Real Estate Information Archive

Good Monday Morning!

The inventory of homes for sale in the Eugene and Springfield area has never been lower.  A brisk market with high demand created by extremely low mortgage interest rates and a national housing shortage have fueled a hot market that currently has about two weeks of housing inventory. Things are changing though!  Mortgage interest rates have bumped up slightly and inflation has hit the housing market hard. The combination of high home prices and higher interest rates could be the catalyst for change. The coming weeks will tell the story.  The following is an article from MSNBC that talks about this current housing market change nationally.

The nation’s housing market has never been this tight, which is frustrating enough for house hunters, but now they have another problem.

Mortgage rates, which have hovered around record lows since the start of the Covid pandemic, are now rising. It’s what one potential buyer called “a perfect storm.” Another described it as “agony.”  

At a Sunday open house in Waldorf, Maryland, last weekend, there were already three offers on the three-bedroom home before it even started. By Tuesday, the agent’s deadline, there were nine.

“We’re stuck between a rock and a hard place,” said Rondie Robinson, who was there with his wife and daughter. Robinson said he recently got a new job and is looking to upgrade to a larger home.

“We thought that because of the winter months that it would slack off a little bit, prices would start to come back down to normal, but that’s not happening,” he said. “It’s anguish, it’s pain, it’s agony.”

Limited supply is taking a toll on sales. Pending home sales, which represent signed contracts on existing homes, fell more than expected from November to December, down 3.8%, according to the National Association of Realtors. The Realtors blame the drop on the extreme shortage of homes for sale, not on lack of demand.

New listings from sellers were down 8% year over year for the week ended Jan. 22, according to Realtor.com. Those listings have been below historical levels for eight of the last 10 weeks. As a result, active inventory, which is the total number of homes for sale, was down 28% from a year ago.

Buyers are coming out early this year, hoping to get a jump on the usually busy spring market. They are also concerned that in an already pricey housing market, rising mortgage rates could force them out.

“Between looming rate hikes, rising home prices and surging rents, today’s home shoppers have plenty of motivation to close while monthly costs might still be affordable,” said Danielle Hale, chief economist at Realtor.com.

The combination of fierce demand and low mortgage rates over the past two years caused home prices to rise at the fastest pace in several decades. While the year-over-year gains are starting to shrink nationally, prices are still at record highs, up close to 19% last November from November 2020, according to the S&P Case-Shiller index.

“We don’t want to wait, because likely when it does get warmer, more houses go on the market, and the rates get higher, it’s just gonna be kinda like the worst situation, like the perfect storm where things really go up,” said Mike Williams, who was at the open house in Maryland.

The home was priced at $375,000, right around the national median. But rising rates mean the monthly payment is now about $200 more than it would have been a year ago and $100 more than just three weeks ago. The average rate on the 30-year fixed mortgage was below 3% at the start of last year and is now hovering around 3.7%.

“Everybody’s concerned that competition’s going to make it so that especially the first-time homebuyers don’t have a leg up, they’re not going to be able to compete,” said Duke Walker, a loan officer at Movement Mortgage in Washington, D.C.

Walker said his phone has been ringing off the hook with calls from potential buyers looking to lock in their rates now before they move any higher. Mortgage applications to buy a home jumped 8% in the second week of this month from the first, according to the Mortgage Bankers Association.

“Over the last two weeks in particular, you’ve seen a significant increase, not just with my own, but industrywide all my contemporaries are also seeing their application count up,” said Walker.

More competition amid limited supply will only make the competition more fierce. Homes are now selling on average 10 days faster than they were a year ago, according to Realtor.com.

City Chic Realty’s Kyo Freeman, who is the agent on the Maryland home, said he expected from the start to see it sell for well above the list price, just as so many did last year.

“It feels like we’re going to see a lot of similar bidding wars,” said Freeman. “Any property that is really, really high interest is going to have a lot of offers, and it’s going to be tough for somebody who has a limited budget to be able to compete for those.”

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

3311 Ginkgo Way, Eugene, OR 

Price: $399,900    Beds: 3    Baths: 2.0    Sq Ft: 1417

Meticulously maintained two owner ranch style home in a quiet Santa Clara neighborhood. Newer roof, forced air w/ heat pump & vinyl windows. Corner 1/4 acre lot w/ screened in covered patio, two storage sheds, sprinklers, an irrigation well & RV par...View this property >> 

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Good Monday Morning!

The inventory of homes for sale in the Eugene and Springfield area is now hovering at right around 2 weeks of active inventory.  This means that if there were no new homes to come on the market, the current inventory of homes for sale would be exhausted within a two week time period. Nationally, the inventory of homes for sale is also extremely low, but in most cases not to the extent that we have here in Lane County.  The result of this low inventory of homes for sale is that the overall number of homes being sold is also quite low.  Mortage interest rates as of Friday had ticked up to around 4%, a marked increase from where we were just 30 days ago.  It is evident that the market change that I have predicted is hitting us.  Higher interest rates could create less demand and begin the cycle of home inventories beginning to build again. The advice that I would give anyone who is going to sell their home this year is to not wait until Spring.  The market is changing and waiting to sell your home could prove costly.  Here is an article from Realtor.com" that talks about the recent national home inventory situation.

