Are You Wasting $471 Per Month On Your Mortgage?

According to Freddie Mac's weekly mortgage rate survey, for 13 straight weeks, the average 30-year fixed rate mortgage has held below 4.000% for mortgage applicants willing to pay up to 0.8 discount points plus a full set of closing costs.

These are the lowest mortgage rates in history and now -- with a bevy of loan programs for the nation's 11 million "underwater homeowners" including HARP, the FHA Streamline Refinance, and the VA IRRRL -- millions of U.S. homeowners can exploit the current mortgage rate environment.

In this 4-minute clip from NBC's The Today Show, you'll learn about today's mortgage market and your refinancing opportunities in Georgia.

The video begins by telling us that 14 million credit-worthy Americans have yet to refinance their respective mortgages, and are leaving an average of $471 in "wasted savings" on the table each month which adds up to more than $5,600 annually.

That's a big number.

Some of the video's other key points include :

• Refinancing is "worth the hassle" when mortgage rates are as low as they are today
• The best rates are reserved for homeowners with the highest credit scores
• Comparison shop -- your current mortgage lender may not offer you the best rates

Furthermore, the video reveals the characteristics of the homeowner type most likely to benefit from a refinance. These traits include having with 20% equity in the home; have plans to live in the home for at least the next 36 months; carrying a current mortgage rate of 5 percent or higher.

It should also be added that, with a zero-closing-cost or low-closing-cost mortgage, even a small reduction in your mortgage rate can make a refinance worthwhile.

Mortgage rates are low but can't stay low forever. If you haven't participated in the Refi Boom, talk with a loan officer and review your mortgage options. You may be able to save hundreds of dollars per month with just modest closing costs. 

Pending Home Sales Rise To 22-Month High

The housing market appears headed for a strong spring season.

After a brief setback in December, the Pending Home Sales Index resumed its climb in January, posting a 2 percent gain over the month prior.

The data puts pressure on Atlanta home buyers. This is because a "pending home" is a home that's under contract to sell, but has not yet sold. It's tracked by the National Association of REALTORS® and, among all housing statistics, it's the only one that's "forward-looking".

The Pending Home Sales Index is important to home buyers throughout Georgia because 80% of homes under contract to sell close within 60 days of contract. In this way, the Pending Home Sales Index forecasts the housing market 1-2 months into the future.

This is very different from how NAR's Existing Home Sales report works; or, how the Census Bureau's New Home Sales report works. These two metrics tell us what's already happened in housing.

By contrast, the Pending Home Sales Index tells us what's coming next.

January's Pending Home Sales Index reading lifts the monthly metric to its highest level since April 2010 -- the month during which the 2010 federal home buyer tax credit expired -- foreshadowing a strong housing market through March and April 2012, at least.

This should not be news, of course. The nation's home builders have said "foot traffic" is rising and home supplies are scarce nationwide. The only wild-card for housing is the high contract cancellation rate.

As compared to last January when just 9 percent of home purchase contracts "failed", this January saw 33 percent of contracts fail. High failure rates undermine the Pending Home Sales Index's viability as a forward-looking housing market indicator.

Despite contract failures, though, the combination of low mortgage rates and low home prices is enticing to today's home buyers. Expect home sales to climb in the coming weeks which will lead to a strong spring season for housing. 

New Home Supply Falls To 5.6 Months

The new construction market rolls on.

As foreshadowed by February's Homebuilder Confidence survey, which rose to a 4-year high, the Census Bureau reports new homes are selling more quickly than builders have built them, lowering the national "home supply" to levels not seen since 2006.

A "new home" is a home that is considered new construction and, at the current pace of sales, the nation's entire new home inventory of 151,000 homes would be sold in 5.6 months.

Anything less than 6.0-month supply is thought to connote a "sellers' market".

321,000 new homes were sold last month on a seasonally-adjusted, annualized basis. 7 of 10 new homes sold for less than $300,000. 

The South Region continues to account for the majority of new construction sales, posting a 59% market share in January. South Region sales were up 9 percent as compared to December. The other 3 regions turned in mixed results. 

• Northeast Region : +11.1% from December 2011 
• Midwest Region : -24.5% from December 2011 
• West Region : -10.6% from December 2011 

Unfortunately, the Census Bureau's New Home Sales data could be wrong.

Although New Home Sales were said to fall by about one percent nationally from December to January, the government's monthly report was footnoted with a ±16.6% margin of error. This means that the actual New Home Sales reading may have been as high as +15%, or as low as -18%. 

Because the range of values includes positive and negative values, the January New Home Sales data is of "zero confidence". However, that's not to say that it should be ignored. The aforementioned homebuilder confidence survey shows builders optimistic for the future, and a bevy of home sale data since October 2011 suggests a market in recovery.

If you're in the market for new construction in Atlanta , therefore, consider going into contract sooner rather than later. Home prices remain low and mortgage rates do, too -- a terrific combination for today's buyers.

In a few months, the landscape may look different.

What's Ahead For Mortgage Rates This Week : February 27, 2012

Mortgage markets improved in a holiday-shortened week last week, drawing mortgage rates lower throughout Canton and nationwide.

Few new economic releases reached the markets, but those that did suggested recovery -- especially with respect to housing and employment, two key drivers of the U.S. economy overall.

Mortgage rates tend to rise when on strong data. That's not what happened last week, however.

First, in housing, the New Home Sales and Existing Home Sales reports each showed strength for December and January. Separate reports show that sales volume is rising nationwide even as the number of available homes for sale fall.

Home Supply is reaching bull market levels, which pressures home prices higher.

And then, in employment, the government's Initial Jobless Claims report turned up good news, too. The report's 4-week moving average is now down to its lowest level since 2008, a figure that suggests that U.S. households are getting back to work and staying there.

As rate shoppers in Georgia , don't expect rates to fall forever.

Last week's rate improvements were partly because the Greece bailout has yet to be finalized, and partly because concerns about Iran have sparked a mortgage bond flight-to-safety. International demand for U.S.-auctioned bonds was especially high last week and mortgage bonds benefited.

As the situations in Greece and Iran stabilize, therefore, all things equal, mortgage rates should rise.

There are just two key data points set for release this week -- the Pending Home Sales Index (Monday) and Personal Income and Outlays (Thursday) -- plus two key European votes on the Greece bailout. The Case-Shiller Index will also be released and the FHA is expected to announce new mortgage insurance premiums.

Mortgage rates remain near all-time lows. If you're still floating a rate, or waiting to refinance, consider moving up your timeframe. It's a good time to lock your mortgage rate for the long-term.

Federal Reserve Wary Of European Spillover

The Federal Reserve has released the minutes from its 2-day meeting January 24-25, 2012.

The Fed Minutes is a summary of the conversations and debates that shape our nation's monetary policy. It receives less attention than the Fed's more well-known, post-meeting press release, but the Fed Minutes is every bit as important.

To rate shoppers in Canton , for example, the Fed Minutes can provide clues about whether mortgage rates will generally rise or fall in the coming months.

The most recent Fed Minutes reveals a central bank divided on the future of the U.S. economy. The minutes show some Fed members in favor of new, immediate market stimulus. It shows others in favor of terminating the stimulus that's already in place.

The Fed's debate centered on the topic of inflation, and the pressures that a prolonged, near-zero Fed Funds Rate can place on the economy. Ultimately, the Fed did nothing, neither adding new stimulus nor removing that which is already in place.

It did, however, communicate a plan to keep the benchmark Fed Funds Rate rate "exceptionally low" through late-2014, at least.

The Fed Minutes included the following notes, too :

• On employment : Unemployment rates will "decline only gradually" in 2012
• On housing : The market is "held down" by the "large overhang" of distressed homes
• On inflation : Consumer prices have remained "flat"

Furthermore, the Fed expressed optimism regarding European financial markets, noting that market sentiment "appeared to brighten a bit". Nonetheless, "spillovers" remain possible and the threat continues to weigh on markets. 

