People say that “life is full of surprises.” And indeed, last week’s Jobs Report contained several surprises. Read on to find out if they were good or bad…and what they meant for home loan rates.

Overall, the Jobs Report wasn’t great, but it did surprise by being better than anticipated. One thing that wasn’t a surprise was the unemployment rate which held steady at 9.1%. But the headline number came in at 103,000 jobs created, which was better than expectations of 60,000 and even higher than some of the more frothy expectations. In addition, 137,000 jobs were created in the private sector, which offset more government job losses and which was a lot better than the 83,000 private job gains expected.

Another surprise in the report was the significant upward revisions, which added 99,000 jobs to what was previously reported in prior months, and this added to the positive tone of the report. These upward revisions really change a very pessimistic jobs picture to something a bit more optimistic. For instance, last month the Jobs Report showed zero job creations and now that figure has been revised to show 57,000 jobs created. Once again, these aren’t great numbers—but they are better than bad, and they tell us that the economy is not in a recession…at least for now.

So, what did all of this mean for home loan rates? It’s important to remember that when our economy is struggling, our Bond Market usually benefits as investors seek a safe haven for their money. And since home loan rates are tied to Mortgage Bonds, our home loan rates are sometimes at their best when our economy is struggling. In a way it makes sense…in times of economic struggle, good home loan rates can help kick start our economy in other areas.

Yet, when good or better than expected economic news hits the wires, like it did with Friday’s Jobs Report, investors often move their money out of Bonds and into Stocks in an attempt to take advantage of these gains. And that’s a big reason why we saw Bonds and home loan rates worsen a bit this week.

As of today (Thursday, October 13th) rates are still great:

Conforming

30 year fixed: 4.125%

15 year fixed: 3.50%

5/1 ARM: 2.875%

7/1 ARM: 3.375%

Government

30 year fixed: 3.75%

5/1 ARM: 3.50%

Jumbo

30 year fixed: 4.875%

5/1 ARM: 3.25%

The most important thing to remember is that now is still a great time to purchase or refinance a home, as home loan rates remain near historic lows.

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Sales activity in the Portland Metro area showed improvements in closed and pending sales this August compared with August 2010. Closed sales grew 30.7% in August 2011 compared to August 2010. Pending sales were up 29.6%, and new listings dropped 24.8%. Comparing July 2011 with August 2011, closed sales increased from 1,709 to 1,805 (5.6%). Pending sales also went up from 1,928 to 2,187 (13.4%). New listings went down from 2,942 to 2,879 (-2.1%). At the month’s rate of sales, the 11,276 active residential listings would last about 6.2 months.

Sale Prices

Average sale price for August 2011 declined 9.2% compared to August 2010. Median sale price also fell 10%. Month to month, comparing July 2011 to August 2011, sale price activity fell slightly. Average sale price went down from $275,100 to $271,800 (-1.2%) while median sale price decreased from $227,200 to $225,000 (-1%).

Year-to-Date

Comparing January-August 2010 with the same period in 2011, results were mixed. Closed sales decreased by 0.5% (13,185 v. 13,114), while pending sales increased by 2.8% (14,248 v. 14,645). New listings fell 26% (34,043 v. 25,189).

NORTH PORTLAND —-
Previous Month’s Average Sales Price: $246,100.
Year-to-Date Average Sales Price & Appreciation: $221,100, -4.7%.

NORTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $282,900.
Year-to-Date Average Sales Price & Appreciation: $270,300, -4.4%.

SOUTHEAST PORTLAND —-
Previous Month’s Average Sales Price: $232,600.
Year-to-Date Average Sales Price & Appreciation: $213,900, -7.2%.

WEST PORTLAND —-
Previous Month’s Average Sales Price: $394,900.
Year-to-Date Average Sales Price & Appreciation: $390,300, -2.5%.

BEAVERTON —-
Previous Month’s Average Sales Price: $217,600
Year-to-Date Average Sales Price & Appreciation: $209,600, -12.5%.

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Amid a sea of negative headlines, there is a hint of good news in the latest Portland area housing report: a small uptick in the median sale price of homes sold in July.

The Regional Multiple Listing Service said in its monthly market action report that the median home sale price in July was $227,200. Granted, that’s a decline of 7.6 percent from a year ago, but it represents a 1.9 percent improvement from June’s $222,900 figure.

Click on the link below for the full story

http://www.oregonlive.com/business/index.ssf/2011/08/home_prices_edging_up_in_portl.html

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Thinking of moving? Ready to buy? Just curious? Our comprehensive guide to 95 Portland neighborhoods and suburbs lets you compare the data you need to know. This guide will answer all your questions and help you with any decisions you have regarding your move or current neighborhood.

Just click on the link below for more information.

http://www.portlandmonthlymag.com/real-estate/articles/neighborhoods-by-the-numbers/

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WASHINGTON (AP) - Home prices rose for the second straight month in most major U.S. cities and are stabilizing after years of declines. But analysts say the trend in prices hardly signals a rebound for the troubled housing market.

