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44 IT'S A SELLER'S MARKET Homesellers enjoyed a windfall in 2017 with buyers paying more than the list price on 24.1 percent of home sales, according to a report by real estate website Zillow. Approximately one in four U.S. homes sold above the asking price, the report said, as a combination of factors led to sellers netting an average of $7,000 over their initial price over. e share of homes selling above list price has grown considerably since the beginning of the housing recovery in 2012, according to Zillow, when slightly more than one in six home sales closed above asking price. is share of homes selling above their asking price has risen for each of the last three years.e typical price increase for homes that sold above the listed price was 3.1 percent in 2017. Low mortgage rates, limited supply and high demand, demographic shifts, and a strong economy were some of the factors that have led to this surge in prices, the report said. Additionally, a shortage of home inventory, especially at the entry level and a growing demographic of young first-time buyers looking to start families also have been responsible for this kind of a market. Cities where the lucrative tech market is booming were more likely than others to see this trend, according to the report. More than half the sellers in San Jose, San Francisco, Salt Lake City, Seattle, and Provo, Utah, sold their homes for more than their asking price. e report indicated that in each of these markets, sellers on average made at least an additional $20,000 over their initial asking price. e largest difference in asking price and what a house sold for was found in San Jose, where the average home sold above list netted sellers an additional $62,000. A BUMP IN RATES AND LOAN SIZES Mortgage interest rates are up, according to a report from the Federal Housing Finance Agency (FHFA) and its Mortgage Interest Rate Survey (MIRS). e FHFA reports that interest rates in December 2017 were at 4.08 percent, a three basis point increase from November's 4.05 percent, and 10 basis points higher than October's rate of 3.98 percent. e effective interest rate, which accounts for the addition of initial fees and charges over the life of the mortgage, also saw an increase by three basis points month over month, from 4.05 percent in November to 4.08 percent in December. In the FHFA's release, the agency states that while the e National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders Index rose from 4.05 percent to 4.08 percent month over month, the average interest rate on all loans rose two basis points, from 4.03 percent in November to 4.05 percent in December. For 30-year, fixed-rate mortgages of $424,100 or less, the average interest rate remained unchanged month over month, remaining at 4.17 percent in December from November. Also in December, the average loan amount went up by $13,300, from $307,800 in November to $321,100. Year over year, December saw an eight basis point increase in interest rates, from 4.00 percent to 4.08 percent. Values from December's MIRS are based on 3,646 reported loans from 16 lenders who reported on terms and conditions of all loans closed during the last five working days of the month and excludes mortgages guaranteed or insured by either the Federal Housing Administration or the U.S. Department of Veterans Affairs. of homes sold for above the listed price in 2017. Source: January 2018 Zillow report, "For a Quarter More: Why 1 in 4 U.S. Home Sales in 2017 Sold Above List Price" STAT INSIGHT 3%

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