Dream," McIntosh said.
Consumers think mortgage rates will continue rising
The recent increase in interest rates and the expectation of multiple increases this year has dampened housing market sentiment.
The Fannie Mae Home Purchase Sentiment Index slipped 0.5 points to 80.7 in December, the fifth consecutive monthly drop. The components relating to personal finances and lower mortgage rates in the next 12 months, were both down.
However, more respondents believe that now is a good time to buy; this metric was up 2 percentage points. There is also lower concern about job losses.
Those who say now is a good time to sell was largely unchanged in December along with those who expect home prices to continue rising.
“Despite the post-election bump in general consumer attitudes, a rapid rise in mortgage rate expectations has tamped down home purchase sentiment, at least in the near term. A spike in economic optimism in the immediate aftermath of an election is typical. Whether consumers will sustain this level of optimism into 2017 remains unclear,” said Doug Duncan, senior vice president and chief economist at Fannie Mae.
Berkshire Hathaway HomeServices now in NYC
A new presence in New York has been established by Berkshire Hathaway HomeServices.
New York Properties, led by Ellie Johnson, has joined the network as part of the New England Properties/Westchester Properties group under the leadership of CEO Candace Adams.
“We are elated to attract such a talented and respected leader in Ellie Johnson and at the same time enter the New York City real estate market,” said Adams. “This is a monumental step for our brokerage as we look to expand our presence in the Northeast.”
Johnson has joined Berkshire from Sotheby’s International Realty.