2016 was a great year for the housing market, nationwide; home prices and sales increased while rates dropped to new historic lows. According to The Mortgage Reports, “In September 2016, the Home Price Index climbed to 239.2, a 0.5 percent increase from the month prior and a 5.7% increase from the year-ago levels.” Because of this, most believe most major housing markets have rebounded from the last economic downturn.
The Mortgage Reports also noted that while the market is moving upward, “Home price growth has varied by region:
- Pacific : +8.1% (Hawaii, Alaska, Washington, Oregon, California)
- Mountain : +7.5% (Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona)
- Middle Atlantic : +3.4% (New York, New Jersey, Pennsylvania)
- East North Central : +5.1% (Michigan, Wisconsin, Illinois, Indiana, Ohio)
- South Atlantic : +7.3% (Delaware, Maryland, District of Columbia, Virginia, West Virginia, North Carolina, South Carolina, Georgia, Florida)” *Sourced from TheMortgageReports.com
Even with events like Brexit, a nontraditional election, and historically low rates, we cap the year off with Conventional and FHA loan limit increases from Fannie and Freddie, and gain insight in to just how good the market is still progressing.
For 2017, there are multiple factors that have the potential to contribute to a more normal market: including inventory limit and price increases as the frontrunners. According to an article from Inman, “just looking at the pricing data in terms of interest rates, the spike in interest rates should definitely slow things down.” Inman also suggested that, “Because most housing inventory comes from the existing market (as opposed to new construction), what potential sellers decide do in 2017 will have an impact on the market as a whole — and rising mortgage rates might not be great for sales.”
Regardless of next year’s price increases, inventory challenges or rate hikes, today’s rates are still historically low, and it may be a great time for you to buy. Visit www.OnQFinancial.com to find out which mortgage loan may be right for you.
Kerry Gaby, Branch Manager/Mortgage Consultant
On Q Financial, Inc.