CLick Here to visit our blog page
The Federal Open Market Committee released its April 2012 meeting minutes this week, revealing a Federal Reserve in the ready in the event additional monetary stimulus is needed.
The Fed Minutes function much like the minutes from a business meeting; or, condominium association meeting, for example. It's a detailed review of the conversations and debates between FOMC members, and is typically published 3 weeks after a Federal Reserve meeting.
The Fed Minutes is a follow-up statement on the FOMC's more well-known, post-meeting press release. It's also much more lengthy.
Whereas the April 25, 2012 press release totaled 444 words, the Fed Minutes spanned 6,618.
Those extra words are important, too, because the detail offered within the Fed Minutes lends insight into how our nation's central bank views the U.S. economy, its strengths and weaknesses, and its threats.
From the Fed Minutes, some of the Fed's comments includes :
There was also substantial talk about Europe and its role in the U.S. economy. Notably, U.S. financial institutions have been actively reducing their European exposure to contain damage in the event of a full-blown economic crisis abroad.
This has had the net effect of lowering mortgage rates in CA. Mortgage bonds often benefit from economic uncertainty.
In addition, because several Fed members acknowledged a willingness to add new stimulus to the U.S. economy, mortgage markets are accounting for the possibility it could happen. It's unclear whether stimulus would be added after the Fed's next meeting, or at some point later in the year, or at all.
The FOMC has its next scheduled meeting June 19-20, 2012.
The economic recovery continues nationwide, however, the recovery's an uneven one. Some metropolitan areas are faring very well this year, posting measurable gains in both employment and housing. Other metropolitan areas, by contrast, are struggling.
To help identify those markets in which growth is occurring, the National Association of Homebuilders created the Improving Market Index, a metric analyzing three separate, independently-collected data series "indicative of improving economic health".
The IMI's three collected data series are :
A metropolitan area is considered to be "improving" if all three indicators show growth at least six months after the respective area's most recent trough, or "bottoming out".
In May, there are exactly 100 U.S. markets that qualify for the NAHB's Improving Market Index, down from 101 last month but higher by more than 800% from the reading in September 2011, the index's inaugural release.
17 areas were added to the Improving Market Index list this month including Phoenix, Arizona; Ann Arbor, Michigan; and Bend, Oregon. 18 areas were removed from the May IMI.
83 metropolitan areas remained from April.
There is little actionable information in the Improving Markets Index but the report does a good job of highlighting how "real estate markets" can't be summarized on a national level and remain relevant to everyday home buyers and sellers across CA and nationwide. For example, Fort Collins, Colorado is listed as an Improving Market. However, Greeley, Colorado -- located just 30 miles away -- was just downgraded from the same list.
Home values and economies vary by region, by state, by city, by neighborhood, and even by street.
The complete Improving Markets Index can be viewed at the NAHB website but for the best read of what's happening in your neighborhood, talk to a local real estate agent.
For the second straight week, the 30-year fixed rate mortgage fell to a new, all-time low nationwide. According to Freddie Mac's weekly mortgage rate survey, the average 30-year fixed rate mortgage rate dropped 1 basis point to 3.83% this week for borrowers willing to pay 0.7 discount points plus a full set of closing costs.
The 15-year fixed rate mortgage also set a mortgage rate record, registering 3.05% with an accompanying 0.7 discount plus closing costs.
Discount points are a one-time, up-front closing cost, based on loan size. 0.7 discount points is equal to 0.7% of the borrowed amount. A home buyer in La Quinta opening a $200,000 mortgage and paying 0.7 discount points, therefore, would be subject to a one-time $1,400 fee paid at closing.
Borrowers wanting to avoid paying discount points can expect higher mortgage rates than Freddie Mac's reported national average.
Falling mortgage rates are nothing new throughout CA. Since peaking in February 2011, mortgage rates of all types have been in steady decline. The 30-year fixed rate mortgage has shed 122 basis points since that date, falling from 5.05%; the 15-year fixed rate mortgage has shed 124 basis points, falling from 4.29%.
Low mortgage rates give today's home buyers additional purchasing power, stretching home affordability to new heights.
Low rates also help existing homeowners to lower monthly mortgage payments. For example, as compared to mortgage rates just 15 months ago, homeowners refinancing into today's 30-year fixed rate mortgage stand to save 13.4 percent on their respective mortgage payments.
A comparison :
A homeowner with a $300,000 mortgage at February 2011 30-year fixed rate mortgage rates would save $2,600 annually with a refinance to this week's low rates. Even accounting for discount points and closing costs, the "break-even point" on savings like that comes relatively quickly.
Mortgage rates can't be predicted so there's no guarantee of low rates forever. If today's rates meet your budget, consider locking something in. Speak with your loan officer about your options.
If you would like to see any of the Foreclosures in the Palm Springs area listed below which are Bank Foreclosures in Palm Springs , please call us at the numbers below. Were committed to helping you find the home of your dreams. Elaine Stewart has been in the Real Estate Business for over 20 years and has extensive experience with Bank Foreclosures in Palm Springs, and surrounding cities in the Palm Springs Real Estate market. Elaine truly enjoys helping people in the process of buying or selling a home. Elaine Stewart - Remax Real Estate Consultants Mobile: (760) 668-2399 - Office: (760) 391-4415 Email: desertrealestate1@yahoo.com
If you would like to see any of the Foreclosures in La Quinta listed below which are Bank Foreclosures in La Quinta , please call us at the numbers below. Were committed to helping you find the home of your dreams. Elaine Stewart has been in the Real Estate Business for over 20 years and has extensive experience with Bank Foreclosures in La Quinta. Elaine truly enjoys helping people in the process of buying or selling a home. Elaine Stewart - Remax Real Estate Consultants Mobile: (760) 668-2399 - Office: (760) 391-4415 Email: desertrealestate1@yahoo.com