Mortgage Rates Jump to 2 Year High

Mortgage rates spiked to their highest levels this week since July 2011, causing frustration among homebuyers and refinancers who were caught by surprise.

The benchmark 30-year fixed-rate mortgage rose to 4.61 percent, compared with 4.12 percent last week, according to the Bankrate.com national survey of large lenders. The mortgages in this week’s survey had an average total of 0.29 discount and origination points. One year ago, that rate stood at 3.89 percent. Four weeks ago, it was 3.99 percent.

The 30-year fixed hasn’t been this high since Bankrate’s survey on July 27, 2011, when the mortgage rate averaged 4.74%. This is the largest one-week rise since the financial crisis of October 2008.

By historical standards, rates are still extremely low

On top of that, the benchmark rate on the 30-year fixed was 3.6% May 8 — so it has climbed more than a percentage point in seven weeks.

The benchmark 15-year fixed-rate mortgage rose to 3.73% this week, compared with 3.3% last week. The benchmark 5/1 adjustable-rate mortgage rose to 3.45% from 2.99%. The benchmark 30-year fixed-rate jumbo mortgage rose to 4.75% from 4.29%.

Weekly national mortgage survey

Results of Bankrate.com’s June 26, 2013, weekly national survey of large lenders and the effect on monthly payments for a $165,000 loan:
30-year fixed 15-year fixed 5-year ARM
This week’s rate: 4.61% 3.73% 3.45%
Change from last week: +0.49 +0.43 +0.46
Monthly payment: $846.85 $1,198.28 $736.33
Change from last week: +$47.66 +$34.86 +$41.57

How did this happen?

Rates started climbing slowly in mid-May on speculation that the Federal Reserve was preparing to trim the $85 billion-per-month bond purchase program that has long kept a lid on rates. When the Federal Open Market Committee wrapped up its meeting last week, many observers expected the Fed to calm the markets. Instead, the Fed did the opposite.

Mortgage rates shot up once Federal Reserve Chairman Ben Bernanke told reporters that the Fed plans to slow the bond purchases this year and end the program in mid-2014, as long as the economy continues to improve. Even analysts who follow rates closely were shocked at how quickly rates have jumped since then.

“We saw a full percentage increase in less than a month,” says Bob Moulton, president of Americana Mortgage Group in Manhasset, N.Y., adding that half the increase happened since the Fed’s press conference. “My customers are dismayed and disappointed.”

The stock market sank on Bernanke’s comments, and a wave of investors immediately pulled money out of the bond market. When there’s less demand for mortgage and Treasury bonds, mortgage rates tend to rise.
Should borrowers lock or wait?

The financial markets are extremely volatile right now, says Cameron Findlay, chief economist for Discover Home Loans.

Homeowners who missed the opportunity to refinance should wait for the markets to calm if they think refinancing now wouldn’t save them much, he says. But he adds that homebuyers and those who are still paying 6 percent or higher on their loans shouldn’t take the chance.

“By historical standards, rates are still extremely low,” he says.

Donna Angeloni, vice president of lending for the Philadelphia Federal Credit Union, says the lender has been receiving an increased volume of calls from borrowers who want to lock a rate. She says rates may drop a little in the next few days, but, as usual, there’s no guarantee.

“I’d wait a few days and then lock if they drop back down,” she says. “If they hold steady, then I wouldn’t wait too long.”

Another strategy would be to ask if your lender offers a float-down option, Moulton says. With a float-down, the borrower has the right to have the rate reduced if rates fall. Not all lenders offer this option, but it’s worth asking the lender, he says.
Some borrowers opting for adjustable-rate loans

Many homebuyers who were expecting to pay 3.5% in interest on their 30-year mortgages and are now faced with higher rates, have chosen a 10-year ARM loan to keep the monthly payments close to their expectations.

With a 10-year adjustable-rate mortgage, the rate is fixed for the first 10 years and resets after that. The average rate for a 10/1 ARM was 4% in Bankrate’s weekly survey.

“We are giving borrowers the menu and saying, ‘These are your options now,’” Moulton says. “Some people are staying with a 30-year because they like the security. But some took a little harder look in terms of how long they are going to stay in the house, and they have chosen to go with the 10-year.”