Mortgage rates are slightly worse since the Fed Minutes were released. 

The Federal Reserve's next scheduled meeting is March 13, 2012 -- its second of 8 scheduled meetings this year.

Existing Home Sales Climb To A 20-Month Record

January's home resales moved to a 20-month high -- additional evidence that the nation's housing recovery is underway.

According to the National Association of REALTORS®, the January 2012 Existing Home Sales showed 4.57 million units sold last month on a seasonally-adjusted, annualized basis -- a 4 percent increase as compared to December's revised figures.

An "existing home" is one that's been previously occupied and cannot be categorized as new construction.

Beyond the headline numbers, though, there was plenty about which for today's Canton home sellers to get excited. Demand for homes remains strong, foreshadowing higher home prices through 2012.

First, the national housing stock is at a 5-year low.

In January, the number of homes for sale nationwide slipped to 2.31 million, the smallest home inventory since February 2007, and a 21% decrease from just one year ago.

Falling home supply amid constant home demand leads home prices higher. At the current pace of sales, today's complete home inventory would "sell out" in 6.1 months. 

Analysts say that a 6-month supply is a market in balance. Anything less is Bull Market territory.

Second, the National Association of REALTORS® says that one-third of all homes under contract "failed" last month. This means that many more buyers tried to buy, but couldn't for a number of reasons including mortgage denials; or, insurmountable home inspections issues; or, homes appraising for less than the contract price.

As contract failures subside, Existing Home Sales are expected to rise even faster.

And, lastly, first-time buyers continue to power the home resale market. In January, 33% of all sales were made to first-time buyers, up four points from last year. This statistic suggests that renters are moving into homeownership, an important component in a sustained housing market recovery.  

Given high demand and shrinking supply, we should expect for Bridge Mill home prices to rise in the coming months, if they haven't already. Thankfully, mortgage rates remain near all-time lows.

Low mortgage rates make homes more affordable.

Foreclosure Filings Down 19 Percent In One Year

 

Foreclosure filings fell 19 percent last month versus one year ago, says foreclosure-tracking firm RealtyTrac. It's yet one more signal that the U.S. housing market may have already climbed off its bottom.

According to RealtyTrac, a "foreclosure filing" is any one of the following foreclosure-related events : (1) A default notice on a home; (2) A scheduled auction for a home; or, (3) A bank repossession of a home.

In looking at the January 2012 figures :

• Default Notices were down 22% from January 2011
• Scheduled Auctions were down 19% from January 2011
• Bank Repossessions were down 15% from January 2011

On a monthly basis, however, the numbers weren't so promising.

Default notices and scheduled auctions were mostly unchanged, but bank repossessions rose 8 percent. The rise in bank repossessions is likely because 2010's robo-signing controversy has been rectified at the state and lender level.

This trend toward more bank-owned homes is expected to continue through 2012.

As in most months, January's foreclosure activity was geographically concentrated. Nevada led the nation in Foreclosures Per Capita, followed closely by California. 13 states fared worse than the national average of 1 foreclosure per 624 households. 37 fared better.

The difference in foreclosure frequency among the two groupings was stark :

• Top 13 Foreclosure States : 1 foreclosure per 435 households, on average
• Bottom 37 Foreclosure States : 1 foreclosure per 5,101 households, on average

North Dakota had January's lowest foreclosure rate nationwide. Just 1 in 63,500 homes was in some form of foreclosure in North Dakota last month.

As a first-time or seasoned buyer in Atlanta , foreclosed homes can be enticing. They're plentiful and cheap. However, just because a foreclosed home can be bought for a "steal", that doesn't mean it's worth buying. The process of buying a foreclosed homes is different from the process of buying a non-foreclosed home.

The contract-and-negotiation process may be different with a foreclosed property, and foreclosed homes are often sold "as-is". This means the home you buy at auction could be run-down and defective to the point where it's uninhabitable.

If you plan to buy a foreclosed home, therefore, have a real estate professional on your side. The internet can teach you much about how the Georgia housing market works, but when it comes to writing contracts, you'll want an experienced agent on your side.

What's Ahead For Mortgage Rates This Week : February 21, 2012

Mortgage markets worsened last week as the Eurozone moved closer to a bailout agreement with Greece, and the U.S. economy displayed more signs of growth.

In response, mortgage rates climbed last week.

Rate shoppers should not be surprised that rates ticked north. Since mid-2011, weakness in Greece has helped keep mortgage rates low and the same is true for a weak U.S. economy. Wall Street has sought "safe assets" as protection from risk and that's driven mortgage rates down.

Now, the safe haven buying that served to anchor low rates appears poised to reverse.

Last month, it was shown, consumer spending rose to record levels and the housing market surpassed analyst expectation again. Homebuilder confidence is now at a 4-year high and Single-Family Housing Starts topped one-half million units for the second straight month.

Conforming mortgage rates in Georgia rose for the first time in a month last week. Unfortunately, few shoppers knew because Freddie Mac's weekly mortgage rate survey failed to capture the change. The survey deadline was Tuesday. Rates started rising Wednesday morning.

Freddie Mac's weekly mortgage rate survey put the average 30-year fixed rate mortgage unchanged at 3.87% for borrowers willing to pay 0.8 discount points plus a full set of closing costs.

Rates are higher today.

Beyond Greece and the U.S. economy, inflation is another reason mortgage rates are up. Inflation is the enemy of mortgage rates and, an on annual basis, the core Consumer Price Index registered 2.3% -- it's highest reading since 2008. The Fed expects inflation to ease later this year but if gas prices stay high, the Fed's forecast may be wrong.

This week is holiday-shortened. Look for Greece to dominate headlines (again) and watch for housing data toward the end of the week. Existing Home Sales is released Wednesday. New Home Sales is released Friday.

For now, mortgage rates remain low. It's a safe time to lock a long-term rate.

What's Ahead For Mortgage Rates This Week : February 21, 2012

Mortgage markets worsened last week as the Eurozone moved closer to a bailout agreement with Greece, and the U.S. economy displayed more signs of growth.

In response, mortgage rates climbed last week.

Rate shoppers should not be surprised that rates ticked north. Since mid-2011, weakness in Greece has helped keep mortgage rates low and the same is true for a weak U.S. economy. Wall Street has sought "safe assets" as protection from risk and that's driven mortgage rates down.

Now, the safe haven buying that served to anchor low rates appears poised to reverse.

Last month, it was shown, consumer spending rose to record levels and the housing market surpassed analyst expectation again. Homebuilder confidence is now at a 4-year high and Single-Family Housing Starts topped one-half million units for the second straight month.

Conforming mortgage rates in Georgia rose for the first time in a month last week. Unfortunately, few shoppers knew because Freddie Mac's weekly mortgage rate survey failed to capture the change. The survey deadline was Tuesday. Rates started rising Wednesday morning.

Freddie Mac's weekly mortgage rate survey put the average 30-year fixed rate mortgage unchanged at 3.87% for borrowers willing to pay 0.8 discount points plus a full set of closing costs.

Rates are higher today.

Beyond Greece and the U.S. economy, inflation is another reason mortgage rates are up. Inflation is the enemy of mortgage rates and, an on annual basis, the core Consumer Price Index registered 2.3% -- it's highest reading since 2008. The Fed expects inflation to ease later this year but if gas prices stay high, the Fed's forecast may be wrong.

This week is holiday-shortened. Look for Greece to dominate headlines (again) and watch for housing data toward the end of the week. Existing Home Sales is released Wednesday. New Home Sales is released Friday.

For now, mortgage rates remain low. It's a safe time to lock a long-term rate.

Housing Starts Stay Strong; Building Permits Rise.

The housing market has carried forward its year-end momentum. 

According to the Census Bureau, on a seasonally-adjusted, annualized basis, January's Single-Family Housing Starts crossed the half-million unit marker for the second straight month.

This hasn't happened in close to 2 years and is the latest in a series of strong data that suggests the beleaguered housing market has turned a corner -- both nationally and locally in Atlanta.  

