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What’s Ahead For Mortgage Rates This Week – July 6, 2020

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What's Ahead For Mortgage Rates This Week - July 6, 2020Last week’s scheduled economic reports included readings on pending home sales, Case-Shiller Home Price Indices, and labor sector reports on private and public-sector job growth. Data on construction spending was also released. Weekly readings on mortgage rates and jobless claims were also released.

Pending Home Sales Jump in May

Sales of homes for which purchase contracts were signed rose by 44.30 percent in May and was the highest month-to-month increase recorded since the report’s inception in 2001..Pending home sales are sales with signed purchase contracts but aren’t closed.

Lawrence Yun, chief economist for the National Association of Realtors® said,  “This has been a spectacular bounce-back and also speaks to how the housing sector could lead the way for a broader economic recovery.” This positive news could be dampened by rising infection rates for the Covid-19 outbreak as some states reversed decisions to re-open additional parts of their economies.

Case-Shiller: Home Price Growth Rises in April

The Case-Shiller National Home Price Index reported that home prices grew by 0.10 percent to 4.70 percent on a seasonally-adjusted annual basis. This reading lagged behind the worst part of the Covid-19 outbreak and analysts cautioned that home price growth would fall in the future. The Case-Shiller 20-City Index reported the top three cities for home price growth were Phoenix, Arizona, Seattle, Washington, and Minneapolis Minnesota. The geographical disparity between these cities differs from recent years when coastal cities dominated home price growth rates.

In related news, the Commerce Department reported improvement in construction spending in May. Construction spending fell -2.20 percent in May as compared to -3.50 percent in April.

 Mortgage Rates Hit All-Time Low; Jobless Claims Ease

Freddie Mac reported the lowest mortgage rates reported since the inception of their Primary Mortgage Market Survey. Rates for 30-year fixed-rate mortgages averaged 3.07 percent and were eight basis points lower. Rates for 15-year mortgages dropped by three basis points on average to 2.56 percent. Rates for 5/1 adjustable-rate mortgages dropped by eight basis points on average to 3.00 percent.

Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages. 

New jobless claims fell to 1.43 million claims filed from the prior week’s reading of 1.48 million initial claims filed. Ongoing jobless claims rose from 19.20 million claims to 19.30 million continuing jobless claims.filed. New and continuing jobless claims were far above pre-coronavirus levels.

Job Growth Reports Mixed as Unemployment Rate Falls

ADP reported 2.37  million private-sector jobs added in June as compared to May’s reading of 3.07 million private sector jobs added. The federal government’s Non-Farm Payrolls report showed 4.80 million public and private sector jobs added in June as compared to 2.70 million public and private sector jobs added in May.

What’s Ahead

This week’s scheduled economic reports include readings on job openings and weekly reports on mortgage rates and jobless claims.

Pros And Cons Of Completing Home Renovations Before Selling

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Pros And Cons Of Completing Home Renovations Before Selling

Whether you originally bought a fixer-upper or you’re just a homeowner who wanted to update their house, chances are you have seen your share of home renovations. Home renovations have the potential to greatly add to the value of your property, but they can also add to your own quality of life. Hopefully, you have completed your home renovations and gotten plenty of use out of them before listing your home for sale. 
If not, you may find yourself wanted to move before all the renovations are complete. What’s the best course of action? Should you put the time and money in to finish? Or should you cut your losses and list the home for sale? What are the pros and cons of completing home renovations before selling?
Pro: The Home May Sell Easier
Your real estate agent will be happier if your home is fully renovated. That’s because they know that the home may sell easier in a fully renovated condition. Of course, you could get a prospective DIY homebuyer eager to put their own “stamp” on the home, but that is nothing you can count on.
Con: You May Not Recoup The Extra Expenses
Not all home renovations equate to value-added improvements that you can count in your wallet. If your renovations are small things like replacing door hinges, patching a hole in the plaster, or stripping outdated wallpaper, you are unlikely to see an equal increase in what you can get for your home sale.
Pro: There Will Be Less Explaining
If you have finished the renovation, you have nothing to explain and no excuses to make to anyone. In the renovated condition, the home is what it is. Even if a prospective home buyer does not happen to like the new paint color you have chosen, they still can?t complain that it is old or worn looking. 
Con: You Will Need To Delay Your Listing
Home renovations can take up a lot of time, as you may know, if you have done a lot of them already. You will have to delay listing your home, which in turn will mean putting your moving plans on hold for what could be an extra month or two. Depending on your future plans, this could impact your child’s school entry date and more.
No one will force you to complete half-finished renovations. But consider these pros and cons before deciding how to proceed.

