Mortgage Interest Rates rise slightly

Interest rates for buying a home on the Palos Verdes Peninsula remained level this week . The following are excerpts from the newsletter on interest rates published by HSH Associates :
“Largely backing and filling for almost all of the fall so far, 30-year fixed mortgage rates turned this week again to filling, with a small rise all but taking back two small declines over the past two weeks. While shorter-term mortgages such as 15-year FRMs or 5/1 ARMs have seen their rates leg higher during that period (to eight-month and more than six-year highs, respectively) 30-year FRMs have largely tread water, wobbling in a very narrow range, and haven’t topped the 4 percent mark since a one-week flare back in July.
With the economy solid, the Fed reducing its balance sheet and poised to raise short-term rates another notch this coming week, it may not be long before the most popular U.S. mortgage more routinely features average rates with a “four handle”. To be sure, it wouldn’t take much of a bump from here to break over that threshold.

The year is rapidly coming to a close and there is a chance we won’t crack the 4 percent mark for mortgages before it ends. That said, we’re pretty close right now, just a handful of basis points below that level. The influential interest rates which underlie mortgages have been generally steady to firmer in the last couple of days, and with the Fed on tap for a move mid-week, we are likely to nudge a little closer to the “psychologically important” 4 percent breakpoint. With the rate hike already “baked in”, any additional upward bump will have to come as a result of a measurable or notable change in policy outlooks, released as part of the “dot plots” that will accompany the close meeting. With six months of 3 percent plus growth in GDP, we think there is a chance that a member or two might have lifted their expectations for the coming year.
Of course, Freddie Mac’s weekly survey will have largely been completed by late-day Wednesday, so any additional kicker for rates would not show until another week has passed. For now, we think that we’ll see a two or three basis point increase in the average offered conforming 30-year FRM rate when Freddie reports next Thursday.”

The following are interest rate quotes from John Alvin of American California Financial:
30 Yr Fixed FHA
Rate APR
3.375 4.506

Conforming 30 Yr Fixed up to $424,100
Rate APR
3.875 3.994

Conforming Jumbo 30 Yr Fixed $424,101 – $636,150
Rate APR
4.125 4.235

Jumbo 30 Yr. to $1.5 Mil
Rate APR
4.125 4.219

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.625 3.688

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Mortgage rates remain steady

Interest rates for buying a home on the Palos Verdes Peninsula remained level this week . The following are excerpts from the newsletter on interest rates published by HSH Associates :

“In the aftermath of a very noisy week for financial markets came a rather quieter period, at least in terms of fresh data and changes atop the Federal Reserve are concerned. At the moment, its potential changes to the U.S. tax code that are garnering the most attention. As seems to regularly be the case in politics these days, there’s not much by way of consensus, and so the coming days and weeks are sure to see some battles in Congress. There is a hoped-for goal to get a deal in place by the end of the year, but with many differences to reconcile that may not come to pass.

The prospects of economy-boosting stimulus being delayed being somewhat lessened by the competing proposal from the House and Senate helped interest rates to settle back a little bit in recent days. Without markets being able to develop a sense not only of what is coming but when it may come, it’s reasonable to think that we’re in for a bit longer period of moderate growth rather than a imminent speed up, so interest rates had a little space to settle as a result.

Depending on what comes, we may see effects on mortgage rates, home prices, the mortgage interest deduction and more, but there’s little to say about any of these until the dust settles.

While we still are likely to see somewhat higher mortgage rates at some point, the trend remains mostly a muted one. The Fed’s gradual reduction of its bond holdings is underway with little fanfare or effect on rate (so far), but another lift in short-term rates is likely just a few weeks away and we will probably see a little firmness as we turn the corner into December. However, absent any significant inflation concern, it will remain hard for rates to get much upward traction, dragged down as they are by a world that is still employing QE-style policies. In this situation, comparatively high U.S. bond yields remain an attractive opportunity for foreign investors faced with rock-bottom local yields, and every time rates here edge higher, it’s to be expected that fresh money comes after them, which in turn pushes them back down to a degree. Ultimately, when more bonds become available as the Fed steps away from the market more quickly higher yields may become more sticky, but for the moment, this is simply not the case.