Although single-family starts slipped 1 percent from December, January's annualized 508,000 figure represents a 16% spike from January 2011 and is the second-highest reading since April 2010 -- the last month of 2010's federal home buyer tax credit program.

A "housing start" is a new home on which construction has started.

The strength of January's Housing Starts data surprised Wall Street analysts and is partially responsible for Thursday's unexpected mortgage rate spike. 

In hindsight, though, we should have seen this coming.

Earlier in the week, the National Association of Homebuilders announced that homebuilder confidence had climbed to its highest point since 2007 amid builder reports of rising sales volume and the most foot traffic from buyers in more than 4 years.

In addition, builders expect to sell more homes in 2012 than in 2011.

Builders are building and buyers are buying.

Meanwhile, as another sign of housing market strength, the Census Bureau reports that, in January, Building Permits moved to a multi-year high as well. Permits issued for single-family homes in January rose 1 percent from December, a statistic that suggests housing will continue its run through the spring season, at least.

86 percent of homes break ground within one month of permit issuance.

It's a good time to be a home buyer. Mortgage rates and home prices are low. Housing market momentum, however, is building. If you're on the fence about whether to buy a home in East Cobb , ask your real estate agent for additional market information.

The cost of home-ownership may never be as low as it is today.

Homebuilder Confidence Returns To Pre-Recession Levels

New construction buyers in Marietta , look out. The nation's home builders are predicting a strong 2012 for new home sales. It may mean higher home prices as the spring buying season approaches.

For the sixth straight month, the National Association of Homebuilders reports that homebuilder confidence is on the rise. The Housing Market Index climbed four points to 29 in February, the index's highest reading since May 2007.

The Housing Market Index is now up 8 points in 8 weeks. The last time that happened was June 2003, a month during which the U.S. economy was regaining its footing, much like this month. It's noteworthy that June 2003 marked the start of a 4-year bull run in the stock market that took equities up 54%.

The NAHB's Housing Market Index itself is actually a composite reading. It's the end-result of three separate surveys sent to home builders monthly.

The association's questions are basic :

1. How are market conditions for the sale of new homes today?
2. How are market conditions for the sale of new homes in 6 months?
3. How is prospective buyer foot traffic?

In February, builders reported marked improvement across all three areas. Builders report that current home sales climbed 5 points; that sales expectations for the next 6 months climbed 5 points; and that buyer foot traffic climbed 1 point.

Most notable of all of the statistics, though, is that the nation's home builders report that there are now twice as many buyers setting foot inside model units as compared to just 6 months ago.

This data is supported by the monthly New Home Sales report which shows rising sales and a shrinking new home inventory.

Because of this, today's new home buyers throughout Georgia  should expect fewer concessions from builders at the time of contract including fewer price breaks on a home and fewer free upgrades. Builders are optimistic for the future and, therefore, may be less willing to "make a deal".  

This spring may mark the best time of year to buy a new home. 60 days forward, it may be too late.

With Retail Sales And Consumer Confidence Rising, Home Prices Are Expected To Follow

The U.S. economy continues to show signs of a rebound.

According to the Census Bureau, Retail Sales climbed to $329 billion last month on a seasonally-adjusted basis, excluding automobiles. January's data marks the 18th time in 19 months that Retail Sales rose, a run that's increased total sales receipts by 11 percent.

This is big news because Retail Sales accounts for close to 70% of the U.S. economy.

In addition, consumer confidence is rising.

In a separate, joint report from the University of Michigan and Thompson Reuters, it was shown that consumer attitudes toward the economy and the future are improving, primarily the result of recent job gains.  

The Survey of Consumers posted its highest value in 12 months.

It is not a coincidence that Retail Sales and consumer confidence both made multi-month highs -- the readings are more than loosely linked. As consumers feel more confident about the economy and their personal prospects for the future, they're more likely to spend money on goods and services, which leads to an increase in consumer spending.

For the housing market, the ramifications are two-fold.

First, from the financing side, an expanding economy is linked to rising mortgage rates. This is because Wall Street tends to chase risk in a growth economy and the bond market offers little in the way of risk. As demand for bonds drops, then, mortgage rates rise throughout Georgia.

Second, rising consumer confidence can lead Canton home values higher, too.

Confident consumers are more likely than fearful ones to become home buyers. They're more likely to stop renting and start buying; more likely to list their home and "move-up" to something bigger; more likely to "take the next step".

So, as more buyers enter the market at a time when the national home supply is shrinking, the supply-demand balance in housing is shifting toward the sellers. This creates price pressures and should lead to higher home valuations in neighborhoods like BrookStone.

If you have plans to buy a home in 2012, the best time to buy may be now. Today's mortgage rates are low and so are the home prices -- a combination that's unlikely to last.

Fewer Jobless Claims Suggests Higher Home Prices Ahead

Economists believe the strength of the 2012 housing market will be closely tied to jobs. If they're right, the housing market is ripe for a boost. It spells good news for Atlanta home sellers and may mean the end of bargain-basement prices for buyers.

Since peaking in mid-2009, the number of U.S. workers filing for first-time unemployment benefits has dropped 44 percent. Over the same period of time, the U.S. economy has added more than 2 million jobs and the national Unemployment Rate is down more than 1 percentage point to 8.3%.

Employment's link to the housing market of Bridge Mill is both economic and psychological.

To make the economic link is straight-forward. A person with a job earns verifiable income and such income is required in order to be mortgage-eligible. For conventional and FHA purchase loans, for example, mortgage lenders want a home buyer's monthly income be more than double his monthly debts. 

For the formerly unemployed that have since returned to work, having a full-time income makes buying homes possible. It also supports higher home valuations nationwide because home prices are based on supply-and-demand. All things equal, when the number of buyers in a market goes up, prices do, too.

The psychological connection between housing and employment is a tad more complicated, but every bit as important. It's not just out-of-work Americans that don't look for homes -- it's fearful Americans, too. People with concerns about losing a job are just as unlikely to shop for homes as people actually without a job. The same is true for people unsure of their prospects for a better-paying job, or their own upward mobility.

A recovering job market can lessen those fears and draw out buyers -- especially those who face a loss on the sale of an "underwater" home.

The Initial Jobless Claims rolling 4-week average is at its lowest level since 2008. Fewer Americans are losing jobs, and more are finding permanent placement.

It's one more reason to be optimistic for this year's housing market. 

What's Ahead For Mortgage Rates This Week : February 13, 2012

Mortgage markets were mostly unchanged last week as Greece -- once again -- was front-of-mind for Wall Street investors. The nation-state is attempting to avoid a debt default, and has been attempting to avoid default since May 2010.

Early in the week, Greece reached a deal with European Union leaders to secure additional financial aid. By Friday, however, the deal was in doubt, as the EU leaders declared that the Greek Parliament would have pass new austerity measures before the aid would be released.

Austerity measures have been unpopular in Greece, giving rise to riots among citizens and resignations among politicians. Markets responded to the potential undoing of the debt deal by seeking safety in bonds -- including U.S. mortgage-backed bonds.

The Greek debt default story has helped fuel low mortgage rates in Georgia. Once a final deal is reached, mortgage rates are likely to rise.

For now, though, mortgage rates remain at all-time lows.

According to Freddie Mac's weekly mortgage rate survey, the average, conforming 30-year fixed mortgage rate held firm at 3.87% last week for mortgage borrowers willing to pay an accompanying 0.8 discount points plus applicable closing costs. 1 discount point is equal to one percent of your loan size.

For borrowers unwilling to pay discount points and/or closing costs, average mortgage rates are higher.

This week, data returns to the U.S. economic calendar.

Greece will still be in play, but the health of the U.S. economy will determine in which direction mortgage rates will go. There are two inflation reports due -- the Consumer Price Index and the Producer Price Index.

The former is a "cost of living" indicator for U.S. households; the latter measures the same for business. Inflation is bad for mortgage rates so if either report comes in unexpectedly high, mortgage rates are likely to rise.

