Maui had a small decline in the number of homes sold last month while median prices moved in different directions for single-family homes and condominiums.

A new report from the Realtors Association of Maui said the median price for single-family homes sold on the Valley Isle in March declined 10% to $680,000 from $756,000 in the same month last year.

Some of the drag on the median price was due to more sales in the Wailuku area where residences tend to be more midpriced. There were 25 homes sold in the area last month for a median $641,114 compared with 15 sales for a median $685,000 a year earlier.

Maui

Adobe Stock

Overall, there were 100 single-family homes sold on Maui last month, down 5 percent from 105 a year earlier.

In Maui’s condo market the median price jumped 15% to $450,000 last month from $390,000 a year earlier. Much of the increase was fueled by sales in Kihei where there were 56 sales last month for a median $416,000 compared with 45 sales a year earlier for a median $359,000.

The number of condo sales slipped 5% to 127 last month from 133 a year earlier.

The median price is a point at which half the sales were at a higher price and half at a lower price.

Maui’s trade association for real estate agents counts sales of new homes and previously owned homes in its report.

Great Article By Andrew Gomes from The Honolulu Star-Advertiser.

Hawaii

Real estate foreclosures declined in Hawaii for a fourth consecutive year in 2017, according to statistics from the state Judiciary.

The number of new foreclosure cases filed statewide last year fell 16% percent to 1,461 from 1,734 the year before.

Foreclosure lawsuits initiated mainly by lenders against homeowners in Hawaii peaked in 2013 at 3,430 cases. The decline began in 2014 when 2,084 cases were filed, and the next year new case volume decreased to 1,826.

The four-year trend has been influenced by a prospering state economy where personal income has risen, unemployment has dropped about as low as it can go, and home values have appreciated moderately. Still, unfortunate life events including divorce, bad financial decisions and debilitating illness or injury can lead to foreclosure.

Judiciary statistics on foreclosures go back only to 2010, though for that year many foreclosures by lenders against homeowners were conducted out of court in a nonjudicial process that homeowner advocates contended was unfair to borrowers. Since mid-2011, all foreclosure cases by lenders against homeowners have been filed in state court after the Legislature overhauled rules governing foreclosure in Hawaii.

Cases filed in court can include actions against owners of commercial real estate and actions initiated by condominium associations against homeowners who fail to pay maintenance fees or other assessments. Condo association cases, however, also can be done through the nonjudicial process. Other foreclosure cases, including actions involving timeshare properties, are typically done through the nonjudicial process that isn’t counted in Judiciary data.

 

By   – Real Estate Editor, Pacific Business News

Homebuyers in Honolulu have the highest mortgage debt-to-income ratio in the nation, while homebuyers on Maui have a ratio that’s third-highest in the U.S., topped only by San Jose in California’s Silicon Valley, according to a report by the personal finance company SmartAsset.

Homebuyers in the Honolulu metropolitan area have mortgages worth 3.959 times their annual income, on average, according to an analysis of data from the Consumer Financial Protection Bureau.

The data showed that Honolulu homebuyers have an average income of $131,639 and that the average mortgage is for $521,201.

Maui homebuyers in the Kahului-Wailuku-Lahaina metro area have an average income of $131,681, and the average mortgage there is $468,597, putting their mortgage-to-income ratio at 3.559.

By contrast, homebuyers in San Jose have an average income of $207,062 and an average mortgage of $740,693, giving them a ratio of 3.577.

California had 17 of the top 25 cities with the largest mortgage-to-income ratios on the list, while Hawaii had two of the top three.

Nationally, the average mortgage-to-income ratio was 2.119.

“The goal of all our studies is to get people thinking about personal finance issues,” AJ Smith, SmartAsset’s vice president of financial education and author of the report, told Pacific Business News. “To look at what the mortages are compared to the income that they’re making.”

Great Article by Diana Olick at www.cnbc.com

A realtor, right, walks with potential home buyers as they tour the property of a home for sale in Sparland, Illinois.

Daniel Acker | Bloomberg | Getty Images
A realtor, right, walks with potential home buyers as they tour the property of a home for sale in Sparland, Illinois.

A huge sell-off in the bond market is about to make buying a home more expensive. Mortgage rates, which loosely follow the yield on the 10-year Treasury, have been rising for the past few weeks, but are seeing their biggest move higher Monday.

