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Sunday
Nov132016

California housing affordability unchanged in 3rd quarter

Mortgage rates rise to highest  levels in 3 years  -  Rates surged as bond yields and stocks rose sharply following the election results. Rates on just about every mortgage product increased over 1/4%.  By Friday the 30 year fixed rate was close to 4%. The Freddie Mac Primary Mortgage Survey which was released on November 10, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.57%. The 15-year fixed average rate was 2.88%.. The 5/1 ARM average rate was 2.88%. Unfortunately, this survey was last Wednesday November 2 to Tuesday November 8. Rates surged after the survey period, so rates will be about 1/4% higher in next week's survey based on where we were at the end of the week. 



California housing affordability unchanged in 3rd quarter - The California Association of Realtors reported that 31% of California households could afford to purchase a median priced home ($515,940).  That was unchanged from the second quarter, but up from 29% in the 3rd quarter in 2015. Although prices were higher this year, wages were higher and interest rates were lower than last year in the 3rd quarter, which increased affordability. Rates look like they will be higher in the 4th quarter so it will be interesting to see where affordability goes. The affordability for a median priced Condo of $418,230 was 40%.
Next week we will have California sales figures and prices for October. It will be interesting to see what the data says.  We have felt a little slowing, but, that said, we are pretty spoiled by several great years! I'd expect that sluggishness we have felt to be just temporary  based on inventory, affordability levels and what experts are saying. 

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