The same is true for Tuesday's Retail Sales report.

Retail Sales account for close to 70% of total U.S. economic activity. An unexpectedly strong Retail Sales figure will suggest that the domestic economy is improving and that, too, would pressure mortgage rates up.

If you're shopping for a mortgage, or floating one with your lender, consider locking in this week. Mortgage rates don't have much room to fall and there's much room to rise.

What's Ahead For Mortgage Rates This Week : February 13, 2012

Mortgage markets were mostly unchanged last week as Greece -- once again -- was front-of-mind for Wall Street investors. The nation-state is attempting to avoid a debt default, and has been attempting to avoid default since May 2010.

Early in the week, Greece reached a deal with European Union leaders to secure additional financial aid. By Friday, however, the deal was in doubt, as the EU leaders declared that the Greek Parliament would have pass new austerity measures before the aid would be released.

Austerity measures have been unpopular in Greece, giving rise to riots among citizens and resignations among politicians. Markets responded to the potential undoing of the debt deal by seeking safety in bonds -- including U.S. mortgage-backed bonds.

The Greek debt default story has helped fuel low mortgage rates in Georgia. Once a final deal is reached, mortgage rates are likely to rise.

For now, though, mortgage rates remain at all-time lows.

According to Freddie Mac's weekly mortgage rate survey, the average, conforming 30-year fixed mortgage rate held firm at 3.87% last week for mortgage borrowers willing to pay an accompanying 0.8 discount points plus applicable closing costs. 1 discount point is equal to one percent of your loan size.

For borrowers unwilling to pay discount points and/or closing costs, average mortgage rates are higher.

This week, data returns to the U.S. economic calendar.

Greece will still be in play, but the health of the U.S. economy will determine in which direction mortgage rates will go. There are two inflation reports due -- the Consumer Price Index and the Producer Price Index.

The former is a "cost of living" indicator for U.S. households; the latter measures the same for business. Inflation is bad for mortgage rates so if either report comes in unexpectedly high, mortgage rates are likely to rise.

The same is true for Tuesday's Retail Sales report.

Retail Sales account for close to 70% of total U.S. economic activity. An unexpectedly strong Retail Sales figure will suggest that the domestic economy is improving and that, too, would pressure mortgage rates up.

If you're shopping for a mortgage, or floating one with your lender, consider locking in this week. Mortgage rates don't have much room to fall and there's much room to rise.

Revamped HARP : Unlimited Loan-to-Value And Same Great Rates

The government's new, revamped HARP program is 6 weeks from release. Homeowners in Georgia and nationwide are gearing up to refinance.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the government's loan product for "underwater homeowners". HARP makes current mortgage rates available to households which would otherwise be unable to refinance because the home lacks equity.

This is a big deal -- especially today. Mortgage rates are at an all-time low and millions of U.S. homeowners have been unable to take advantage. HARP aims to change that.

HARP originally launched in 2009. Its first iteration failed to reach a meaningful percentage of U.S. homeowners, however, because costs were high and loans were high-risk. With its re-release, the government has removed the hurdles to HARP, putting refinancing within reach for millions of U.S. households.

To qualify for HARP, homeowners must first meet 3 qualifying criteria.

First, their current mortgage must be backed Fannie Mae or Freddie Mac. FHA- and VA-backed loans are HARP-ineligible, as are jumbo loans and loans backed by portfolio lenders.

• To check if your loan if Fannie Mae-backed, click here.
• To check if your loan if Freddie Mac-backed, click here.

Second, the existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior on, or before, May 31, 2009. If you bought your home or refinanced it after that date, you are HARP-ineligible.

There are no exceptions to this rule.

And, third, the existing mortgage must be accompanied by a strong repayment history. Mortgage payment must have been paid on-time for the last 6 months, at least, and there may not be more than one 30-day late payment in the last 12 months.

If these 3 qualifiers are met, HARP applicants should find the approval process straight-forward : 

• Fixed rate mortgages allow unlimited loan-to-value
• The standard 7-year "waiting period" after a foreclosure is waived in full
• Except in rare cases, home appraisals aren't required 

Furthermore, HARP mortgage rates are expected to be on par with non-HARP rates, meaning that HARP homeowners in Atlanta will get the same rates and pay the same fees as everyone else. There's no "penalty" for using HARP.

The revamped HARP is expected to be generally available beginning Monday, March 19, 2012.

To get a head-start on HARP, check with your loan officer for the complete list of HARP eligibility requirements.

Quick Tips : Boost Your Credit Score For Better Mortgage Rates

Credit scores play a huge role in today's mortgage market -- larger than at any time in recent history. Blame it on the high default rates of the last half-decade. Lenders are reserving their lowest rates for the customers most likely to make on-time repayments.

Mortgage rates are at an all-time low in Georgia. However, the low rates you see advertised on TV and online are only available to the home buyers and would-be refinancers whose credit scores are pristine. Having a high credit score is often the difference between getting "the best rates" from your lender, and getting something worse.

The first part of improving your credit score is understanding how it works. In this 5-minute piece from NBC's The Today Show, you'll learn the basics :

• Why you shouldn't close a credit card after you pay off a large debt
• What is the maximize balance to leave on your credit cards, relative to your credit limit
• What types of credit checks harm your credit scores, and which ones don't

You'll also learn how to shop for a mortgage with multiple lenders without having your credit score "dinged", as well as several proven methods to raise your credit score quickly.

In the end, good credit scores are the result of paying bills on time and staying with your means. Those with the best scores, get the best rates.

Federal Tax Deadline Extended To April 17, 2012

Traditionally, federal income taxes must be filed with the IRS on, or before, April 15 each year. The date has become such a part of U.S. culture that many people simply call it "Tax Day".

This year, however, for the 3rd time in 7 years, your federal income taxes will not be due April 15. Instead, because of a combination of the calendar, a holiday, and tax law, Tax Day 2012 is delayed until Tuesday, April 17.

You will have two extra days to prepare and file your federal income taxes this year. 

Here's why.

First, April 15 is a Sunday and all federal offices are closed on Sundays. This means that that taxes can't be filed on April 15, as regularly scheduled. Rather, the tax due date should roll over to the first available business day -- Monday.

However, Monday, April 16 is Emancipation Day, a holiday in the District of Columbia since 2005.

Emancipation Day honors President Abraham Lincoln's April 16, 1862 signing of the Compensation Emancipation Act. All of Washington, D.C. is closed for the local holiday -- including the offices of the IRS. Taxes can't be due on this date because there will be nobody at the Internal Revenue Service to receive them.

Therefore, Tax Day rolls over to the next available business day, and that's Tuesday, April 17. Despite the 2-day change, as a reminder, the deadline to file a federal tax return with extension has not changed. That filing date remains October 15, 2012. 

Also, note that most states have chosen to mirror the IRS' tax deadlines this year even though Emancipation Day is a Washington, D.C-specific. Be sure to check with your accountant to confirm your local filing deadline.

Lock An Instant 13% Savings On Your Monthly Mortgage Payment

Falling mortgage rates make owning a home more affordable. Mortgage rates are directly tied to monthly mortgage payment so as mortgage rates drop, so does the cost of home-ownership.  

It's a money-saving time to buy a home in Canton -- or to refinance one. Mortgage rates have never been this low in history.

According to Freddie Mac, last week, the average 30-year fixed rate mortgage fell to 3.87% nationwide for borrowers willing to pay an accompanying 0.8 discount points plus closing costs. 0.8 discount points is a one-time closing cost equal to 0.8 percent of your loan size, or $800 per $100,000 borrowed.

This represents an incredible value as compared to February of last year. 

It was exactly one year ago that mortgage rates begin their long slide lower. On February 11, 2011, the 30-year fixed rate mortgage reached its peak for the year, reading 5.05% in Freddie Mac's nationwide survey. If you are among the many U.S. households that bought or refinanced a home around that time, you could choose to replace your current home loan with a new one and save close to 13% on your monthly mortgage payment.

