Real Estate Information Archive


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Some Housing Market Info.

by Tim Hart

I read an article in the Bozeman Daily Chronicle today by Jason Bacaj about the current housing market in Bozeman.

Here is what I found to be very interesting:

Houses on the high and low ends of the market are moving extremely quickly, while mid-priced homes have stayed on the market longer.

Any current listing at or below $350,000 will be expected to be sold within three and a half months.

Out of state migrants, investors and young professionals are driving the current market in Bozeman.

According to Erlenbush, high end homes are selling by more than 50 percent compared to 2013.

Definitely an interesting read and I’m interested to see if the market follows the trends they are predicting.


Mortgage Rates Hit Lowest for 2014

by Tim Hart

After mortgage rates dropped in the U.S. for the second week in a row, borrowing costs hit their lowest rate yet for 2014. This week, the average rate shifted from 4.12% to 4.1% for a 30 year fixed mortgage. Although the percentage shift may be small, when added up over 30 years, even the smallest changes can greatly impact the cost of home ownership. A 30 year rate has not been this low since the end of October last year. 15 year mortgages also saw price reductions, slipping from 3.24% to 3.23% this month. The 30 year rate has been consistently declining since it had hit a two year high of 4.58% last August. Experts foresee the lower rates supporting and fostering home demand. July trends support these expert’s claims, as previously owned homes sold at an annualized rate of 5.15 million this July, up 2.4% from June. The longer the rates stay low, the more activity can be expected in the future of the US housing market.


New Home Construction Rising

by Tim Hart

I read an interesting article today on new construction for July. More and more people are putting their faith in the housing market. Here’s what I took out of it.


New home construction continued to rise in July which should continue to boost the economy in the coming months. Housing start ups climbed 16% last month to an annual rate of 1.093 million units, showing a renewed faith in the housing market. July levels hit the highest level of construction since November. Construction on new apartments has seen the greatest increase in the US. Total home construction rose 22% all the way up through July, and building permit applications.

New FICO Credit System Changing

by Tim Hart

The credit scoring system may be changing for the better, at least for consumers with a shakier credit history. FICO has introduced their new credit system that is aiming to be more loan friendly towards clients with past, but paid-off debts as well as those with medical debt. The new FICO scoring system will take settled bills into consideration when adjusting someone’s credit score. If someone had owed money in their past, with the old system, their credit could be retroactively affected for seven years. Now, old, but paid off bills should not affect their credit score as much as before.

            The new FICO system will also remove the negative effects of having unpaid medical bills. Currently, 64.3 milion Americans’ credit scores are affected by these unpaid medical bills. By removing the negative impact of medical debt, some Americans may see their credit scores raise by 25 points. Considering that FICO scores are used to determin loan decisions around 90 percent of the time, many more people may find themselves eligible loan. Even more people will see their own rates lower, especially if they had been receiving less than friendly rates from banks. These new rates could greatly increase the number of Americans receiving loans and buying cars and houses.

Residential building permits and rising utility connections continue to suggest rapid growth in Bozeman. From 2008 until 2013, Bozeman dealt with around 200 residential building permits per year. In 2014, the City of Bozeman Department of Community Development expects more than 1,000 permits to be given. Other than last year, the last time residential building permits reached more than 1,000 permitted buildings in a year was 2005.

Bozeman is also beating other Montana cities for new electric and gas connections. As of early June, Bozeman had 375 new electronic connections and 175 new gas connections. Billings paled in comparison, despite having the second highest number of new electronic connections with 100. To put the growth in perspective, compared to a high growth year in 2013, Bozeman has still doubled its average new electric connections per year in 2014.


The Beige Book--The Fed's Survey of The Housing Market

by Tim Hart



Fed: Economy Sees Steady Growth

The Beige Book is the Feds survey of the housing market and it is showing continual signs of strengthening. The Federal Reserve described it as moving at a “modest to moderate” improvement rate. The only grey cloud is the rising gas prices. Since the economy is a complex structure of interwoven concerns and markets, high prices at the pump may translate into restriction in the flow of overall money as everyone’s confidence in the market stands on the thin ice.

But for now, the news is positive. “Residential real estate activity also improved in most districts, with Cleveland and San Francisco remaining outliers with lackluster real estate activity,” HousingWire reports on the Fed’s report.  

"In general, the demand for commercial and industrial loans remained steady, while several districts reported an increase in commercial real estate lending activity," according to the Beige Book.

