JW Mashburn Homes

What’s Up With the Housing Market?

Many people have questions about the housing market.  They are wondering, “What should I do?” Sell, Buy, Rent or Just Wait! 

I can’t speak to your specific circumstances but, I can give you an overview from The Oklahoma Mortgage Bankers Association’s assessment of “The Market.”

 First, The bad news and it’s in the form of perception, Specifically the Lack of Consumer Confidence.  This is due to several factors:

·  Media reports are nearly 100% negative

·  Japanese Tsunami and European governments creating global fears

·  National unemployment over 9%

·   4 million home loans over 6 months delinquent or in foreclosure

·   Fears of U.S. government shutdown without a debt ceiling adjustment

·   Historically no recovery without improved housing sector

·   Potential buyers cannot get a home loan with stringent underwriting

Second, The good news and it’s in the form of facts. “The Market” still is and will continue to be Local.  Here are the supporting facts:

·   Oklahoma’s economy continues to show signs of strength

·   State tax receipts are up 15% over the past year as of June

·   Statewide unemployment dropped to 5.3%, decreasing in all 77 counties

·   Unemployment in Oklahoma City is 4.5% - lowest in the nation of major cities

·   Since 4th Quarter of 2009, Oklahoma’s personal income growth is 2nd highest nationally

·   Oklahoma is one of the few states with significant inward migration

·   Market values on most homes have remained stable

·   Lenders and borrowers remember the Oil Bust and have been conservative

 Third, as I said earlier, “I can’t speak specifically to your circumstances” but, here are a few more facts that may help you in your decision:

·   Average Sales Price in the OKC Metro area is approximately $150,000

·   Interest rates are at a 50 year low

·   Average interest rate since 1990 is 7.16%, current rate is 4.5%

·   If interest rate on average house ($150,000) moves from 4.5% to 6.5% (still below average for last 20 years) the payment increases $183.00 per month

·   With the FHA monthly MI (Mortgage Insurance) increase over the past year the payment has increased another $75 per month

·   What does this mean to you? It means, for the same amount of monthly payment, you would have to settle for a home that is $50,000 less in value.  This could make a difference in where you live.

·   One last interesting fact; the average net worth of homeowners is $188,000 while it is $4,600 for Renters