Market News

I have noticed a gradual change in the market in the past several weeks. Our phone traffic has picked up but the rental requests far outweigh the buyer requests. All our rental properties are occupied and we are turning away renters on a daily basis. Lenders are requiring higher down payments from buyers and the fees on government backed loans have increased. In effect this has taken many prospective buyers out of the market and made renting a more viable option for them. Investors should take heed of this. A great opportunity exists today to purchase properties at great prices and rent them out making a tidy profit until the property values recover a few years out. Most investors don’t want the headaches of being a landlord but we not only can help acquire the properties but we will manage it for them as well.

What are Interest Rates Doing?

The average rate on the 30-year mortgage topped 5 percent this week for the first time since April. Freddie Mac said Thursday that the average rate rose to 5.05 percent from 4.81 percent last week. It hit a 40-year low of 4.17 percent in November. The average rate on the 15-year home loan, a popular refinance option, increased to 4.29 percent from 4.08 percent. It reached 3.57 percent in November, the lowest level on records starting in 1991. Rates are following the yields on the 10-year Treasury note, which are spiking on fears of higher inflation. Investors have been demanding higher Treasury yields since the Federal Reserve began its $600 billion bond-buying program to boost the economy. However rates are still extremely low by historical standards. Home prices remain depressed and even with a slight uptick in Interest Rates there are many values to be had. Rates are probably going to continue to rise so if you are thinking of purchasing you should get going!

We Are Moving in Right Direction

Our area seems to be recovering faster than other areas in the nation. Pending home sales in the South jumped 11.5 percent to an index of 101.9 and are 1.7 percent above December 2009. In the West however, the index fell 13.2 percent to 105.8 and is 10.7 percent below a year ago. (Pending Home Sales are homes that there are contracts on and are expected to close in the next couple of months.) Florida and especially Central Florida is going to be on the forefront of this recovery. A real concerted effort to create new jobs and restore old jobs is underway. We are moving to reeducate our work force with new skills that are going to enhance their technical knowledge and in turn create higher paying jobs. The one draw that remains constant is our climate and now we are going to combine that with opportunity. The fix is on!