Well now that Thanksgiving is over, and Christmas and New Years is upon is it’s time to start planning for what we are likely to see in the new year. The election was a wild ride and bumpy to say the least, but now that president elect Trump is in office we can move on. With newly appointed future HUD secretary Ben Carson in office it remains to be seen how low income housing, lending, and urban real estate will be affected since Mr. Carson has admittedly said he is not well versed in the industry. One thing we do know is he is a very sharp level headed man, and I have no doubts he will be well informed by those familiar with our field to help him in making good decisions to help home owners and home buyers.
Now that 2017 is quickly approaching home buyers and sellers alike are weighing their options as the holidays fade the slow season will too. What’s that mean for you?
According to Moody’s Analytics projections – nationally, home prices are expected to keep rising, albeit more slowly— 3.5% in 2017, vs. 4.5% in 2016. But even more so than in recent years, your position is now going to hinge on what and where you’re buying or selling.
It probably comes as no surprise that there has been a resurgence in interest in urban living as millennials move away from mom and dad’s house. Most of who prefer to walk, bike or Uber from place to place with in their city or town. No where is that more evident than Charleston SC, where parking is almost impossible in the city and loft style condos are becoming the new hot trend. Small homes have seen much sharper price growth than larger ones, urban areas have appreciated faster than metro outskirts— and both trends are expected to continue in 2017.
If you’re a suburbanite, things are looking bad for you either. Over the five years between 2011 and 2016, the average price on a two-bedroom house climbed 59% nationwide, while four-bedroom houses climbed a more modest 41%, according to an analysis by Attom Data Solutions. Inventory has also risen at the higher end of the market, rising almost 8% for homes in the $500,000 to $750,000 range.
Most of my clients here in the area are retirees looking to move from colder climates and enjoy the laid back beach feel, charm, and phenomenal world class dining that only Charleston offers. If you’re one of those retirees looking to move to sunnier climates, you may profit from what are now bigger variations between U.S. metro areas than have existed at any time in the past two decades, according to Yun – chief economist at the National Association of Realtors.
If you haven’t pulled the trigger just yet on buying it may have cost you, as mortgage rates have risen from once all time lows to current rates of 3.85%, and I wouldn’t be surprised if you see them push over 4% within in the first half of 2017. For example: That would mean an $864 increase in annual payments on a $250,000 mortgage if rates jump to 4.2% from the 3.7% average on 30-year fixed loans in November.
For 2017 The FHA has announced they are going to increase loan limits due to rising home prices.
Here are the upcoming changes. In high-cost areas, the FHA national loan limit “ceiling” will increase to $636,150 from $625,500. FHA will also increase its “floor” to $275,665 from $271,050.
Additionally, the maximum claim amount for FHA-insured Home Equity Conversion Mortgages (HECMs), or reverse mortgages, will increase to $636,150.