Source: “Fed Survey Shows Growth, Improving Hiring,” USA Today (April 11, 2012) and “Loan Demand and Real Estate Activity Levels Improve: Beige Book,” HousingWire (April 11, 2012)

Read More

6 Housing Markets Gear Up for a Rebound



Trends of High Affordability Continue!

by Tim Hart

High Housing Affordability

Here’s a closer look at mortgage rates for the week ending Dec. 8.

30-year fixed-rate mortgages: averaged 3.99 percent, with an average 0.7 point, down from last week’s 4 percent average. A year ago, 30-year rates averaged 4.61 percent. 

15-year fixed-rate mortgages: averaged 3.27 percent, with an average 0.8 point, just slightly above the all-time low of 3.26 percent it reached on Oct. 6. Last year at this time, 15-year rates averaged 3.96 percent. 

5-year adjustable-rate mortgages: averaged 2.93 percent this week, with an average 0.5 point, ticking up slightly from last week’s 2.90 percent average. Last year at this time, the 5-year ARM averaged 3.60 percent.

1-year ARMs: averaged 2.80 percent this week, with an average 0.6 point, edging up slightly from 2.78 percent last week. A year ago, 1-year ARMs averaged 3.27 percent.  

Source: Freddie Mac

Housing is being kept affordable through this holiday season as the mortgage rates continue to dip down into record lows. 12.6% of a median family’s income is spent on monthly principal and mortgage interest payments. The National Housing Affordability Index reached its 6th all time high according to the National Association of REALTORS.  

The Housing Market is Still a Great Investment

by Tim Hart

Still a Great Investment:

62% of Americans believe purchasing a home is a good investment and they think that trend will continue at least for the next ten years. Affordability is the primary factor for the 1,104 consumers polled by the Mortgage Index Study conducted on behalf of Bank of America. Of these, 62% percent are considering a home purchasing having visited a lender or using online tools to determine their affordable monthly mortgage payments. 74% said they will be using personal savings for their down payments.

Good news on the horizon this holiday season from the consumer’s point of view! 

Source: “Bank of America Survey: Consumers Cautious About Home Affordability,” Inman News (Dec. 8, 2011)

Fed Focuses On Real Estate

by Tim Hart

Ben Bernake, the Federal Reserve chairman, is considering buying more mortgage-backed securities to help the other fixes hoping to serve as a trickle down backbone for strengthening the rest of the economy. He comments: “The housing sector is a very important sector. Problems in that sector are a big reason why our economy’s not recovering more quickly.”

Economists believe that more people must buy homes to boost consumer purchases in other sectors (furniture, appliances, home repairs equipment) The housing market has led the economy out of recession in the past by creating jobs and increase both endurable and durable spending.

Although the housing market continues to be bogged down by a high rate of foreclosures, home sales rose 1.5% last month.


Housing Market Fixes

by Brittney Dahlberg

Housing Market Fixes: Spending Big Bucks or Saving on the Small Adjustments?

Continuing the handful of minor adjustments in the housing market is projected to hasten the already advancing housing market. GOOD NEWS: A major monetary overhaul is not needed!

"I take a great deal of solace in recent numbers. The stability in non-distressed prices is encouraging and suggests an underlying stability in the overall housing market. If you can implement policies that reduce the share of distressed sales of the total market, housing should see a dramatic recovery quickly." says Moody's Chief Economist Mark Zandi.

Zandi’s three core issues within the housing market today are as follows:

Valuation: Values of houses have been dramatically high comparatively to incomes and rental costs. Housing prices are leveling out at a more parallel rate to income although still high compared to rents.

Overbuilding: Excess inventory on the market will take a few years to even out. The current surplus in supply needs to meet up with the rate of demand.

Foreclosure: ~3.4 million first-mortgage loans are in foreclosure right now. Prices are expected to decline until the amount of foreclosures starts to go down.

Simple solutions such as government sponsored enterprises (Fannie Mae and Freddie Mac) can make it easier to refinance and do principal reductions. The attorneys’ general suit against banks which improperly handled documentation on mortgages must reach an end. Distressed sales will go up and short sales/foreclosures held up by such suits will fall in the long term. The last minor fix is with credit. Credit needs to get back to the pre-boom levels. Getting qualified borrowers back into the market to take advantage of the ‘outstanding quality’ of different loans currently being offered.

"Our problems are not drastic," Zandi said. "We don't need to do one big thing to fix all of this. We've gone a long way to right the wrongs in this industry. There are just a few things we need to do around the edges. If you can implement policies that reduce the share of distressed sales of the total market, housing should see a dramatic recovery quickly."

Tim Hart

At Home In Bozeman--Tim Hart


Displaying blog entries 1-10 of 12

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