Month: January 2018

Mortgage Applications

Despite mortgage interest rates being the highest in ten months, homebuyers led the 4.5 percent increase in mortgage application activity in the week of January 19^th. Purchase applications for home mortgages rose on a seasonally adjusted basis by 6.0 percent from the week prior. This increase left the year on year gain in the unadjusted Purchase Index unchanged from the previous week’s 7 percent. Applications for refinancing, which is usually more sensitive to interest rates, rose one percent from the previous week. The refinancing share of mortgage activity was down 0.8 percentage points to 49.4 percent.

FHFA House Price Index

Home prices rose a solid 0.4 percent in November with the year on year at 6.5 percent for the FHFA’s house price index. October’s monthly rate is revised 1 tenth higher to 0.6 percent with the yearly rate revised two tenths higher to 6.8 percent. This index has held near the 7 percent rate through much of last year.

Existing Home Sales

Lack of supply continues to be an issue in the housing market as it pulled down existing home sales in December and may possibly pull down sales in January as well. Existing homes sales fell 3.6 percent in December to an annualized rate of 5.570 million which is at the low end of what economists predicted after seeing a solid 5.6 percent jump in sales to a 5.810 million annualized rate. November did however get revised by a small amount to a 5.780 million rate, it remains still the best month of the expansion. Supply in December’s market fell a very steep 11.4 percent in the month to only 1.480 million homes. On a sales basis, supply fell from 3.5 months in November to 3.2 months which is a 19-year record low. Prices softened slightly, the median slipped 0.2 percent in the month to $246,800 for a year on year increase of 5.8 percent. This year on year price rate is well above the 1.1 percent gain in overall sales pointing to perhaps future price concessions and even less supply. On a yearly basis supply is down a sizable 10.3 percent. Sales for condos show weakness as they were down 11.6 percent on the months to a 610,000 annualized rate. Single family sales fell a monthly 2.6 percent to 4.960 million. The lack of supply will be a serious obstacle moving forward and is very likely to effect existing home sales.

New Home Sales

Despite the headline 9.3 percent decline in new homes sales for December, the report is actually a solid new home sales report. December’s 625,000 annualized rate is the fourth best of the expansion following November’s revised 689,000 rate which is the best. Most importantly supply has finally moved into the market, up 3.9 percent at 295,000 units. On a sales basis, supply improved to 5.7 months from November’s 4.9 months. Prices were steady in the month, the median edged up 0.1 percent to $335,400 for a modest year on year improvement of only 2.6 percent. Given the sales supply is up 15.2 percent and sales rate up 14.1 percent prices may have room to grow. This report shows upward sales momentum, incoming supply and room for prices to move higher. Residential investment has been dragging GDP down in recent quarters, this report points to this sector finally adding a solid contribution in the GDP report.

 

Ocean views and a rooftop deck, this beautiful condo is clean, clean, clean and perfect for the coastal lifestyle. The 3 bedrooms, 3 1/2baths, 1534 square feet is just blocks to the beach. Completed in late 2016, this is a small complex of just four homes. The spacious master suite with sweeping ocean views is on the upper floor with the roof deck plus one guest bedroom and a full bath. Bright and cheery, the main floor has open plan living, kitchen and dining with plenty of windows for natural light plus one bedroom, laundry and full bath. Take full advantage of outdoor living from the neighborly front porch, the kitchen deck ready for your grill, the sweet fenced back yard and patio plus the oh-so-private rooftop deck. Flooring is stylish and easy care, colors are coastal chic. Ground floor is a mudroom for flip flops with the 2-car garage roomy enough for toys and beach cruisers plus drive space parking for friends.
Nancy Heins 805.458.3583 Lic#01757840

Orcutt! This four bedroom, three bath with over 2300 sq ft of living, home offers the downstairs bedroom and bath room everyone asks for! The front living room ceiling soars 20 feet high with huge picture windows allowing sunlight to naturally lighten the home. Enjoy a formal dining/den area off the kitchen that could be suitable for an office, extra den or ? The kitchen is open to the huge family room complete with stone fireplace and wet bar. French doors lead to the private, east facing back yard. Upstairs there are three more bedrooms, one bath and a master suite large enough for an army. With a walk in closet the size of a normal bedroom, and a remodeled bathroom complete with glass block, gorgeous tile, separate tub and shower as well as dual sinks… All this with a three car garage, too! Close to Joe Nightingale elementary school, Waller Park, shopping and the Santa Maria Country Club.
Wendy Teixeira 805.310.3505 Lic#01345995

List the things that make a home most desirable, and you will find a great many of them in this one lovely property. Located in the gated San Luis Obispo Country Club on a quiet cul-de-sac, it is beautifully upgraded, meticulously maintained, with formal living room plus family room, kitchen with breakfast bar, formal dining room, three bedrooms and office – all in one beautiful home. It is comfortable, peaceful, gracious and not to be missed!
Beverly James 805.748.8613 Lic# 01856768

Above is the 30 year fixed Freddie Mac conventional program’s APR historic average data for the past 30 years dating back to 1987. In the late 1980’s, when the graph begins its recording, rates were at a 30 year high with all APR’s above the 10.00% mark, which is more than double where rates have been at in most recent years. In the early 1990’s rates began dropping for a four year on year decline from years 1989 to 1992. For the most part, APR averages on a yearly basis have been steadily declining in the past 30 years since 1987, with some years being an exception to this trend, but when looked at from a distance it appears rates are moving downward on a yearly averaged basis. 2017 was an exception to this trend as rates increased by more than 30 basis points: from the 30 year low of 3.65% APR in 2016. Since 2010 it appears that rates have been fluctuating at only a minimal pace.

This 2 bedroom, 2 1/2 bath is located at the end of a cup-de-sac and backs up to open space and gorgeous Edna Valley hill side views. Just built in 2011, this large, open floor plan boasts many custom upgrades such as motorized window coverings, designer alder cabinets in kitchen, laundry, bath and study, tankless water heater, solid core doors, and even has air condition for those rare occasions in San Luis Obispo where it is needed. See the photos which feature amazing sunrise views, the cozy family room fireplace and even 2 additional parking spaces in front of the 2 1/2 car, oversized garage. With HOA fees at only $160/month, this low maintenance, luxury living opportunity is truly a rare opportunity. Wes Burk 805.801.7061

The jobless claims report is one of the three reports that came out this week that reflect the continued strength seen in the employment sector of the economy. Jobless claims remained low though they did see some increases to initial claims and the four-week average, as well as the four-week average for continuing claims. Despite these small increases claims are little changed from a month ago – a positive sign for the employment report. The ADP Employment report is computed from a subset of ADP records and is usually a prediction of the employment situation report. The ADP consensus for December was a call of steady strength at 188,000. The employment situation, the last of this week’s employment related reports, is a set of labor market indicators based on two separate surveys in one report. In the report, hiring has cooled, though employment levels remain high. Nonfarm payrolls rose 148,000, though favorable, they came in lower than expected. Revisions are mixed with November up sharply to 252,000 and October sharply down to 211,000 for a 9,000 decline. The number of unemployed actively seeking work rose slightly to 5.308 million though the unemployment rate remained at 17-year low of 4.1 percent. Both labor participation rate and pool of available workers remain little changed. Average hourly earnings rose a noticeable 0.3 percent on the month as November got a one tenth downgrade to only 0.1 percent gain. On a yearly basis this reading is moving in the right direction but at a very slow pace, up only one tenth to 2.5 percent. The payroll breakdown confirms that the housing and factor sector had accelerated into the year end, as manufacturing was up 25,000 while construction increased 30,000.