13 percent saved on your mortgage is a noteworthy statistic.

Look at this 30-year fixed rate mortgage payment comparison over the last 12 months :

• February 2011 : $539.88 principal + interest per $100,000 borrowed
• February 2012 : $469.95 principal + interest per $100,000 borrowed

Because of falling mortgage rates, a homeowner with a $250,000 30-year fixed rate mortgage would save at least $175 per month just by refinancing into a new loan at today's mortgage rates. That's $2,100 in savings per year. 

Even after accounting for discount points and closing costs, the "break-even point" on a mortgage like that can come relatively quickly.

We can't predict mortgage rates so there's no promise rates will stay like this forever. If you're planning to buy a home or refinance one, the best way to keep your monthly payments down is to lock your rate while rates are still low.

The market looks ripe for that now. 

What's Ahead For Mortgage Rates This Week : February 6, 2012

Mortgage markets worsened last week as domestic job growth surprised Wall Street and the Eurozone moved yet one more step closer to reaching a lasting Greece sovereign debt solution.

Conforming mortgage rates in Georgia rose on the news, although you wouldn't know it from looking at Freddie Mac's weekly mortgage rate survey.

According to Freddie Mac, the average 30-year fixed rate mortgage rate fell to 3.87% last week with 0.8 discount points due at closing, plus closing costs. 1 discount point is a fee equal to one percent of your loan size.

3.87% for a 30-year fixed rate mortgage is the official, all-time low for the weekly Freddie Mac survey, conducted since the 1970s. However, because Freddie Mac gathers its results on Monday and Tuesday only, by the time the survey results were released Thursday morning, mortgage rates were already rising off their lows.

Then, Friday morning, after January's Non-Farm Payrolls data was released, mortgage rates surged.

The January jobs report exceeded expectations in nearly every fashion possible :

• Economists expected to see 135,000 jobs created in January. The actual number was 243,000.
• Economists expected to see the Unemployment Rate at 8.5% in January. The actual number was 8.3%.
• Revisions added an additional 180,000 net new jobs to the original 2011 tally.

As compared to one year ago, there are 2.1 million more people employed in the U.S. workforce. Figures like this hint at a stronger national economy, and that tends to drive mortgage rates up.

This week, with little economic data due for release, mortgage rates are expected to move on momentum. Right now, that momentum is causing rates to rise.

If you're shopping for a mortgage rate in Canton and want to know if the time is right to lock, consider that it's impossible to time a market bottom, but simple to spot a "good deal".

Mortgage rates remain near historical lows -- it's a good time to lock one in. Call your lender today. 

Banks Start To Loosen Up In Underwriting

After a half-decade of tightening mortgage guidelines, banks are starting to "loosen up".

The Federal Reserve conducts a quarterly survey of its member banks and, last quarter, not a single responding bank reported having tightened its mortgage guidelines for prime borrowers.

A "prime borrower" is defined as one with a well-documented credit history, high credit scores, and a low debt-to-income ratio.

53 banks responded to the Fed's survey and none said that mortgage guidelines "tightened considerably" or "tightened somewhat" between September and December 2011; 50 said that guidelines remained "basicaly unchanged"; 3 said that guidelines "eased somewhat".

Mortgage applicants sometimes remark that the mortgage approval process can be challenging. Last quarter's Fed survey hints that looser standards are coming. 

Not since before the recession have banks lowered mortgage approval standards like this and it bodes well for this year's Marietta  housing market. Real estate agents report that 1 in 3 home sale contracts fail with "declined mortgage applications" as a leading cause.

Looser mortgage lending standards should mean more home loan approvals for buyers, and fewer contract cancellations. This can spur the housing market forward.

Make note, though. "Looser standards" should not be confused with "irresponsible standards". It remains more difficult to meet bank standards as compared to 5 years. Today's underwriters are more conservative with respect to household income, overall assets and credit scores. 

Even as compared to one year ago:

• Minimum credit score requirements are higher
• Downpayment/equity requirements are larger
• Maximum allowable debt-to-income ratios are lower

For buyers and refinancing households gaining approval, though, the reward is the lowest mortgage rates in a lifetime. Mortgage rates in Georgia continue to fall, helping home affordability reach new highs.

If you're in the market to buy a new home or refinance one, your timing is excellent.

Home Affordability Threatened By Friday's Jobs Report

This week, once more, we find mortgage rates are on a downward trajectory. Conforming mortgage rates have returned to near all-time lows. After Friday morning's Non-Farm Payrolls report, however, those low rates may come to an end.

It's a risky time for Georgia home buyers and would-be refinancers to be without a locked rate.

Each month, on the first Friday, the Bureau of Labor Statistics releases its Non-Farm Payrolls report for the month prior. More commonly called the "jobs report", Non-Farm Payrolls provides a sector-by-sector employment breakdown, and the nation's Unemployment Rate.

In December 2011, the government reported 200,000 net new jobs created, and an Unemployment Rate of 8.5%.

For January 2012, economists project 135,000 net new jobs with no change in the Unemployment Rate and, depending on how accurate those predictions are proved, FHA and conforming mortgage rates for homes in Bridge Mill are subject to change. The monthly jobs reports tends to have an out-sized influence on the direction of daily mortgage rates.

The connection between jobs and mortgage rates is fairly direct.

Job growth is a key cog in the economic growth engine and mortgage rates change daily based on short- and long-term economic expectation. As more people join the workforce, economic expectations change; the economy tends to expand, breeding optimism among investment. When this occurs, it often spurs investment in the stock market, which tends to leads mortgage rates up.

In short, in a recovering economy, when job growth is strong, all things equal, mortgage rates rise. Home affordability suffers.

So, for today's rate shoppers, Friday's job report represents a risk. The economy has added jobs over 15 straight months, a streak that's added 2.1 million people to the workforce. Although the jobs market remains weak and well off its peaks from last decade, a 15-month streak is worth watching. More jobs means more more income earned nationwide, more money spent by households, and more taxes collected by governments.

This items build a foundation for economic growth and Wall Street is watching.

If tomorrow's Non-Farm Payrolls shows more jobs created than the estimated 135,000, mortgage rates are expected to rise. If the jobs figures falls short, mortgage rates should fall.

The Non-Farm Payrolls report is released at 8:30 AM ET.

Case-Shiller Index Says Detroit And Washington DC Lead The Market

Standard & Poors released its November 2011 Case-Shiller Index this week. The index measures the change in home prices from month-to-month, and year-to-year, in select U.S. cities.

According to the data, for the second straight month, home values fell in 19 of the Case-Shiller Index's 20 tracked markets. In addition, also for the second straight month, Phoenix, Arizona was the lone Case-Shiller-tracked city in which home values rose.

Overall, November's Case-Shiller Index showed a 1 percent decrease in home values between October and November 2011, and a near-4 percent decrease between November 2010 and 2011, putting home values at roughly the same levels as 8 years ago. Don't read too far into it, however.

The Case-Shiller Index, though widely-cited, remains widely-flawed.

As a buyer or seller in Bridge Mill, for example, , relying on the Case-Shiller Index for market research can lead you to improper conclusions. To understand the Case Shiller Index's methodology is to understand why.

First, the Case-Shiller Index draws its data from a very limited geography.

There are more than 3,100 municipalities nationwide. The Case-Shiller Index tracks just 20 of them. And they're not the 20 largest, either. Four of the Top 10 Most Populous U.S. Cities are excluded (Houston, Philadelphia, San Antonio, San Jose) whereas Minneapolis and Tampa are not.

Minneapolis is the 48th largest city in the United States. Tampa is #55.

Next, when Case-Shiller Index gathers its data from its 20 cities, it only includes the home sale data of single-family, detached homes. This means that sales of condominiums and multi-unit homes are specifically excluded from the index. There are some cities -- Chicago and New York, for example -- where condominium sales represent a large percentage of the overall market.