The numbers: Existing-home sales decreased 4.6% between November and December, hitting a seasonally-adjusted, annual rate of 6.18 million, the National Association of Realtors said Thursday. Compared to a year ago, sales were down more than 7%.

Economists polled by MarketWatch had projected existing-home sales to come in at 6.48 million.

Overall in 2021, though, existing-home sales reached the highest level since 2006, a sign of the strong demand among buyers nationwide in light of the short supply of properties on the market.

“December saw sales retreat, but the pull back was more a sign of supply constraints than an indication of a weakened demand for housing,” said Lawrence Yun, the National Association of Realtors’ chief economist, in the report.

Key details: The inventory of homes for sale fell to the lowest level on record, based on data from the National Association of Realtors. The total inventory of homes for sale dropped 18% between November and December.

Expressed in terms of the months-supply, there was a 1.8-month supply of home for sale in December. A 6-month supply of homes is generally viewed as indicative of a balanced market.

The median price for an existing home was $358,000, up 15.8% from December 2020. Homes remained on the market for 19 days on average, and 79% of the homes sold in December had been on the market for less than a month.

Regionally, every part of the country witnessed a decline in home sales in December, led by a 6.8% downturn in the West.

The big picture: The recent surge in mortgage rates threatens to knock some of the wind out of the housing market’s sails. As of Thursday, the average rate for a 30-year fixed-rate mortgage was 3.56%, according to Freddie Mac. That represents the highest level for mortgage rates since March 2020, when the pandemic became a major concern in the U.S.

With a backdrop of still-rising home prices, some buyers will face greater affordability challenges in the high-rate environment. Still, the other factors that have fueled the rise in home sales over the past two years remain, including the shift to remote work and the resounding emergence of millennial buyers. In the near term, the prospect of rising interest rates could cause some buyers to rush to lock in deals.

Looking ahead: “Low mortgage rates and a pandemic-related desire for ‘more house’ continued to fuel demand, despite surging prices,” Priscilla Thiagamoorthy, an economist with BMO Capital Markets, said in a research note.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

2700 5th Street, Springfield, OR 

Price: $459,900    Beds: 3    Baths: 2.0    Sq Ft: 1391

Fantastic single level Hayden Bridge ranch style home w/ backyard access to Royal Delle Park. Tastefully remodeled two years ago w/ new hardwood floors & tile, quartz counters, soft close cabinetry, stainless steel appliances & a spacious master bat...View this property >> 

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Good Monday Morning!

As I have been warning everyone for weeks, mortgage interest rates took a jump last week.  Continued high inflation numbers and other negative economic news are the primary cause of this rise.  The current rise in rates is modest and won't effect the market strongly at this time, but look for the Fed to begin a series of rate increases in the near future that could begin to have a negative effect on the national housing market.  If you are thinking of selling your home soon, the time is now to put your home on the market if you want to have a chance to sell in this current hot sellers market.  Waiting could be very costly.  Contact me for market information and for a detailed look at your homes current market value.  Here is an article from "Realtor.com" that will give you further details on the current mortgage rate scenario.

Interest rates are surging on the heels of data showing a concerning outlook for inflation—and home buyers are to set to pay the price.

The 30-year fixed-rate mortgage averaged 3.45% for the week ending Jan. 13, up nearly a quarter of a percent from the previous week, Freddie Mac reported Thursday. It’s the highest average rate for the 30-year loan since March 2020 when the coronavirus pandemic first began to send shockwaves through financial markets amid the first wave of lockdowns.

Comparatively, a year ago, the 30-year fixed-rate mortgage averaged 2.23%, near record-low levels.

The 15-year fixed-rate mortgage, meanwhile, rose 19 basis points over the past week to an average of 2.3%. The 5-year Treasury-indexed adjustable-rate mortgage averaged 2.57%, up 16 basis points from the previous week.

Mortgage rates skyrocketed in response to the latest data on inflation. The Consumer Price Index released Wednesday showed that inflation was at a nearly 40-year high, with prices for goods and services having risen 7% over the past year.

Such a high rate of inflation is a major concern to the Federal Reserve, which had already indicated it would increase interest rates and scale back its bond-buying activity in an attempt to right-side the economy. But the central bank’s initial plan may now be out the window.

“With inflation more persistent, the Federal Reserve has sped up its timetable for winding down quantitative easing and is likely to begin raising interest rates sooner and more aggressively than previously expected,” said Sam Bullard, managing director and senior economist for corporate and investment banking arm of Wells Fargo, in a research note.

Bullard projected that the Fed may now hike interest rates four times, rather than the initially-projected three. And rather than simply stopping its bond-buying behavior, the central bank could actually begin shrinking its balance sheet by not replacing U.S. Treasuries and mortgage-backed securities when they mature, he said.

The Fed’s rate hikes would not have a direct impact on mortgage rates, as they tend to follow the direction of the yields on long-term bonds such as the 10-year Treasury. Instead, higher rates will materialize as investors begin to make assumptions about the Fed’s plans for curbing inflation.

