U.S. Treasury Bond yields lower this week – The 10-year U.S. Treasury Bond closed the week yielding 2.41%, down from 2.49% last Friday. The 30-year Treasury Bond yield closed the week at 3.01%, down from 3.11% last week. Mortgage rates follow bond yields, so we watch treasury bonds closely.
Mortgage rates hold steady – The Freddie Mac Primary Mortgage Survey released on February 9, 2017 revealed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 4.17%. The 15-year fixed average rate was 3.39%. The 5/1 ARM average rate was 3.21%.
Home sales and prices spike in the fourth quarter of 2016 – The number of homes sold in the fourth quarter of 2016 was 7.1%higher than the fourth quarter of 2015, according to The National Association of Realtors. It was the highest quarterly sales pace of the year and pushed available housing supply to record lows in the final quarter of 2016. Home prices increased at a quicker pace in the final quarter of 2016, up 5.7% from the same quarter one year earlier, which was attributed to more competition for fewer homes. The number of homes for sale nationally in the fourth quarter was down 6.3% from the number of homes for sale in the same quarter of 2015. It marked the fewest number of homes for sale since NAR began tracking available listings. Nationally, there was a 3.9 month supply of homes for sale in the fourth quarter of 2016, down from a 4.6 month supply in the same quarter a year ago. California had a 2.6 month supply in December, according to The California Association of Realtors.
California fourth quarter housing affordability unchanged from 3rd quarter – The California Association of Realtors reported that 31% of California households could afford to purchase a median price home in the fourth quarter, unchanged from the third quarter and up from 30% in the fourth quarter of 2015. A minimum income of 100,800 was needed to purchase median priced home of $511,360 according to CAR. 40% of households were able to purchase a condominium or town home, which had a median price of $413,700 and needed an annual income of $81,550. They attributed the slight year over year increase in affordability to increases incomes.