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Smart Home Tech

by Kathy and Michael Rain - The Rain Team

Market Snapshot: San Mateo County Real Estate Report

by Kathy and Michael Rain - The Rain Team

Here is an updated Market Report summarizing recent real estate activity along the coastside. Please keep in mind that the values represented are based on current, detailed information from the Regional Multiple Listing Service. If you need clarification on any of the figures or if you wish to take additional steps toward property ownership, please let us know. We are happy to help you. See the full report.

Mortgage Musts

by Kathy and Michael Rain - The Rain Team

Down Payment Dilemma

by Kathy and Michael Rain - The Rain Team

Market Snapshot: San Mateo County Real Estate Report

by Kathy and Michael Rain - The Rain Team

Here is an updated Market Report summarizing recent real estate activity along the coastside. Please keep in mind that the values represented are based on current, detailed information from the Regional Multiple Listing Service. If you need clarification on any of the figures or if you wish to take additional steps toward property ownership, please let us know. We are happy to help you. See the full report.

 

 

Third quarter housing affordability

by Kathy and Michael Rain - The Rain Team

For release:
November 1, 2018 

Flat home prices, stable interest rates lift California housing affordability, C.A.R. reports

  • Twenty-seven percent of California households could afford to purchase the $588,530 median-priced home in the third quarter of 2018, up from 26 percent in second-quarter 2018 and down from 28 percent a year ago.
  • A minimum annual income of $125,540 was needed to make monthly payments of $3,140, including principal, interest, and taxes on a 30-year fixed-rate mortgage at a 4.77 percent interest rate.
  • Thirty-five percent of home buyers were able to purchase the $479,390 median-priced condo or townhome. An annual income of $102,260 was required to make a monthly payment of $2,560.

LOS ANGELES (Nov. 1) – More Californians could afford to purchase a home in the third quarter as flat home prices and stable interest rates combined to improve California housing affordability, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today. 

The percentage of home buyers who could afford to purchase a median-priced, existing single-family home in California in third-quarter 2018 edged up to 27 percent from 26 percent in the second quarter of 2018 and was down from 28 percent in the third quarter a year ago, according to C.A.R.’s Traditional Housing Affordability Index (HAI). The index has been below 30 percent for five of the past eight quarters. California’s housing affordability index hit a peak of 56 percent in the first quarter of 2012. 

C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state. The index is considered the most fundamental measure of housing well-being for home buyers in the state. 

A minimum annual income of $125,540 was needed to qualify for the purchase of a $588,530 statewide median-priced, existing single-family home in the third quarter of 2018. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,140, assuming a 20 percent down payment and an effective composite interest rate of 4.77 percent. The effective composite interest rate in second-quarter 2018 was 4.7 percent and 4.16 percent in the third quarter of 2017.  

Conversely, housing affordability for condominiums and townhomes fell in third-quarter 2018 compared to the previous quarter with 35 percent of California households earning the minimum income to qualify for the purchase of a $479,390 median-priced condominium/townhome, down from 36 percent in the second quarter. An annual income of $102,260 was required to make monthly payments of $2,560.

Compared with California, more than half of the nation’s households (53 percent) could afford to purchase a $266,900 median-priced home, which required a minimum annual income of $56,930 to make monthly payments of $1,420. 

Key points from the third-quarter 2018 Housing Affordability report include:

  • Housing affordability improved from third-quarter 2017 in 10 tracked counties and declined in 33 counties. Affordability in five counties remained flat.
  • In the San Francisco Bay Area, affordability improved from a year ago in San Francisco and Marin counties, primarily due to higher wages. Affordability fell in six counties (Alameda, Contra Costa, Napa, San Mateo, Solano, and Sonoma). Affordability held steady in Santa Clara County.
  • In Southern California, affordability improved only in Ventura, and dropped in four counties (Orange, Riverside, San Bernardino, and San Diego) compared to a year ago. Affordability in Los Angeles County was unchanged.
  • In the Central Valley, Fresno and Madera counties saw an improvement in affordability from third-quarter 2017. Housing affordability decreased from a year ago in eight counties (Kings, Merced, Placer, Sacramento, San Benito, San Joaquin, Stanislaus and Tulare). Affordability held steady only in Kern County.
  • In the Central Coast region, only Santa Barbara experienced a year-to-year improvement in affordability, while three counties (Monterey, San Luis Obispo, and Santa Cruz) posted a decline.
  • During the third quarter of 2018, the most affordable counties in California were Lassen (67 percent), Kern and Kings (51 percent), Tehama (49 percent) and Yuba (48 percent).
  • Mono (11 percent), Santa Cruz (12 percent), San Mateo (14 percent), San Francisco (15 percent), and Santa Clara (17 percent) counties were the least affordable areas in the state.

