As is the case during the holiday season, home loan application volume slowed down in the last quarter of 2014. Figures reported in mid-December by the Mortgage Bankers Association were down 11.9 percent compared to the same time one year ago. Decreases in total home loan purchase applications were, however, met with net gains from home loan refinances, due to lower interest rates.
Homebuilders were also recalibrating their sales strategies going into next year. According to an early December CNBC report, many homebuilders this season are not raising prices, but are instead seeing more interest from wealthier buyers looking at larger homes. The report also stated that as of now, luxury homebuilders do not foresee raising prices to improve their margins, while others are benefitting from strategic geographic and product changes.
All in all, homebuilder sentiment remained in positive territory in December, staying at 57 on the National Association of Home Builders/Wells Fargo Housing Market Index (NAHB, HMI); anything above 50 is considered positive. Said NAHB Chief Economist David Crowe, “As we head into 2015, the housing market should continue to recover at a steady, gradual pace.”
Good Job News to End 2014
A promising November Jobs Report portends economic growth for early 2015, which many hope will trickle to housing. According to the Bureau of Labor Statistics, nonfarm payrolls grew by 321,000, crushing the forecasted figure of 230,000. The unemployment rate was unchanged at 5.8 percent. As noted in Business Insider, “This was the 10th straight month that the U.S. Economy saw payrolls grow by more than 200,000, the longest streak since 1995.”
What’s in Store for 2015
A December Financial Times consumer survey predicted the following for housing in early 2015: people will continue to try to sell existing homes. As the supply of existing homes for sale goes up, so does competition from new homes and homebuilders. Housing demand will come from young people getting jobs and forming households, but whether they opt for rentals and saving for a down payment rather than buying homes right away remains to be seen. Check back in April’s REALinsight for your next quarterly Market Watch.
If you’re looking to jump into Las Vegas’ real estate market and want to see what the market looks like in your neighborhood or the neighborhood you would like to be in, please call Dulcie Crawford at (702) 505-2775 for a personal consultation or you can sign up for the free Market Snapshot at newdulcie.agentreputation.net/marketsnapshot to have a comprehensive report emailed to you.
Dulcie is a native Nevadan, born and raised in Las Vegas, and has witnessed the spectacular growth of the Las Vegas Valley first hand. She has a strong knowledge of the Las Vegas Community and what’s going on in Real Estate today. Dulcie stays current with market conditions and keeps continuously updated on market trends, legal reforms and financing so she can assist you to make informed decisions. A senior Realtor with Simply Vegas, she does an average of over $10 million in sales annually. You will be assured a professional experience when buying or selling Real Estate with The Dulcie Crawford Group.
Sources: CNBC, Financial Times
Reposted from: Aaron Gordon – Guild Mortgage Company – 760-607-3540