Mortgage Applications Fall Again
From Reuters:
Home loan demand down as rates hit new highs
Mortgage applications fell for a second consecutive week, led by a decline in demand for home purchase loans, as interest rates reached new multiyear highs, an industry trade group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended April 14 decreased 1.7 percent to 569.6 from the previous week's 579.4.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.56 percent, up 0.06 percentage point from the previous week, its highest level since the week ended June 7, 2002 when it reached 6.65 percent.
The 30-year fixed-rate mortgage, the industry benchmark, is also above last year's high of 6.33 percent, reached in the week of November 11 after climbing on and off from a 2005 low of 5.47 percent in June.
The MBA's seasonally adjusted purchase mortgage index fell 2.7 percent to 407.4 from the previous week's 417.7.
The index -- widely considered a timely gauge of U.S. home sales -- was also below its year-ago level of 466.7.
The group's seasonally adjusted index of refinancing applications decreased 0.4 percent to 1,526.1 compared to 1,532.4 the previous week. A year earlier the index stood at 1,870.0.
Home loan demand down as rates hit new highs
Mortgage applications fell for a second consecutive week, led by a decline in demand for home purchase loans, as interest rates reached new multiyear highs, an industry trade group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended April 14 decreased 1.7 percent to 569.6 from the previous week's 579.4.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.56 percent, up 0.06 percentage point from the previous week, its highest level since the week ended June 7, 2002 when it reached 6.65 percent.
The 30-year fixed-rate mortgage, the industry benchmark, is also above last year's high of 6.33 percent, reached in the week of November 11 after climbing on and off from a 2005 low of 5.47 percent in June.
The MBA's seasonally adjusted purchase mortgage index fell 2.7 percent to 407.4 from the previous week's 417.7.
The index -- widely considered a timely gauge of U.S. home sales -- was also below its year-ago level of 466.7.
The group's seasonally adjusted index of refinancing applications decreased 0.4 percent to 1,526.1 compared to 1,532.4 the previous week. A year earlier the index stood at 1,870.0.
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Wealthy Escape Home Market
California's wealthy investors are choosing to invest less and less in real estate, a trend that local experts say should serve as a beacon to all real estate investors in the county.
In San Diego, financial advisors who work with some of the region's wealthiest people are advising their clients to sell their investment properties. After a monumental run-up in home prices, they say, their clients are weary of holding onto investments too long and repeating the past mistakes of the dot-com bubble.
Nationwide, only 21 percent of wealthy people who plan on making additions to their investment portfolios intend to invest in real estate, according to data collected by the Phoenix Affluent Marketing Service, a New York-based market research and consulting firm. That figure is a lot lower in California, where only 16 percent of wealthy investors said they would be buying more real estate, down from 21 percent a year ago.
...
"It is reasonable for the average investor to look at what rich people are doing, because presumably the richer people have more access to better information," Painter said. "Because of that, they're going to be able to more quickly move their money when they see trends changing."
Under that logic, if wealthy investors are choosing not to rely on real estate for a good return, their decision is probably based on sound economic advice. Most wealthy real estate investors have made a good profit on their properties over the last few years, but as price increases slow, sales drop and inventory spikes, many of those speculators are choosing to invest elsewhere in order to avoid any risk of a downturn in home values.
The message some financial advisors in San Diego are giving wealthy investors is clear: Those clients who can afford to sell their investment properties should do so.
grim
I recall that condo (MLS 2244454) discussed here before. I think the monthly condo fees were over $500 -- quite a tough sell.
Taxes + monthly fees = $15,000 a year. On a condo.
It was also priced at $699K for awhile 6+ months ago (and I believe $725K before that, but my memory is fuzzy on that price point).
Now it's dropped $200,000 to $524K?!
Pop!
$524k FOR A CRAPPY CONDO?
No F%$# way!
"$524k FOR A CRAPPY CONDO? No F%$# way!"
There was another condo posted here from CraigsList a few weeks ago -- $900K, in SOUTH ORANGE, with $30,000 in annual taxes and condo fees.
That's:
* $900K condo
* SOUTH ORANGE
* $30,000 annual taxes/condo fees
Sucker born every minute...
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