Home values are continuing to climb nationwide. According to the FHFA Home Price Index, property values grew nationwide in April, making it the 17th straight month of price growth. It was also the 38th out of the 39 past months to have produced positive growth value nationwide. Home values are up 5.3% in the past year.
Mortgage rates have remained so low lately for borrowing that it has changed consumers’ perceptions from renting to buy over rent. Demand for homes is currently outweighing supply, raising home value, and as a result, raising home prices. Buyer purchase power has been on the rise with Freddie Mac declaring the average 30-year mortgage rate at a steady 4%. Adding into that, there are low and no-down payment mortgages readily available for consumers. Right now, it is an excellent time to be a U.S. homebuyer.
The FHFA Home Index, which we mentioned, is a product of the Federal Home Finance Agency. The main purpose behind the index is to track home values in between subsequent sales. Data is supplied via Freddie Mac as part of the mortgage approval process. In April, we saw the highest reading of the Home Price Index since September of 2007, at a shocking 221.7. The April index shows a housing market expansion, with high demand, home prices growing at a more rapid pace than compared to mid-2014, and listing prices for home rising due to the shortage of homes currently. Competition for homes is remaining fierce.
According to the National Association of REALTORS, 45% of homes for sale are selling within a 30-day window. For buyer’s that results in a challenge to find a great inexpensively priced home. Thankfully to help offset that is today’s current low mortgage rates remaining cheap. FHA and VA loans are even lower than the 30-year we discussed earlier. Lower mortgage rates in turn give buyers extra purchasing power and expanded home affordability.
The FHFA’s Purchase-Only Home Price Index rose 5.3% from a year ago, and the index is at its highest point in more than 7 years. These gains do not currently apply to all areas equally however. This is because the index examines the housing market, and does little to capture the buyer-seller activity in any one state, city, or neighborhood. Instead, the Home Price Index groups its findings by region, on a monthly basis. Tennessee and Kentucky led the charge in the West North Central Region of the country expanding 1.4% from the previous month. Since last year though, the Pacific region has led all home values with a rise of 7.5%.
Home values are higher nationwide and U.S. mortgage interest rates are down. Today’s low rates help to keep U.S. homes affordable for first-time buyers, repeat buyers, and investors alike.
Low rates can’t last forever, though. So now may be your time to purchase. If you are interested on gaining more information, you can read other NSH Mortgage articles or contact us directly: Contact Us
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