Weekly News (July 27, 2022)
Mortgage Interest Rates Review (29th Week)
(by Fairway Home Loan 7/27/2022)
30 yr fx (%)
|15 yr fx (%)||FHA (%)||10 yr Tr Y (%)||5 yr Arm (%)||
7 yr Arm (%)
|A year ago||2.750||2.125||2.375||1.289|
|A month ago||5.875||5.125||5.125||3.288||5.750||5.750|
Green Light on Englewood Cliff’s Apartment (잉글우드클립스 대규모 아파트 단지 건설 임박)
(Korea Daily 7/22/2022)
- The NJ Court of Appeal judged on 15th that the appeal by Englewood Cliffs town government is not valid. The appeal was filed by Republican politicians in town government.
- The development on 800 Sylvan Ave includes 450 units of apartments (112 townhouses, 338 apartment units) and 60-65 units of apartment on the lot at Hudson Terrace, owned by the town.
- The project might have some hindrances due to the Republican’s continuing objections, including the mayor Mario Kranjac during the course of actions.
- The median home price in the town is close to $1.5M.
NJ Landlords will not discriminate immigration Status (신분 이유로 세입자 차별 못한다)
(Korea Daily 7/22/2022)
- Gary Shaer (Dem), member of general assembly is proposing a law that landlord cannot discriminate tenant’s immigration status.
- Currently NJ LAD(Law Against Discrimination) protects 18 classes, but there is no protection for immigration status in NJ.
- If this law becomes effective, landlord cannot reject tenant because of immigration status, nor evict tenant, and nor threaten tenant. Any offender shall pay $2,000 penalty, and ask for monetary damages and attorney fees, etc.
- In NJ, there are about 460,000 illegal immigrants among its residents of 9M.
Record Home Prices Lowered Sales (6월 최고 주택 가격으로 상승, 판매 건수는 축소)
- NAR reported that housing sales dropped in June, as the median price of an existing home climbed to a record $416,000. Sales of previously owned homes fell for a fifth straight month, dropping 5.4% in June.
- West Coast such as California shows slowing down more than East Coast. Albany, NY shows least changes in residential market.
- Some experts say the market shows healthy normalization.
Median U.S. existing-home price
Housing-Price Growth Slowed Slightly in May (5월 주택가격 상승세 소폭 둔화세)
- Home-price growth remained strong in May despite rising mortgage rates and steep prices that are pushing some buyers out of market.
- The S&P CoreLogic Case Shiller Index rose 19.7% in the year ended in May, down from 20.6% annual rate the prior month.
- The sale of newly built single homes slid 8.1% in June from the prior month to the lowest seasonally adjusted annual rate since 2020, the Commerce Dept said Tuesday.
S&P CoreLogic Case-Shiller Index, change from a year earlier
Tighter Lending Curbs Commercial Real-Estate Deals (커머셜 건물에 융자 조건 다소 강화)
- Wall Street is tightening the loan spigot on the commercial real-estate industry, which is putting a squeeze on deal making and values. Banks are lending less and charging higher interest rates for the loans they make to owners and buyers of office buildings, shopping centers and other commercial real estate.
- In this year’s 2nd Qt, banks issued $20.6B of securities backed by real-estate loans, down from $29B in the 1st Qt, according to Trepp.
- This year, the sale-volume growth rate has been falling as rising inflation has pushed inerest rates higher. In the 2nd Qt, investors purchased $190.3B of commercial property, an increase of 17% over the same period in 2021, which is down from a 150% sales-volume increase in the 2nd Qt of 2021.
Some Economists See Peak in Prices – and a Slow Decline (인플레이숀이 정점을 보였나?)
- Growing signs that price pressures are easing suggest that June’s 9.1% increase in consumer prices will probably be the peak. But even if inflation comes down, economists see a slow pace of decline.
- Gasoline prices have fallen around 10% from their mid-June high point of $5.02 a gallon. Wheat futures prices have fallen by 37% since mid-May and corn futures prices are down 27% from mid-June. The cost of shipping goods from East Asia to the U.S. Coast is 11.4% lower than a month ago, accoring to each reputable data source.
- Inflation expectation also fell recently – an upbeat signal for the Fed, which believes that such expectations influence wage and price-setting behavior and thus actual inflation. The University of Michigan consumer-sentiment survey showed that longer-term inflation expectations slipped from June’s 3.1% reading to 2.8% in late June and early July, matching the average rate during the 20 years before the pandemic.
Keeping the Mortgage in the Family (가족, 친척내에서 모기지로 주택 구입 – 높은 이자률 극복)
- For those who can afford it, now is a great time to help out house-hunting relatives. Such loans are of the last places borrowers can get a 3% mortgage. With average mortgage rates near 6% for a 30-year loan, some lucky home buyers are snagging rate at half that. They are borrowing from family members instead of a bank.
- If the loan is for $10,000 or more, the default IRS rule says the parents have to charge interest. A loan agreement should spell out the amount borrowed, the interest rates, and the terms of the loan. The key thing is structuring the agreement and treating it as a bona fide loan.
- Parents can use a combination of gifts and loans. For 2022, an individual can give up to $16,000 to any number of people, known as the annual gif-tax exclusion. (Both parents can give $32,000.) If the child cannot make a payment, parents might make additional gifts of cash, keeping under the annual gift tax exclusion threshold.