It has been a very interesting year. We have seen real estate values go up 5% to 8% and predictions are for them to go up another 5% for each of the next 2 years. The inventory in most of NJ is still very tight and continuing to cause bidding wars which is driving up values. The home prices up to 1 million seem to be moving the quickest and over 2 million are really sitting on the market for a while. Builders are finally starting to look at places to build new homes and investors are buying properties to fix up and sell to take advantage of the low inventories and increasing values. This should really make for a very active spring real estate market. I have been saying for years that with the home values so depressed and rates in the 3’s the last few years were incredible for first time homebuyers. But rates are still low and knowing values are heading up it is still a great time to buy.
Mortgage rates also had a very wild swing this year. After years of being in the mid 3 percent range for a 30 year fixed, in August rates increased to around 4.5%. This was based mainly on the feds comments with regard to beginning to taper(reduce) the 85 billion a month the feds were buying in treasuries and mortgage back securities. Rates are now hovering in that area and will probably fluctuate between 4.25% and 4.75% for the next 6 to 12 months. But rates could very well pop over 5% during this time and will probably stay above 5% starting around 12 to 18 months from now. I don’t believe they will go much higher than the low to mid 5’s but with a new presidential election looming 2 years away we will see how that plays out and most importantly how the economy holds up over the near and long term.
Please pass my name on to anyone you know looking to buy or refinance a 1 to 4 family primary residence, second home or investment property in NY, NJ, CT, PA and FL. They will thank you for referring me!! Additionally, I provide reverse mortgages as well.