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MBA Pushes for Lower FHA Insurance Premiums
The Mortgage Bankers Association (MBA) is pushing for lower mortgage insurance premiums on FHA loans to improve housing affordability. A recent executive order directed federal agencies to find ways to lower costs for Americans, including housing. While zoning laws largely fall under state and local control, the MBA believes a “reasonable reduction” in FHA mortgage insurance premiums could make a significant and positive impact on the market.
MBA President and CEO Bob Broeksmit emphasized that the administration’s deregulatory approach could lower costs in the mortgage process, making homeownership more accessible. The group urges swift action, believing this change aligns with the administration’s commitment to easing financial burdens for homebuyers and renters alike.1
Buying a Home May Help Shield You from Inflation
With inflation driving up costs, many are wondering if now is the right time to buy a home. The good news? Homeownership is one of the best ways to protect yourself from rising prices. A fixed-rate mortgage locks in your monthly principal and interest payments, offering stability that renting can’t. While rent tends to rise over time—often outpacing inflation—homeowners can better predict their housing costs, making budgeting easier.
Home values also typically appreciate faster than inflation, helping homeowners build wealth. Experts forecast continued home price growth, making real estate a strong long-term investment. While inflation can make everyday expenses unpredictable, owning a home provides financial security.2
Why More People Are Moving Back to Cities
Are you someone who loves or dreams of living in a city? Well, cities are making a strong comeback, with more homebuyers choosing urban living. According to the National Association of Realtors, city migration has reached its highest level in a decade. A recent BrightMLS survey shows that 1 in 5 buyers now prefer city life. Why the shift? First, cities offer vibrant culture, with entertainment, dining, and events right outside your door. Second, as more companies return to in-person or hybrid work, living near the office is more convenient. Lastly, city living provides easy access to essentials like public transportation, healthcare, and shopping.
For those considering a move to metro areas, rising home values may provide an opportunity. Many suburban homeowners can sell their homes, use built-up equity, and make the transition to an urban lifestyle.3
Did You Know?
Many homeowners are eager to sell in the next 3 years, with 36% looking to upgrade, 17% needing more space, and 14% relocating for new job opportunities. While market conditions can be challenging, strong demand and rising home values make it a great time for sellers to maximize their equity.4
Fixer-Uppers Are Out as Buyers Pay Up for ‘Move-in Ready’
The real estate market is shifting toward move-in ready homes, with buyers now willing to pay up to 4% more for homes that are already remodeled. Recent data shows that these homes get significantly more attention, with 26% more daily saves and 30% more shares compared to fixer-uppers. Renovated homes allow buyers to avoid costly and time-consuming repairs, which is especially important in a market where budgets are tight and renovation costs are high. Fixer-uppers now tend to sell for about 7.3% less than expected, reflecting the decline in interest for homes needing significant work. The demand for renovated homes is especially strong in the spring, as more sellers flood the market with these finished properties.5
The Ideal Debt-to-Income Ratio for Buying a Home
Have you ever worried about being able to own a home due to debt? A common misconception is that having debt automatically rules out homeownership. In reality, many homeowners carry debt and still qualify for a mortgage. The key is managing your debt-to-income (DTI) ratio, which compares monthly debt payments to gross income. Most lenders prefer a DTI under 43%, with a lower ratio being ideal. If your DTI is high, there are ways to improve it, such as paying down debt, increasing income, and refinancing loans. By improving your DTI, you can qualify for better loan terms, like lower interest rates and larger loan amounts. Whether you’re considering a conventional, FHA, VA, or USDA loan, working with a lender who understands the specific DTI limits can help you determine the best option. Managing your DTI can open more pathways to homeownership and ensure a smoother mortgage process.6
Sources: 1 housingwire.com; 2 keepingcurrentmatters.com; 3 keepingcurrentmatters.com; 4 finance.yahoo.com; 5 nationalmortgageprofessional.com; 6 rwmloans.com