Higher rates aren’t likely to cause home buyers to fully pump the brakes on their plans to purchase property, economists suggested. But it will have an impact at the margins for buyers who may struggle to afford the double whammy of higher interest rates and rising home prices.

“The rise in mortgage rates so far this year has not yet affected purchase demand, but given the fast pace of home price growth, it will likely dampen demand in the near future,” Sam Khater, chief economist at Freddie Mac, said in the report.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

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Good Monday Morning!

The 2021 Real Estate Market in the Eugene and Springfield area ended with a bang!  Home prices were up 19.1% over the year.  It ended with an average sales price of well over $400,000. Will this trend continue through 2022?  My bet is a big, "NO"!  We may see this same kind of market with inflating home prices and low inventory for the first quarter and possibly into mid year.  After that, look for the effects of raging inflation to have an effect as the Fed has to raise interest rates in an effort to stem inflation.  This could create a cooling of the housing market.  How much it cools and for how long, greatly depends upon the national economy.  For now, if you are thinking about selling your home, don't wait.  You can still take advantage of a hot sellers market!! Here are the home sale numbers for December of 2021.

New listings (240) decreased 8.4% from the 262 listed in December 2020, and decreased 25.2% from the 321 listed in November 2021.

Pending sales (290) decreased 1.7% from the 295 offers accepted in December 2020, and decreased 26.0% from the 392 offers accepted in November 2021.

Closed sales (414) decreased 7.0% from the 445 closings in December 2020, and increased 0.7% from the 411 closings in November 2021.

Inventory and Market Time

Inventory decreased to 0.6 months in December. Total market time held steady at 30 days.

Year-To-Date Summary

Comparing the twelve months of 2021 to the same period in 2020, new listings (5,850) increased 4.5%, pending sales (5,180) increased 4.0%, and closed sales (5,124) increased 5.8%.

Average and Median Sale Prices

Comparing 2021 to 2020 through December, the average sale price has increased 19.1% from $365,500 to $435,300. In the same comparison, the median sale price has increased 18.6% from $336,500 to $399,000.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

2021 was a year of home price increases across the nation.  Some areas saw massive increases, while others saw only moderate increases.  The areas with the largest home price increases were typically those states that saw large numbers of people moving to them such as Florida and Arizona.  2022 may see home price increases inch down some, but watch the same areas of heavy growth in 2022.  The rate of home price increases could remain fairly strong in those areas.  Here is an article from "Realtor.com", that goes over the home price increase situation.

The numbers: Home-price growth continues to decelerate

For the third consecutive month, home-price appreciation occurred at a slower pace, according to a major price barometer released Tuesday, reinforcing the notion that the housing market is cooling after over a year of frenzied sales.

The S&P CoreLogic Case-Shiller 20-city price index posted a 18.4% year-over-year gain in October, down from 19.1% the previous month. On a monthly basis, the index increased 0.8% between September and October.

What happened

The separate national index from the Case-Shiller report showed a 19.1% annual gain, down from a 19.7% increase in September. While lower on the monthly basis, this still represented the fourth-largest annual increase in home prices over the 34-year history of the data.

Phoenix once again led the country in terms of home-price growth, with a 32.3% increase, reinforcing research that showed it to be the housing market where housing affordability suffered the most over the past year. It was followed by two Florida cities, Tampa and Miami. Only six of the 20 major cities that the report tracks notched larger price increases in October than in September, though prices did continue to increase in all 20 cities.

“U.S. home prices moved substantially higher, but at a decelerating rate,” Craig J. Lazzara, managing director at S&P DJI, said in the report. “October’s gains were below September’s, and September’s gains were below August’s.”

The big picture: Prices won’t start falling anytime soon

A separate home-price index from the Federal Housing Finance Agency recorded a 17.4% increase between October 2020 and October 2021 nationally. That report indicated that the Mountain region—Idaho, Montana, Wyoming, Nevada, Utah, Colorado, Arizona and New Mexico—saw the largest price gains.

“House price levels continue to rise, but the rapid pace is curtailing through October,” Will Doerner, supervisory economist in FHFA’s Division of Research and Statistics, said in the report. “The large market appreciations seen this spring peaked in July, and have been cooling this fall with annual trends slowing over the last four consecutive months.”

Still, slowing price-growth isn’t the same as falling prices. Home buyers can expect to pay more and more to buy a home throughout 2022. It’s a reflection of the tight inventory of properties for sale: With so few homes to go around, competition for what properties are on the market will ensure that prices will increase given the high demand for housing.

What they are saying

“Unfortunately, the rate of home-price growth will be limiting for many young buyers who have yet to accumulate sufficient equity gains, and an expected increase in mortgage rates next year will present further challenges. Together, these two factors will keep a lid on continued home-price acceleration,” said CoreLogic deputy chief economist Selma Hepp.

“As housing costs eat up a larger share of home purchaser’s paychecks, buyers will get creative. Many will take advantage of ongoing workplace flexibility to move to the suburbs where, despite home price gains, many can still find a lower price per square foot than nearby cities,” said Danielle Hale, chief economist at Realtor.com.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!