We believe that there is no reason to believe that home
prices will not continue to rise in 2015. BanCorp would not be surprised if the
average price increase stood at 5% across the board. Present inventory might be
higher than normal to flat and we don’t believe that Fannie or Freddie will
ease lending standards but with annual inflation running at 2%, an additional 2
-3% increase up and beyond this is not wishful thinking as the generation “Y”
market continues to enter the market.
Interest rates remain at historically low levels and they
won’t remain there. If rates were to increase a single point, the corresponding
monthly payment increase to the borrower is approximately 20 -25% which
obviously reduces buying power and this will drag down home prices due to the
fact that the buyers will be expecting the sellers to drop the asking prices to
reflect the higher borrowing costs. With that being said, BanCorp believes that
even a ½ % increase in rates during 2015 is highly unlikely, the Federal
Reserve is too active in the market and this simply would be too dramatic of a
hike and they have an excellent pulse of the market right now.
In conclusion, expect supply to outweigh demand, but this
will not damper increasing home values due to low interest rates and new buyers
entering the market helping to fuel home prices.
Orange County Cities and
Communities BanCorp Properties Serves In:
BanCorp Properties: Aliso Viejo Real
Estate & Aliso Viejo Homes For Sale | BanCorp Properties: Costa Mesa Real
Estate & Costa Mesa Homes For Sale | BanCorp Properties: Coto De Caza Real
Estate & Coto De Caza Homes For Sale | BanCorp Properties: Dana Point Real
Estate & Dana Point Homes For Sale | BanCorp Properties: Irvine Real Estate
& Irvine Homes For Sale | BanCorp Properties: Ladera Ranch, Real
Estate & Ladera Ranch Homes For Sale | BanCorp Properties: Laguna Beach Real
Estate & Laguna Beach Homes For Sale | BanCorp Properties: Laguna Hills Real
Estate & Laguna Hills Homes For Sale | BanCorp Properties: Laguna Niguel Real
Estate & Laguna Niguel Homes For Sale | BanCorp Properties: Lake Forest, CA
Real Estate & Lake Forest, CA Homes For Sale | BanCorp Properties: Mission Viejo Real
Estate & Mission Viejo Homes For Sale | BanCorp Properties: Newport Beach Real
Estate & Newport Beach Homes For Sale | BanCorp Properties: Corona Del Mar
Real Estate & Corona Del Mar Homes For Sale | BanCorp Properties: Newport Coast Real
Estate & Newport Coast Homes For Sale | BanCorp Properties: Rancho Santa
Margarita Real Estate & Rancho Santa Margarita Homes For Sale | BanCorp Properties: Dove Canyon Real
Estate & Dove Canyon Homes For Sale | BanCorp Properties: San Clemente Real
Estate & San Clemente Homes For Sale | BanCorp Properties: San Juan
Capistrano Real Estate & San Juan Capistrano Homes For Sale
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