It’s all good news! Homeowners who endured years of declining home values will discover that the game has changed in their favor.
With low mortgage rates and home prices gaining momentum, an increasing number of buyers are out and buying this spring. The good news for sellers: The inventory of homes for sale is shrinking, so they have less competition and more control of the situation.
FACT: Recent month-over-month homes sales in the Triangle increased 3.85%
As more distressed homeowners regain equity in the coming months, many with high-interest loans will be able to refinance and perhaps cash out some equity. If you fell behind on your mortgage payments, you might get a second chance to modify your loan.
Homebuyers are losing bargaining power as the market shifts in favor of sellers. But home prices remain attractive for the most part, and low mortgage rates should stay on their side for a little longer.
Here are five selling trends you should expect to see this spring.
· Demand -- from homebuyers is growing faster than the supply of homes for sale, according to data from the National Association of Realtors.
· Competition -- Buyers are encountering bidding wars in the Triangle – I have negotiated several in the past month alone!
· Homeowners who are behind on their mortgages may get a hassle-free opportunity to reduce their monthly payments. The Federal Housing Finance Agency will require mortgage servicers to offer a streamlined modification program to borrowers with loans owned or guaranteed by Fannie Mae and Freddie Mac, starting in July. The offers will be sent to homeowners who are at least 90 days behind on their loans but no more than two years behind. To qualify, borrowers must owe at least 80% of the home's value.
For more information on these loans: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/nsc/faqlm
· Nationwide, about 1.7 million homeowners regained equity in their homes last year, and an additional 1.8 million are close to it, according to a recent study by CoreLogic. All they need is home values to go up by another 5%.
· Home as ATM: Lenders remain somewhat reluctant because these types of loans contributed to the mortgage meltdown as homeowners turned their homes into ATMs. But borrowers who have good credit scores and sufficient equity should be able to find lenders willing to do cash-out refis and home equity loans this spring.
· Mortgage rates are expected to creep up this spring but should remain low. This will continue to bring more buyers out.
· Up just a little: The Mortgage Bankers Association estimates the 30-year fixed rate will reach 3.9% by the end of the first quarter this year.
· Sellers are more willing to venture into this territory in order to corral their finances and move forward with their lives.
· Shadow inventory: I’m sure you’ve heard this term – the ominous, looming & dooming glut of distressed homes that were going to flood the market and ruin it for everyone.
***NEVER HAPPENED – NOT GOING TO HAPPEN***
· These types of homes currently on the market are priced accurately – there is no acceptance of bids thousands less than asking.
I have an excellent team of lenders and attorneys who are expert in short sales and foreclosures. My clients have been surprised at the wonderful help & support they received. If you would like to explore any of these options, give me a call.
e-PRO, Strategic Pricing Specialist
Fathom Realty NC, LLC