Last Open Houses before July 4
These are the last Open Houses before July 4:
Click on these links for details:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open Houses
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Are mortgage rates headed to 3%?
At mid-year, as the Freddie Mac weekly survey produced a figure of 3.73% for the 30 year Fixed Rate Mortgage(FRM), it is timely to note both that the rate has come down sharply since late 2018 and also that there are some forecasts that it could go even lower.
The first chart shows the FRM weekly since the beginning of 2018.
In late 2018 there were several forecasts that the rate would top 5% in 2019. The Mortgage Bankers Association, for example, in its December 2018 publication, forecast that the rate would reach 5.0% in Q4 2019. And they were not alone.
So what happened?
The most important aspect of mortgage rates to understand is that the FRM is based upon a premium – or spread – demanded by investors over what they can earn from investing in US Government Treasuries. The Federal Reserve sets the Fed Funds Rate – which is the basis for Prime Rate, which determines interest rates on credit cards, auto loans and adjustable rate mortgages – but the market sets the rate for the yield on the 10 year Treasury (10T), which is the main reference for FRM.
The FRM has been at a premium of about 1.7% over the 10T in recent years.
This week’s Freddie Mac FRM was 3.73% and the yield on 10T 2.01% – a difference, or spread, of 1.72%, in line with what one would expect. And that spread has been consistent even while the yield on 10T has varied from a low of under 1.5% to a high over 3.2% as shown in the next chart.
Why have interest rates dropped this year?
I addressed this in a recent post Why are mortgage rates plummeting? and there is a page on the website devoted to Mortgage Rates. Basically, the yield on 10T reflects three things: the outlook for the US economy (a rapidly expanding economy produces a greater demand for borrowing and interest rates tend to rise); geopolitical tensions (the “flight to quality” which sees interest rates drop as a result of the buying of US Treasuries as a “safe haven”); and relative yields compared with other developed countries.
I have been writing consistently since late 2018 that the outlook for the US economy is for a slowing, but still growing economy. At mid-year that still looks a good bet, tariffs notwithstanding.
There is no doubt that the world economy is slowing or that inflation has failed to appear as expected, while the world is awash in cash. Against that background the yield offered by US Treasuries is extremely attractive. The chart below shows the yields on 10 year Government Securities in 10 major countries.
Startlingly, roughly 50% of all European Government debt carries negative yields, meaning that investors are paying for the privilege of owning the securities.
Will mortgage rates reach 3%?
At a time when the economic outlook can change in the time it takes one man to type 280 characters, it is really hard to make forecasts. Most economists and businessmen would say that uncertainty slows investment and there is plenty of uncertainty at the moment. To get to a 3% FRM, the yield on 10T would have to drop to around 1.25%. In July 2016 it reached 1.37%, so it is not impossible. Is it likely? Hand me my crystal ball – oh it’s gone all cloudy.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Most expensive US Listing gets $50 million price cut
Traditionally on the North Shore buyers like to have a property under agreement by July 4 to ensure that they can move and be in place for the start of the school year.
After July 4, therefore, it is not unusual to see price cuts or, as we like to call them, price adjustments. But probably not on the scale of the $50 million cut on a property in Los Angeles. On the other hand the “adjusted” price is still a cool $195 million. Yeah, I always thought $245 million was a bit rich. $195 million – that’s so much more affordable. I wonder if there is an Open House today?
Click on the link for a description of the property from Mansion Global: US most expensive listing
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 before July 4
These are the last Open Houses before July 4 (and remember to check back at 8 a.m. tomorrow for an updated list for Sunday):
Click on these links for details:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open Houses
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 29
New listings for the last weekend before July 4th:
Click on these links for details:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Two things you learn from this blog
Regular readers of this blog know two things:
the cost of a 30 year Fixed Rate Mortgage (FRM) is based upon the yield on the US Treasury 10 year Note, not the Federal Reserve’s rate announced with great fanfare each month
the list of Sunday’s Open Houses published on Saturday is incomplete: you need to check back at 8 a.m. on Sunday for an updated list.
In tomorrow’s blog I shall publish an article entitled: “Are mortgage rates headed for 3%” – and an updated list of Open Houses.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Mid-Week New Listings June 26
These are the latest new listings as we move towards July 4th:
Click on these links for details:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 23
Summer officially started on Friday and FINALLY arrived yesterday. Celebrate the solstice by attending one of these Open Houses:
And here are the details:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open House
Please contact me if you have any questions about any of these properties – or the market – or if you would like a private showing of any of these properties.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 22/23
Here are this weekend’s Open Houses. Don’t forget to check back tomorrow at 8 a.m. for an updated Sunday list:
And here are the details:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open House
Please contact me if you have any questions about any of these properties – or the market – or if you would like a private showing of any of these properties.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 22
Here are the latest new listings:
And the details:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Please contact me if you would like to see any of these new listings or if you have any questions about them or the market.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 mid-week June 19
Here are the most recent new listings:
and the details:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Father’s Day Open Houses
Father’s Day Open Houses:
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open Houses
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 16/17
Here are this weekend’s Open Houses. Remember to check back tomorrow at 8 a.m. for an updated list for Father’s Day.
Marblehead Open Houses
Swampscott Open Houses
Salem Open Houses
Beverly Open Houses
Lynn Open Houses
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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 June 15
Here are the latest new listings:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.com
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Mid-Week New Listings June 12
These are the most recent new listings:
Click on these links for details:
Marblehead new listings
Swampscott new listings
Salem new listings
Beverly new listings
Lynn new listings
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
m 617.834.8205
www.OliverReports.com
www.TeamHarborside.com
Andrew.Oliver@SothebysRealty.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