The Case-Shiller Index ignores that.

And, lastly, when the Case-Shiller Index is published, it's published on a 60-day delay. Its data is not "current", therefore, and does little to tell buyers and sellers of Marietta and the country what's happening in their home markets right this minute. Instead, the Case-Shiller Index tells us how the housing market looked two months ago.

If you're active in the real estate market, either as a buyer or a seller, the Case-Shiller Index does you little good. For real-time data that actionable, speak to a real estate professional instead. It's where you'll find your best, most reliable and relevant information.

Supply Of New Homes At 6.1 Months Nationwide

New Home Sales slowed into the New Year but the market for newly-built homes remains strong. For home buyers in Georgia and nationwide, December's New Home Sales report is yet one more signal that the housing market recovery may be underway.

According to the Census Bureau, the number of new homes sold in December 2011 slipped 2 percent to 307,000 units on a seasonally-adjusted, annualized basis nationwide.

A "new home" is a home that is considered new construction; a home for which the buyer will be the first owner and tenant.

As compared to December 2010, last months' sales volume fell seven percent. It's a statistic that suggests housing market weakness. However, in looking at a different component of the New Home Sales report -- the supply of homes for sale -- we're forced to reconsider.

At the current pace of sales, every new home for sale nationwide would be "sold" in a matter of 6.1 months. 

Economists believe that a 6.0-month supply defines a market in balance -- anything quicker is termed a "seller's market". Statistics like that are enough to create urgency among today's Canton home buyers. 

Unfortunately, the Census Bureau's data may be wrong.

Although December's New Home Sales report shows sales down 2 percent, the government's data was published with a ±13.2% margin of error. This means that the actual New Home Sales figure may have been as low as -15.2 percent, or as high as +11.2 percent. And, because the range of possible values includes both positive and negative numbers, the Census Bureau had no choice but to assign its December data "Zero Confidence".

It will be a few months before final revisions are made to December New Home Sales data. Until then, therefore, buyers should take cues from the market-at-large and the market-at-large hints at recovery. One example of this is homebuilders showing more confidence in their product than at any time in the last 5 years.

If your plans for 2012 call for buying new construction, therefore, consider using this lull to "make a deal". As the year progresses, the great values in housing may be gone.

What's Ahead For Mortgage Rates This Week : January 30, 2012

Mortgage markets improved last week as news from the Federal Reserve, the U.S. economy, and Europe combined to spur new demand for mortgage-backed bonds.

Conforming mortgage rates rallied from Wednesday through Friday's close, ending the week near all-time lows set earlier this year.

Last week's rally was sparked by the Federal Open Market Committee.

After its first meeting of the year, Chairman Ben Bernanke & Co. changed its projection for "exceptionally low rates" to at least late-2014. Previously, the Fed had said its benchmark Fed Funds Rate would remain low until 2013.

This, in conjunction with the Fed's message that further economic stimulus may be coming, led Wall Street investors to increase their bets on mortgage bonds, pushing up prices and pushing down yields.

Lower yields means lower rates.

Mortgage rates were also helped lower by mixed data on the U.S. economy including weaker-than-expected housing reports, and another setback in the Greece sovereign debt negotiations.

Each time that Eurozone leaders have failed to reach an expected accord with Greece since 2010, mortgage rates have dropped. Last week was no different.

This week, with a large amount of U.S. economic data due for release and a high-profile summit among European Union leaders, mortgage rates are poised to move. Unfortunately, we can't know in which direction.

Some of the news that will move markets include :

• Monday : Personal Consumption Expenditures
• Tuesday : Consumer Confidence; Case-Shiller Index
• Wednesday : Construction Spending
• Thursday : Weekly Jobless Claims
• Friday : Non-Farm Payrolls;Factory Orders

Of all of the economic releases, Friday's Non-Farm Payrolls has the most potential to move markets. More commonly called "the jobs report", Non-Farm Payrolls details the monthly change in national employment and the national Unemployment Rate. 

Jobs are believed to be the key to U.S. economic recovery so strength in jobs should result in higher mortgage rates throughout Georgia and the country.

Mortgage rates remain very low. If you're nervous about mortgage rates rising this week or next, it's as good of a time as any to lock your rate with a lender, and start moving toward closing.

Pending Home Sales Index Posts Second Best Month Since April 2010

After 3 consecutive months of growth, the housing market appears to have eased a bit in December.

According to the National Association of REALTORS®, December's Pending Home Sales Index slipped 4 percent from the month prior. The index measures the number of homes under contract to sell nationwide, but not yet sold.

Despite falling below its benchmark "100 value", December's Pending Home Sales Index is the reading's second-highest value since April 2010 -- the last month of last year's home buyer tax credit program.

In other words, the housing market continues to show signs of improvement, propelled by low home prices and the cheapest mortgage rates of all-time.

Freddie Mac's mortgage rate survey put the 30-year fixed rate mortgage at an average of 3.96% in December -- a 75-basis point improvement from December 2010. This helps to make homes more affordable nationwide.

On a regional basis, December's Pending Home Sales Index varied :

• Northeast Region: -3.1 percent from November 2011
• Midwest Region : +4.0 percent from November 2011 
• South Region : -2.6 percent from November 2011
• West Region : -11.0 percent from November 2011

But even regional data is only so helpful. Like everything in real estate, data must be local to be relevant.

Throughout the West Region, for example, the U.S. region in which pending home sales fell the most, several states must have performed better than the regional average. And, undoubtedly, there were cities, towns, and neighborhoods that experienced marked market growth.

Unfortunately, the Pending Home Sales Index can't capture that data. Nor can it identify the markets in which home sales suffered.

For today's Marietta home buyers and sellers, therefore, it's important to understand your local market and the drivers of local activity. Reports like the Pending Home Sales Index can paint a broad picture U.S. housing but for data that matters to you, you'll want to look local.

For local real estate data, talk to an experienced real estate professional.

A Simple Explanation Of The Federal Reserve Statement (January 25, 2012)

Wednesday, the Federal Reserve's Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The Fed Funds Rate has been near zero percent since December 2008.

For the third consecutive month, the Fed Funds Rate vote was nearly unanimous. Just one FOMC member dissented in the 9-1 vote, objecting only to the language used in the Fed's official statement.

In its press release, the Federal Reserve noted that the the U.S. economy has "expanding moderately" since its last meeting in December 2011, adding that the growth is occurring despite "slowing in global growth" -- a reference to ongoing economic uncertainty within the Eurozone.

The Federal Reserve expects moderate economic expansion through the next few quarters but is wary of "strains" from global financial markets, and these three threats to the U.S. economy :  

1. The housing sector remains "depressed"
2. The unemployment rate remains "elevated"
3. Fixed business investment has "slowed"

On the positive side, the FOMC said that household spending is rising and inflation remains in-check. The group also believes that employment will gradually improve nationwide going forward.

The Federal Reserve neither introduced new economic stimulus, nor discontinued existing market programs.

Immediately following the FOMC's statement, mortgage markets rallied, pressuring mortgage rates to fall in and around Atlanta. 

Mortgage rates remain near all-time lows and, for homeowners willing to pay points plus closing costs, conventional, 30-year fixed rate mortgages can be locked at below 4 percent. If you're in the process of buying or refinancing a home in Georgia , it's a good time to lock a mortgage rate with your lender.

The FOMC's next scheduled meeting is a one-day event slated for March 13, 2012.

The Federal Reserve Meets Today : Mortgage Rates Expected To Move

The Federal Open Market Committee adjourns from a scheduled 2-day meeting today, its first of 8 scheduled meetings this year.

The FOMC is a designated, rotating, 12-person committee within the Federal Reserve, led by Federal Reserve Chairman Ben Bernanke. Members of the FOMC sub-committee are the voting members of the Federal Reserve; the ones that ultimately determine U.S. monetary policy.

