2013 Roadmap For Home Buyers And Investors

The number of US cities that have improved since January 2012 has tripled. New Orleans is included.

Improving Market Index for February 2013

To be deemed “improving”, a U.S. city must show broad-based job growth, housing growth, and a rise in median home prices. The index has increased more than 10-fold since October 2011, the month largely thought to represent the housing market bottom.

72% Of U.S. Cities Now “Improving”

The Improving Market Index is a monthly metric from the National Association of Home Builders (NAHB).

In order to qualify, a given metropolitan area must show six consecutive months of improvement with respect to real estate, as measured by home price information from Freddie Mac; with respect to employment data, as measured by data from the Bureau of Labor Statistics; and, with respect to new housing construction, as measured by data from the Census Bureau.

In February, 20 cities were added to the Improving Market Index, from all across the country.

Rockford, Illinois and South Bend, Indiana were added; as were New York City, New York, Racine, Wisconsin and Huntsville, Alabama. Even California and New Mexico added cities to the index, with Chico and Albuquerque making the list.

All 50 states now have at least one major city on the Improving Market Index. Washington, D.C. is included as well.

Where Are The Best Deals In Housing For 2013

The U.S. housing market has been broadly improving since October 2011 and this month’s Improving Market Index may prove to be a roadmap for mobile first-time or repeat home buyers, or bona fide real estate investors in search of medium-term home appreciation.

This is because U.S. markets deemed “improving” have each shown six consecutive months of economic growth beyond just home prices. Any of the identified 259 U.S. markets could be considered a safer bet for higher home prices as compared to the cities left off the list.

Furthermore, mortgage rates remain below 4 percent, which makes for highly affordable payments; and a home buyer’s ability to get mortgage-improved is increasing.

The Federal Reserve reports that more U.S. banks are loosening guidelines than tightening them for “prime” mortgage borrowers; and mortgage approval rates have jumped 5 percentage points in the past 12 months.

There are also a bevy of low- and zero-downpayment mortgages available for today’s first-time home buyer.

FHA mortgages, for example, allow for a 3.5% downpayment on most loans, and carry mortgage rates which tend to trump those of a comparable conventional loan.

In addition, USDA mortgages and VA loans offer zero-downpayment mortgages for qualified buyers. USDA loans are insured by the U.S. Department of Agriculture and are available from most U.S. banks. VA loans are guaranteed by the Department of Veterans Affairs and are also available from most U.S. banks.

To qualify for a VA loan, you must be on active duty, have been honorably discharged from the service, or be the surviving spouse of a servicemember.

Build Your Housing Budget Using “Real” Rates

If you plan to buy a home in 2013 or 2014, expect home prices and mortgage rates to rise over time. Demand for homes is outpacing supply, and economic growth is pushing rates up. This combination will harm your home purchasing power, and limit what you can afford.

FHA home buyers will face an additional hurdle, meanwhile, because the FHA has announced new, higher mortgage insurance premiums for all FHA-backed homeowners, beginning April 1, 2013.

As you build your housing budget, therefore, plan for the future. Use today’s real mortgage rates, and have your lender account for a cushion. As the economy improves, the cost of homeownership will rise.

Click here to start your Greater New Orleans home search WWW.LIVING504.COM

Source: www.themortgagereports.com

Author – Dan Green is an active loan officer with Waterstone Mortgage.

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