A fairly quiet week last week for interest rates, but things will pick up a bit data-wise this week. Mortgage rates really have little upward traction and any that does seem to form (as we saw in September and into October) just doesn’t seem to have staying power. Backing and filling seems to be the order of the day, but our expectation is that we’ll generally notch our way higher as we go. In reviewing the trend for last week there’s not much to see, so odds favor perhaps an increase of a couple of basis points in the average conforming 30-year fixed rate reported by Freddie come this Thursday”

The following are interest rate quotes from John Alvin of American California Financial:

30 Yr Fixed FHA
Rate APR
3.375 4.506 Details

Conforming 30 Yr Fixed up to $424,100
Rate APR
3.875 3.994 Details

Conforming Jumbo 30 Yr Fixed $424,101 – $636,150
RateAPR
4.125 4.235 Details

Jumbo 30 Yr. to $1.5 Mil
Rate APR
4.125 4.219Details

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.750 3.747 Details

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For more information about Palos Verdes and South Bay Real Estate and buying and selling a home on the Palos Verdes Peninsula, visit my website at http://www.maureenmegowan.com . I try to make this the best real estate web blog in the South Bay Los Angeles and the Palos Verdes Peninsula. I would love to hear your comments or suggestions.

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Interest rates go down slightly to near 2017 lows

Interest rates for buying a home on the Palos Verdes Peninsula eased this week . The following are excerpts from the newsletter on interest rates published by HSH Associates

“Partly due to increasingly bellicose saber-rattling between the U.S. and North Korea, but also more than partly due to inflation that simply can’t find a reliable toe hold, mortgage and other interest rates found new reasons to decline this week. With this as the backdrop, it seems likely that we’ll set new 2017 lows for mortgage rates in the days ahead, possibly beating previous lows by a few basis points. This is remarkable, given that the Fed has raised the federal funds rate three times in the last eight months.

To be fair, the fed funds rate and mortgage rates don’t have a whole lot to do with one another, but a central bank tightening policy is usually done to try to attenuate above-trend growth or inflation. In this instance, neither has been the case, so it has been just a not-so-routine removal of excess accommodation, a process of removing emergency-level supports that the economy simply doesn’t need, with these moves having very little overall effect on economic or labor market growth to date.

Odds favor that we will see a different kind of excess accommodation removal beginning in a few weeks with what is expected to be the onset of the Fed starting the protracted process of trimming its balance sheet. Analysts have come to expect that this will come at the expense of another lift in the federal funds rate, and odds of a lift in the fed funds rate in September are currently reckoned at about zero. The process of the Fed recycling fewer funds into mortgages and Treasuries will slowly increase in impact over time, but there currently are few expectations that this will disturb financial markets (or raise rates) very much, at least at the onset.

 

That said, the Fed has been expected to kick the next rate hike down the road to December’s meeting, but there have been no demonstrably durable acceleration in economic growth yet, and already-limited inflation pressures have faded over the last few months. Couple this with expectations for near-term fiscal policy changes to goose growth all but absent from the market, odds makers in the futures markets put the chance of a December move by the Fed at only about one-in-three.

With plenty of political trouble, only moderate domestic (and global) growth to be seen and no imminent inflation threat, interest rates simply have little reason to rise.

Mortgage rates seem poised to slip again next week, but probably not by very much. That said, as this week’s average conforming 30-year FRM as reported by Freddie Mac was only two basis points above 2017 lows, it’s likely that we’ll see “new lows for mortgage rates!” headlines when Freddie reports again next Thursday. We think a 2-4 basis point decline is what we’re likely to see in that benchmark, little more than statistical noise but enough to generate a little mid-summer excitement.”

 

 

The following are interest rate quotes from John Alvin of American California Financial:

30 Yr Fixed FHA
Rate APR
3.250 4.379 Details

 

Conforming 30 Yr Fixed up to $424,100
Rate APR
3.750 3.869 Details

 

Conforming Jumbo 30 Yr Fixed $424,101 – $636,150
Rate APR
4.000 4.109 Details

 

Jumbo 30 Yr. to $1.5 Mil
Rate APR
3.875 3.968 Details

 

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.375 3.570 Details

For additional information, go to my website http:www//www.maureenmegowan.com 

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Interest rates ease

Interest rates for buying a home on the Palos Verdes Peninsula eased this week . The following are excerpts from the newsletter on interest rates published by HSH Associates :

“Late last year and earlier in this one, it was pretty easy to find concerns being expressed that higher mortgage rates and rising prices would make it a tough spring for potential homebuyers. As it has turned out, rates have been fairly steady for a while, and even sported a dip this week that pushed them to about six month lows. Prices of course have continued to rise, crimping affordability, but for the most part, over housing market conditions are about as good as they get.

