Here is the latest national and regional Financial and Mortgage for this past week (May 7th through May 11th), that may have some influence over our local real estate market here in Orange County California.
  • Consumer credit outstanding increased at a 6.7% annual rate or by $13.5 billion in March. Consumers used credit cards and took out car loans at an almost equally fast pace in March as mortgage equity withdrawals decreased. Credit usage is expected to remain elevated as consumers use other lines of credit to finance spending due to weakening in the housing market and slower cash out refinancings. These are National statistics that apply here in Orange County as well.

  • The National Association or Realtors (NAR) lowered their forecasts for Nationwide home sales and prices again this month after a similar sized downgrade last month. The Association expects existing home sales to decline 2.9% this year to 6.29 million compared with its April sales forecast of 6.34 million. New home sales are now expected to drop 18% to 864k, vs. the earlier forecast for a 14% decline. In its first ever projected price decline, the NAR said that prices for existing homes will fall 1.0% this year while new home prices are expected to remain unchanged. Forecasts of 2008 existing and new home prices are for gains of 1.0% and 2.0% respectively.  Based upon our weekly real estate market statistics that gather for south Orange County, we project a similar  price decline for 2007' and a very soft recovery in 2008'

  • The MBA mortgage applications index rose 3.6% to 680.7% for the week that ended May 4. The purchase index climbed 2.6% higher on the week while the refinance index gained 4.9%. After falling steadily from mid-2005 though 2006, home purchasing activity has stabilized in the last 5 months. Refinancing activity continues to surge as many homeowners facing resets in adjustable rate mortgages are opting to refinance into a more favorable loan.

  • The FOMC opted to hold the target for the fed funds rate steady at 5.25% at their policy meeting today. This was the seventh straight meeting policymakers have left rates alone. Moreover, there were only minimal changes to the post-meeting statement. The Fed acknowledged slower growth in the first part of this year and that recent indicators have been mixed. They stated again that the correction in the housing market was ongoing and forecast moderate economic growth ahead. The Committee reiterated that core inflation remained somewhat elevated but that they were optimistic that inflationary pressures would moderate. The current high level of resource utilization poses an upside risk to inflation. The Fed maintained that inflation continues to be the predominate risk to the economy and that future policy adjustments will remain dependent upon incoming economic data.  As a result, 30 year fixed interest rates here in Orange County stayed steady at about 5.78% for a Conforming loan, and the 10 Year Treasury yield is at 4.64%.
If you have any questions regarding mortgage loans for the purchase of a home or condo here in Orange County, CA., or if you would like a second quote on a Mortgage loan with very low interest rates and low costs, please feel free to call us at:  949-388-3396 or drop us an email at:  Info@SearchOCHomes.com