“Bottom line, rate sheets are going to be ugly this morning,” wrote Matthew Graham, chief operating officer of Mortgage News Daily. “Some lenders will be at 4.5 percent on their best-case-scenario 30-year fixed quotes.”

That is the highest rate since 2014.

The average rate on the popular 30-year fixed started the year right around 4 percent but then began to climb on positive news in the U.S. economy, solid company earnings reports and a shift in foreign central bank policies which appear to now be following the Federal Reserve’s tightening of monetary policy. The rate was at 4.28 percent by the end of last week.

“Apart from central banks, there’s a ton of bond market supply coming down the pike due to infrastructure and tax bill spending,” Graham said. That new supply will send yields and, consequently, mortgage rates higher.

While mortgage rates are still historically low, they were even lower in the years following the financial crisis. That not only helped juice the sharp increase in home prices, but it has also given borrowers a new sense of normal. Both will hurt affordability this spring on several fronts.

“Today is one more reason for Realtors and buyers to move up their spring schedule,” said Chris Kopec, a mortgage loan consultant at Chicago-based Lakeside Bank.

The housing market is already facing a supply crisis, with demand substantially higher than the supply of homes for sale. Higher mortgage rates will exacerbate that problem because most current homeowners have likely refinanced to rates in the 3 percent range over the past few years and will be reluctant to give those rates up, either to downsize or upsize to a new home. Hence, fewer new listings.

For first-time buyers, even a quarter point difference in mortgage rates could price them out of the type of home they’re looking to buy. Today’s buyers are saving less, due to high levels of student debt and high rent rates. Confidence in the current economy is driving spending even higher and savings even lower.

“With spending rising faster, what also drove spending was credit card debt as the US savings rate is down to just 2.4 percent in December from 2.5 percent in November and 3 percent in October. September 2005 was the last time it was this low,” Peter Boockvar, chief investment officer with Bleakley Advisory Group, wrote in a note to clients. “Lower taxes and higher wages couldn’t have come at a better time for the average consumer, but some of that will likely go towards paying down some of the accumulated debt.”

Wages may be growing, but the rate is nowhere near the now-nearly 7 percent annual home price growth. Price gains are highest on the lower end of the housing market, where demand is highest and supply is lowest. That is also where buyers are most sensitive to mortgage rates because they are already squeezing to make the monthly payment.

A great article by Diana Olick:

  • Total mortgage application volume fell 4.6 percent from the previous week.
  • The average loan amount on purchase applications increased to $317,000, the highest since May.
  • Mortgage applications to refinance a home loan fell 3 percent for the week.

A for sale sign is posted in front of a home as interest rates for home loans climbed to nearly 4% in the wake of the election of Donald Trump to be the U.S. president on November 17, 2016 in Miami, Florida.

Joe Raedle | Getty Images
A for sale sign is posted in front of a home as interest rates for home loans climbed to nearly 4% in the wake of the election of Donald Trump to be the U.S. president on November 17, 2016 in Miami, Florida.

A few weeks ago, it looked like interest rates were on their way down again, but that was short-lived. So was the surge in mortgage application volume that went along with it.

Interest rates rose last week, and consequently total mortgage application volume fell 4.6 percent from the previous week. The Mortgage Bankers Association’s seasonally adjusted weekly index now stands down 19 percent from the same week one year ago.

The drop affected all types of applications, but those to purchase a home fell the hardest — 6 percent for the week. This may have less to do with the rise in rates and more to do with the lack of homes for sale. The drought in supply continues to push prices higher and clearly sidelined more buyers. Purchase applications remained 10 percent higher from the same week one year ago.

Higher home prices are now showing up in mortgage applications. The average loan amount on purchase applications last week increased to $317,000, the highest since May.

Mortgage applications to refinance a home loan fell 3 percent for the week and are down 36 percent from a year ago, when interest rates were higher. The MBA is now forecasting a 28 percent drop in refinance originations next year because interest rates are expected to rise further.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $424,100 or less increased to 4.18 percent last week from 4.14 percent the previous week, with points decreasing to 0.42 from 0.44, including the origination fee, for 80 percent loan-to-value ratio loans.

“Rates increased late last week as the market responded to news of a Senate budget plan which may positively impact tax reform progress and more speculation around the future leadership of the Federal Reserve,” said Joel Kan, an MBA economist.

The 30-year fixed rate last week was at its highest level since July, and it continued to rise this week, ahead of a policy announcement expected Thursday from the European Central Bank.