Housing Affordability slides (click link to open)


Affordability peak versus current 
Annual required income peak vs. current
Monthly PITI peak versus current

Affordability by region peak versus current
Housing affordability by county 

See C.A.R.’s historical housing affordability data.
See second-time buyer housing affordability data
.

 

Photo by Pixabay on Pexels

Six Reasons Why The Holidays Are A Good Time To List Your Home

by Kathy and Michael Rain - The Rain Team

What home buyers need to know when mortgage rates rise- even just a fraction

by Kathy and Michael Rain - The Rain Team

By: Clare Trapasso

By now, we've all grown accustomed to the screaming, panic-inducing headlines: "Mortgage Rates Are on the Rise!" But what does this actually mean to home buyers? With mortgage interest rates notching up just small fractions of a point, is it really as big a deal as experts are making it out to be?

Well, yes. And they're about to go up again.

As it turns out, those teeny, tiny increases can cost home buyers hundreds of dollars a year, and thousands of dollars over the life of their loans. And they're likely to keep rising as the Federal Reserve continues increasing its key interest rate. (Mortgage rates are different, but often follow the same trajectory as the federal ones.) The latest Fed hike is expected this month, with more on the horizon.

"When you're talking about a 30-year mortgage, a small increase in mortgage rates adds up to a lot of money," says Senior Economist Joseph Kirchner of realtor.com®. "If you've got a house in mind and you're ready to pull the trigger, don't dillydally. Interest rates will definitely go up ... so you're going to be paying more money for the same house."

And they're not just a buyer's dilemma. Rising mortgage rates limit just how much buyers spend on homes—and therefore serve as a bit of a check on just how high sellers can price their abodes. It can prevent some folks from becoming buyers, meaning there are less offers to go around.

How much can higher rates add to a mortgage bill?

So what does this all mean? Well, current mortgage rates are 4.65% on 30-year, fixed-rate loans. If they increase by just one full percentage point, it costs typical home buyers an additional $147 a month—or almost $53,000—over a 30-year period. (This assumes that a home is about $300,000 with a 20% down payment.)

Even much smaller increases really add up. If mortgage rates tick up by just 0.05%, it can cost typical buyers $2,600 or more over the life of their 30-year loans.

Rates are expected to rise to between 5.5% and 6% over the next two years if the economy keeps humming along, according to Len Kiefer, deputy chief economist at Freddie Mac.

Those escalations can make it harder for buyers to qualify for loans on the abodes of their dreams, forcing some to purchase smaller residences, fixer-uppers, or properties in less desirable or farther-out neighborhoods as a result. Some may even be priced out of the market altogether.

But don't panic just yet.

It's important to realize that rates are still low. Yes, they're more than 0.8% higher than they were a year ago, according to Freddie Mac data. But they're nowhere near the peak of 18.63%, in October 1981. So, you know, breathe.

"We've experienced low rates for a very long time," says Kiefer. He pointed out the last time that rates rose above 5% was way back in 2011. "[So] the increases that we've seen are likely to stick."

Mortgage broker Chris Brown has seen fewer buyers seeking loans over the past few months as a result of the increases.

"Buyers are starting to come to the realization that real estate prices have moved up significantly over the last six or seven years and, combined with higher rates, the homes they were once targeting are no longer in their price range," says Brown of CB Investments in Huntington Beach, CA. "It has forced them to either settle for a lesser home than they expected or temporarily put off the home search. [And] a lot more buyers are opting for the latter."