A flurry of spring buyers is helping boost sales. At the same time, millions of foreclosures are in limbo, awaiting the results of a government investigation into improper practices by mortgage lenders. Once that probe is complete, banks will resume seizing homes and prices will likely fall again.

The Standard & Poor’s/Case-Shiller home-price index released Tuesday showed that prices rose in May in 16 of the 20 cities tracked.

Boston, Minneapolis and Washington posted the biggest monthly increases. Prices in Detroit, Las Vegas and Tampa, Fla. - three cities hit hardest by the housing crisis - fell to their lowest points since the recession began.

Price declines have been getting smaller through the year. Seasonally adjusted prices have fallen a modest 1.2 percent over the past six months, according to the index. That’s roughly a third of the decline from the previous six months.

But analysts say the weakening job market and the uncertainty over foreclosures could lead to deeper price declines in the second half of the year. They estimate prices will fall another 5 to 10 percent by year’s end.

“The aggregate economy is at a turning point and there is much uncertainty now,” said Robert Shiller, a Yale professor and co-founder of the home-price index.

David M. Blitzer, chairman of S&P’s index committee, said the month-over-month increases in May were attributed to a “seasonal period of stronger demand for houses.” Such increases are expected, he said.

After adjusting for seasonal factors, such as spring buying, prices fell in 11 markets.

“Sustained increases in home prices over several months and better annual results need to be seen before we can confirm a real estate market recovery,” he said.

Over the last 12 months, prices have fallen in 19 of the 20 cities tracked.

Housing remains the weakest part of the economy. High unemployment, larger down payment requirements and tighter credit are preventing many buyers from entering the market. Many who can afford to buy are waiting because they are worried prices have yet to hit bottom.

Foreclosures and short sales - when a lender agrees to sell for less than what is owed on a mortgage - made up about 30 percent of all home sales last month, up from about 10 percent in past years. And 1.7 million potential foreclosures are being held up, according to real estate firm CoreLogic, either by backlogged courts or lenders awaiting state and federal probes into troubled foreclosure practices.

At least 10 percent of homeowners are 90 days or more past due on their mortgage payments in nine major U.S. cities, according to CoreLogic. The national average is 7.4 percent.

Most of those areas are well known trouble spots, including Atlanta, Las Vegas, Phoenix, Tampa, Fla., and Riverside, Calif. But others haven’t been as battered, including Chicago, Orlando, Fla., Long Island, N.Y., and Sacramento, Calif. That suggests the weakness in the housing industry is nationwide, economists say.

“We’re just really bouncing along the bottom right now,” said Chris Christopher, senior economist at IHS Global Insight. “Even with the positive news, there’s nothing very meaningful in these reports to show we’re coming back up. It’s just little blips here and there.”

There’s also less demand because the U.S. is seeing a decline in household formation. Fewer people are getting married. More young people are moving back in with their parents. Fewer immigrants are coming to the United States, partly because of the economy and also because of tougher enforcement of immigration laws. And the divorce rate has dropped, which is good for families but means there are fewer buyers.

Before the recession, between 2002 and 2007, roughly 1.3 million households were formed every year, according to U.S. Census data. That figure peaked in 2007 at more than 1.6 million. But since then it has fallen to just 357,000 last year, the lowest level in more than 60 years.

One bright spot in the S&P/Case-Shiller data: Even when adjusted for seasonal factors, month-over-month prices rose in some markets that had been pummeled by slumping sales. Those cities are Chicago, Denver, Miami, Minneapolis and Seattle.

The index measures prices compared with those in January 2000. It then provides a three-month average. The May data is the latest available.

FOX12

By DEREK KRAVITZ
AP Real Estate Writer

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SW Princess Ave

NE 31st Ct

NE Copper Beech

SW 186th Pl

Call me with any questions regarding home buying or selling! Licensed in the State of Oregon.

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Market Update

Housing activity continues to remain above year-ago levels despite some setbacks resulting from the now-expired tax credit. Improved stability in home prices with similar levels of distressed properties seen last year offers a hopeful sign the market is holding its ground. However, the economy still has a considerable way to go to achieve its full recovery. 

Consumers are saving more and being picky about how they spend their money. While a higher savings rate means less spending in the near term, this is a positive sign that households are taking control of their finances to build some cushion that can be used to pay down debt and/or support future spending.

Existing home sales marked the twelfth consecutive month of year-over-year increase in June. On a monthly basis, sales activity eased 5.1% from May. The moderation in home sales reflects “understandable swings as buyers responded to the tax credits,” according to Lawrence Yun, NAR chief economist. He anticipates such impact to show up in the next two months.

June’s median home price increased for the fourth consecutive month. Distressed homes, accounting for 32% of sales last month, continued holding home prices at highly affordable levels for the time being. While distressed sales hovered around the same level as a year ago, the gain in home prices is pointing to a sustained stability in the making.

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 In July, mortgage rates set a new record low as consumer confidence softened and unemployment remained elevated. This presents a great opportunity for buyers and investors. Coupled with lowered home prices and a robust rental market, investors are finding their way to cash-flow opportunities. As recovery gains deeper roots, rates will need to rise to keep inflation in check. 

Rates as of August 6.

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