Waning Mortgage Forecast
The December 2020 forecast is unchanged from past months as the waning effects of the pandemic persist on the mortgage market. At the moment, the mortgage rates remain favorable with intentions to stimulate demand by prospective homebuyers. However demand has remained constrained due to the economic hardship brought on by the pandemic.
If inventory remains low into early 2021, it's possible that home prices will continue to go up. The median sales price for properties in November 2020, according to the Honolulu Board of Realtors, was $872,500 for a single family home. The number of single-family homes sold above the original asking price skyrocketed 210.2% compared to this time last year.
While there are some indicators of positivity, there are also potential negatives that could come into play. Unemployment numbers are still high, and another pandemic lockdowns throughout the winter could cause those numbers to rise. Finally, while there are some unnerving indicators, the forecast shows that record-low mortgage rates will hold into the foreseeable future.
The mortgage rate graph depicts a steady decline during the past 40 years. The graph was from a housing and economic recovery webinar presentation prepared for the Hawaii Association of Realtors by Dr. Paul Brewbaker, a respected and renown local economist. Click Here if you would like to view a full recording of the webinar.
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VA Home Loans
So what do these rates mean if you are seeking a Veteran's Assistance or VA home loan? VA home loan is a home loan guaranty program offered to Veterans, military service members and eligible surviving spouses. The rates one actually qualifies is based on several factors including the loan program, credit score and credit worthiness. The forecast rates are only intended to provide you with insight into what the market considers as the overall average rate for the given period. You must check with your financial institution to find out what rate you qualify and in some cases that rate may be lower than what you see forecast by Mortgage Bankers Association.