WICHITA, KS: (Wichita KS Realty News) A 2.4 percent week over week increase for mortgage applications has been reported in the current Mortgage Bankers Association weekly survey. Even seasonally adjusted figure are showing an increase, which is a good sign for buyers and sellers alike. With what feels like a trickle of new listings hitting the market and many people interested in buying, this uptick is welcome news.
Along with the slight increase in week over week mortgage applications, the refinance share of mortgages also increased .3 percent from the previous week to 41.9 percent. And in what can be seen as the consumer’s belief that rates may continue to rise, there was a 8.2 percent decrease in in the amount ARM (Adjustable Rate Mortgages) in those figures. With traditional 30 year fixed rate mortgages slightly above 4 percent, the overall affordability of the interest rate component of buying a home is not keeping potential buyers away. Many areas are still reporting anemic listings in relation to interested buyers.
At the time of the writing of this article, here are the rates quoted by a couple of our local lenders on their websites;
Capitol Federal 30 year fixed rate mortgage- 4.125 percent*
Credit Union Of America 30 year fixed rate mortgage- 4.246 percent*
* Please visit their sites for the details, limitations, and other restriction on their quoted rates
With spring buying in full swing, Wichita’s residential real estate market is dealing with many of the issues we are seeing in other parts of the country. Inventories are low and prices are rising. Homes are going under contract relatively quickly. As always, time will tell as to the long term health of our real estate market, but in the short term, the trend seems to already be established. We will be looking into the new home market and will be talking to builders to find out what they are seeing, soon.
WICHITA, KS: (WichitaKSRealty.News) Counting all of the steps we have when we begin our search for a new home, one option stands out as as our best choice. Get Pre-qualified! There is nothing more disheartening than finding the perfect home and not be able to buy it!
This entails getting with your local bank, credit union, or mortgage broker and begin the process of qualifying for a loan. Think, Capitol Federal and/or Credit Union of America, two local lenders that have years of experience in our local market.
The benefits to getting pre-qualified are tremendous.
- You will know precisely the limits of your price range. While getting online and looking at million dollar plus homes in the Flint Hills area is fun, it isn’t very realistic for most of the residents of the Wichita area. Though it’s still nice to look at these types of “dream homes”, the likelihood of actually buying one is slim to none. Once you have pre-qualified, you will better be equipped to hone in on areas and homes within your price range.
- Provides Greater Impact to sellers during negotiation. There is nothing more frustrating for a seller, and their agent, to negotiate, re-negotiate, sign contracts, set up inspections, title searches, and other closing needs only to have all these efforts go to waste when a potential buyer can’t arrange financing. It happens, and it is very frustrating! Once you are pre-qualified, unless something changes in your financial position, you are almost guaranteed to get the loan. I said almost, well, because things can still happen in a closing. Nothing is done until it is done.
- Positions yourself above other offers. Still on negotiation here, but in today’s low inventory environment, seller are receiving multiple offers. Put yourself in their shoes; You receive two separate offers, same net price, one from a pre-qualified buyer, one not pre-qualified. Which one would you be more apt to take? Yep, the pre-qualified one, of course. And in some instances, you may even be able to be slightly lower on your offer since the seller is more assured of your ability to close the sale.
- You have tho opportunity to fix potential problems. When you get pre-approved for a loan, you are able to see how your current debt structure is impacting your borrowing ability. Sometimes, subtle change can make a huge impact on how much of a mortgage you can get. This is a great time to truly evaluate your debts and fine tune them to help benefit your financial position.
- You typically have a chance to lock-in rates. Rates are moving up, not by much but they still are. The trend is for a couple more federal reserve rate hikes this year. These typically increase mortgage rates. You have the opportunity to lock in rates when you get pre approved. Discuss this with your lender for the details.
All in all, getting pre-qualified is the best first step when you are searching for a new home in earnest.
What the Outcome of the Election Means to Wichita’s Real Estate Market
WICHITA, KS: (wichitaksrealty.news) As a follow up to yesterday’s article, what does the election outcome have in store for the local Wichita real estate market? Well, the answer is in the short term, more uncertainty. Markets in general like certainty, whether it’s the stock and bond markets, or real estate. Why, you ask? Because PEOPLE like certainty and people ARE the markets. As an example, the markets swung wildly this morning with deep declines pre-market and subdued trading when it opened.
Owning real estate means holding a tangible asset. It’s an investment. Not only financial but in time and commitment. We have seen almost a decade of extremely low interest rates, low to no inflation and stagnated income. We have become accustomed to this. It is the new norm, so we make our decisions based on this. But will these things, and others, change? Will we see interest rates and/or inflation rise, thereby affecting affordability of housing? Will we see wage rates stay the same or increase in a more long term normalized pattern?
By having an “outside the beltway” president will there be disruption in the status quo? Not saying we should or we should not, just asking.. will we? And to answer. Probably. Needless to say, though, that this new norm might take a while to get used to.
So, to answer the main question, we are moving in to a seasonally slow time for real estate sales. My bet is that the election will have a minimal short term effect. We will revisit this topic in the spring, once we have the chance to see the direction we are headed.