On Friday, the CCL team put in some hard work with Habitat for Humanity to kick off this Memorial Day Weekend!
We had a great time helping the San Luis Obispo Habitat Team at Rockview Place in San Luis Obispo. We’ve had Julia Ogden, the CEO for the SLO Habitat for Humanity, as a guest on Mortgage Matters in the past, and it was great to get out and help support her organization and the local community by helping build a home.
“It’s great to see members of the community coming together to help others,” Central Coast Lending owner Jason Grote said, “it’s something simple we can do to help give back to our town.”
You can learn more about SLO County Habitat for Humanity, including how to volunteer, HERE.
April saw a month of rising sales in the new home market, despite limited supply. New home sales rose 2.3 percent in April to an annualized rate of 454,000 from 444,000 in March. This mix of low supply and rising sales are driving prices up sharply. The median price and average price both set new records with prices of $271,600 and $330,800 respectively. Although these price readings can be volatile, the year-on-year gain of 14.9 percent for both the median and the average price is very convincing and mirrors the gains in existing home sales.
Some good news for May’s economic data outlook; initial claims have taken yet another drop. There were 340,000 claims for unemployment benefits in the May 18 week, down 23,000 in the week and 15,000 from the April 13 week.
Continuing claims also show some positive news, which are down 112,000 in the May 11 week, putting them at a new recovery low of 2.912 million.
What little girl doesn’t have dreams of living in a fairy castle? When I was little, I remember my friends and I would draw pictures of our dream homes – often involving elaborate pools and rivers and castle-like structures.
And, let’s be honest, those dreams still resonate today in one form or another today. Even if that fairy tale castle is now a multi-million dollar estate, people still fantasize about owning extravagant properties.
The standard multi-million dollar estate may be nice for some, but for me, a castle still seems fitting. Perhaps I’d settle for a vineyard estate in Paso or even this extravagant mansion in Cambria. But without the mote, knights, and fortress walls, something just seems to be missing.
Which is why I was thrilled when I saw that Eagle Castle Winery in Paso Robles (complete with mote!) is on the market! At $6.9 million I’d consider this fairy tale property a bargain (although it’s still a little out of my price range). Read more
Existing-home sales rose in April with a seasonally adjusted increase of 0.6 percent from March and an increase in resale activity of 9.7 percent above the April 2012 level, according to the National Association of Realtors. Although all regions are showing strong price gains from a year ago, sales levels still remain below underlying demand, signaling the need for higher levels of new home construction.
Median existing-home prices was $192,800 in April, up 11 percent from April 2012. This marked the first time there were 14 consecutive months of year-over-year price increases since April 2005 to May 2006.
The median time on the market for all homes also decreased this month. With a median time on the market of 46 days in April, not only was it down from 62 days in March, it was also 45 percent faster than the 83 days on the market in April 2012.
Mortgage Rate Update (May 22): San Luis Obispo County mortgage rates continue to show slight increases
We apologize for not having our usual Monday rate update; our office was experiencing some technical difficulties.
This week, mortgage rates continue to tick up, showing slight increases in APR for the majority of the programs. Keep in mind, though, that rates are still at historically low levels. Keep reading for the full 10-program CCL Rate Tracker, including graphs of the most recent two-week movement. Read more
Miss a recent episode of the popular San Luis Obispo County radio show Mortgage Matters? Individual episodes are now available for download and offline use on the Central Coast Lending Soundcloud page, which you can find HERE.
Download the episode to a media device and take it along with you on the road, office, or gym to catch up on the latest economic, real estate, and mortgage news and analysis.
Mortgage Matters airs every Saturday from 10 a.m. to 12 noon on KVEC 920. Central Coast Lending hosts Daniel Podesto and Jason Grote keep listeners up-to-date on the news, answer caller questions, and interviews local professionals.
Miss a recent episode of the popular San Luis Obispo County radio show Mortgage Matters? Individual episodes are now available for download and offline use on the Central Coast Lending Soundcloud page.
Tune in as Mortgage Matters Radio hosts Jason Grote and Dan Podesto discuss the recent increase in jobless claims, the increase in median price for new and existing houses, and the confidence in the economy’s future health. Later, Jason and Dan are joined by Dan Ferreira from Ferreira Contracting.
Can borrowers get a mortgage with a down payment under 5%? Are homebuyers able to shop around at different lenders after prequalification? By law, do all banks charge the same fee for credit reports and appraisals?
The answers are “yes”, “yes”, “no.” Did you get the them correct? Because many Americans are still a bit confused about such mortgage basics, finds a recent Zillow poll.
Zillow put together a “Mortgage IQ” test, which features 10 questions used to gauge familiarity with the mortgage process. Some questions (like if borrowers can get a mortgage with a low down payment – see FHA, USDA, and Conforming Financing), underscore beliefs that could keep potential buyers out of the marketplace, and harm borrowers that have qualified for a mortgage (not knowing they could shop around).
Of respondents, 34% didn’t know that programs exist for down payments under 5%. Over one-quarter (26%) believe that they must close their loan with the original lender that pre-approved them.
You can take the quiz here.
And just as a side note (and a bit of an indulgent pat on the back), this is why we have made it our company mission statement to educate potential borrowers as much as possible. (Check out Mortgage Matters Radio every Saturday from 10 a.m. to 12 noon for more!)
We encourage borrowers to shop around as much as they like; we are confident that our mortgage rates will be lower and our service superior. In other words, we don’t rely on cheap tricks or misinformation to make our business go.
Call us any time (805.543.Loan) or email us (info@centralcoastlending) with any of your mortgage or real estate questions.
Home prices are on the rise – and fast.
The National Association of Realtors (NAR) registered an 11.8% year-over-year price gain between the median home price in March 2012 and March 2013. Other home price trackers such as FHFA, Zillow, and Case-Shiller have also shown significant movement.
Demand for real estate is high. Part of the reason why prices are rising is that there isn’t enough supply to fill demand. Six months supply is considered “healthy” for a market, but in March there was only 4.6 months of inventory nationally, according to the NAR. As buyers look for a diminishing supply of properties, prices are move up as bidding raises competition.
Locally, we have seen a similar story. San Luis Obispo County prices are up 13.3% since the end of 2012.
Atascadero poses an extreme local example. With just 2 months of inventory on the market, prices are up 15% from the end of 2012.
With so much price appreciation, we are hearing rumors about another real estate “bubble.” Are we in such territory? No, says Trulia.
Bubble-phobes can rest easy. Even with recent sharp home price increases, prices are still low relative to fundamentals and are far below bubble levels.
The gist of Trulia’s point is that any bubble would have to bring prices above their “fundamental value.” By comparing current market conditions with historical prices, incomes, and rents, Trulia created several measures of fundamental value.
Home prices are still “undervalued” by 7% in 91 of the 100 largest metros. (Of the nine “overvalued” metros, California has four: see sidebar to the right.)
Trulia also points out (as does CCL’s Jason Grote in our recent article that questions the bubble narrative) that “mortgage credit remains very tight” and that people are actually qualifying for mortgages they can afford, whereas the previous crash toxic mortgages “artificially inflated housing demand” by expanding borrower eligibility.