Except there’s little for wanna-be buyers to buy, and what inventory does become available is disappearing from the market at the fastest pace since 2011, and probably at prices above asking levels. As such, there remains plenty of demand for housing, but no supply to satisfy it, so sales of homes just can’t grow.

Once finalized, and if the economy continues to manage apace, nearly all policymakers indicated that it likely would be appropriate to begin reducing the Federal Reserve’s securities holdings this year. We think that this plan could start in December, and should not have much immediate effect on mortgage rates for the foreseeable future.

A holiday-shortened week for financial markets beckons next week, with Memorial Day the unofficial start of summer here in the U.S. Despite the Monday holiday, the latter part of the week turns the month, bringing with it a slew of fresh data. Mortgage rates were fairly stable for much of this week and that is how we’ll begin next week, when we expect that Freddie Mac will report virtually no change in 30-year fixed mortgage rates come next Thursday. After that, Thursday and Friday’s cascade of data may serve to start a new push upward. We’ll see..”

The following are interest rate quotes from John Alvin of American California Financial:

30 Yr Fixed FHA
Rate APR
3.250 4.379 Details

Conforming 30 Yr Fixed up to $424,100
Rate APR
3.875 3.994 Details

Conforming Jumbo 30 Yr Fixed $424,101 – $636,150
Rate APR
4.125 4.235 Details

Jumbo 30 Yr. to $1.5 Mil
Rate APR
4.0004.094 Details

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.500 3.762 Details

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New Listing of Luxury Home in Rolling Hills Estates

3717 Palos Verdes Dr. N, Rolling Hills Estates
$2,350,000
 
Welcome to this warm and inviting estate home, in the desirable community of Rolling Hills Estates! This beautiful home has a dramatic entrance with cobble stoned circular driveway surrounded by lush landscaping. This quality appointed home, extensively remodeled in 2002, is situated on a 23,157 sq. ft. lot featuring approximately 3,501 sq. ft of spacious living space with four bedrooms and four and half baths. Extensively remodeled with meticulous craftsmanship, this special home offers a wonderful mix of comfort and luxury.
The formal entry opens to the living and dining areas featuring custom wood moldings, recessed lighting and distressed hardwood flooring. The open and spacious kitchen and family rooms boast granite counters, stainless steel appliances (all new 2016), custom maple cabinets, heated travertine flooring and a beautiful stone fireplace that is enjoyed from both areas.
The French doors with disappearing screens lead to a huge deck with heated pool, spa, stone waterfall, barbeque and outdoor kitchen, sound system, flat screen TV, gazebo and cozy fire pit. It is truly an extension of the home from all areas. The Master Suite is a luxurious and relaxing retreat featuring its own balcony overlooking the pool, pastoral, downtown LA, city light and snow capped mountain views.
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4Poolviewfromabovesmaller.jpg
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Click this link for a virtual tour of the property
Click this link for an interactive floor plan with pictures
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Interest rates steady

Interest rates for buying a home on the Palos Verdes Peninsula remained steady this week . The following are excerpts from the newsletter on interest rates published by HSH Associates :

“Mortgage rates continue to meander about, largely rangebound, as financial markets try to figure out where we go from here in terms of both fiscal and monetary policy. On the one side are hoped-for or expected changes in tax and regulatory structure that may help boost business profits and the promise of new fiscal outlays that may further goose growth; On the other side is the Federal Reserve, who is looking out over the landscape and is beginning to judge that their policies of keeping interest rates at rock-bottom levels for years is finally having the desired effect on employment and inflation.

In this view, the central bank sees an economy that may need less, not more, stimulus in order to continue a long-running modest expansion.

The Fed has already overtly stated that it believes that it will be raising the federal funds rate perhaps three times this year. Fed Chair Janet Yellen spoke before Congress this week in her semi-annual testimony on monetary policy, and she gave no indication that her view has changed in this regard. In fact, one of her statements was said to make the March meeting “live” for a policy move, as she noted “Waiting too long to remove accommodation would be unwise.” Although futures markets did put an increased probability of a move by the Fed at the March 14-15 meeting, that likelihood had retreated to about an 18 percent chance by Friday.

Frankly, we think the markets are underestimating this risk, as the economic data continue to be pretty solid. There has been scant evidence to suggest that the Fed’s move in December 2015 had much by way of effect on last year’s growth; it’s too soon yet to say if the December 2016 rate increase will have an effect, but so far, no discernable negative impact is evident. Make the move in March, and the Fed could probably sit and wait until September before considering another. Skip March, and they run the risk of having to cram three hikes into the remaining 9 months of the year. Data due out in the next three weeks will be key, and whether March or beyond, rates will be again increasing before all that much more time has passed.