What should buyers do to get the lowest-cost mortgages?

Hope is not lost for those striving to protect their pocketbooks from rising rates. Consumers should start by looking for the cheapest loans with the lowest mortgage rates.

"Shopping for a mortgage is like shopping for anything else," says Eric Tyson, co-author of “Mortgages for Dummies.” Some lenders offer specials to lure in customers while others have consistently lower prices. "You can certainly check with the bigger banks and credit unions in your area, or online."

They may also want to consider getting a rate lock with their mortgage providers. This means that they're guaranteed a certain rate once they turn in their offer. So if rates go up, buyers don't have to worry about it. The downside, however, is that not all rate locks are free. And if rates fall, buyers can't take advantage of them.

Should buyers consider adjustable-rate mortgages?

Another option is an adjustable-rate mortgage, known as an ARM. This loan typically starts with a lower interest rate that then goes up after a set period of time. The proliferation of ARMs was partly responsible for the housing crash about a decade ago as rates—and therefore monthly payments—suddenly ballooned and homeowners couldn't afford the new, higher bills.

But newer regulations have since been put in place to make them safer for consumers. In addition, most of these loans come with a cap that limits just how high interest rates can go.

Miami-based mortgage loan originator Sylvia M. Gutiérrez has been advising her clients to consider ARMs, which typically fix interest rates for three-, five-, seven-, or 10-year periods.

"The lower initial rate allows you to qualify with a lower mortgage payment," says Gutiérrez, also the author of "Mortgage Matters: Demystifying the Loan Approval Maze." "[And] today's ARMs are much stabler than pre-recession ARMs."

But folks need to pay close attention to when those rates are likely to adjust and just how high they could possibly go before signing on the dotted line. And they shouldn't bank on being able to refinance at a lower interest rate down the line, because rates are just going to keep going up, says realtor.com's Kirchner.By: Clare Trapasso

By now, we've all grown accustomed to the screaming, panic-inducing headlines: "Mortgage Rates Are on the Rise!" But what does this actually mean to home buyers? With mortgage interest rates notching up just small fractions of a point, is it really as big a deal as experts are making it out to be?

Well, yes. And they're about to go up again.

As it turns out, those teeny, tiny increases can cost home buyers hundreds of dollars a year, and thousands of dollars over the life of their loans. And they're likely to keep rising as the Federal Reserve continues increasing its key interest rate. (Mortgage rates are different, but often follow the same trajectory as the federal ones.) The latest Fed hike is expected this month, with more on the horizon.

"When you're talking about a 30-year mortgage, a small increase in mortgage rates adds up to a lot of money," says Senior Economist Joseph Kirchner of realtor.com®. "If you've got a house in mind and you're ready to pull the trigger, don't dillydally. Interest rates will definitely go up ... so you're going to be paying more money for the same house."

And they're not just a buyer's dilemma. Rising mortgage rates limit just how much buyers spend on homes—and therefore serve as a bit of a check on just how high sellers can price their abodes. It can prevent some folks from becoming buyers, meaning there are less offers to go around.

How much can higher rates add to a mortgage bill?

So what does this all mean? Well, current mortgage rates are 4.65% on 30-year, fixed-rate loans. If they increase by just one full percentage point, it costs typical home buyers an additional $147 a month—or almost $53,000—over a 30-year period. (This assumes that a home is about $300,000 with a 20% down payment.)

Even much smaller increases really add up. If mortgage rates tick up by just 0.05%, it can cost typical buyers $2,600 or more over the life of their 30-year loans.

Rates are expected to rise to between 5.5% and 6% over the next two years if the economy keeps humming along, according to Len Kiefer, deputy chief economist at Freddie Mac.

Those escalations can make it harder for buyers to qualify for loans on the abodes of their dreams, forcing some to purchase smaller residences, fixer-uppers, or properties in less desirable or farther-out neighborhoods as a result. Some may even be priced out of the market altogether.

But don't panic just yet.

