Mortgage Rates Moving
Mortgage rates were moving all sorts of ways as the first month of the new year came to a close. Some were up, some were down and some haven't moved at all, according to the weekly survey by Freddie Mac.
"Mortgage rates were mixed ... on news that December's leading indicators, a measure of future economic activity, signaled steady growth in the coming months," the company's chief economist, Frank Nothaft, explained.
Another factor impacting loan costs was new construction, which came in stronger than expected in December; this despite a decline in single-family starts.
Here's the latest read:
- The 30-year fixed-rate mortgage averaged 6.25 percent with an average 0.4 points as January drew toward its end. That's up from 6.23 percent the previous week and 6.12 percent a year ago. (A point is 1 percent of the loan amount, and should be added to loan rates to reflect the true cost of the mortgage.)
- The average for the 15-year fixed-rate loan was 5.98 percent, also with 0.4 points. That's unchanged from the previous week. But it is higher than the 5.7 percent average at this time a year ago.
- One-year Treasury-indexed ARMs averaged 5.49 percent with an average of 0.5 points. That's down slightly from 5.51 percent the previous week but up from 5.2 percent 12 months earlier.
- Hybrid adjustable rate loans in which the initial rate remains fixed for the first five years, at which time the rates adjusts on an annual basis, averaged 6 percent, again with 0.4 points. That, too, is a bit of a drop off from 5.51 percent. But it is higher than a year ago, when the five-year hybrid ARM was 5.2 percent.
Valuing Location
Ever wonder what makes some properties more expensive than others or why a home in one part of town can cost much more than the same home in another part of town? A new online model lets you plug in a variety of home and location characteristics to find out which ones mean more money and which ones don't.
To show the effects that various features can have on a home's value, the National Association of Home Builders has created a house price estimator model based on data from the American Housing Survey, a nationally representative survey of about 60,000 housing units conducted by the Census Bureau in odd-numbered years.
NAHB found that waterfront locations have the most significant positive effect on home values in every census region and in every type of setting. That may seem obvious, but the characteristic with the second largest impact was proximity to public transportation. Being near transit lines was found to be even more important than being "near" water, being in a gated community or having a host of recreational features at hand.
The characteristic with the largest negative effect? The presence of abandoned buildings.
To learn more about the house price estimator, or to explore the price effects of other house features and location characteristics, check out the model online here .
Running the estimator requires a computer with a "reasonably recent" version of Microsoft Excel. In addition, Excel's security setting must be set to either "low" or "medium." Once this is done, it's possible to access the NAHB model, specify a home's age, features, location and neighborhood characteristics, and generate an estimated house price.
Landlord's Survival Guide
Why do novice investors hire stock brokers but try to go it alone when it comes to rental real estate?
A new resource guide from the Westlake Realty Group is San Mateo, Calif., doesn't seek to answer that question. But it is a survival guide for small-time and rookie landlords on how to manage their properties effectively without help from a professional.
"Too often, it isn't until investors get into trouble that they realize how poorly prepared they are to manage property," says Robert Klag, CEO of Westlake Realty and co-author of "Happy About Apartment Management." Don't let the title fool you, though; the management principles are the same for rental houses as they are for apartments.
Among other things, the book (ISBN: 160005031X, $19.95, Publisher: HappyAbout.Info) covers how to keep your rentals occupied, ways to keep tenants from moving, avoiding common lawsuits, how to screen would-be tenants, and how to improve collections.
According to the authors, many owner-managers don't devote enough time to their properties. This leads to short-cut decisions such as selecting tenants without predetermined standards for background checks and deferring ultimately small maintenance problems until they ultimately become big ones.
Moving On
North and South Carolina were the top destinations for movers last year, according to United Van Line's 30th annual migration study. The survey tracks where its customers moved from and to over the year. It is based upon more than 227,000 interstate moves.
Alabama experienced its fourth consecutive year as a high in-bound state. Tennessee also captured a spot on the high in-bound list, but it saw less people moving in 2006 than it did the year before.
The Western region was a top migration area, too, with Oregon second only to North Carolina. Nevada has been a high in-bound state since 1986, but Arizona saw roughly 5 percent fewer people moving in last year than it did the year before. Last year was the first in the last 25 that Minnesota had more people coming than going.
On the negative side, New York, Indiana, Illinois, New Jersey, Pennsylvania and Ohio all lost more people than they gained. Of course, Louisiana did, too. But the states which lost the most residents were Michigan and North Dakota. Maryland continued its 15-year outbound tradition; Connecticut, it's fourth.
SBA Disaster Relief
Sens. John Kerry (D-Mass.), the new chair of the Senate Committee on Small Business and Entrepreneurship, and Olympia J. Snowe (R-Maine), the panel's ranking member, have made improving the Small Business Administration's Disaster Assistance program a top priority by introducing legislation to provide more immediate and meaningful relief to disaster victims.
"Washington can do better to help small businesses and homeowners recover after a disaster," Sen. Kerry said. "I am committed to ensuring small businesses and homeowners have the tools they need to recover from devastating disasters," added Sen. Snowe.
The Small Business Disaster Response and Loan Improvements Act of 2007 would establish a private disaster loan program that allows banks to make loans directly to victims after meeting SBA criteria. The SBA will provide an 85 percent guarantee for these loans.
The measure also requires the agency to draft rules within one year that would create a new "expedited disaster assistance business loan program." These short-term loans would have low interest rates similar to regular disaster loans and would provide businesses with short-term assistance while they await other forms of federal assistance or insurance payouts following future disasters. It specifically addresses one of the major issues following Hurricanes Katrina and Rita -- a lack of access to immediate capital to keep businesses afloat.
Keeping local businesses operating after a disaster is important to communities because nearby residents often have no incomes when their places of employment cannot re-open. Also, they have nowhere to go to purchase the necessary staples or the things they need to start rebuilding their lives.