The most well-known Federal Reserve monetary policy tool is the central bank's Fed Funds Rate. The Fed Funds Rate is the prescribed interest rate at which banks borrow money from each other for a period of one night. 

The Fed Funds Rate can only be changed by FOMC vote.

For home buyers and would-be refinancing households in Marietta , it's important to recognize that the Fed Funds Rate is an interest rate separate and distinct from "mortgage rates". Mortgage rates are not voted upon by the Federal Reserve. Rather, mortgage rates are based on the price of mortgage-backed bonds, a security bought and sold among investors.

Historically, there is little correlation between the Fed Funds Rates and 30-year fixed rate mortgage rates throughout Georgia. Going back 20 years, the benchmark rates have been separated by as much as 5.29% and have been as near as 0.52%. 

The spread has even gone negative, most recently in 1979 and 1981 -- a period marked by high inflation.

Today, the separation between the Fed Funds Rate and the average, 30-year fixed rate mortgage rate is roughly 3.60%. Beginning at 12:30 PM ET, however, that spread is expected to change. The FOMC will make its statement to the press at that time, and will release its quarterly forecast to the markets.

As Wall Street reacts to the Fed's press release and projections, mortgage rates will move.

Investors expect the Fed to vote the Fed Funds Rate unchanged from its current range near 0.000 percent, but are unsure of how the Fed will characterize the U.S. economy. If the Fed speaks optimistically on the economy, stock markets should rise and mortgage bonds should fall, driving mortgage rates higher.

Conversely, if the Fed shows concern for future economic growth, mortgage rates should drop. Either way, today figures to be volatile one for mortgage markets. 

When mortgage markets get volatile, the safe play as a rate shopper is to lock your mortgage rate immediately. There too much risk in floating.

Existing Home Sales Approach Bull Market Territory

The housing market finished 2011 with strength, and is carrying measurable momentum into 2012. 

According to data from the National Association of REALTORS®, on a seasonally-adjusted, annualized basis, December's Existing Home Sales climbed by 120,00 units overall from the month prior on its way to an 11-month high.

An "existing home" is a home that's been previously occupied; that cannot be considered new construction.

After 4.61 million existing homes were sold in December, there are now just 2.38 million homes for sale nationwide. The last time the national home supply was this sparse was March 2005.

At today's sales pace, the complete, national home inventory would be exhausted in 6.2 months -- the fastest pace since before the recession. A 6.0-month supply is believed to represent a market in balance. 

The December Existing Home Sales report contained noteworthy foreclosure and short sale statistics, too :

• Foreclosures sold at an average discount of 22% to market value
• Short sales sold at an average discount of 13% to market value
• Together, foreclosures and short sales accounted for 32% of all home sales

Clearly, "distressed homes" remain a large part of the U.S. housing market.

Furthermore, in its report, the real estate trade group also noted that one-third of homes under contract to sell nationwide succumbed to contract failure last month. That's up from 9% one year ago.

Contract failure occurs for a multitude of reasons, most notably homes appraising for less than the purchase price; the buyer's failure to achieve a mortgage approval; and, insurmountable home inspection issues. December's high failure rate underscores the importance of getting pre-approved as a buyer, and of buying homes in "good condition".

For today's home buyer in Atlanta , December's Existing Home Sales figures may be construed as a "buy signal". Home supplies are dropping and buyer demand is rising. This is the basic recipe for higher home prices ahead.

If your 2012 plans call for buying a home, consider that home values throughout Georgia are expected to rise as the year progresses. The best values of the year may be the ones secured this winter.

What's Ahead For Mortgage Rates This Week : January 23, 2012

The outlook for the U.S. economy improved last week, taking the mortgage bond market with it. For the first time this year, conforming mortgage rates rose throughout Georgia from one week to the next.

Data was strong across all categories last week.

• Home Resales :Existing Home Sales rose 5%
• New Homes : Single-Family Housing Starts rose 4%
• Builders : Home Builder Confidence rose to a 5-year high
• Jobs : Jobless claims fell to lowest level since April 2008
• Inflation : CPI remained in balance

In addition, European leaders moved closer to a final resolution on the Greek sovereign debt default situation.

Overall, the action gave investors reason for optimism in the U.S. economy, and economies abroad. This drew money away from the U.S. mortgage bond market, which caused mortgage rates to rise.

Freddie Mac reports the average 30-year fixed rate mortgage slipping 0.01 percentage points to 3.88% nationwide, with an accompanying 0.8 discount points and complete set of closing costs. These costs are slightly higher as compared to the week prior.

1 discount point is equal to one percent of the borrowed loan size.

Freddie Mac's weekly mortgage rate survey puts the conforming 30-year fixed rate mortgage under 4 percent for 7 consecutive weeks.

This week, mortgage rates may rise; the week is anchored by a 2-day Federal Open Market Committee meeting. Whenever the FOMC meets, mortgage rates can be volatile.

The Ben Bernanke-led FOMC is not expected to raise the Fed Funds Rate from its current target range near 0.000 percent, but it's not what the Fed does that can change mortgage rates as much as it is what the Fed says. 

After its 2-day meeting concludes Wednesday, the FOMC will issue its customary statement to the markets, to be followed by a press conference led by Chairman Bernanke. Wall Street will watch the press release and conference for clues about the Fed's next steps and its outlook for the U.S. economy.

If the Fed indicates that the economy is growing, mortgage rates in Atlanta are likely to rise. Conversely, if the Fed indicates that the economy is slowing, mortgage rates are likely to fall.

Other factors influencing mortgage rates this week include the President's annual State of the Union address (Tuesday), the Pending Home Sales Index (Wednesday) and New Homes Sales data for December (Thursday).

Mortgage rates remain low but may not stay that way. If you're looking for the best rates of the year, this week may be your chance.

Behind The Housing Starts Headlines, The Story That Matters

When it comes to housing data, sometimes you have to look past the headlines. December's Housing Starts data offers a terrific illustration of why.

Each month, the Census Bureau tallies Housing Starts for the month prior. A "housing start" is a home on which construction has started.

The Housing Starts report is separated by property type. There is a count for single-family homes; a count for 2-4 unit homes; and a count for buildings of 5 units or more, a category including apartments and condominiums.

In December, as reported by the government, Housing Starts fell 4 percent nationwide overall. This runs contrary to recent strength in housing and the story was quickly picked up by the press :

• U.S. Housing Starts Fall More Than Forecast (BusinessWeek)
• U.S. Housing Starts Fall (MarketWatch)
• December Housing Starts Are Worse Than Expected (Fox Business)

Now, although these headlines are factually true, they're also are a little bit misleading.

Housing Starts did fall 4 percent last month but that was for all Housing Starts, across all three property types. Data like this is somewhat irrelevant to home buyers in Georgia or anywhere else nationwide.

Few buyers purchase 2-4 unit homes, and almost nobody purchases an entire apartment building. Rather, it's the Housing Starts reports' "single-family" tally that matters because that's the home type that the majority of home buyers purchase.

In December, for the fourth straight month, Single-Family Housing Starts increased.

Single-family housing starts climbed 4 percent last month to 470,000 units on a seasonally-adjusted, annualized basis. This is the highest number of Single-Family Housing Starts since April 2010 -- the last month of last year's home buyer tax credit.

The Single-Family Housing Starts data is the latest in a series of data that point to a housing rebound nationwide. New Home Sales, Existing Home Sales, Pending Home Sales and Homebuilder Confidence has each posted multi-month highs and all are poised for strong gains into 2012.

If you're planning to buy a home in 2012, consider buying in between now and March rather than at some point later. Home prices -- and mortgage rates- are likely to move higher.

Pending Home Sales Index Rises Back Above 100

Low home prices and mortgage rates have combined to push home affordability to record levels nationwide. Home buyers are taking advantage.

The Pending Home Sales Index rose 7 percent in November to rise to its highest level since April 2010, the last month of last year's home buyer tax credit program. 

The Pending Home Sales Index is published monthly by the National Association of REALTORS®. It measures homes under contract nationwide, but not yet "sold". 

