New Listings week ending October 12
Here are the latest new listings:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
New Listing Mid-Week October 10
A quiet week so far for new listings:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Open Houses Sunday October 7
Here are today’s Open Houses:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open Houses
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Mortgage rates head for 5%
The yield on the US 10 year Treasury Note (10T) jumped sharply in the later part of the past week, a move which will cause the 30 year Fixed Rate Mortgage to move up again in the coming week, approaching 5%.
What drives mortgage rates?
The Federal Reserve (Fed) raised the Fed Funds (FF) rate again recently, the 8th increase since December, 2015
While changes in the FF rate (the rate at which banks lend overnight money to each other) claim the headlines, the 30 year Fixed Rate Mortgage (FRM) rate is set by the market and is a based on the yield investors in mortgage- backed securities demand over what they can earn from the US 10 year Treasury Note (10T).
Let’s look at some numbers. In the chart below, the first column shows the FF rate on the date of the increases. The second and third columns show the yield at that time on the 10T and FRM.
The second chart shows the spread (difference in yield) between FRM and FF on the left, and between FRM and 10T on the right. The consistency of the second column illustrates the link between the 30 year mortgage rate and the yield on the US 10 year Treasury Note.
What rates are influenced by the FF rate?
Banks respond to increases in the FF rate by raising their Prime Rates. This in turn influences the rates on such things as credit cards and auto loans, as well as home equity lines of credit. Adjustable rate mortgages (ARM) also move up with increases in short-term rates, especially the 1 year Treasury bill.
Where are rates heading?
Part of the reason for the increase in bond yields last week was the statement from the Chairman of the Federal Reserve that the current FF rate was “a long way from neutral”, a statement interpreted by the bond market as confirming that the FF rate may increase by another 1% over the next year. With the economy currently growing strongly and very low levels of unemployment, the bond market fears that inflation will pick up. With higher inflation levels, investors will demand higher yields from Treasuries. And this comes at a time when the Budget Deficit is jumping, a deficit that needs to be funded by selling more Treasuries.
Background Reading
Here are two articles I have written. The first is from October 2018:
Why mortgage rates may be headed upwards – finally
And this one from February 2018:
What will happen to Home Prices in the Experimental Economy?
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
New Listings week ending October 5
Here are the latest new listings:
Mareblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Open Houses weekend of October 6/7
Here are the Open Houses for this Columbus Day weekend:
Saturday
Marblehead Saturday Open Houses
Swampscott Saturday Open Houses
Salem Saturday Open Houses
Beverly Saturday Open Houses
Lynn Saturday Open Houses
Sunday
Marblehead Sunday Open Houses
Swampscott Sunday Open Houses
Salem Sunday Open Houses
Beverly Sunday Open Houses
Lynn Sunday Open Houses
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Housing Supply by Town and by Price
A housing market is generally regarded as being in equilibrium between buyers and sellers when the number of properties for sale is equal to 6 months of sales. But figures for a market overall can disguise major differences between supply at different price points. This report analyses the supply by price as of October 1 for Marblehead, Swampscott, Salem, Beverly and Lynn; and for Essex County.
First, the overall market. In each of these, supply favors sellers as it is less than the 6 months which indicate a balanced market.
Now let’s break down each market by price. It will not come as a surprise to see that higher-priced properties take longer to sell, but the differences are quite stark. Bear in mind that some of the sample sizes, especially at higher price points, are quite small.
Marblehead
The advantage does not shift from sellers to buyers until prices reach $1.5 million.
Swampscott
Similar story here: advantage switches to buyers above $1.5 million.
Beverly
The change over in Beverly starts at $750,000.
Salem
Supply is tight at all price points.
Lynn
Supply becomes freer above $500,000.
Essex County
Whereas some of the individual towns have small numbers in some price ranges, Essex County overall has larger numbers and therefore the numbers are a more reliable guide to the overall market. These numbers show how the supply increases as do prices, but that current inventory continues to favor sellers up to $1 million.
Sagan Harborside Sotheby’s International Realty
www.SaganHarborside.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Recent Comments