Taken all together, there doesn’t seem to by much by way of economic weakness to worry about of late. Global growth and turmoil, so important to driving U.S. rates lower in the last few years, seems to be stabilizing, if not improving outright. There are some sore spots we may yet see (Greece debt payments, Italian bank issues, Brexit and more) but markets seem to be taking concerns those in stride, too. Throw in solid consumer spending and any number of whiffs of rising prices, it seems to us that the conditions for higher interest rates are forming, if not already in place.

Perhaps it is simply a case where nominal interest rates moved first (and perhaps too far) in anticipation of data to come, only now the data is beginning to fill in behind them. If that’s the case, then we may not see much by way of upward movement for a period of weeks, but if the data continues to suggest upward momentum for growth and prices, that space will fill fairly rapidly, and we’ll soon be ready for the next move higher.

At the moment, it doesn’t appear that this will start next week. Although underlying interest rates did move up mid-week this week, there was a backpedaling seen on Thursday and Friday, leaving us just a little below where they began the week. With this as a backdrop, we think that the average 30-year fixed-rate mortgage as tracked by Freddie Mac will hold about steady again next week, but it wouldn’t be a surprise to see a basis point or two decline… or increase.

One last note of interest: The Mortgage Bankers Association reported that the share of mortgage applications for refinancing hit their lowest level since June 2009. At that time, the average 30-year FRM was at 5.92 percent, so there is truly nothing left in the potential refi pool when rates just over 4 percent can’t get a rise out of homeowners.”

The following are interest rate quotes from American California Financial:

30 Yr Fixed FHA
Rate APR
3.375 4.506 Details

Conforming 30 Yr Fixed up to $417000
Rate APR
4.000 4.120 Details

Conforming Jumbo 30 Yr Fixed $417001 – $625500
Rate APR
4.250 4.361 Details

Jumbo 30 Yr. to $1.5 Mil
Rate APR
4.250 4.345 Details

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.625 3.688 Details

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Interest rates move up

Interest rates for buying a home on the Palos Verdes Peninsula moved up this week . The following are excerpts from the newsletter on interest rates published by HSH Associates :
“The uptrend in mortgage rates carried into this week, but certainly with less velocity than we’ve seen since the election was decided two weeks ago. Where rates will go from here depends on a host of factors, not the least of which is incoming economic data and how this will affect any policy decisions by the Federal Reserve.
Minutes from the November 2 central bank get-together were released this week. The discussions and details firmed up the suspicion that a rate hike is coming shortly, as the minutes noted that “Most participants expressed a view that it could well become appropriate to raise the target range for the federal funds rate relatively soon…” and went on to say that “Some participants noted that recent Committee communications were consistent with an increase in the target range for the federal funds rate in the near term and or argued that… such an increase should occur at the next meeting. A few participants advocated an increase at this meeting…”. With this as a backdrop, the collective opinions of “most”, “some” and “a few” all point to a change in policy come December. There was no mention of any concern about any effects of the then-imminent presidential election, so it isn’t clear if they might view the unexpected outcome as disruptive to their policy plans or not.
The recent rise in mortgage rates shouldn’t do much damage to the housing market. Rates are only about at levels we began 2016 at, and not much of a deterrent to the desire to buy a home. That said, it will likely be a few months before we see if there are effects, but at least as far as available data goes, the market is doing fairly well.

Markets are closed for the Thanksgiving holiday on Thursday, and Friday is certain to be a thin day in financial markets, even as the retailer’s Black Friday bonanza (and the poorly-named “cyber mondayy”) give us a sense of how the consumer is feeling about spending money. After that, the usual first week of the month slew of data is due out. As other interest rates edge higher still, mortgage rates are also firming a little bit, but the selloff looks a little tired at this point. We’ll likely see another 5 basis point or so rise in Freddie’s conforming 30-year fixed rate mortgage by the time next week comes to a close.”

The following are interest rate quotes from American California Financial:
30 Yr Fixed FHA
Rate APR
3.500 4.633 Details

Conforming 30 Yr Fixed up to $417000
Rate APR
4.000 4.120 Details

Conforming Jumbo 30 Yr Fixed $417001 – $625500
Rate APR
4.250 4.361 Details

Jumbo 30 Yr. to $1.5 Mil
Rate APR
4.375 4.471Details

Jumbo 7/1 ARM $1.5 Mil (higher loan amt available)
Rate APR
3.375 3.570 Details

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