The Housing Market Update
10/07/2013
Brought to you by:
Mark Carver
President
Office: 949-423-7985
Cell: 949-878-0520
[email protected]
Three Reasons to Consider School Districts When Buying a Home:
If you’re in the market for a new home, there’s a lot to consider: price, neighborhood, square footage, number of
bedrooms and bathrooms, the size of the lot and the home’s condition, to name a few. But have you taken into
account the local school district? Even if you don’t have or never plan to have school-age children, the quality of
nearby schools can have an impact on how much you pay — and how much you sell a home for later.
Here are three reasons why you should consider the quality of school districts when you buy your next home.
1. You’ll pay more to live in a good school district
Parents of school-age kids often pay attention to school performance ratings and are likely to pay more to be
near public schools with higher scores. Buyers who have kids or are planning to have kids will likely use this type
of criteria as the most important part of their search.
The upshot: A school’s high rating often drives up the prices of homes in that school’s district. Even if you don’t
have kids, you’ll still pay more to be near a good school. Schools basically establish an area as a good location.
And as any real estate agent will tell you, location matters.
2. A good school district might protect you from the real estate
market’s ups and downs
Even in a down market, an excellent school can be the rising tide that lifts all nearby home prices.
For example, in 2007 — a time when real estate prices were slowing down — the San Francisco Chronicle
reported that the impact of an excellent school on home values can be dramatic: “There could be two districts —
one perceived as excellent, one mediocre — divided by a street. The same hypothetical house built by the same
developer on either side of that street could fetch $100,000 more if it feeds into great schools.”
Markets turn faster and harder these days, as evidenced by the past credit and housing crisis and the recent
upswing in sales. Buying in a strong school district can help protect your home’s value in a declining market. It’s
basically more of a “safer bet.”
3. Though it may cost more to buy near a good school, it will be good
for resale
Real estate never comes with guarantees, of course. But it’s certain that parents will always want the best
school they can afford for their kids. In markets good and bad, home buyers should think about resale when
seriously considering a home. Buyers, before moving forward on a home, should immediately think like a seller.
Ask yourself the question: “If the housing market changes and I need to sell, how will my home fare?” The
location, and in particular the school district, should be considered.
Always pick the home that’s right for you
School districts and their boundaries, even if you don’t have children, should be on every buyer’s radar. Though
schools should factor into your thinking, don’t let them top your real priority — to buy the right home for you, at
the right time. The right home for you should be one where you feel comfortable and in a location that makes
sense to you. Finally, it has to be the right home in terms of size, style, condition and price.
What Happened to Rates Last Week?
The Carver Group, Inc.
424 32nd Street Suite
D
Newport Beach, CA
92663
www.the-carvergroup.com
the right time. The right home for you should be one where you feel comfortable and in a location that makes
sense to you. Finally, it has to be the right home in terms of size, style, condition and price.
What Happened to Rates Last Week?
Mortgage backed securities (MBS) gained just +6 basis points from last Friday's close which caused 30
year fixed rates to move sideways.
Effectively the bond markets were held hostage by the government shutdown which occurred on
Tuesday morning. As a result, mortgage backed securities (MBS) traded in a very narrow range with a
well-defined ceiling of resistance that traders were unwilling to trade above due to the uncertainty of the
length of the shutdown.
Several economic reports were not released, most notably was Friday's Non-Farm Payroll and
Unemployment reports. But we did have very good readings with the Chicago Purchasing Managers'
Index (PMI) and the ISM Manufacturing Index which both showed decent economic expansion. The
ISM Servicing Sector showed economic expansion but was weaker than market expectations.
On the jobs front, the ADP Private Payroll report was lighter than expected but the weekly Initial Jobless
Claims data was a great reading and lower than expected.
All of the above data was largely ignored by traders. This is because if the government shut down
drags on, then regardless of how well the economy WAS doing - it will slow down and potentially
reverse course in the short term.
What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week. They each have the ability to
affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional
mortgages.
Date
7-Oct
8-Oct
8-Oct
9-Oct
9-Oct
9-Oct
9-Oct
10-Oct
10-Oct
10-Oct
10-Oct
10-Oct
10-Oct
11-Oct
11-Oct
11-Oct
11-Oct
11-Oct
11-Oct
Time (ET)
3:00 PM
8:30 AM
10:00 AM
7:00 AM
10:00 AM
10:30 AM
2:00 PM
8:30 AM
8:30 AM
8:30 AM
8:30 AM
10:30 AM
2:00 PM
8:30 AM
8:30 AM
8:30 AM
8:30 AM
9:55 AM
10:00 AM
Economic Release
Consumer Credit
Trade Balance
JOLTS - Job Openings
MBA Mortgage Index
Wholesale Inventories
Crude Inventories
FOMC Minutes
Initial Claims
Continuing Claims
Export Prices ex-ag.
Import Prices ex-oil
Natural Gas Inventories
Treasury Budget
Retail Sales
Retail Sales ex-auto
PPI
Core PPI
Mich Sentiment
Business Inventories
Actual
-
Market Expects
$11.8B
-$38.6B
NA
NA
0.30%
NA
318K
2903K
NA
NA
NA
NA
-0.10%
0.20%
0.20%
0.10%
74.5
0.20%
Prior
$10.4B
-$39.1B
3.689M
-0.40%
0.10%
5.472M
308K
2925K
-0.10%
-0.20%
101 bcf
+$75.180B
0.20%
0.10%
0.30%
0.00%
77.5
0.40%
I will be watching these reports closely for you and let you know if there are any big surprises:
It is virtually impossible for you to keep track of what is going on with the economy and other events that can
impact the housing and mortgage markets. Just leave it to me, I monitor the live trading of Mortgage Backed
Securities which are the only thing government and conventional mortgage rates are based upon.
Copyright © 2012
The Carver Group is located at 424 32nd Street, Suite D, Newport Beach, C A 92663. The Carver Group, Inc. (NMLS IdenEfier #299532, www.nmlsconsumeraccess.org) is a California corporaEon licensed by the Department of Business Oversight under the California ResidenEal Mortgage Lending Act and operates with the following licenses: B RE #01006654 N MLS #299532
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