The Anna Maria Island Sun Newspaper


Vol. 17 No. 7 - November 30, 2016

REAL ESTATE

What a way to start the holiday season

 

“Tis the season to be jolly,” except, of course, if you’re looking to finance or refinance and missed the low interest rate window. But don’t be afraid the Grinch has not totally taken over, and although rates are inching up, they are still historically low.

After the election, the treasury bond yields when up right along with mortgage interest rates. Two days after the election the average rate on a 30-year, fixed-rate, conforming mortgage spiked a quarter of a percentage point to 3.87 percent, going as high as 4.02 percent after that. As of this writing, the 30-year, fixed rate is about 3.98 percent and the 15-year rate is 3.09 percent.

As previously stated, even though rates are going up they are still historically low. In, fact the average over the past 45 years is 8.26 percent, according to data from Freddie Mac. No one, of course, wants to see those rates again, but even a small movement in the rate can have a serious impact on the real estate market in general.

Higher interest rates can have a dramatic effect on not only the mortgage market, but also on the refinance market. This has proven to be true since two weeks ago the refinance index fell to a six-month low. The refinance market is more sensitive to even small rate increases since homeowners who currently have mortgages close to the new higher rates may reconsider their refinance options.

New home buyers probably will not change their decisions to purchase, but could readjust their price range and potential marginal buyers may find they may not qualify for financing. For example, a $300,000 30-year mortgage at 3.5 percent carries a $1,347 monthly payment; a $300,000 30-year mortgage with a 4 percent mortgage carries a $1,432 monthly payment, $85 a month more. It doesn’t sound like a lot, but it may be just enough to either send buyers into a lower price range or disqualify them all together if they don’t have additional funds for a down payment.

Higher rates also could have the effect of pushing those buyers who have been sitting on the fence to jump into the market. His could be a temporary boom to the real estate marke but long term it could backfire. And there is an upside to higher mortgage interest rates. It could keep out real estate speculators as well as buyers who may be encouraged to purchase properties more expensive than their incomes could afford.

Another factor to keep an eye on that could affect the real estate market is the regulatory environment. The new administration will undoubtedly rollback many of the banking regulations contained in the Dodd-Frank law. The law instituted strict safeguards for mortgages resulting in banks only making loans to buyers with sterling credit and credit scores in the high 700 range. That left a lot of buyers out of the loop, especially younger buyers with fuzzy credit histories.

It is unlikely lenders will go back to the wild west days of balloon payments, no document loans and little or nothing down. However, there likely will be some loosening of regulations bringing new buyers into the fold. That said what will happen to real estate values is anyone’s guess, and since no one could predict the outcome of the president race I dare anyone to predict next year’s real estate market.

Now you can face the holiday season more confused than ever about home financing. Time to get out the eggnog.

Real Estate Transactions
Real estate transfers of June 2016

Sponsored by Alan Galletto Island Real Estate

Sold Date | List Price | Sold Price | Address | Provision | Property Style

Anna Maria

16-07-11 625,000 525,000 122 Oak Ave 1176 3 Br/2 Ba SFR 16-07-08 745,000 689,000 405 Spring Ave 1696 4 Br/3 Ba SFR 16-07-01 899,000 850,000 302 Tarpon St 1878 3 Br/2 Ba SFR 16-07-05 1,099,000 919,000 525 Kumquat Dr 2288 3 Br/2 Ba SFR 16-07-22 1,200,000 1,100,000 116 Peppertree Ln 1996 3 Br/2.5 Ba SFR
16-07-14 1,250,000 1,153,500 229 Chilson Ave 1597 3 Br/3 Ba SFR 16-07-21 1,250,000 1,170,000 238 Lakeview Dr 2281 3 Br/2 Ba SFR 16-07-25 1,745,000 1,600,000 909 N Shore Dr 1868 3 Br/3 Ba SFR 16-07-25 3,500,000 3,300,000 825 N Shore Dr 3486 3 Br/4.5 Ba SFR
16-07-21 620,000 580,000 218 Palmetto Ave 1648 52x100 Duplex
16-07-15 399,000 350,000 710 N Shore Dr 60x85 Vac.
16-07-07 495,000 470,000 401 S Bay Blvd 76x105 Vac

Bradenton Beach

16-07-01 1,495,000 1,495,000 106 4th St S 3000 6 Br/5 Ba SFR 16-07-01 379,900 349,000 1301 Bay Dr N #5a 1079 2 Br/2 Ba Condo
16-07-28 610,000 585,000 1417 Gulf Dr N #1417 1524 3 Br/2.5 Ba Condo

Cortez

16-07-26 1,800,000 1,720,000 12614 Baypointe Ter 4677 3 Br/3.5 Ba SFR
16-07-12 123,500 107,500 12334 Baypointe Ter 110 x 151 Apx Vac.

Holmes Beach

16-07-11 489,000 475,000 406 Bay Palms Dr 1332 2 Br/2 Ba SFR 16-07-06 549,000 490,000 308 56th St 1080 2 Br/1 Ba SFR 16-07-12 579,000 575,000 208 Haverkos Ct 2181 65x98 3 Br/2.5 Ba SFR 16-07-18 619,000 620,000 5802 Imperiore Ave 1020 2 Br/2 Ba SFR 16-07-20 650,000 650,000 304 60th St #B 1150 3 Br/2 Ba SFR 16-07-15 849,000 790,000 206 67th St 2139 4 Br/3 Ba SFR 16-07-27 999,000 975,000 307 74th St 1676 3 Br/3.5 Ba SFR
16-07-11 1,299,000 1,185,000 671 Key Royale Dr 2885 221x78 3 Br/2.5 Ba SFR
16-07-19 2,190000 1,800,000 512 59th St 4544 6 Br/4.5 Ba SFR 16-07-11 2,399000 2,100,000 625 Key Royale Dr 3118 4 Br/3.5 Ba SFR
16-07-05 375,000 350,000 3215 Gulf Dr #3215 672 1 Br/1.5 Ba Condo
16-07-01 360,000 360,000 600 Manatee Ave #205 1187 2 Br/2 Ba Condo
16-07-01 389,000 375,000 3402 Gulf Dr #3 359 2 Br/2 Ba Condo
16-07-18 415,000 392,000 5806 Gulf Dr #204 1078 2 Br/2 Ba Condo
16-07-15 499,900 485,000 6006 Gulf Dr #111 1154 2 Br/2 Ba Condo
16-07-11 395,000 367,500 3009 Avenue E 751 2 Br/1 Ba Villa
16-07-26 469,000 425,000 5613 Guava St #A&B 1580 57x105 Duplex

Source: Mid Florida Multiple Listing Service


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