During the four weeks leading up to January 21, the median home sale price in the U.S. saw a significant increase of 5.1%, marking the largest rise since October 2022. Additionally, asking prices for homes jumped by 6.5%, which is the most notable increase in over a year.

There are several reasons behind these rising prices. Firstly, the inventory of available homes is still quite limited. Compared to last year, the total number of homes on the market has decreased by 4%. Even though there's a 2% increase in new listings, this is the smallest year-over-year growth seen in approximately three months. Another factor is that buyers currently have more financial leeway. Mortgage rates have stabilized at a mid-to-high 6% range, which is a decrease from the 8% observed in October. This steadier rate of mortgages gives buyers more purchasing power, allowing sellers to ask for and receive higher prices for their properties.

The US economy has been growing for 44 months now, with an average yearly growth in real GDP of 4.9%. However, there's a bit of concerning news: the Leading Economic Index, which predicts future economic activity, has been going down for 21 months straight.

This is the longest downward trend since the 2007-08 period. The Conference Board, a group that studies the economy, now thinks the US might see negative growth (or a recession) in the second and third quarters of 2024. This prediction is a bit later than their earlier forecast, which expected a recession sometime in 2023.

One important factor in their forecast is the US Yield Curve. This measures the difference between long-term and short-term interest rates. Right now, this curve has been inverted (meaning short-term rates are higher than long-term ones) for 457 days. This is almost the longest inversion ever. If it stays like this for two more weeks, it will beat the record set between November 1965 and March 1967. What's interesting is that last time, even though the curve was inverted for so long, a recession didn't happen until years later, starting in January 1970. This makes some people wonder if the current inversion might also not lead to a recession right away.

A recession, or strong recession indicators would lead to lower rates, driving more buyers to the market as the unemployment remains low. Even if it rises to 5%. Buying a house is smart. Shop within your means.

The Dream For All Shared Appreciation Loan is a down payment assistance program for first-time homebuyers to be used in conjunction with the Dream For All Conventional first mortgage for down payment and/or closing costs.

Upon sale or transfer of the home, the homebuyer repays the original down payment loan, plus a share of the appreciation in the value of the home.

KEY CHANGES TO THE LOAN PROGRAM:

1. You must obtain a signed letter from your loan officer to register for the DFA voucher in April.

2. The maximum loan amount is up to $150,000 or 20% of the sales price or appraised value, whichever is less.

3. Yes, all borrowers must be first-time homebuyers.

4. At least one borrower must be a current resident of California.

5. A first-time homebuyer is defined as a borrower who has not had an ownership interest in any principal residence or resided in a home owned by a spouse during the past three years.

6. To qualify for the Shared Appreciation Loan, at least one borrower must meet the definition of a first-generation homebuyer.

7. A first-generation homebuyer is defined as a homebuyer who has not been on title, held an ownership interest or have been named on a mortgage to a home (on permanent foundation and owned land) in the United States in the last 7 years, and;

   To the best of the homebuyer’s knowledge whose parents (biological or adoptive) do not have any present ownership interest in a home in the United States or if deceased whose parents did not have any ownership interest at the time of death in a home in the United States, or; An individual who has at any time been placed in foster care or institutional care (type of out of home residential care for large groups of children by non-related caregivers).

8. All borrowers must occupy the property as their primary residence within sixty (60) days of closing. Non-occupying co-signers are not allowed.

9. New income limits by county are listed below.

10. At the time of sale, refinance, payoff or transfer of first mortgage the homeowner must pay back the original loan amount plus any shared appreciation percentage identified below.

11. This loan is not assumable.

12. See below for examples of shared appreciation.