In this way, the Pending Home Sales Index is different from other housing market indicators. It's a "forward-looking" figure; a predictor of future home sales. According to the National Association of REALTORS®, more than 80% of homes under contract close within 60 days. 

By contrast, housing data such as the Existing Home Sales report and the New Home Sales report "look back".

November marks the second straight month of Pending Home Sales Index improvement. The housing market metric made big gains of 10 percent in October 2011, as well.

On a regional basis, each part of the country showed an increase in homes under contract.

• Northeast Region: +8.1 percent from October 2011
• Midwest Region : +3.3 percent from October 2011 
• South Region : +4.3 percent from October 2011
• West Region : +14.9 percent from October 2011

However, here in Kennesaw, we must discount the value of even the regional data, somewhat. Like else in real estate, the volume of homes going under contract vary by locality.

Throughout the West Region, for example, the region in which pending home sales increased the most from October, there are nearly a dozen states. Undoubtedly, some of those states performed better than others in terms of "homes under contract", but we don't have an indication of which states those were.

In addition, within each state, every city, town, and neighborhood realized its own unique market in November, and produced its own sales statistics.

For buyers and sellers throughout Georgia and the country, therefore, it's more important to watch data on a local level than on a national one. Reports like the Pending Home Sales Index are helpful in showing national trends, but as an individual, what you need are local trends.

For local real estate data, be sure to ask your agent.

Nationally, Home Prices Off 18.3 Percent From April 2007 Peak

The government confirms what the private-sector Case-Shiller Index reported yesterday. Nationwide, average home values slipped in October.

The Federal Home Finance Agency's Home Price Index shows home values down 0.2% on a monthly, seasonally-adjusted basis. October marks just the second time since April that home values fell month-over-month.

The Case-Shiller Index 20-City Composite showed values down 0.7 percent from September to October.

As a home buyer in Atlanta , it's easy to look at these numbers and think housing markets are down. Ultimately, that may prove true. However, before we take the FHFA's October Home Price Index at face value, we have to consider the report's flaws.

There are three of them -- and they're glaring. As we address them, it becomes clear that the Home Price Index -- like the Case-Shiller Index -- is of little use to everyday buyers and sellers in places like Vinings.

First, the FHFA Home Price Index only tracks home values for homes backed by Fannie Mae or Freddie Mac mortgages. This means that homes backed by the FHA, for example, are specifically not computed in the monthly Home Price Index.

In 2007, this was not as big of an issue as it is today. in 2007, the FHA insured just 4 percent of the housing market. Today, the FHA is estimated to have more than one-third of the overall housing market.

This means that one-third of all home sales are excluded from the HPI -- a huge exclusion.

Second, the FHFA Home Price Index excludes new home sales and cash purchases, accounting for home resales backed by mortgages only. New home sales is a growing part of the market, and cash sales topped 29 percent in October 2011.

Third, the Home Price Index is on a 60-day delay. The above report is for homes that closed in October. It's nearly January now. Market momentum is different now. Existing Home Sales and New Home Sales have been rising; homebuilder confidence is up; Housing Starts are showing strength. In addition, the Pending Home Sales Index points to a strong year-end.

The Home Price Index doesn't capture this news. It's reporting on expired market conditions instead.

For local, up-to-the-minute housing market data, skip past the national data. You'll get better, more relevant facts from a local real estate agent.

Since peaking in April 2007, the FHFA's Home Price Index is off 18.3 percent.

New Home Sales Approach Bull Market Territory

New home inventory is approaching bull market territory.

According to the Census Bureau, the number of new homes sold rose 2 percent in November. On a seasonally-adjusted, annualized basis, home buyers bought 315,000 newly-built homes last month.

November's New Home Sales data marks the 4th straight month of rising sales volume, lifting the housing-market metric to a 7-month high, and adding to the housing market's recent show of strength. 

Last week, we learned that Existing Home Sales also climbed in November.

The big story in the New Home Sales report, though, is the remaining new home supply nationwide.

With just 158,000 homes "on the market" and the pace of home sales hastening, the complete, national inventory of "new homes" would now be sold in just 6.0 months, a 0.2-month improvement from October. This is the quickest home sales pace in nearly 6 years for the new construction market. 

It's even faster than in April 2010 -- the buyer-deadline month of last year's federal home buyer tax credit.

Home builders expect the trend to continue, too. Buyer foot traffic is on the rise and builders have a strong outlook for the next 6 months.

It's an unsettling series of developments for today's Kennesaw home buyers. As home supplies drop and builders gain confidence, the ability of an buyer to negotiate for price reduction and/or upgrades shrinks.

If you're a home buyer in search of new construction, therefore, consider that the best new construction "deals" of the next 12 months may be the ones you find today.

What's Ahead For Mortgage Rates This Week : December 27, 2011

Mortgage markets worsened last week on renewed optimism from the Eurozone, additional evidence of a U.S. economic recovery, and ongoing strength in housing.

The action sparked a stock market rally at the expense of mortgage bonds, sending conforming and FHA mortgage rates meaningfully higher for the first time in more than 2 months.

Markets closed early Friday and remained closed Monday. When they re-open today, conforming mortgage rates will already have bounced off last week's new, all-time lows.

As reported by Freddie Mac's weekly mortgage rate survey, the average 30-year fixed rate mortgage fell to 3.91 percent nationwide, with an accompanying 0.7 discount points plus closing costs. 1 discount point is equal to 1 percent of your loan size such that 1 discount point on a $100,000 loan is equal to $1,000.

It's not just the conventional 30-year fixed that made new lows last week, either. All of Freddie Mac's reported rates fell to new, all-time lows.

• 30-year fixed : 3.91% with 0.7 discount points
• 15-year fixed : 3.21% with 0.8 discount points
• 5-year ARM : 2.85% with 0.6 discount points

These rates are no longer valid, however. FHA mortgage rates rose slightly last week, too.

This week, mortgage rates will be more volatile than usual. There isn't much economic data on which to trade, and it's a holiday-shortened week (again). Look for geopolitics and momentum to nudge markets forward, therefore -- a potentially bad combination for today's rate shoppers. There is very little room for mortgage rates to fall, but lots of room for them to rise.

If the stock market rallies to close 2011, mortgage rates will rise right on with it.

For now, rates remain historically low. If you've been shopping for a mortgage -- waiting for rates to fall -- this last week of the year may be your last chance at sub-4 percent, fixed-rate mortgage rates. Don't wait too long or you might miss it.

It's a good time to execute on a rate lock.

Pay Your Mortgage Early, Boost Your 2011 Federal Income Tax Deductions

Time is running out to boost to your 2011 federal tax refund. All you have to do is make your January 2012 mortgage payment while it's still December.

It's a simple tax strategy that works because of how mortgage interest is paid, and of how the U.S. tax code is written.

Different from rent which is paid for the month ahead (i.e. "you're paying January's rent"), mortgage payments are made only after mortgage interest has accrued (i.e. "you're paying for money you've already borrowed from the bank").

This is called "paying interest in arrears" and U.S. tax code states that the mortgage interest is tax-deductible in its year paid, subject to limitations.

By making the January 2012 mortgage payment in December 2011, therefore, homeowners who itemize their on their tax returns can apply their January mortgage payment's interest portion to their 2011's tax returns.

The alternative is to pay the mortgage on schedule, and wait for April 15, 2013 to claim the credit.

If you choose to pre-pay your mortgage and typically send your payment via USPS, give your check ample time to be delivered to your lender, and processed. Mail your check no later than Saturday, December 24.

For Kennesaw homeowners that pay electronically, the process is simpler. Edit your online bill pay program to have your mortgage payment post no later than Thursday, December 29.

Make note, however. Not all mortgage interest is eligible for tax-deductibility, and not all homeowners throughout the state of Georgia who pay mortgage interest should itemize said interest on their tax returns.

Before prepaying on your mortgage, ask your tax professional for advice.