A Cabela’s Trophy Property: Spectacular “Off the Grid” Snake River Executive Waterfront Ranch

AMAZING best describes all the unique features of this Sun Valley Builder’s Own Custom Snake River Waterfront Ranch and Dream Home.

Perched overlooking the Snake River the home takes in all the views with its floor to ceiling windows and patios.

Totally self-contained with its own solar power system, wells, water rights and ponds. Fruit trees, 3 ponds, garden with green house and room to farm whatever suits your fancy on this 46 acres of paradise.

Geothermal well which produces water at 88* year round. King Hill Canal Company irrigation water. Hunting out your door for deer, duck and many other critters.

Additional buildings include a 40 x 70 barn, 24 x 72 equip shed, 10 x 12 garden shed, 14 x 19 greenhouse and 20 x 20 artesian well pump house.

Quality Photos Can Make The Difference When Selling Your Home

Companies that sell products tend to be meticulous about the photography of the merchandise they’re advertising — the pictures are almost always crisp, detailed and attractive.

If you’ve surfed online for houses, you know what I’m talking about — the offending photos are so dimly lit you can’t tell how big the family room is. Or toys and family clutter are all over the place. Couldn’t they even bother to take the dirty dishes out of the sink before they photographed the kitchen?

A good understanding of color temperature, having proper lighting, quality, high-end equipment and a trained eye makes all the difference when creating professional marketing photos for any home that’s for sale. This photo is of a home I took in the Golden Eagle area. All Photos © George Martin, Jr., Hallmark Idaho Properties

Brian Balduf runs a company that provides photography services to real estate brokerages, and he has seen it all. He said the quality of real estate photographs didn’t used to matter much, but the growth of online real estate marketing and the advent of the iPad and photo-sharing sites has changed that. Balduf, chairman of Chicago-based VHT Inc., explained how it’s crucial these days that photographs of your house must really sell it:

Q: I suppose it’s easy to blame the real estate agents for poor real estate pictures — after all, they’re agents, not photographers. But why are so many of the photos so bad?

A: Agents, in the past, just marketed homes to other agents (by generally only placing photos on their multiple listing service). They weren’t marketing to consumers. Then the Internet came along, and (the photo quality) still didn’t matter a lot.

Until the iPads and tablet displays became really popular recently, all real estate photos on the Internet originated from the MLS, and the images just weren’t very detailed. But as soon as you started presenting them full screen on iPads or people were able to look at them on 50-inch, flat-panel television screens, consumers started realizing, gee, these photos are really bad.

It’s interesting, because consumers aren’t used to seeing bad (marketing) photos. Every other product they see online, even if it’s a $2 bucket at Wal-Mart, is going to have a good photograph.

And the photos are going to be critical for grabbing the attention of the people who are cruising through houses on the Net — if you didn’t get them with that first impression, you may never get that buyer back.

Q: If you’re listing a home for sale, what should you ask an agent about photography?

A: First, ask to see samples (of photos of previous listings), just like with any other service provider. And ask for photos (of current listings) that are being used to market the houses you’re competing with. If you’re selling a three-bedroom, two-bath, ask to see the photos of other three-bedroom, two-baths nearby.

Ask if the agents photos are optimized for the newer high-resolution displays such as Apple’s Retina displays used on most of their newer products.

The good, bad and ugly thing about these newer HD screens is they automatically make a great photo look even better, but really make a bad photo look even worst. What do you want the photos to say about your property?

Photo above is a lower priced home in Woodside, Hailey Idaho

You’re starting to see more progressive real estate firms saying this is important, and they’re having their listings professionally photographed. But it varies a lot, regionally, and the number of professionally shot houses is small, maybe 10 to 20 percent of the market. Chicago is fairly good about using professional photography. It’s starting to pick up more on the coasts. On the West Coast, you probably see the most professional photography in San Diego.

I took this photo from apx 30 feet in the air – Gimlet Area of Ketchum Idaho

In Florida, you’re seeing it more, and you’ll see more aerial photography there — that is, they might shoot a house from a crane or boom because buyers want to see what’s behind the house — a waterway, a pond, the Everglades.

Q: What goes into good real estate photography?