Whether you originally bought a fixer-upper or you’re just a homeowner who wanted to update their house, chances are you have seen your share of home renovations. Home renovations have the potential to greatly add to the value of your property, but they can also add to your own quality of life.

Hopefully, you have completed your home renovations and gotten plenty of use out of them before listing your home for sale. 

If not, you may find yourself wanted to move before all the renovations are complete. What’s the best course of action?

Should you put the time and money in to finish? Or should you cut your losses and list the home for sale?

What are the pros and cons of completing home renovations before selling?

Pro: The Home May Sell Easier
Your real estate agent will be happier if your home is fully renovated. That’s because they know that the home may sell easier in a fully renovated condition. Of course, you could get a prospective DIY homebuyer eager to put their own “stamp” on the home, but that is nothing you can count on.

Con: You May Not Recoup The Extra Expenses
Not all home renovations equate to value-added improvements that you can count in your wallet. If your renovations are small things like replacing door hinges, patching a hole in the plaster, or stripping outdated wallpaper, you are unlikely to see an equal increase in what you can get for your home sale.

Pro: There Will Be Less Explaining
If you have finished the renovation, you have nothing to explain and no excuses to make to anyone. In the renovated condition, the home is what it is. Even if a prospective home buyer does not happen to like the new paint color you have chosen, they still can?t complain that it is old or worn looking. 

Con: You Will Need To Delay Your Listing
Home renovations can take up a lot of time, as you may know, if you have done a lot of them already. You will have to delay listing your home, which in turn will mean putting your moving plans on hold for what could be an extra month or two. Depending on your future plans, this could impact your child’s school entry date and more.

No one will force you to complete half-finished renovations. But consider these pros and cons before deciding how to proceed.

 

It Is Tax Time Again Learn About Tax Deductions and How to Write off Your Home Mortgage Interest

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It Is Tax Time Again Learn About Tax Deductions and How to Write off Your Home Mortgage InterestMuch to the frustration of taxpayers all over the country, the tax-filing season begins in January and runs through April 15 of each year. The year 2020 brought us many changes, including an extension on filing taxes. Taxes this year are due on July 15th. Are you ready?

As the current tax season approaches, it presents an opportunity to help tax-payers clarify their responsibilities and remind them of certain important tax deductions that may be available.

Filing Responsibilities

Every person in the United States is required to file their tax returns by July 15 so long as they have some form of qualifying income. Based on filing status, income and available deductions, tax-payers must file a 1040EZ, 1040A or 1040 (long-form for itemized deductions).

Qualifying income is generally defined as, but not limited to wages, commissions, miscellaneous income (rental, interest), investment income and alimony. These forms of income are reported on a periodic basis to the IRS and State governments by employers, banks, contract employers and/or other responsible parties.

The most common tax receipts that must be sent to tax-payers by January 31 are W-2s and 1099-Misc forms.

Calculating Taxes

While the IRS requires individuals to report all forms of income, they also allow certain living costs to be used as deductions to offset income in order to arrive at a “taxable income” number on which tax liabilities are calculated.

If a tax-payer’s deductions fail to exceed the combined statutory standard deduction,, they will want to file the 1040EZ or 1040A. If itemized deductions exceed this number, the 1040 becomes preferable.

Mortgage Interest Deduction

For a majority of tax-payers, the largest tax deduction available is usually mortgage interest paid on secured debt where the primary residence and in some cases second homes or rental property serve as collateral. In most of these cases, all interest paid during the year is deductible.

If the mortgages are large enough, the total interest paid will typically push the tax-payer into position to itemize deductions. It is important for tax-payers to read the rules related to mortgage interest deductions as they tend to be somewhat complicated.

Other Important Deductions to Consider

Once a tax-payer qualifies to itemize deductions, many other living expenses become deductible. Other prominent deductions include property taxes, charitable contributions, childcare costs, qualified moving expenses, certain work related expenses and certain medical expenses.

Prior to using any deduction, it is incumbent on the tax-payer to review deduction guidelines in order to determine applicability.

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Equal Housing Lender


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Coral Gables, FL 33134