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bewildering
9 years ago

What is considered a balanced
What is considered a balanced inventory? The value seems to jump around all over the place. 3 months seems low, but I haven’t seen any values prior to 2007.

werdna
9 years ago

UT San Diego recently had and
UT San Diego recently had and article on the return of 0-down loans:

http://www.utsandiego.com/news/2014/Jul/11/zero-percent-down-mortgages-return-loans-homes/?#article-copy

Sounds like 0-down loans are limited to a few credit unions, but are lending standards going down again more generally? Could that contribute to the increasing prices? Or would you expect increasing number of sales if that were that case?

spdrun
9 years ago
Reply to  werdna

This article says that 0%
This article says that 0% down was brought back in 2010 by NFCU. With QM coming into force this past January, there’s next to no secondary market for 0% down loans. I seriously doubt that this is a big factor, especially since sales aren’t rising like during the last bubble.

EconProf
9 years ago
Reply to  spdrun

I’d suggest interest rates
I’d suggest interest rates are a big factor here. The 10-year bond interest rate is down 1/2 % so far this year, and mortgage rates track this instrument pretty closely. Plus, credit standards are reportedly being relaxed of late for home buyers.
The interest rate decline is surprising everyone, since the forecasts at the end of last year were for higher rates. Blame that on weak GNP growth (actually minus 2.9% rate in the first quarter) so far this year. With economists rapidly lowering their growth forecasts, low mortgage rates may be with us for some time.

bewildering
9 years ago
Reply to  EconProf

US bond yields are high
US bond yields are high compared to international bond yields. Irish 10-year bond yields are now 2.23 – US are 2.45. Weird considering Irish yields were above 10 a few years ago…

Japan and Swiss 10-year yields are 0.6. Is this the future for the US 10-year bond yield?

I can’t imagine US yields going higher in this international market. So mortgage rates might be heading even lower.

spdrun
9 years ago
Reply to  bewildering

Prices have been all over the
Prices have been all over the map in the past five years, even with low mortgage rates. You’re ascribing some sort of rationality to the market. Perhaps geopolitics will be good for a scare.