A: It’s harder than most people realize. Room photography is lighting, lighting, lighting. And when you photograph a home, you may be dealing with every kind of lighting — exterior lighting, incandescent, fluorescent — so without controlled lighting, every room is going to come out different. You may see a lot of bluish bathrooms and kitchens.That’s were a good understanding of color temperature comes into play.

Another challenge is balancing the light so you have a good photo of the interior while allowing the exterior views to shine through. Luxury contemporary home located in Sun Valley

Outside, you want to time the photograph to control for weird shadows; you also want to get rid of parked cars or garbage cans in the driveway.

Another aerial photo taken from apx 30 feet in the air. This home overlooks both Dollar and Baldy in Sun Valley Idaho and recently sold for 5+ million. The out of state buyer said the photos, aerial maps, etc. I posted on the internet for another agent played a large role in viewing the home prior to deciding to call a local realtor and fly into town to see the it in person and ultimately purchase.

And it takes a real camera. Technology is making it easier to shoot bad photos — camera phones don’t have enough flash or depth of field (for rooms). Your drunk friend at a Cubs game, a camera phone is great for that. But if you have a room that’s deep, you want to be able to see it.

A room needs to be shot on a tripod — it’s a must, because the shots have to be level. It can be a gorgeous home, but if the photos are dark or crooked or pixilated, you have either helped the buyer pass your home up or they’ll place less value on it.

Q: What if you have a very simple, ordinary, unadorned home? It may be a great place to live, but what if there’s nothing in it that would look particularly “gorgeous,” by room photography standards?

A: If you don’t have anything that’s unique about your property, then you want to make it look as good as possible. Good, clear photography of a neat, clean home may be your one competitive advantage if you’re on the market and competing against 20 similar starter homes. You may be able to make it sell before the guy who has the same house across the street.

You don’t have to own an expensive home to expect high quality marketing photos. One of the photos above is an affordable home in Woodside and another in Della View.

F.Y.I. The Della View property was just listed this past week and had 4 offers presented within 72 hours of posting the HD Photo Tour online.

Another picture perfect street side view in downtown “Old Hailey” Idaho

Local community and lifestyle photos also help people outside our area get a better understanding and feel for what Sun Valley and it’s surrounding communities are like.

Finally, quality photos are important, but they won’t make a difference if nobody sees them.

It’s critical for your listing agent to have the proper tools, knowledge, networks and syndication’s to give your property maximum exposure by reaching buyers outside the immediate area.

SOURCE: Chicago Tribune / Hallmark Idaho Properties

PRESS RELEASE: Cabela’s Partners with Hallmark Idaho Properties

Debra Hall, Owner/Broker of Hallmark Idaho Properties, is proud to announce that her firm has become affiliated with Cabela’s, the World’s Foremost Outfitter, in a recreational real estate listing service called Cabela’s Trophy Properties.

Hallmark Idaho Properties will be responsible for serving the needs of recreational buyers and sellers in the greater Sun Valley areas. Cabela’s Trophy Properties is an exclusive recreational property listing service for marketing fine sporting and recreational properties to sportsmen and investors worldwide.

“Cabela’s Trophy Properties is a global network of professionals who are on track to become the ultimate one-stop-shop for the purchase, sale, improvement and management of recreational properties.”

As the new marketing programs become available Hallmark Idaho Properties will make clients and customers aware of them by posting updates on HallmarkIdahoProperties.com.  Participating agents at Hallmark Idaho Properties have been helping people who have dreamed of owning land for many years, and now they will be able to apply the benefit of Cabela’s outdoor marketing expertise to the properties they represents that qualify to be in the Cabela’s Trophy Properties program.

The firm invites you to visit the Cabela’s Trophy Properties website at www.CabelasTrophyProperties.com.

For more information about local real estate visit www.HallmarkIdahoProperties.com

If you are a recreational buyer or seller and want to know about the services available to you through this program you can call Debra at (208) 928-7653 or email her at Help@HallmarkIdahoProperties.com

About Cabela’s Trophy Properties LLC: Cabela’s Trophy Properties LLC, a wholly-owned subsidiary of Cabela’s Corp. (NYSE: CAB), is a global network of experts who serve the recreational industry. For more information please call 1-800-535-6007 or visit www.CabelasTrophyProperties.com.