Smart. Sharp. Funny. Fearless.

Monday, December 09, 2019 {{ new Date().getDay() }}

Mortgage Rates Level Off At 4 Percent Amid Positive Housing News

By E. Scott Reckard, Los Angeles Times (TNS)

Mortgage lenders were offering conventional 30-year loans at an average rate of 4 percent this week compared to 4.04 percent a week ago, Freddie Mac’s weekly survey showed.

The survey, released each Thursday, found that fixed rates for 15-year loans also eased slightly, from 3.25 percent to 3.23 percent. There was little change in the start rates for adjustable home loans.

News from the housing markets has been generally positive, Freddie Mac’s deputy chief economist, Len Kiefer, said in announcing the survey results.

Although housing starts dropped 11.1 percent in May, housing permits have surged 11.8 percent to the highest level in nearly eight years, and a separate industry index has been rising since June, “suggesting home builders are very optimistic about home sales in the near future,” Kiefer said.

Freddie Mac’s survey, which dates to 1971, provides a consistent gauge of mortgage trends, but actual rates adjust constantly and are influenced by many factors.

The big mortgage finance company asks lenders each Monday through Wednesday about the terms they are offering to solid borrowers seeking mortgages of up to $417,000. The loans must conform to guidelines set by Freddie Mac and by Fannie Mae, the nation’s other major buyer and guarantor of home loans.

The borrowers would have paid an average of 0.7 percent of the loan balance in upfront lender fees and discount points to obtain the 30-year fixed-rate loan in the latest survey. Payments for such services as appraisals and title insurance are not included.

Photo: Some good news for the housing markets, like this beautiful Laurens, South Carolina, home. via Flickr

Baby Boomers, Flush With Stock Gains, Drive Record Vacation Home Sales

By E. Scott Reckard, Los Angeles Times (TNS)

Bolstered by stock-market gains, affluent Americans bought more than 1.1 million vacation homes last year, according to an annual trade group survey — up 57 percent from 2013 and the most since the survey began in 2003.

The strong sales of second homes contrasted with a weaker year for purchases of principal residences, and also a decline in sales to investors.

Vacation home sales represented a record-high 21 percent of all home purchases in 2014, the National Association of Realtors said Wednesday.

California witnessed a contrasting trend, with the percentage of vacation home sales falling to just five percent in 2014 from six percent in 2013, according to a tally by the California Association of Realtors, which said sky-high housing prices impeded the sales.

Lotus Lou, a spokeswoman for the state group, said the methodologies of the surveys were similar.

The national lobbying group’s survey of about 2,000 homebuyers calculated that 2014 purchases by investors fell about seven percent to just over one million, and purchases by owner-occupants declined 13 percent to 3.2 million.

Aging baby boomers boosted the sales, buying homes they plan to retire to, often with help from investments in stocks whose value has jumped in recent years, said Lawrence Yun, chief economist for the real estate association.

“The steady rise in home prices has likely given them reassurance that real estate remains an attractive long-term investment,” Yun said.

The Realtor group said the typical vacation-home buyer in 2014 had a median household income of $94,380, up from $85,600 in 2013.

The median vacation home price fell 11.1 percent to $150,000. Yun attributed the trend in part to higher sales of condos and townhomes versus single-family homes.

Buyers also increased their purchases of distressed properties, and of homes in the relatively affordable South, while vacation home sales fell throughout the more expensive West and Northeast, the survey showed.

Photo: one2c900d via Flickr

New iPhone Can Make Payments, But Most Folks Don’t Care, Survey Says

By E. Scott Reckard, Los Angeles Times

Shoppers can use Apple’s newest iPhone instead of their credit and debit cards to buy goods and services from retailers who install the required technical system.

But nearly two-thirds of Americans express little or no interest in making payments by tapping their cellphones at a register, according to a survey of consumers.

CreditCards.com, a division of Bankrate.com, reported Tuesday that 44 percent of the consumers surveyed said they would never use their mobile phones to make purchases. An additional 18 percent said they would hardly ever do so.

Younger, more affluent, and better-educated people are more interested in paying by cellphone, according to the tally of 1,003 U.S. adults by Princeton Survey Research Associates International, which said the margin of sampling error was 3.6 percentage points.

City dwellers had a more favorable view of these mobile payments than people in rural areas, said Matt Schulz, a senior analyst at CreditCards.com.

Demand for mobile payments has been lukewarm so far, analysts said. Critics have taken aim at systems such as Google Wallet, saying the programs are designed to invasively track consumers’ individual spending.

But the devotion many consumers feel for Apple products could help change things, Schulz said, “if Apple can make it as easy as pulling out a debit or a credit card and consumers believe it is safe and secure.”

Apple’s chief executive, Tim Cook, said the system is far safer than plastic payments because it allows consumers to make purchases without sharing their personal financial information with the retailer.

Instead, their credit or debit card information is encrypted into the new phones, secured with fingerprint recognition and disguised when the card is used, so hackers can’t find personal financial information by breaking into retailers’ computers.

“It greatly reduces the vulnerability to retail breaches,” said Douglas Brown, senior vice president at payment technology specialist FIS.

Brown said he believes consumers still regard Apple’s systems as secure despite recent news of hackers stealing nude photos of celebrities from the company’s iCloud accounts.

In the end, he said, the success of the new phones may depend on things Apple didn’t display Tuesday — features that would allow consumers to embed on their phones items such as rewards from loyalty programs, manufacturer coupons, and gift cards so that they could replace their old wallets.

Apple may have plans to incorporate those features, Brown said, “but we’re not seeing them yet.”

AFP Photo/ Justin Sullivan

Interested in national news? Sign up for our daily email newsletter!