It's important to realize that rates are still low. Yes, they're more than 0.8% higher than they were a year ago, according to Freddie Mac data. But they're nowhere near the peak of 18.63%, in October 1981. So, you know, breathe.

"We've experienced low rates for a very long time," says Kiefer. He pointed out the last time that rates rose above 5% was way back in 2011. "[So] the increases that we've seen are likely to stick."

Mortgage broker Chris Brown has seen fewer buyers seeking loans over the past few months as a result of the increases.

"Buyers are starting to come to the realization that real estate prices have moved up significantly over the last six or seven years and, combined with higher rates, the homes they were once targeting are no longer in their price range," says Brown of CB Investments in Huntington Beach, CA. "It has forced them to either settle for a lesser home than they expected or temporarily put off the home search. [And] a lot more buyers are opting for the latter."

What should buyers do to get the lowest-cost mortgages?

Hope is not lost for those striving to protect their pocketbooks from rising rates. Consumers should start by looking for the cheapest loans with the lowest mortgage rates.

"Shopping for a mortgage is like shopping for anything else," says Eric Tyson, co-author of “Mortgages for Dummies.” Some lenders offer specials to lure in customers while others have consistently lower prices. "You can certainly check with the bigger banks and credit unions in your area, or online."

They may also want to consider getting a rate lock with their mortgage providers. This means that they're guaranteed a certain rate once they turn in their offer. So if rates go up, buyers don't have to worry about it. The downside, however, is that not all rate locks are free. And if rates fall, buyers can't take advantage of them.

Should buyers consider adjustable-rate mortgages?

Another option is an adjustable-rate mortgage, known as an ARM. This loan typically starts with a lower interest rate that then goes up after a set period of time. The proliferation of ARMs was partly responsible for the housing crash about a decade ago as rates—and therefore monthly payments—suddenly ballooned and homeowners couldn't afford the new, higher bills.

But newer regulations have since been put in place to make them safer for consumers. In addition, most of these loans come with a cap that limits just how high interest rates can go.

Miami-based mortgage loan originator Sylvia M. Gutiérrez has been advising her clients to consider ARMs, which typically fix interest rates for three-, five-, seven-, or 10-year periods.

"The lower initial rate allows you to qualify with a lower mortgage payment," says Gutiérrez, also the author of "Mortgage Matters: Demystifying the Loan Approval Maze." "[And] today's ARMs are much stabler than pre-recession ARMs."

But folks need to pay close attention to when those rates are likely to adjust and just how high they could possibly go before signing on the dotted line. And they shouldn't bank on being able to refinance at a lower interest rate down the line, because rates are just going to keep going up, says realtor.com's Kirchner.

Photo by rawpixel on Pexels.com

Market Snapshot: San Mateo County Real Estate Report

by Kathy and Michael Rain - The Rain Team

Here is an updated Market Report summarizing recent real estate activity along the coastside. Please keep in mind that the values represented are based on current, detailed information from the Regional Multiple Listing Service. If you need clarification on any of the figures or if you wish to take additional steps toward property ownership, please let us know. We are happy to help you. See the full report.



2019 California Association Of Realtors Economic & Market Forecast

by Kathy and Michael Rain - The Rain Team

Displaying blog entries 1-10 of 395

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The Rain Team
CA# 01169588 | CA# 01125976 | CA# 01908304
248 Main Street, Suite 200
Half Moon Bay CA 94019
Michael: 650-888-6361
Kathy: 650-888-6903
Fax: 866-396-0207

Kathy and Michael Rain of Coldwell Banker provides real estate services in the San Mateo County, California area including the surrounding communities: El Granda, Half Moon Bay, Montara, Moss Beach, Pacifica and San Mateo. Search for homes in San Mateo County. We list and sell residential real estate, investment properties, vacant land, lots for sale in the San Mateo County, California area.

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Kathy Rain - CA BRE# 01169588 | Michael Rain - CA BRE# 01125976 | Coldwell Banker - CA BRE# 01908304
Cell Phone: (650) 888-6903 * Direct Phone: (650) 712-0411
San Mateo County Real Estate and Homes for Sale

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