When the bottom dropped out of the real estate market, the biggest indicator that the economy was in trouble was that home owners and new home buyers found themselves paying more for their home than what it was worth. One of the biggest indicators that the housing economy has been in recovery has been the increase in house pricing regionally nationwide. These home prices went up steadily during the end of 2013 and 2014, so much so, that investors were concerned that they would cause a housing bubble and throw the entire economy back into a Recession. Once again, though, supply and demand allowed for free market commerce to dictate the real estate market, and prices started to stabilize in the 1st quarter of 2015.
For the 5th month in a row, conventional mortgages for new homes have increased to an all-time high of $352,500 in June, and this is also a record for the average loan amount which has not yet so far been above $350,000 after the Recession. In addition to the average amount of a loan going up, home prices also increased in June to $462,100 from $447,600 which is a 3% increase. Also a record-breaking statistic, this is the first time that new home prices have been above $460,000 since the Recession as well.
Even though the average initial fees and charges on loans decreased by 3 basis points to 1.08%, the effetive interest rate on conventional mortgages went up to 3.98%. Home buyers and people interested in refinancing their homes have been “spoiled” with the phenomenally low interest rates over the past 5 years, but an average overall interest rate in the 4% range is still a historically low rate and will probably not be seen again for quite some time. The Fed was set to increase interest rates in September, but this is not a guaranteed move and has been in limbo for over a year. Interest rates are still low, credit is easing allowing higher borrowing amounts for conventional mortgages, and Ron Lee Homes is building new, custom homes in St. Tammany Parish for interested home buyers. Contact Us today to help you start building the home of your dreams. Call 985-626-7619 or e-mail Info@RonLeeHomes.com.